Friday, April 17, 2009

Mom's home, and she's really mad: The Product Development Pipeline at Yahoo.

In the April 27 issue of Fortune magazine I read Jon Fortt's article "Yahoo's Taskmaster" about Carol Bartz, the new CEO at Yahoo. Bartz is most recognized as the retired CEO of Autodesk, makers of the ubiquitous AutoCAD suite of engineering tools. Under her 14-year reign, Autodesk increased sales at a 13% compounded annual growth rate and the stock price peaked at an 8X increase.

According to Bartz, the success at Autodesk is the result of disciplined product management. Once slow to innovate, she led Autodesk to grow its offerings by acquisition and a focus on new products developed internally. So you would assume that she would employ the same approach at Yahoo. But wait, hasn't Yahoo continuously rolled out new product and features on its core site to attract new and keep existing users? Varied and sometimes multiple products for on-line dating, job posting, original entertainment, photo sharing and social media have been introduced on the portal, some even more timely and technically better than the offerings from competitors like Google. Few, if any, of these products have made strong connections with customers, and Yahoo has a reputation not as a leader but more like a company whose best days are past.

Bartz has identified the problem as the management of Yahoo's product development pipeline -- it's a mess. Bartz is not impressed with the chaotic management structure and unconventional job titles instituted by the founders, including "Chief Yahoo" Jerry Yang. She referred to Yahoo's product management as "amateur hour" and is revamping the process:
  • Roll out new product and features BASED ON CUSTOMER FEEDBACK
  • OBTAIN FEEDBACK FROM THE CUSTOMER at every stage of the product development cycle
  • Use the best ideas from customers to update product in the next version to GIVE CUSTOMERS A REASON TO COME BACK AND BUY MORE

In other words, expect Mama Bartz to whip the Yahoos into shape (perhaps literally, as Fortt mentions Bartz's widower father used a belt to discipline his kids). Known for once sending a casually-dressed subordinate home to put on a coat and tie, surviving Carol Bartz means the Yahooligans may need to embrace the business-wear department at Macy's as well as the concept of a management control.

Stay tuned...this should be fun to watch.

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