Yahoo to *may* Streamline, Reduce Headcount by 15-20% and Focus

Update, Nov 19th: Jeff’s first comment on this post suggests that the memo is a suggestion, he’s correct it’s unknown what the future state of the headcount at Yahoo will be. Although I still stand by my observations below, I’ve updated the title and added *may* into it.

I’m a shareholder of Yahoo, and I’ll be one of the first to say that the company has grown to large and corporate, trying to be too many things while other corporate strategies stay somewhat focused. The Yahoo homepage in the past is a good indicator of the mass confusion and focus on media, have you see how many things there are to click, it’s confusing.

NYTimes reports this internal memo demonstrates that management recognizes that there is a lack of focus, vision, with multiple arms competing with each other in same spaces.

The specific action items suggest Yahoo will undergo the following weight loss exercises:

  • 1. Focus the vision
    • a) We need to boldly and definitively declare what we are and what we are not.
    • b) We need to exit (sell?) non core businesses and eliminate duplicative projects and businesses.
  • 2. Restore accountability and clarity of ownership
    • a) Existing business owners must be held accountable for where we find ourselves today — heads must roll,
    • b) We must thoughtfully create senior roles that have holistic accountability for a particular line of business (a variant of a GM structure that will work with Yahoo!’s new focus)
    • c) We must redesign our performance and incentive systems.
  • 3. Execute a radical reorganization
    • a) The current business unit structure must go away.
    • b) We must dramatically decentralize and eliminate as much of the matrix as possible.
    • c) We must reduce our headcount by 15-20%.

Good luck my friends at Yahoo, sounds like this strategy could help obtain an efficient organization.  See the multiple conversations on Techmeme about this.