Wednesday, December 06, 2006

Yahoo Cleans House, Same Mess

About the most consistent behavior you'll ever find in corporate America is the old One Two Punch:

1. Hiring new people to bring about new changes and restore profitability
2. Firing the people who failed to bring about new changes and restore profitability

And so we have Yahoo, the inept slumbering giant, finally waking up to the fact that the internet isn't Hollywood and that the Web isn't downloadable television. Which brings us to most revent events, in which Yahoo announced not only the imminent departure of Terry Semel (slated for March, 2007), but the immediate departure of Lloyd Braun, who according to Reuters News Service, is "a former ABC TV executive hired two years ago to help Yahoo blend its Internet services with Hollywood-style showmanship."

Actually, both Semel and Braun are entertainment executives, and therein lies the reason for Yahoo's Number Two punch. Yahoo never should have hired either of these guys, if they had known anything about Hollywood. Had Yahoo known the real story on how Hollywood deals really work, they would have avoided both of these guys like the plague:

Neither of them had any internet experience. Neither of them had any done real business deals. But both of them were highly educated in the art of the schmooze, the major weapon of the "let's-do-lunch" crowd, where talent and acumen carry no currency at all. In Hollywood, it's all about ego and the deal. And this time, neither Semel nor Braun are leaving the party with much of either.

Sitting on mountains of corporate hubris, they moved much of Yahoo's offices down to the west side of Los Angeles, where much of the new entertainment media is located. The reason? You got me. Maybe it was a closer commute for Braun and Semel. Maybe it was a massive show of ego for Braun and Semel to parade in front of their Hollywood pals. For the record, Yahoo's roots are planted squarely in Northern California -- as are its foremost business interests.

That may explain why Yahoo's stock languished in a narcoleptic haze while the buzz masters at Google ate their lunch.
Which brings us back to Punch Number One: Hiring new people to bring about new changes and restore profitability. The same Reuters article reports Yahoo's CFO, Susan Decker, as a potential successor as CEO.

Can you say Caretaker Manager?

"Out of the frying pan, and into the fire," I believe the saying goes. I guess Yahoo still hasn't learned that to run an internet-based business, you need an entrepreneur who knows how to run an internet-based business. The last thing you thing is a bean-counter, schooled in the practice of analyzing enterprise from a balance sheet perspective.

You just watch: If Decker gets the gig, the first public comment will ring of "cost-cutting," "getting back to our core business," "restoring profitability" and "focusing on what our audience wants." In other words, the corporate code for, "Hey, I'm getting millions, plus options if I can just make it beyond the minimum term of my contract."

Hey, what about a brand strategy? What if Yahoo could actually could get everyone rowing the boat in the same direction, behind a brand that everyone could articulate with accuracy and precision? What if all of its programs and products and services echoed that brand strategy, reinforcing Yahoo's value to users and the market?
Think that would work?

Tell you what: You call your agent and if likes the deal, let's do lunch.


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