Yahoo

Yahoo! Inc.

Yahoo Strategic Business PlanningPresentation

This presentation is based on Case Study of Yahoo! Inc. which prepared by Hamid Kazeroony in year

2009. All reported facts and data was correct during that time.

Yahoo! Inc.

Our Vision and Mission

VISION STATEMENT

Yahoo! powers and delights our communities of users, advertisers, and

publishers — all of us united in creating indispensable experiences,

and fueled by trust.

MISSION STATEMENT

To connect people to their passions, their communities, and the world's

knowledge. To ensure this, Yahoo offers a broad and deep array of

products and services to create unique and differentiated user

experiences and consumer insights by leveraging connections, data,

and user participation

*Actual statement by Yahoo! Inc. in 2009

Yahoo! Inc.

Our Shared Values

Excellence:

We are committed to winning with integrity. We know leadership is hard

won and should never be taken for granted. We aspire to flawless

execution and don't take shortcuts on quality. We seek the best talent

and promote its development. We are flexible and learn from our

mistakes.

Innovation:

We thrive on creativity and ingenuity. We seek the innovations and

ideas that can change the world. We anticipate market trends and

move quickly to embrace them. We are not afraid to take informed,

responsible risk.

Customer Fixation:

We respect our customers above all else and never forget that they

come to us by choice. We share a personal responsibility to maintain

our customers' loyalty and trust. We listen and respond to our

customers and seek to exceed their expectations.


Yahoo! Inc.

Our Shared Values

Teamwork:

We treat one another with respect and communicate openly. We foster

collaboration while maintaining individual accountability. We encourage

the best ideas to surface from anywhere within the organization. We

appreciate the value of multiple perspectives and diverse expertise.

Community:

We share an infectious sense of mission to make an impact on society

and empower consumers in ways never before possible. We are

committed to serving both the Internet community and our own

communities.

Fun:

We believe humor is essential to success. We applaud irreverence and

don't take ourselves too seriously. We celebrate achievement.


Yahoo! Inc.

Internal and External Audit

In order for the company to formulate this year strategy, it is imperative for us to

understand and audit the current state internally and externally, ensuring the

direction towards our vision and mission. The Management team has completed

the following analysis:

1. SWOT Analysis

2. TOWS Matrix

3. PESTLE Analysis

4. Porter’s 5 Forces Analysis

5. BCG Matrix

6. SPACE Matrix

7. IE Matrix

8. Porter’s Generic Competitive Analysis

9. Value Chain Analysis

10. Ishikawa and Pareto Analysis

11.McKinsey’s 7S Framework and Analysis

12.Strategy Map

Yahoo! Inc.

SWOT Analysis (Internal) (1/5)

No Key Internal Factor

Strength

1 The core of Yahoo’s strategy and operations is to become the starting point for

internet users, to provide must buy solutions for the world’s largest advertisers and

to deliver industry-leading open platforms that attract developers and publishers.

2 Yahoo!’s full year revenue in 2008 exceeded by $ 2.2 billion compared to 2007.

3 For the 2nd quarter of 2009 cost cutting allowed Yahoo! to post 7% increase in profit

up to $ 141.4 million.

4 Revenue generated by Yahoo! marketing activities has always being increasing

between 8% from 2006 to 2007 and 4 % from 2007 to 2008.

5 Yahoo is the second leading global internet brand and one of the most trafficked

internet destinations worldwide.

6 Yahoo, together with it’s owned and operated online properties and services; it also

provides advertising offerings and access to internet users beyond Yahoo through its

distribution network of 3rd party entities.

7 Vast product offering

8 Yahoo has offices in more than 25 countries, province or territories.

9 Part of Yahoo’s code of ethics – Customer Fixation (Customer Centric)Q1

A SWOT analysis is a structured planning method used to evaluate the strengths,

weaknesses, opportunities and threats involved in a project or in a business venture.

Yahoo! Inc.

SWOT Analysis (Internal) (2/5)

Q1

No Key Internal Factor

Weakness

1 Failure to strike partnership with Microsoft.

2 Declining business in certain area (closing twenty video services, including network

site Yahoo! 360 and its Web hosting service)

3 Declining internet traffic.

5 Decline in Net Income of Yahoo in 2008 was $ 424,298

6 Yahoo! advertising business is also deteriorating rapidly.

7 Yahoo! lost 1% in rich media revenue, 1% in sponsorship and 2% in percent in

2008.

8 Yahoo! posted 78% in 1st Qtr. 2009 profit decline.

9 Stock raise to high of $ 120 in 2000 but for most 2009 it has been trading under $

14.

Yahoo! Inc.

SWOT Analysis (External) (3/5)

Q1

No. Key External Factors

Opportunities

1Yahoo is the second leading global internet brand and one of the most trafficked

internet destinations worldwide.

2There are 1.1 billion internet users around the world and 211 million in the USA as

of end of 2006

4 Growth in internet advertisement.

5 Broadband price drop (cheaper).

6 Internet advertisement revenue in USA remains strong, topping $ 23 billion.

7

Federal Communication Commission (FCC) adopted flexible access rules for users

and wireless resellers in conjunction with agency‘s early 2008 wireless spectrum

auction.

