Déjà vu all over again at Yahoo?
Widely covered in the business press over the last week, Yahoo recently named Marissa Mayer as CEO – their seventh CEO in five years (including two interim CEOs). If you haven’t been following the rapid-fire (or, more accurately, rapid firing) history of the executive turnover at Yahoo in recent years, it’s been quite the drama. Founder Jerry Yang was ousted, Carol Bartz left in a blaze of…well, just in a blaze. Most recently, Scott Thompson was fired after a few months on the job once shareholders identified a fabrication on his resume. (The merits of not embellishing your resume are too rudimentary to elaborate here, but the “Leadership 101” lesson from Thompson’s ouster is that once you’ve lost the respect of your employees – especially for suspected lying – you’ve lost the key ingredient for leadership: trust. No leader can effectively lead without the respect of his or her team. Period.) Activist shareholder Dan Loeb, who forced the ouster of Thompson, also won a number of seats on the board of directors, after some pointed letters and threats of lawsuits.
But the question I’m pondering is this: what is the origin of the excessive turnover and attendant lack of leadership and confidence in Yahoo? Not only has employee confidence and morale been low, but Yahoo shares have also plummeted during the turnover turmoil; once $33/share during the days of Microsoft’s 2008 offer, shares are now hovering around $15. Can all the blame be put on the recent CEOs? As Harry Truman said, “the buck stops here.” Well, in the case of any public company, the buck stops with the board of directors.
This is a remarkable case study in executive leadership, trust, activist shareholder threats to take over board seats, and overall responsibilities of any board of directors. If you haven’t been following this story, I highly encourage you to check it out. I’m not pointing blame at any players in this situation…but I do find the leadership lessons to be compelling. I promise the story won’t disappoint.
With a number of new board members and an exciting choice for CEO in Marissa Mayer, Yahoo may be on track for some stability in the C-suite – something shareholders and employees would certainly welcome.
Any advice for Yahoo? Thoughts on the future direction the CEO should take? Any lessons learned on the role of the search committee and board overall?