Yahoo! Questions and Answers

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Question Number 1 When Terry Semel became Chairman and CEO of Yahoo! he faced the daunting task of guiding Yahoo! through yet another restructuring process. Was Semel correct in his assumption that another restructuring was necessary or would Yahoo! have been fine without the restructuring? Yahoo! began as a small web site in the mid ‘90s geared toward tracking favorite sites visited by users and quickly grew into a widely used and highly popular Web browsing tool and media sensation. With Yahoo!’s initial “business plan modeled on [that of a] traditional broadcast media” company it was inevitable that at some point in the future Yahoo!’s structure would need to be adjusted to better suit the company’s needs (Wheelen & Hunger pg 13-3). Yahoo!’s first restructuring created a bureaucratic organization that was easily overwhelmed by “overlapping responsibilities” which predictably “slowed down the decision-making process” (Wheelen & Hunger pg 13-6). Regardless of this set back in the company’s structure Yahoo! has maintained an extraordinary assortment of accomplished and knowledgeable senior executives. However, because Yahoo! lacked any clear-cut and decisive structure the company lost some of its vital personnel as well as many other employees throughout the corporation. Yahoo! began as a company focused on “communication, content, and commerce” and was well-known for its abilities in these areas (Wheelen & Hunger 13-8). However, over the years Yahoo! managed to lose both its focus and its identity causing its executives to become overwhelmed by the many opportunities in the internet industry. Semel arrived on the scene with a clear idea of what needed to be done to refocus Yahoo! on what would make the company profitable in ... ... middle of paper ... ... forms of online advertisements and fees as well as “promotions, sponsorships, direct marketing, and merchandising” (Wheelen & Hunger pg 13-3). During the dotcom boom Yahoo!’s revenues exceeded expectations due to the increased advertisements for the dotcom companies. However, as the dotcoms went out of business Yahoo! saw a marked decrease in its revenues. Yahoo!’s revenues continued to decrease further as the company failed to adapt to the changing needs of the online advertising market. With the needs of its customers changing and the reluctance of Yahoo!’s executives to modify the company’s business model Yahoo! was unable to meet its customer’s needs further causing its revenue to decrease. Works Cited Wheelen, Thomas L. and J. David Hunger. Strategic Management and Business Policy, 13th Ed. Upper Saddle River, NJ: Pearson Education, Inc., 2012. Print.
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