8 Increased recognition that consumers spend more and more of their time online.

Yahoo! Inc.


Q1

Threat (1/2)

1Economic growth in the USA and the world has slowed amid crisis in housing and

credit market.

2Rising unemployment and problematic geopolitics to the mix and USA had

difficult economic back drop.

3In 2009, number of internet content and advertisement companies reported

disappointing financial results and lowered their forward financial outlooks.

4

Yahoo operates in the internet products, services and content markets, which are

highly competitive and characterized by rapid change, converging technologies

and increasing competition.

6Although internet related business have perhaps held better than their non-digital

counterparts, but have still suffered from macroeconomics malaise.

7From its first year of operation as a public company (2004), Google has

increased its operating profit to $ 6.7 billion from a modest $ 852 million.

Yahoo! Inc.


Q1

Threat (2/2)

8During 2008, Google had 72% of internet traffic while Yahoo only possessed 17%

followed by MSN at 6% and IACI at 4%.

9

Due to changes in legislative requirements concerning technology sharing, patents

rights and information security, future expenses and profitability of the companies

operating with the industry are harder to predict.

10Technical and regulatory makes the projection of its business viability for existing

companies difficult.

11Future innovations and shifts in technology also make long term strategies regarding

the internet and software services industry difficult

SWOT Analysis enables Company to take stock of internal and external factors affecting

the Company. Limitation of this tool are it doesn't prioritise issues, doesn't provide

solutions or offer alternative decisions, can generate too many ideas but not help you

choose which one is best, and can produce a lot of information, but not all of it is useful.

Yahoo! Inc.

TOWS Matrix (1/2)

Q2

TOWS analysis is useful to get a better understanding of the strategic

choice, in identifying strategic alternatives that address the following

additional questions:

1. Strengths and Opportunities (SO) – How can you use your

strengths to take advantage of the opportunities?

2. Strengths and Threats (ST) – How can you take advantage of your

strengths to avoid real and potential threats?

3. Weaknesses and Opportunities (WO) – How can you use your

opportunities to overcome the weaknesses you are experiencing?

4. Weaknesses and Threats (WT) – How can you minimize your

weaknesses and avoid threats?

See our TOWS analysis in the next page…

Yahoo! Inc.

TOWS Matrix (2/2)

Q2

Strengths Weakness

Refer Slides 8. Refer Slides 9.

Opportunities S-O Strategies W-O Strategies

Refer Slides 10. 1. Implement a vertical or

horizontal integration (forward

or backward) of a company

that has global presence

2. Increase advertising spending

by additional 10% on fee

based segments.

3. Cutback prices on advertising

and fee based segment by

2%.

1. Acquire innovative technology /

Internet related businesses

using a combination of cash

and debt.

2. Sell off low profit segments and

pay down the long term debt.

Threat S-T Strategies W-T Strategies

Refer Slides 11-

12.

1. Offer new marketing data

collection for advertisers.

2. Create additional bundling

partnership for sound or video

streaming.

1. Improve innovation to protect

the company’s technology,

patent rights and information

security.

Yahoo! Inc.

PESTLE Analysis (1/5)

Q3

Yahoo! Inc.


Q3

Political, Government and Legal Forces

No Identified Factors

1 Federal Communication Commission (FCC) adopted flexible access rules for

users and wireless resellers in conjunction with agency‘s early 2008 wireless

spectrum auction.

2 Due to changes in legislative requirements concerning technology sharing,

patents rights and information security, future expenses and profitability of the

companies operating with the industry are harder to predict.

3 Technical and regulatory makes the projection of its business viability for existing

companies difficult


1 Yahoo is the second leading global internet brand and one of the most trafficked

internet destination worldwide

2 There are 1.1 billion internet users around the world and 211 million in the USA as

of end of 2006

3 Economic growth in the USA and the world has slowed amid crisis in housing and

credit market

Economic Forces

Yahoo! Inc.


Q3

Economic Forces


4 Rising unemployment and problematic geopolitics to the mix and USA had difficult

economic back drop

5 Although internet related business have perhaps held better than their non-digital

counterparts, but have still suffered from macroeconomics malaise.

6 In 2009, number of internet content and advertisement companies (including

Bankrate Inc., Knot Inc.… including Yahoo!) reported disappointing financial results

and lowered their forward financial outlooks.

7 Internet media and market research firm comScore Inc., expressed concerns about

deceleration in online growth.

8 Internet advertisement continues to grow though in slower pace

9 Broadband prices fall

10 Internet advertisement revenue in USA remain strong, topping $ 23 billion

Yahoo! Inc.


Q3

Economic Forces


11 Even Google Inc., expressed economic related caution in conjunction with its

second quarter results

12 Yahoo operates in the internet products, services and content markets, which are

highly competitive and characterized by rapid change, converging technologies and

increasing competition.

13 From its first year of operation as a public company (2004), Google has increased

its operating profit to $ 6.7 billion from a modest $ 852 million.

