Yahoo’s Peanut Butter Problem [The Next Net]

  peanut butter. 
  Originally uploaded by megamommatron.

The blogoshere is abuzz with a leaked memo written in October by Yahoo senior VP Brad Garlinghouse dubbed the Peanut Butter Manifesto.  In it he warns that Yahoo is spread too thin and is all over the place.  Excerpt:

We lack a focused, cohesive vision for our company. We want to do everything and be everything — to everyone. We are scared to be left out. We are reactive instead of charting an unwavering course. We are separated into silos that far too frequently don’t talk to each other. And when we do talk, it isn’t to collaborate on a clearly focused strategy, but rather to argue and fight about ownership, strategies and tactics.

Our inclination and proclivity to repeatedly hire leaders from outside the company results in disparate visions of what winning looks like — rather than a leadership team rallying around a single cohesive strategy.

I’ve heard our strategy described as spreading peanut butter across the myriad opportunities that continue to evolve in the online world. The result: a thin layer of investment spread across everything we do and thus we focus on nothing in particular.

I hate peanut butter. We all should.

We lack clarity of ownership and accountability. The most painful manifestation of this is the massive redundancy that exists throughout the organization.

We lack decisiveness. Combine a lack of focus
with unclear ownership, and the result is that decisions are either not
made or are made when it is already too late.

We end up with competing (or redundant) initiatives and synergistic opportunities living in the different silos of our company.

• YME vs. Musicmatch
 
• Flickr vs. Photos
 
• YMG video vs. Search video
 
• Deli.cio.us vs. myweb
 
• Messenger and plug-ins vs. Sidebar and widgets
 
• Social media vs. 360 and Groups
 
• Front page vs. YMG
 
• Global strategy from BU’vs. Global strategy from Int’l
 
We
have lost our passion to win. Far too many employees are "phoning" it
in, lacking the passion and commitment to be a part of the solution. We
sit idly by while — at all levels — employees are enabled to "hang
around". Where is the accountability?

He goes
on to suggest how to remedy these issues, principally by picking its
best bets and getting rid of everything else. "Heads must roll," he
writes, as many as 15% to 20% of employees, and Yahoo needs to stop
managing by committee. These are all good (and somewhat obvious)
suggestions. The question is, will Yahoo follow them?

Yahoo has
done a good job of identifying and acquiring hot startups on the cheap
(Flickr, del,icio.us, Bix, MyBlogLog) but then fails to integrate them
with the rest of Yahoo, creating all those redundant properties
Garlinghouse lists. By leaving them alone, Yahoo has at least succeeded
in not screwing them up, but it also has succeeded in creating a lot of
silos.

Yahoo is in a tough spot. It needs to stay on top of the
latest Web fashions, but at the same time not alienate mass audience of
hundreds of millions of people who visit it each month. In an interview
I did with Garlinghouse a few weeks ago, he told me:

It
is certainly not a simple thing to do. The first thing is you have to
fundamentally understand what users care about the most. Too often
business people try to deliver the coolest, whiz-bang widget they can
do that will appeal to 1% of users. You have to understand what the
mainstream users care about the most. I think it helps that I am from
Kansas.

The Yahoo home page is the number one homepage, with 300
million monthly unique visitors. How do we appeal and exceed the
expectations of all of those users? Therein lies the crux of a delicate
balance between delivering what the users expect , and anticipating
what will Wow them. How do we make a user say, ‘Wow, I did not even
know you could do that.’ Some companies over-invest in the table
stakes, and then they become mundane. The secret sauce is effectively
balancing excellence in the table stakes with Wow.

My
guess is that Garlinghouse’s next move is to start tying different
parts of Yahoo together in a more cohesive fashion. And communications
products like Yahoo Mail and Messenger will be the string. It’s no
coincidence that Google is similarly trying to pull its various
products together instead of launching five million different ones a
day. People like to be Wowed with simplicity.