IT's amazing that something so simple as a not having a clear vision/mission could take down a successful company but that's the essentially what happened at Yahoo! When I worked there in 2004 it was just confused, chasing competitors and ideas, never deciding on what it wanted to be when it grew up. I left a year or so later and from what I saw it never figured itself out.
I always wanted the company to focus on a mission about being "useful" - like the digital WD-40/duck tape of your life. Finance, news, fantasy-sports, email, messenger, groups, My Yahoo!, Delicious, Flickr... They're all useful. They could have continued to happily and profitably offer all of these services - and expanded to dozens more - under the mantra of being useful to our every day lives, but Yahoo! was never content with that. They wanted to be eBay, or Google, or Facebook, or YouTube or whoever else was a big player at the time, instead of focusing on the customer loyalty they had already generated.
Having that clear core vision/mission seems like a small thing, but not having one crippled Yahoo! and caused infighting, turnover and confusion that eventually killed it. (Oh, and also Mayer was an idiot.)
Finance, news, fantasy-sports, email, messenger, groups, My Yahoo!, Delicious, Flickr... They're all useful.
I agree these are useful, but they weren't very good businesses. Take email. Email is useful. Most of us use it every day, arguably for more important communications than facebook. Still, facebook is a massive business and email is barely a business at all, generally.
Yahoo was blinkered by chances at big wins for the same reason VCs and nearly anyone in that game is, they're very, very big relative to the medium sized ones.
core vision... they kind of lost that game. The first vision was the directory, which is really just search with a different back-end. This turned out to be an excellent business, but they didn't realize what they had.^ Google ate the whole pie.
The 2nd vision was content, to be a sort of online publication/media business. They half abandoned the first vision for this one. Your examples mostly fit here. This turned out to be (mostly) a terrible business type, and the wide, generalist variant that type which yahoo was going for turned out to be even worse.
I don't really know what they could have done from the early 2000s onwards. Your core vision needs to be, the core of what you do. There wasn't a core anymore.
^even though they basically invented adwords, the business model for that business.
They still haven't demonstrated that they can make significant money on anything other than advertising. They do a lot of stuff but nothing really turns into a profitable business. Compare that to Microsoft who have shown over decades many times an ability to get into new lines of business profitably.
Around 13% of total revenue then, growing year on year, that's nice. I would like to know what percentage of net profit is contributed by that fraction.
The other category is producing an operating loss.
Just as a stray example, for 3Q17 Alphabet generated $7.8 billion in operating income.
Google, the subsidiary, generated $8.7 billion in operating income for that quarter.
With continued solid growth of Google's cloud business, and the pull back on burning red ink on Google Fiber, maybe they'll push that other category to break-even soon. Regardless, Google is generating all of their profit. Google is a cash production marvel, nearly on par with the iPhone at this point. They should be able to hit around $40 billion in operating income in that subsidiary this year.
It's very possible that they produce a lot of revenue but no profit like Uber. On the other hand I would assume Google Cloud is making money since Azura and AWS are profitable for MS and Amazon.
What they are doing is exactly the opposite of what grandparent claimed Yahoo did.
They just create things that are useful.
Search, GMail, Maps, Chrome, Android, Youtube, Analytics and many other products and services.
If they can milk them from advertising, they will. But they don't necessarily care if it doesn't make money directly.
They own so many crucial parts of the internet that they cannot become irrelevant like Yahoo did.
Compare that to similar companies.
Facebook has only Facebook.com, Whatsapp and Instagram (which is basically just Facebook)
Amazon their store and AWS. Their other attempts (phone, tablets, Alexa, etc) have never took off.
Microsoft is in a powerful position as they have Windows, Office, Azure, XBox and Bing although they have not managed to gain share in new markets for quite some time.
I think Google is by far the most relevant company on the internet.
They gain market and the cash will flow later. This is in their DNA. This is how exactly it got started for them.
Their search was popular but was not making money for years. All they did was to focus on making it better, thinking that they'll find a way to make money later. And they did.
Exactly. Focus on providing value to your customer and all will be good with financials. Google grwth has actually accelerated as their numbers get bigger.
