4 chiefs, 4 years: Yahoo's leadership problem

Who will lead Yahoo? A word on departed CEO Carol Bartz and the Internet giant's big-picture strategy issues.
Written by Andrew Nusca, Contributor

What does this symbol stand for? I don't know, either.

I've spent the last 48 hours trying to digest Yahoo's firing of chief executive Carol Bartz. I'm sure she's been doing the same, although I hope for her own sake she's doing it on a beach or somewhere else where Internet connectivity is spotty.

I can't say it was a surprise, given how the company's fortunes were faring. Like her predecessor, Jerry Yang, Bartz was given the job to halt the company from spinning its wheels and exit the deepening rut it found itself in. Unlike Yang, who co-founded the company but never ran it before taking the top job, Bartz was the company's latest look outside its own ranks. And it's clear that the board was taken with her brash, no-holds-barred attitude.

It's hard to fault the board on those merits, but the reality is that Bartz was more comfortable in the technology industry than in Yahoo itself. She was great at getting press coverage for Yahoo, but that wasn't the company's primary problem. Income was, and continues to be.

But a company as large as Yahoo can't be led without a clear perception of what it stands for and where it wants to go, aside from profitability.


"I won't be satisfied until the external perception of Yahoo matches reality," Yang said during a conference call in 2008.

"What is Yahoo? Neither Bartz nor other executives have proven able to coherently answer that question," Nicholas Thompson writes on The New Yorker's website this morning.

I was in the room when Bartz sparred with fallen TechCrunch angel Michael Arrington last year, and between the more headline-grabbing comments she made was the admission that she didn't believe she should be responsible for innovation after 16 months on the job. (Yang was chief for 18 months.)

While she's right that innovative products occur along a developmental pipeline that is many years long, the truth is that she had the most opportunity to exact change at the company during the "honeymoon period" after she was first hired. She famously did, of course, but in doing so incurred so much turnover that the company's bottom line took a hit.

Bartz was proud to tout her operational shuffling, seeking profitability in reduction. But it may have been the only thing she was capable of in such a short time.

Nevertheless, while a lean, mean purple machine is good for everyone, a "more focused" company is of no use if there's nothing on which to focus in the first place. On some earnings calls Bartz spoke of the company in terms of search revenue and display ads, hinting at Google; on others, she compared the company to traditional media giants like CBS Interactive, parent company of this publication. There's a degree of synergy between the two, of course, but making such broad comparisons is akin to fighting a multi-front war.

In a way, Yahoo began to feel like a big tech dollar store, stocking anything that would make a buck without any rhyme or reason to its selection.

Change can be good, but it's hard not to feel a little sad for Bartz. She clearly excels at being a margin-minding bad cop, but as any corporate denizen knows, you need a good cop -- a visionary, even -- to provide the strategy that puts the company on the offensive.

Perhaps Bartz really was that person -- after all, her stint at Autodesk is something of legend. But as Yahoo's board of directors deliberates on who to welcome as its fourth chief executive in four years, it's becoming increasingly clear that the board is binding the hands of its leaders with pre-determined strategies, choosing the wrong chiefs, or both.

Either way, something continues to get lost in translation, and each passing day makes it more clear that Bartz never really had the freedom to engineer a complete turnaround -- just spin Yahoo's wheels with even more gusto than usual.

Can Yahoo's board let up on the reins enough to let someone guide it in a direction? Or must the company's fortunes slide further before they can be truly rebuilt? It remains to be seen, but if there's one thing that we can all agree on, it's that Yahoo may not be any worse a company with Bartz at the beach -- and that's no remark on her ability.

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