Yahoo - Strategic Management Analysis
EXECUTIVE SUMMARY
Yahoo! Inc., over its journey of almost 17 years has become the world’s largest online network integrated services provider with users exceeding 500 million in numbers worldwide (Yahoo FAQ, 2012). It has a presence in more than twenty markets and regions across the globe and is best known for its search engine and host of other services like finance, e-mail, advertising and social media.
Yahoo! Inc. was started as a personal website directory by two doctorate candidates at Stanford University named David Filo and Jerry Yang. Filo and Yang realized the potential of generating revenue from their web directory by allowing companies to advertise their products on their online directory. Soon, Yahoo was notable enough to gain the attention of Sequoia capital, a venture capital firm. Sequoia provided much needed capital to Yahoo and Tim Koogle, a Motorola executive was hired as Yahoo’s Chief Executive Officer. Koogle’s excellent management skills and vision took Yahoo to the new heights of success i.e. Yahoo! Inc.’s stock price rose from $5 a share to almost $244 a share in 1999 (Jones, 2007)
However, despite the leadership that the company enjoyed in its initial years, the company over the past years seems be losing market share to its arch rival Google Inc. Google has been outdoing Yahoo for the past many years now, gaining market share and increasing its customer base manifolds.
Over the course of past few years, Yahoo! Inc. made a slew of changes in its objectives, business model and to its external, internal environment and strategy to shore up its performance and regain lost ground to its main competitor Google. Herein, we shall take a close look at some of such factors through defining the company’s mandate, internal analysis as well as external analysis.
INTRODUCTION
The company under consideration Yahoo! Inc. (referred to hereinafter as “Yahoo”) is one of the world’s largest online network integrated services provider with a
Yahoo! Inc., over its journey of almost 17 years has become the world’s largest online network integrated services provider with users exceeding 500 million in numbers worldwide (Yahoo FAQ, 2012). It has a presence in more than twenty markets and regions across the globe and is best known for its search engine and host of other services like finance, e-mail, advertising and social media.
Yahoo! Inc. was started as a personal website directory by two doctorate candidates at Stanford University named David Filo and Jerry Yang. Filo and Yang realized the potential of generating revenue from their web directory by allowing companies to advertise their products on their online directory. Soon, Yahoo was notable enough to gain the attention of Sequoia capital, a venture capital firm. Sequoia provided much needed capital to Yahoo and Tim Koogle, a Motorola executive was hired as Yahoo’s Chief Executive Officer. Koogle’s excellent management skills and vision took Yahoo to the new heights of success i.e. Yahoo! Inc.’s stock price rose from $5 a share to almost $244 a share in 1999 (Jones, 2007)
However, despite the leadership that the company enjoyed in its initial years, the company over the past years seems be losing market share to its arch rival Google Inc. Google has been outdoing Yahoo for the past many years now, gaining market share and increasing its customer base manifolds.
Over the course of past few years, Yahoo! Inc. made a slew of changes in its objectives, business model and to its external, internal environment and strategy to shore up its performance and regain lost ground to its main competitor Google. Herein, we shall take a close look at some of such factors through defining the company’s mandate, internal analysis as well as external analysis.
INTRODUCTION
The company under consideration Yahoo! Inc. (referred to hereinafter as “Yahoo”) is one of the world’s largest online network integrated services provider with a
References: Yahoo FAQs. (2012). Investors FAQs. Retrieved from http://yhoo.client.shareholder.com/faq.cfm Jones, G Yahoo Overview. (2012). Overview. Retrieved from http://pressroom.yahoo.net/pr/ycorp/overview.aspx Perez, J Liedtke, M. (2012, 04 04). New yahoo CEO Scott Thompson cuts 2,000 jobs The Christian Science Monitor, Retrieved from http://www.csmonitor.com/Innovation/Latest-News-Wires/2012/0404/New-Yahoo-CEO-Scott-Thompson-cuts-2-000-jobs Baker, L Yahoo Values. (2004). Yahoo! we value. Retrieved from http://docs.yahoo.com/info/values/ Yahoo 10K Barboza, D. (2010, 01 13). Baidu’s gain from departure could be china’s loss. The NewYork Times. Retrieved from http://www.nytimes.com/2010/01/14/technology/companies/14baidu.html?_r=1 Claburn, T Carlson, N. (2010, 03 22). Breaking: Google pulls out of china. Business Insider, Retrieved from http://articles.businessinsider.com/2010-03-22/tech/29990556_1_google-com-hk-google-s-china-googlecn Yahoo Income Statement Womack, B. (2012, 08 10). Yahoo strategy review may result in changes to cash plans. Bloomberg, Retrieved from http://www.bloomberg.com/news/2012-08-09/yahoo-ceo-strategy-review-may-result-in-changes-to-cash-plans.html