Yahoo tries for market repositioning amid layoffs, declining profits

April 20, 2012
Yahoo tries for market repositioning amid layoffs, declining profits

At the dawn of the internet era, Yahoo became one of the first stalwarts of this new process for accessing information and communicating in real time. A generation later, the company has lost its market positioning, ended its most recent CEO’s brief tenure through a phone call and instituted layoffs affecting more than 10 percent of its workforce.

Simply put, Yahoo is in the midst of an identity crisis, as it seeks to operate in an internet space where it has been surpassed by Google and Facebook in both traffic numbers and advertising pull. Compounding these challenges is the fact that the internet is constantly evolving, so instead of being a market leader that sets the tone – as it once was – Yahoo must now respond to fluctuations over which it has little control.

"It all adds up to an identity problem for Yahoo, a company that began as a portal to the web," David Rosenbaum writes for "Today, the very idea of a portal seems anachronistic, replaced by apps that immediately serve up whatever anyone is seeking. The difficulty of defining what Yahoo is today, and what it may become tomorrow, may make challenges like Big Data, mobile and new computing platforms seem trivial."

In order to successfully complete its ascent back to the lofty peak of internet dominance, Yahoo needs to begin thinking long-term, which means, in part, catering to consumers who prefer to access its services through mobile devices. Yahoo will also focus solely on its most popular services, which include news, sports, finance and email. Despite this leaner business structure and a 1 percent increase in profits year-over-year, the company’s expenses still outpace its profits.

By working with headhunting firms that have experience recruiting managers and accountants, companies like Yahoo can begin to think more strategically about their organizations and institute more effective long-term plans. Similarly, a financial project consulting service can bolster staffing positions in the short-term as needed.

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