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I’ve just been fired ….

September 8, 2011

Well, actually, what Carol Bartz said was this: “I am very sad to tell you that I’ve just been fired over the phone by Yahoo’s Chairman of the Board. It has been my pleasure to work with all of you and I wish you only the best going forward.”.

And with those immortal words, she’s sparked off hundreds of thousands of comments, responses, angry remonstrations against Yahoo!, cheering from the stock market … and anything else that could be imagined.

End result: after 30 months at Yahoo, Carol Bartz moved on … leaving Yahoo stock almost exactly where it was when she had joined (about $12.50).

Where did Carol Bartz fail? According to this analyst, her biggest mistake was her over confidence that made her misread the situation at Yahoo.  She waited eighteen months before she built a team with her.  And the tough-talking, sometimes profane Bartz, a respected veteran of Autodesk and Sun Microsystems, had hoped to bring her management skills to bear on a company that was adrift for years and unable to capitalize on what is still one of the Web’s largest audiences under one corporate roof.

In other words: Carol clearly didn’t realize her own 50 bar limit (Sutra 8).  And yes, by all accounts, she wasn’t too good a buddy either (Sutra 4) .. considering the speed with technology employees were leaving Yahoo.

But was the fault hers alone?

In my opinion, the real fault lies with Yahoo’s board itself.  The hired Bartz based on her experience at scaling Autodesk .. but that experience was completely out of context when it came to managing a “Digital Media” company, as Yahoo calls itself.  In effect: the Yahoo board hired Bartz for her “certificates” from Autodesk, rather than from her “expertise” (see Scuba Sutra 5: I will not confuse expertise with certificates”).  At Autodesk, Bartz’s expertise was built in scaling a core business … and therefore growing earnings and market.  She never had to deal with finding innovative products, or innovative revenue sources at Autodesk: which is what she needed expertise in for Yahoo.

Second: and this is even more alarming.  The Board of Directors … after having approved an investment into Jack Ma’s Alibaba (China) in return for 40% stock … only later realized that Alibaba’s flagship Online Payment service, Alipay, did not feature in this investment.  It wasn’t just Bartz’s failure: it was the failure of the whole board.  Didn’t they think of following the first sutra: “I will never dive without a check”?

Third: the board itself is contentious and divided.  And its been that way since February 2008, when the first news of a “friendly” (but unsolicited) takeover by Microsoft was first announced to the press.  The board was constantly divided on this issue .. not a very good example of the 4th Sutra: “being good buddies”, is it?

It will be interesting to see what Yahoo does next.  One report states that Yahoo is bringing in external consultants to advise the board on what to do.  And yesterday, a report came out that Yahoo was going to propose a sale to Microsoft.

Whatever it does, these are contentious times for all at Yahoo.   What do you think?

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4 Comments leave one →
  1. Viswanathan permalink
    September 8, 2011 9:21 am

    Many of your posts constantly point to the neutral buoyancy sutra. This blog spreads the sutra reference 🙂 Its been ages since I went to yahoo. Who visits yahoo still ?

  2. September 8, 2011 11:43 am

    Good example Guhesh. Could not have been a better example to spread the sutras.

  3. Rajesh Shukla permalink
    September 8, 2011 1:02 pm

    Very interesting article and beautifully related to fundamentals of scubasutra.

  4. September 8, 2011 1:03 pm

    Someone who has gone through scubasutras will really relish this article

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