Is Yang right to run Yahoo?
Published: 19 Jun 2007 12:54 BST
Thirteen years ago, Jerry Yang was working on his doctoral degree in electrical engineering at Stanford University when he and fellow student David Filo created "Jerry Yang's Guide to the World Wide Web".
They left university to turn their little project into a company they called "Yahoo" and never looked back.
On Monday, Yang took over as the chief executive at Yahoo, replacing seasoned executive Terry Semel. Semel will assume the position of non-executive chairman and serve as an adviser to the management team and board of directors.
But is Yang, who ran the company when it was small but lacks Semel's management expertise and business sense, the right person for the top job at a company struggling to regain a foothold in search — and more importantly, lucrative search advertising — that was lost to Google?
Analysts, former Yahoo employees and others say yes, but only with newly named Yahoo president Sue Decker at his side. And some speculate that he's only filling the spot until Decker is ready to take over the reigns.
"Yang has got some strong backup, with Sue Decker at president," said Charlene Li, an analyst at Forrester Research. "The key thing he lacks is strong management experience of a large, complex organisation... Semel brought discipline, now they need vision. [Yang] definitely has the credibility to do that."
"They had to do something," Li added. "There was an attitude of 'anyone but Terry' at this point."
Greg Sterling, principal of consultancy Sterling Market Intelligence, speculated that Yang's new job would be temporary and that Decker was being groomed to be the permanent chief executive.
"Yang is a known commodity and they're trying to reassure the market," Sterling said. "Probably, it's the case that he's the interim CEO... If they had brought in a rock star, that might have changed the dynamics of the company and prevented or delayed Decker's ascension to the ultimate CEO role."
A company re-organisation and management shuffle six months ago led many to surmise that Yahoo was grooming Decker to become chief executive. Since then, she continued serving as chief financial officer, until the company recently named investment banker Blake Jorgensen as chief financial officer. Then she was free to assume the role she was assigned during the shake-up late last year as head of the advertising business.
In the current re-organisation, the advertising and consumer divisions will be integrated under Decker's leadership.
Yang is respected as Yahoo's co-founder and therefore holds influence. For example, he is involved in every executive decision at Yahoo, insiders say. More importantly, in this case, Yang — whose title is "chief Yahoo" — is considered a passionate user of the network and dedicated to a creating a good user experience. He's been responsible for numerous design overhauls on the Yahoo home page.
Yang's passion for Yahoo, critics say, runs in stark contrast to Semel's, who isn't known to be an avid user of the site, nor of the internet at large.
"You couldn't get an outsider to understand the company better than Yang," said one executive, who spoke on the condition of anonymity. "He's been the voice of the user for a long time."
Decker described Yang as the "heart and soul of Yahoo" during the conference call.
Still, Yang isn't seen as a saviour among the staff, nor as a great articulator for Yahoo's vision. He's more of a behind-the-scenes man. For that reason, some…
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