In 2007, Yahoo! was the setting for a major Silicon Valley shakeup. The company’s then CEO Terry Semel was ousted and replaced by its original co-founder, Yang. It was a tumultuous time for the company, which was suffering from much shareholder criticism in the face of rising competition from Google. But Yang was determined to rise to the challenge.
Upon taking office, Yang’s first order of business was not to completely overhaul the company with new staff or new projects. He did not criticize Semel for mistakes he might have made, or blame Yahoo!’s industry dominance slip on any one action or individual. What he did do, however, was telling of the way in which Yang was able to grow Yahoo! into an Internet behemoth in the first place.
The very first thing Yang did was conduct a business review of Yahoo! “We conducted an intense review of our business, examining everything from our strategy and culture to our competitive position and how the marketplace is evolving,” says Yang. “We knew we had to change not only our business, but also how we prioritize and make decisions.”
Yang gathered together senior leaders from across the company – leaders who had been with the company even through its downward slip – to discuss new visions and new priorities. “We had to shift from a siloed mentality to a more collaborative organization that marches toward a common horizon,” he says. “We had to determine which businesses to invest in, and which to begin to exit or de-emphasize.”
What Yang and his associates found was potential, and lots of it. “We defined a strategy that revolves around making Yahoo! indispensable to an ecosystem of consumers, advertisers, publishers and developers while tapping into three key differentiators,” says Yang, “generating and leveraging insights, deploying open platforms, and becoming partner of choice.”
Yang wanted to reorient Yahoo! towards a focus on increasing its relevance for each member of its “ecosystem.” To that end, he established three long-term objectives. First, Yahoo! was to become the starting point for the most customers, the site “that helps you better manage your life and connect you to what matters most to you.” That goal led to such recent moves as the new Yahoo! Mail and the acquisition of BuzzTracker.
Second, Yang wanted Yahoo! to become the “must-buy” for advertisers. “What’s key here is our transformation from selling inventory on primarily the Yahoo! network,” says Yang, “to becoming an advertising company that delivers comprehensive, integrated, and targeted solutions on Yahoo! and beyond.”
Third, Yahoo! was to start delivering open, industry-leading platforms that attract more publishers and developers. “We have phenomenal technology platforms and data infrastructure, and it’s time to share,” says Yang. “The possibilities are endless and ‘open’ is all part of a new way of operating at Yahoo!”
Yang set out on a mission to identify past weaknesses and outline clear goals for the future to compensate: “We’ve scripted our strategy, sharpened our organization, determined how we’ll prioritize, and zeroed in on our big bets,” he says.
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