Not AS vulnerable but in the near future when you search thru voice commands and hear results back, all those google ads that your eyes scan can be thrown out of window.
Don’t have much to say about her. It could have been anyone else in the management class looting a company for eight or nine figures and leaving it for dead. I’d do it for seven, if anyone needs a punching bag.
I'm always skeptical about this argument because it can be seen either way, if the old world companies stuck to their vision/mission they might just be disrupted by new/alternate business models/technology and if they try to experiment (Ex: Google) it can be seen as not having a clear vision. There are very few companies that can sustain through 50 yr cycles but even having a clear vision may not help a company succeed if someone else renders their business useless.
Mission/Vision should evolve and sometimes it might be considered luck and sometimes foresight.
I think its the case that changing goals is fine, as long as the current plan of action is clear
but having many, competing, and underspecified goals, is the problem of unclear vision; You're doing a bunch of work, but its not clear where you're trying to go. Driving aimlessly, versus driving to texas and halfway through changing your mind to drive to chicago, are two very different acts.
They could have survived without a "vision"; lots of boring utility companies do. But in order to do so they would have had to be detail- and customer-focused. This would have been boring, unglamourous and offered at most a few percent growth. They might have had to charge users, heresy.
> ...but Yahoo! was never content with that. They wanted to be eBay, or Google, or Facebook, or YouTube or whoever else was a big player at the time, instead of focusing on the customer loyalty they had already generated.
This is far from unique about Yahoo! too. So many services I loved using have gone under because they were VC funded and, though successful, useful, etc., weren't able to "eat the world" and so were shuttered.
I keep waiting for Twitter to go under that way. I think the Trump White House may have bought them some time, but they're just too damn top heavy to stay afloat.
Mission/vision is often the largest thing rather than a small thing with regards to long-term success. Waging a war without an overall mission and vision for achieving it results in, at best, a collection of battles that can only accidentally be strategic (and usually judged as such retrospectively).
Of course operating under overly vague generalities while believing they are mission/vision statements is nearly as bad as operating with none.
What it meant to me was that Yahoo couldn't help itself from taking every successful product or acquisition and screwing it up, deprecating it or otherwise wholly missing why its users valued it.
These have been listed in greater detail elsewhere, but Y! Games is one of the most glaring examples where they had a massive, loyal audience and just destroyed the community bit by bit.
Flickr is the other commonly sited example where Yahoo just didn't seem to understand why the users valued it so much. Every year they'd nerf some core aspect of the product trying to turn it into something less useful but more "trendy".
Finally, for me, the "my.yahoo.com" customizable landing page / rss feed had enormous utility and huge potential but was just left to rot.
> but Y! Games is one of the most glaring examples where they had a massive, loyal audience and just destroyed the community bit by bit.
I'm sorry, but at least we tried when I was there, and if it hadn't been one of Filo's babies, it would have been killed long before we got to take a stab at it.
I think useful in this case is pretty clear with the WD-40/duct tape example; hardly the best-in-class solution, but when you just need a simple, short-term solution, then Yahoo! should be the place to go.
In the same fashion that excel is the default go-to tool for any kind of basic data management (and now to a certain degree superceded by google spreadsheets), Yahoo! would have been the default place to go basic image hosting, basic blogging, basic chatting, basic news; A good enough solution to meet the 80% of common problems
I always wanted the company to focus on a mission about being "useful" - like the digital WD-40/duck tape of your life. Finance, news, fantasy-sports, email, messenger, groups, My Yahoo!, Delicious, Flickr... They're all useful. They could have continued to happily and profitably offer all of these services - and expanded to dozens more - under the mantra of being useful to our every day lives, but Yahoo! was never content with that. They wanted to be eBay, or Google, or Facebook, or YouTube or whoever else was a big player at the time, instead of focusing on the customer loyalty they had already generated.
Having that clear core vision/mission seems like a small thing, but not having one crippled Yahoo! and caused infighting, turnover and confusion that eventually killed it. (Oh, and also Mayer was an idiot.)