Let me say this straight out: I think Carol Bartz was a great CEO. She worked miracles at Autodesk. Bartz took a company headed straight to hell and transformed it into a profitable giant. At Autodesk, though, she had a free hand to set the company's course. At Yahoo, her hands were tied with a lousy board of directors who had already set a strategic course that pointed Yahoo straight at the rocks. Bartz was doomed from the start.
Look at the record. Bartz made multiple smart moves to get Yahoo back on track, but the company was already sinking underneath her. Frankly, I blame Yahoo's stick-in-the-mud board. As my old-friend Charlie Cooper put it, "With a board of directors as incompetent as this one, even the most talented CEO would be hard pressed to engineer a Yahoo turnaround." Amen.
Let's take the way-back machine to Yahoo 2009 shall we? Yahoo has beaten back a hostile takeover attempt by Microsoft, knocked back a related proxy fight with Carl Icahn, many of its best executives have left and it has a failed AdSense/search deal with Google to its "credit."
When I say "hostile" by the way I meant that then Yahoo CEO Jerry Yang thought Microsoft's $47 billion offer was "substantially undervalued." Let me check, yes, a bit more than two years later, Yahoo's market-cap is $17.1 billion. Great job Yang!
You know, there's a reason my buddy, Jason Perlow, with my full blessing, recently listed Yang's refusal of the Microsoft acquisition offer as one of the all-time worst tech industry executive decisions. It was one of the worst technology business decisions of all time.
Getting back to the point, in walks the no-nonsense Bartz and the Yahoo ship is sinking. Since Yahoo's board refuses to sell to Microsoft, Bartz is forced to make the best deal she can to prop up Yahoo's staggering search business: she makes a search deal with Microsoft. This is not an easy deal to pull off. In the end, Microsoft strip mines Yahoo for its search expertise and advertising contacts for its own none-too-successful Bing search engine.
In the meantime, Google was continuing to kick Yahoo's teeth in the search market. In Bartz's first quarter as captain, the company's year-over-year profits were down 78% and the company started to lay off even more employees.
As Yahoo continues to turn over more and more of its core search business to Microsoft, the company also decides to kill off Yahoo Publisher Network, it advertising platform for small-to-medium businesses (SMB) and its one time answer to Google's AdSense. So, tell me again Yahoo board why you turned down Microsoft's offer since you were determined to wreck your own business?
I could go on, but I'll sum it up for you. Yahoo brass flees the company; staffers are fired; and Yahoo spins off one subsidiary business after another. Of course, having sold the search soul of the company for a pittance, I'm really not sure what Yahoo's core business is anymore anyway. Does anyone really know?
In the end, all Bartz could do was to try to steer the wreck of what was once an Internet giant to the rocky, lee shore that the Yang and the board had pointed it to. She won't have the chance to salvage what she could from this disaster. Perhaps it's just as well. Bartz deserved a better company than Yahoo.