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Summary:

Yahoo says that Autodesk’s former Executive Chairman Carol Bartz is taking over as the CEO, a major step forward for the beleaguered Sunnyvale, Calif.-based company. I agree with the choice, but she has her work cut out for her. Here are seven reasons why Bartz is the one to fix Yahoo and clean up its mess.

carolbartzYahoo says today that Autodesk’s former Executive Chairman Carol Bartz is taking over as the CEO, a major step forward for the beleaguered Sunnyvale, Calif.-based company. I also like that Sue Decker has decided to move on; that means a big housecleaning is going to start at Yahoo — exactly what the doctor ordered.

While I agree with the choice of Bartz (see my seven reasons below the fold), she has her work cut out for her, and my view on Yahoo changes day to day. The current economic downturn and the collapse of Yahoo’s big advertising verticals — finance and automobiles — is not over just yet. Similarly, Yahoo has problems with bureaucracy that need to be addressed. Most importantly, Bartz will have to help Yahoo rediscover its identity — and, while she might be a superwoman, it will take time.

Bartz, who was named as one of 20005’s 50 Most Powerful Women in Business, sat on President Bush’s Council of Advisors on Science and Technology and is on the boards of Cisco and Intel. She holds an honors degree in computer science from the University of Wisconsin.

Here are 7 reasons why 60-year-old Bartz is the one to fix Yahoo and clean up its mess.

  1. She was the No. 2 executive at Sun Microsystems when she took over the top job at Autodesk in 1992. With sales of about $250 million, Autodesk was staring into an abyss, thanks to a hacker culture gone wild. When she left that position in April 2006 (and became Autodesk’s executive chairwoman), Autodesk had sales of $1.45 billion. The problem she fixed? Autodesk had a widespread culture of consensus bureaucracy, which bogged down the business. Yahoo has the same problems, so an encore won’t be that difficult.
  2. On the second day of her job at Autodesk, she discovered she had breast cancer. She managed to fix Autodesk and fight the cancer. Superwoman!
  3. In the 1990s, Autodesk saw many engineers leave, and Wall Street analysts wanted her to resign because the company was slow to adapt to the Internet . According to Business 2.0, she told the analysts, “You’d be happier if we were selling plastic-wrapped fruit baskets over the Internet?” She needs to do that again and tell Wall Street to shut up.
  4. Finding your passion is one of her management mantras. “When I say find your passion, some people might say this is not the right time and that we need to be pragmatic. But our passions and dreams should not move to the back burner when things get tough. This is exactly the time that we need to tap into new sources of energy,” she recently wrote. If she means what she writes, Yahoo engineers — still a strong cadre — are going to find a great leader in Bartz.
  5. According to a 1992 New York Times profile, she is “direct and quick-witted, quick to laugh and willing to tease her way through tense situations.”
  6. She is not shy about bringing down the hammer on her executive team if she isn’t happy with them. She is known to use foul language. For instance, she once told a reporter, “What the fuck does Adobe know about engineering drawings?” She blends these outbursts with diplomacy and a folksy style. These traits will come in handy when shaking up Yahoo’s hit-and-miss senior management.
  7. Bartz is known to take big bets. For instance, in early 1990s she bet AutoCad on Microsoft Windows and that bet paid off. In 1996 when she felt that computing (and the market) was ready, she got the company developing 3D-related products.

Research assistance by Susie Lin.

  1. Thanks for a great writeup as usual, keep up the good work!

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    1. Well a year from now this had changed.. carol bartz just proves to the wrold how she is letting Yahoo slide on its tomb

      don’t believe us? See this proof http://bit.ly/carol-bartz-is-a-loser

      sad but its the truth

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      1. *proves to the world

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  2. Yahoo has a culture of consensus? When did that happen?

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  3. Om, all your points suggest that Carol is a great executive and manager. But what Yahoo really needs at this point is someone with a strong product vision to pull all their disparate pieces together into a coherent direction for the company that’s something other than follow-the-Google. I hope I’m wrong and Carol does a great job, God knows the internet needs a revitalized Yahoo!

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  4. [...] via 7 Reasons Why Carol Bartz Is Right for Yahoo. [...]

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  5. anand

    I think she needs to do precisely what was suggested in the peanut butter manifesto. cleanhouse before getting a vision. at least 12-18 months before things get better. she totally needs to manage first and then vision. I am actually advocating a strong number two :-)

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  6. jeffrey

    you are right…. bad choice of words and I have corrected to reflect things more accurately.

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  7. Totally agree that while there has been minor operational improvements they have been relatively mild — the first 9 months need to be about changing the culture and improving operational excellence and discipline.

    She needs to restore a culture of meritocracy — too many SVPs were promoted over the past two years b/c they were good friends with Sue Decker, and yet did not deliver any new products.

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  8. The analog that comes to mind is when Gerstner joined IBM, and the outside mantra was vision, Vision, VISION to which Gerstner countered, “The last thing IBM needs right now is a vision.”

    A lot of this gets back to (re) creating a culture of execution and accountability, which then drives identity and vision. Counter-intuitive to those of us (myself included) used to sprinkling vision and strategy like salt on everything.

    At least that’s the hope for Yahoo. TBD.

    Cheers,

    Mark

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  9. I have competed against Autodesk in my prior life selling CAD enterprise software on SGI boxes and imo, she rocks.
    She is one of the few leaders/people who believe in spedning time being interested, rather than interesting!
    Good post Om

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  10. @mark,

    I am glad you feel the same way. Good to always hear from you. I think for the first time I am happy to give Yahoo a chance. I have another post for tonight but i need to go for a run right now ;-)

    @michael,

    Cleaning house is the best thing to do. Decker and her gang was one big part of Yahoo’s big problem.

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