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Yahoo CEO Marissa Mayer Is Wrong!

Yahoo Marissa Mayer

Yahoo CEO Marissa Mayer announced that she was going to put an end to remote working for Yahoo employees in June. Mayer came from Google as a division head with a rock-star reputation. At Google, employees work on site, and it’s hard to argue with their success, so it’s understandable why Mayer would try to recreate the culture and practices at Yahoo. But Yahoo isn’t Google. Yahoo used to be like Google is now (leading the competition for online search space), but no longer. And it’s naïve to think Yahoo can beat Google at being Google. That’s one of the reasons why I think Mayer’s gambit is going to fail.

The Recruiting Angle

The ability to work remotely has been one of Yahoo’s chief selling points for employees and prospects, according to recruiters in the tech industry. By taking away this perk (and perhaps adding long commutes), Mayer is giving up Yahoo’s competitive advantage. What’s to keep recruiters from poaching Yahoo’s talent now? All things being equal, would you rather work for Google or Yahoo?

The Prediction

Recruiters are going to be pounding the phones and selling the virtue of working for the company that developed Marissa Mayer (and her stellar career) rather than working for a second-rate, also-ran that lost its luster years ago. Mayer may still be able to create a cool, young, and more collaborative culture at Yahoo, but she’s made her job harder, not easier. She’ll find it difficult to replace the appeal of working from home (for prospects) and the expectation of being able to work from home (for current employees).

The (Belated) Suggestion

Mayer made a bold decision, and perhaps she felt like she had no other option to revive Yahoo. In general, though, it’s better for organizational culture to change organically, not by hitting it with a defibrillator.

When you spend a lot of power capital at once, you reduce your authority capital. Power capital comes from hierarchical power while authority capital comes from effectively aligning, engaging, and building accountability over time. When power is exercised without buy-in from a large percentage of employees, leaders are often surprised and chagrined by the amount and nature of resistance they receive.

While Mayer will undoubtedly face some resistance, I don’t imagine a SWOT analysis of Yahoo would unequivocally favor keeping remote workers. Still, Mayer could have addressed the issues around ineffective collaboration and accountability without sacrificing the strength of a remote workforce. In fact, I find it easier to imagine her building upon this strength, not only to increase the barriers from raiding rivals, but to recruit talent away from them.

About the Author

Gary Cohen is a highly-skilled Executive Coach, Leadership Author, Trainer, and International Keynote Speaker. His clients range from entrepreneurial CEOs of the nation’s fastest-growing companies to executives of global 100 companies. He differentiates himself from traditional (psycho/therapeutic) executive coaches by bringing a vast amount of business experience as a former Founder / President of one the Nation’s Fastest growing companies. He is the author of Just Ask Leadership: Why Great Managers Always Ask the Right Questions (McGraw Hill). Gary B. Cohen Full Bio

  • jimjr11

    In the final analysis, no one will remember the change in the work from home policy, it really doesn’t matter. In the end I suspect the far greater issue will be her politics. She’s a big time leftwinger and Yahoo now owns ultra leftwing Huffington Post. Looking at the dearth of left wing companies out there, CNN. WAPO, LA TImes, NY Times, Bostin Globe, etc. none of which are flourishing, if her politics show up in her strategy, she looses roughly 50% of the market. We’ll see

    • Gary B Cohen

      You mean like Hyatt, Birshire Hathaway, Microsoft and Google.

      • Dr. Mark Bing

        Forgive this late post…. I just joined Disqus….

        Nice reply Gary! …. Oh, and I completely agree with your post and its premise, “Yahoo CEO Marissa Mayer Is Wrong!”
        In fact, I have all of my Organizational Behavior students read it, at both the MBA and upper-division undergraduate levels. And, given Yahoo’s performance of late, it would appear that you were (and are) absolutely correct, in my opinion.
        ——-Mark Bing

  • Gary B Cohen

    Nathan, in talking with insiders this view of it working also is having some management challenges.

    • Nathan Zeldes

      Gary, I’d be interested in more details if you can share. At any rate, management challenges are sure to exist in any worthwhile
      endeavor… that’s why managers are usually highly paid, because by
      solving the challenges they empower great value creation by their
      groups. Managing remote employees (whether at home or in globally
      distributed teams) is certainly non trivial, but the benefits are worth
      it IMO.

      • Gary B Cohen

        Nathan, I believe the conversation I had were confidencial although not stated. I would prefer to keep it contained.

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