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7 Reasons Why Carol Bartz Is Right for Yahoo

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carolbartzYahoo (s YHOO) says today that Autodesk’s (s ADSK) 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. [digg=]

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 (s CSCO) and Intel (s INTC). 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.

41 Responses to “7 Reasons Why Carol Bartz Is Right for Yahoo”

  1. Carol who? oh you mean carol bartz, the woman who said “she will kick some butt” to raise yahoo from the ashes but obviously failed?

    or the other carol bartz who bitterly said, “Yahoo was never a search engine” when she knew in her heart that Google see right through the company.

    Or the far-version of Carol bartz, the one Mr. Icahn called a “loser”?

    I guess those 3 carol bartz looks the same to me

    detail sources:

    Not to sound to be mean, but facts are facts. Sometimes things are hard to swallow but in the end it can do you more good than harm. Just like that Bitter Pill you use to take when you were a child.

  2. To Deltaeye:

    She would be no different than Chrysler’s Lee Iaccoca who tried so hard and so long to discriminate against auto safety and then once cornered by regulation and public opinion,embraced and touted how safe Chrysler’s cars are: Lookee airbags!

    The irony in this economy is that she will be given a better chance to make changes because the last thing one wants to appear is taking “Wall Street advice”.

    Bring the Call Centers and Help Desks back, service is key. Ensure Yahoo! will not only be relevant but also vital during the Info-Infrastructure-build-out of America.

    But, as Om said it first, time to clean house just as someone will else will do starting next Tuesday.

  3. Its interesting that 2 important CEOs are joining new organizations at the same time (the other being Obama). There’s a lot of work for them both to do, but some of the issues and the processes that they have to follow are similar (but perhaps different in scale)

  4. I think part of what Carol should do is manage expectations around Yahoo’s future. Yahoo’s principal failing was in adopting a me-too strategy and in trying to chase Google in the search space. Yahoo could have very well continued to be a successful company (measured by financial metrics) by focusing on its core market albeit with a lower growth rate than Google. But by spreading itself too thin, Yahoo lost focus on its core space and is now operationally inefficient as well. I believe Carol has the operational chops to fix Yahoo’s apparent management issues, but doubt she (or anyone else for that matter) can recapture Yahoo’s glory days.

  5. Yahoo doesnt need more features or products it already has enough !! what it needs its simplifying and focus on adding core value to its services(make sure that it really works well) and reduce the bloat, basically focus on what users really need then what they might want . Look at two great product companies …………google and apple , they both focus what users really need and simplifying how users use their products

  6. Charles Wu

    Nice write up, and Mark’s comment about Gerstner resonated with me. I recently left Yahoo and my sense of what was holding the company down was too many independent operating units that failed to work together for economies of scale. In that way it resembled Hewlett Packard which too had many independent units that didn’t work well together and competed with themselves more than anyone else. A profitable company, but not a glamorous one.

    So when Fiorina left and Mark Hurd came in, the collective question was Mark who? Wall Street at the time was screaming for the spin off of the printing and imaging division, and Hurd resisted the call. There were cries for a new strategy, and Hurd said no strategy changes. Bartz seems very similar to Hurd and if she can bring alignment and tone up the business there is a great turnaround opportunity here. Will history repeat itself?

  7. I doubt she will be at Yahoo four years let alone the 14 she spent at Autodesk. The lady will dress the business and it will be gone within two or three years. And I seriously doubt that any of your seven reasons will be striking fear in the halls of Microsoft or Google!

  8. I don’t think Yahoo days are numbered. Yahoo has high traffic and lots of content sources. Technology wise Yahoo hasn’t produced anything new in years (if ever), but it can successful if it focuses on one thing and do it well: tech or media.

  9. it is too late for a “product person” at yahoo. the “steve jobs” option would have worked in 2005. now its too late. what they need is someone to prep the company for sale, in whole or parts. tell me one grand-slams created at yahoo (not acquired) that was created at the company post-2000. the entire product portfolio of merit was created in the 90s. yahoo’s “idea” days are past. frittering away more capital on trying to recapture “ownership” of the web from google and facebook will just make a sale harder and less lucrative.

    yahoo has a lot of traffic from what it built in the 90s….very little from traffic it has built post-2000.

  10. Wall Street disapproves. Of course, Wall Street is a negative indicator; a year ago, Wall Street would have disastrously put Yahoo in monkey-boy’s chubby embrace. I say, she’ll probably do fine.

  11. @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 ;-)


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

  12. 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

  13. 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.



  14. 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.

  15. 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 :-)

  16. 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!