Mayer saw her plan as a return, in a sense, to Yahoo’s original mission. Yahoo grew in popularity and value during the late 1990s, when it was the most user-friendly way to peruse the World Wide Web. Now, Mayer believed, it could ride the shift from P.C.s to smartphones and make the mobile web-browsing experience more user-friendly too. Yahoo, in other words, would need to become a really great apps company. Mayer wanted to narrow its product portfolio down to approximately a dozen from more than 100. She and her C.M.O., Kathy Savitt, did some market research and found a list of common user activities on mobile devices. She called this list the “Daily Habits”, and they included news-reading, checking weather, reading email and photo-sharing. Mayer was determined to ensure that Yahoo had the best mobile app for each.Nicholas Carlson
A story of good intentions, and the not so good places where they lead. My favorite part: when Marissa Mayer started to read from a children’s book in front of her employees…
In retrospect, focusing on apps was not such a smart idea. As numerous developers can testify, it’s difficult to build a business on someone else’s platform. The successful apps either come from massive social platforms (Twitter, Facebook and co.), create unique experiences (like Paper for iPad) or access already established services (productivity apps like Evernote or Office). Unfortunately for Yahoo, they offer neither. It’s even harder if you target ‘daily habits’, because the competition is especially diverse, differentiation is low, and people can readily switch whenever a new app comes along. The result: looking at the recent Homescreen study, no Yahoo apps made it in that top…
Turning around a technology company has been historically rare. Tech companies invent new ways of doing things, but as they expand, often metastatically, they tend to shift their focus toward protecting their booming business rather than investing in new disruptive ones. Inevitably some newer company, usually financed by a wealthy venture-capital firm, beats them to it. It’s a cycle that happens in all industries, but everything moves faster in technology — too fast, usually, to allow for turnarounds.
The distinction between defensive and disruptive innovation is often unclear, but a great way to analyze a business. Most of Google’s products are defensive, helping secure their advantage in search and advertising: Maps, Chrome, Android, are not revenue generators by themselves, but continue to drive people to Google search. In a way, Google+ was a defensive product as well: creating a unified profile for users would make ad targeting more precise and lucrative. The same thinking can be applied to Apple: the iPhone disrupted the iPod and the Mac (to an extent), but it generated so much revenue that it now makes up the majority of Apple’s business. It remains to be seen if the Watch can have the same effect – although right now, being completely tied to an iPhone for its functionality, the Watch looks much more like a defensive product.
Mayer also favored a system of quarterly performance reviews, or Q.P.R.s, that required every Yahoo employee, on every team, be ranked from 1 to 5. The system was meant to encourage hard work and weed out underperformers, but it soon produced the exact opposite. Because only so many 4s and 5s could be allotted, talented people no longer wanted to work together; strategic goals were sacrificed, as employees did not want to change projects and leave themselves open to a lower score.
One of the uglier parts of the process was a series of quarterly “calibration meetings,” in which managers would gather with their bosses and review all the employees under their supervision. In practice, the managers would use these meetings to conjure reasons that certain staff members should get negative reviews. Sometimes the reason would be political or superficial. Mayer herself attended calibration meetings where these kinds of arbitrary judgments occurred.
I’m sufficiently familiar with calibration meetings from my current workplace to know they’re a bad idea.