Last night we reported a tip that Yahoo has created a list of 1,500-2,500 jobs that may be cut within two weeks and that Jerry Yang will make the decision to go ahead with the layoffs–or not–this week. We have now received additional details from the same source, who has been reliable in the past. Our source’s understanding of the situation is this:
The “list” is reportedly the product of a Q4 project in which all group heads were asked to look at redundancies and create their own lists of potential cuts. All the group-level lists have now been turned in to corporate.
The decision to go ahead with lay-off is said to be largely dependent on stock price: Yahoo’s stock trading in the low $20s has gotten Jerry’s and president Sue Decker’s attention. Jerry will feel vulnerable if the stock goes into the teens and will try whatever he can to prop it up. He’s not ready to give up the CEO job, sell-out, or shop the company around at this point.
Update on Peanut-Butter Manifesto (a.k.a., Yahoo’s stifling bureaucracy)
Jerry is reportedly trying to speed up the time that decisions are made and how fast new products get released. Jerry and other execs are finally admitting that management by committee does not work. The new, more rapid decision making process is gathering momentum internally and is promising but still has a ways to go.
Outlook for the Company
Our source believes Jerry & Co. have a chance of pulling off the turnaround and allowing Yahoo to survive as a stand-alone company. So do we. Although it is hardly fun to “root” for a large layoff, we continue to believe it would be a smart move for the company and a smart move for Jerry.
We hear the “Jerry’s too nice a guy to do what it takes” refrain from people very close to the situation, and a tough, initially unpopular move like this would strengthen his leadership position, both inside and outside the company. If executed well, we believe it would also improve morale for the rest of the company. (“Finally, a leader who demands excellence again!”)
Yahoo is not in the same situation as AOL: It still has a strong brand and a cohesive, growing business. With the right leadership, it can still be saved.
Know more? We’d love to hear from you! Please post below or send to [email protected] Anonymous submissions fine and appreciated, but to help us assess the info, please tell us as much as you can about where it is coming from.
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