Succession Planning Case Study

Jerry Yang's Exit from Yahoo!: Googling for the Right Strategy?

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Abstract:
This case study’s primary objective is to debate on whether a founder/co-founder is the right person to lead a company during its most demanding and challenging times. Yahoo!, one of the world’s oldest Internet companies, is struggling for survival amid intense competition from Google, lost focus and above all, ineffective leadership that resulted in failed execution and missed opportunities. Yahoo! made its web portal as the starting point to the Internet, while Google made its way through web search. Ignoring Google, Yahoo! focused aggressively on content creation, while Google leapt forward with excellent technology sophistication. The co-founders Jerry Yang (Yang) and David Filo merely held titles as ‘chief Yahoo!s’ leaving unpleasant things of actually running the company to external executives – Tim Koogle during the early growth and media veteran, Terry Semel (Semel) during the dotcom crash. Although Yang replaced Semel in June 2007 he could not give Yahoo! the right strategic refocus and messed up things for the company. Meanwhile, Yahoo! lost the battle to Google – both technologically and strategically and in no time became a takeover target to other rivals like Microsoft, who in turn are eyeing for a bigger market share to compete with Google. As the competitive battle in the global web markets intensified, Yang failed to revive Yahoo! back to profitability – all amid turning down Microsoft’s takeover bid at $33 per share and a lost advertising alliance with Google. All this made investors furious and they put enormous pressure on Yang to quit. Now, Yahoo! is on the look out for a new leader, who would reinvigorate the company with the right strategic refocus. Should Yahoo! struggle as a standalone company or should it merge with one of its rival? When a co-founder cannot lead the company during its troubled times, who else would?

Pedagogical Objectives:

• To discuss the nature of business and critical success factors for a company offering a wide range of web-enabled services
• To identify the factors that led to troubled times at Yahoo!
• To critically examine Jerry Yang’s leadership at Yahoo!
• Amid intensifying competition and declining revenues, what should Yahoo! do to revive the company?

Keywords : Internet, World Wide Web, Web 2.0 technologies, Google, Microsoft, dotcom bubble, Terry Semel, Jerry Yang, Panama Project, Time Warner's AOL, Social Networking, Web/Internet Portals, Web search/Searh Engine, Carl IcahnContent, Communication and Commerce

Contents:

• Dynamics of the Global Internet and Web Technologies
• Yahoo! – Inception and Growth across the Years
• Yahoo!'s Fortunes during Jerry Yang’s Tenure – Continued Troubles amid HammeringCompetition