Executive Summary
The current report examines the challenges faced by Yahoo! when Marissa Mayer was the corporation’s chief executive officer. The analysis has identified several issues associated with Mayer’s poor leadership that resulted in losses for the business. Three alternative solutions have been proposed based on the pinpointed problems, primarily employee dissatisfaction.
Mayer laid off many staff members, which contributed to a considerable number of workers quitting. Although inadequate management has been identified as the main concern, the best of the proposed solutions is focusing on addressing employee grievances to enhance interactions between the personnel and directors. Such a measure is anticipated to retain the workforce while transforming how executives, including Mayer, make decisions since staff members are essential for the business’s success.
Case Facts, Symptoms, and Underlying Problem
The case study (CS) presents troubles faced by Yahoo! during the period the company was managed by Marissa Mayer. The primary facts are that Mayer was hired as the corporation’s chief executive officer (CEO) to transform its business model, yet has failed, leaving multiple stakeholders disappointed (GEB, n.d.). Some symptoms of the hardships experienced by Yahoo! are investors not being pleased with the enterprise’s stocks alongside staff members’ dissatisfaction and uncertainty (GEB, n.d.).
The CS illustrates several considerable problems encountered by the firm. For example, the company’s financial performance was hindered due to hesitation in moving its offerings to mobile devices (GEB, n.d.). It appears that the cause of the issues was Mayer’s inability to execute three of the four essential management functions (Dolechek et al., 2019). The CEO failed to plan proper acquisition strategies, conduct corporate reorganization, and meet employees’ needs (Dolechek et al., 2019; GEB, n.d.). Although Mayer was supposed to help Yahoo!, the CEO’s poor leadership exacerbated the situation.
Case (Situation) Analysis
The state of Yahoo! can be better depicted by conducting a SWOT analysis. The corporation’s strengths are moderately healthy financial condition and the presence of some loyal workers (GEB, n.d.; Sherman, n.d.). For instance, the business was able to spend $108,000,000 yearly on free food, and Mayer had staff members who approved of her actions (GEB, n.d.).
The weaknesses of Yahoo! include inadequate planning, substantial employee turnover, and violation of a common managerial practice (GEB, n.d.; Sherman, n.d.). For instance, Mayer’s acquisition strategies did not produce anticipated revenue growth, 33% of the workforce left the enterprise within one year, and the CEO was not paid according to her factual performance (GEB, n.d.).
Opportunities for Yahoo! are stock increases and the ability to attract workers by offering substantial rewards (GEB, n.d.; Sherman, n.d.). The company has the finances to provide its staff members with free lunches, events, and retention packages (GEB, n.d.). Threats for the corporation are the need to partially or entirely sell the business, raising employee and investor dissatisfaction, and uncertainty (GEB, n.d.; Sherman, n.d.). Consequently, the SWOT analysis demonstrates Yahoo! as having more problems than favorable prospects.
Alternative Solutions
The first alternative solution (AS) for Yahoo! is addressing its personnel’s grievances. Under Mayer’s management, the firm laid off multiple employees, including key lieutenants and experts from its mobile team, and numerous staff members quit (GEB, n.d.). However, a company’s workforce is its most important and valuable asset in determining success, and the CS states that Mayer was worried about the brain drain (Singh, 2019).
Potential pros are that the personnel is crucial for the business’s sustainable development, competitive advantage, and image (Singh, 2019). Nonetheless, possible cons are that retained or newly attracted employees may not be the most competent and that satisfying the workforce will likely be a long-term, expensive, and challenging process (Singh, 2019). Yahoo! could have benefited by changing its interactions with staff members so that it could operate properly and continue advancing.
The second AS is promptly adapting to the demands of modern customers. The CS declares that the financial performance of Yahoo! was plagued because the company hesitated when transferring its offerings to mobile gadgets, so such an issue should be addressed (GEB, n.d.). The pros of the suggested AS are potentially improved monetary state of the business and access to new markets with clients who rely on contemporary electronics. Possible cons are spending resources on developing ways to present the business’s products and services on mobile devices and attracting a qualified workforce since Mayer’s decisions broke up the Yahoo! mobile team (GEB, n.d.). The corporation could have profited by promptly reacting to modern trends.
One more AS for Yahoo! is modifying its directors’ payments. The CS reports Mayer’s compensation package as a problem due to the CEO not being paid per her performance (GEB, n.d.). One can assume that Mayer and other executives’ actions and decisions could have been better had they had an adequate earnings system. Possible pros of the AS are the advanced functioning of the firm and increased profits, while cons are the potential dissatisfaction of those in leading positions alongside the difficulty of devising ways to change payments. The upper management of Yahoo! should have been reimbursed for their accomplishments and penalized for failures.
Proposed Action Plan
Of all the discussed ASs, addressing employees’ grievances to retain the workforce is the best alternative. Although the CS does not seem to specify why many staff members were laid off, it appears that a substantial number of workers quit because of discontent with the firm, which worried Mayer (GEB, n.d.). What should be done in the presented situation is to improve upper management’s interactions with the personnel. The primary effort should be made by Yahoo! executives, especially the CEO responsible for bad employee morale and prolonged contemplations of a corporate reorganization (GEB, n.d.).
The company’s leadership should strive to satisfy its staff members’ needs and retain competent workers, which is essential to maintaining the business (Singh, 2019). Employees’ grievances can be addressed, and subsequent relationships can be improved by letting the personnel voice their concerns, establishing an efficient communication process, and enhancing leadership practices concerning internal culture alongside managerial support (Singh, 2019). The AS can solve problems in Yahoo! and prevent prospective workforce resentment because implementing the listed changes will require transforming executives’ behavior while encouraging directors and staff members to operate jointly toward the company’s success.
The triumph of the proposed AS is correlated with a proper contingency plan (CP). With the suggested AS, problems that may arise concern the interactions between employees and Yahoo! management, including the CEO. Consequently, the first element in CP concerning the solution is recognizing such essential processes as allowing the workforce to voice their concerns, enhancing communication, and advancing leadership practices (Waldow, 2022).
Potential risks include employees being afraid to raise issues, interpersonal conflicts, and executives concentrating on their own interests (Waldow, 2022). The identified perils have high, very high, and high exposure, respectively, based on potential impact and the probability of occurring (Waldow, 2022). Yahoo! can respond to the threats by generating a grievance-handling system with incentives to encourage workers to discuss rather than conceive problems, providing training on critical thinking and negotiations, and establishing specific regulations for managers. The CP can help Yahoo! prepare for possible negative events during the implementation of the AS.
References
Dolechek, R., Lippert, T., Lloyd, R., & Vengrouskie, E. (2019). Solving a whale of a problem: Introducing the four functions of management in a management principles course. International Forum of Teaching and Studies, 15(2), 29-35.
GEB 1011 management case study [PDF document]. (n.d.).
Sherman, F. (n.d.). SWOT and problem-based analysis. Chron. Web.
Singh, D. (2019). A literature review on employee retention with focus on recent trends. International Journal of Scientific Research in Science and Technology, 6(1), 425-431. Web.
Waldow, D. (2022). What is a contingency plan, and why every project needs one. Monday Blog. Web.