Will A Leaner And Meaner Yahoo Be Better?

News broke this week that Yahoo has hired a cost-cutting specialist as its new CFO, with references that he'll help "...weed out the bureaucracy that has been dragging down its profits." Is that what Yahoo needs to fix?The announcement is a continuation of what we've been hearing since Carol Bartz took over as CEO early this year. I was a big fan of hers when she led Autodesk, where she was a smart, tough leader, and she has wasted no time effecting change at Yahoo: in April, the company announced it would fire 5% of its workforce, because "you have three people telling project engineers what to do, and nobody's f*#king doing anything" (the quote was attributed to Bartz in an analyst call). It has become accepted wisdom that Yahoo has been unable to keep pace with rivals like Google and Facebook because of its corporate structure and processes.

I'm all for efficiency, and if the new CFO can cut expenses even further, that's good news for Yahoo's shareholders. But producing a lean and mean company isn't the same as having the faintest idea of where you want to go with it. It's not strategy, is it?

From a brand perspective, Yahoo isn't like Google or Facebook, in that it stands for a wide variety of things, depending on the user: Yahoo is an information aggregator, email platform, IM tool, community host, Internet search window, proprietary content provider and, gasp, a web portal...among other things. While not exactly the geriatric contemporary of AOL, it has much more in common with it than with companies founded closer to the .com bust. It does lots of things, so it has rivals across the board.

That's a crappy brand strategy, and a really dicey business model. So I'm not sure that running it more efficiently would make much of a difference, in and of itself. Perhaps there's a bold strategy yet to emerge from Ms. Bartz and her team, and they're simply setting the stage for implementing their new plan.

But then I start thinking of another company, and it's not Facebook or Google. It's GM.

I wonder if the real "fix" that needs to happen at Yahoo isn't some drastic, bottom-to-top, "we used to be in the X business, but now we're going to do Y" overhaul. Like it needs to become a new company, and do something utterly different than what it has done up to now.

A leaner and meaner Yahoo might save money, but it won't necessarily make any. Isn't the ultimate problem not so much a muddled bureaucracy, but rather the fact that Yahoo needs to become something else?

Jonathan Salem Baskin writes the Dim Bulb blog and is the author of Branding Only Works On Cattle.