Falcon's Invoice Discounting: Your Path to Prosperity
Yahoo Turnaround Strategy
1. Yahoo At Glance
Overview
• Founded by two Stanford Graduates in 1994
• Business Segment
– Marketing Services (88% Revenue)
– Fees (12% Revenue)
Offerings
– Product Base
– Content Base
2. History
• The company was founded in 1994 by David Filo and
Jerry Yang who were attending Stanford University’s
PhD program (The History of Yahoo!).Yahoo! Inc.
• Yahoo! Inc. has become the world’s largest global
online network of integrated services.
5. Area Of Concern
• Revenue Declining by 35%
• Share Price fallen by 94%
• Infighting within the top management
• Conflicts between top management and
employees
• Major source of revenue had fallen
6. Turnaround Strategy
• “The implementation of a set of actions required
to save an organization from business failure and
return it to operational normality and financial
solvency”.
• “Turnaround management usually requires
strong leadership and can include corporate
restructuring and redundancies, an investigation
of the root causes of failure, and long-term
programs to revitalize the organization.”
7. Steps Implemented by Yahoo!
• Change of Leadership
– Tim Koogle to Terry Semel.
• Retrenchment the Organization
– Downsize 44 business units to 5 business units.
• Restructuring the Organizational Structure
– Started hiring traditional media sales veterans and
introducing more flexibility.
– Farzad Nazem - Chief Technical Officer
8. Steps Implemented by Yahoo!
• Looking Opportunity for Revenue Generation
– Charge on free services to generate revenue;
digital music and online games to job listings and
premium e-mail accounts with loads of extra
storage.
– Way to go ‘Broadband’
• Introducing More Subscription Based Service
• Acquisitions and Partnerships
– SBC Communications (SBC )
9. Analysis
• Yahoo's decline is the result of nothing more
or less than creative destruction.
• “Too little, Too late”
– creative destruction, a radical strategy is usually
needed, something that looks almost crazy and
high risk.
10. Our Take
• Yahoo is not a player in the two major shifts -
search and social.
• Re-energize the current core money-makers
• Disrupt the current leaders with a new
proposition for developers
11. Conclusion
• Organization should concentrate on their core
products
• Implementation of Strategy should be in
accordance with the resources
• Leaders Play a crucial role