14 During 2008, Google had 72% of internet traffic while Yahoo only possessed 17%

followed by MSN at 6% and IACI at 4%, Google had 72% of Internet traffic while

Yahoo only possessed 17%.

Yahoo! Inc.


Q3

Social, Cultural, Demographic and Natural Environment, Forces


1 Increased recognition that consumers spend more and more of their time online

Technological ForcesNo Identified Factors

1 Future innovations and shifts in technology also make long term strategies

regarding the internet and software services industry difficult.

Summary

We have opportunity and threat where our internet business have performed better than

their non-digital counterparts but on the whole businesses were affected by the economy

depression. Internet business has performed better than their non-digital counterparts are

an opportunity and economy depression is a threat.

Yahoo! Inc.

Porter’s Five Force Model

Q4

Yahoo! Inc.

Relationship between PESTLE

and Porter’s Five Forces Model

Q5

PESTLE

External, Macro

External, Micro

Porter’s 5 Forces

Model

Yahoo! Inc.

BCG Matrix

Q6

BCG Matrix is that it draws attention to the cash flow, investment characteristics and needs

of an organization’s various divisions. Also, there is no industry growth rate data given in

the case study, hence, this test cannot be conducted.

Yahoo! Inc.

SPACE Matrix (1/5)

Q7

No Financial Position (FP) Ratings

1

Yahoo’s revenue from 2007 to 2008 increased by 3.4% to $7.2 billion. But net income decreased by

35.7% to $ 424 million.

1

2

Liquidity Ratio

Current ratio is > 1, Quick ratio is > 1 in 2006 and 2008, 1

3

Leverage Ratio:

Debt to total asset ratio decreased from 8% in 2006 to 2% in 2008

Long term debt to equity ratio decreased from 9.5% in 2006

1

4

Activity Ratio:

Fixed asset turnover ratio for was good 2006 reading 7.14 but dropped by 2.11 and ending with 5.03 in

2008, Total asset turnover ratio is low at 0.56 from 2006 and ended with 0.53 in 2008

3

5

Profitability Ratio:

Gross profit margin is within 59% to 58%, this shows cost of revenue is in the region of 40% of the

sales generated.

Operating profit ratio decreased from 18% in 2006 to 9.5% in 2008.

Net profit margin in 2006 was 12% and decreased by 50% to end at 6% in 2008.

ROA decreased by 3.5% from 2006 to 2008

ROE decreased by 50% from 2006 ending at 4% in 2008

EPS has decreased from 0.52 in 2006 to 0.29 in 2009

3

6 Price earnings ratio was 41.38 in 2009 1

7 Growth Ratio

Sales started 100% in 2006 and ended up at 112% in 2008, each year sales increase by 8% in 2007

and 3% in 2008

3

Total 13*Assumption: Ratings given based on the international benchmarking exercise.

Yahoo! Inc.

SPACE Matrix (2/5)

Q7

No Stability Position ( SP) Ratings

1

Yahoo operates in the Internet products, services and content markets, which are highly

competitive and characterized by rapid change, converging technologies and increasing

competition.

-4

2 Internet advertising continues to grow, albeit slower pace. -3

3 Add rising unemployment and problematic geopolitics to the mix and we have a difficult

economic back drop to say least. -4

4 Each company in the industry is committed to attract as many visitors (as Exhibit 8

demonstrates) as possible.

-4

5 Although internet –related business have perhaps held up better than their non-digital

counterparts, they have still suffered from macroeconomics malaise.

-3

6 Google has 72% of Internet traffic while Yahoo only possessed 17% followed by MSN at 6% am

IACI at 4%.

-1

7 Future innovations and shift in technology also make long term strategies regarding the Internet

and software services industry difficult.

-3

Total -22

*Assumption: Ratings given based on the international benchmarking exercise.

Yahoo! Inc.

SPACE Matrix (3/5)

Q7

No Competitive Position ( CP) Ratings

1

Yahoo, together with it’s owned and operated online properties and services; it also provides

advertising offerings and access to internet users beyond Yahoo through its distribution network

of 3rd party entities.

-2

2 Vast product offering -Yahoo offering include Yahoo Group, Yahoo Answer and search offering

include Yahoo Search, Yahoo Local, Yahoo Yellow Page & Yahoo Maps are available free to

users. Yahoo communication segment include Yahoo Mail, Zimbra Mail and Yahoo Messenger

-2

3 Yahoo is the second leading global internet brand and one of the most trafficked internet

destination worldwide.

-1

4 Yahoo has offices in more than 25 countries, province or territories. -2

5 Yahoo! sites has 140,080,000 unique visitors sharing the same number as Google. -2

6 The core of Yahoo’s strategy and operations is to become the starting point for internet users, to

provide must buy solutions for the world’s largest advertisers and to deliver industry-leading

open platforms that attract developers and publishers.

-3

Total -12

*Assumption: Ratings given based on the international benchmarking exercise.

Yahoo! Inc.

SPACE Matrix (4/5)

Q7

No Industry Position ( IP) Ratings

1

This trend confirms marketers increased recognition that consumers spend more and more of

their time online.

5

2 Internet advertising revenues in the united states remain strong, topping $23 billion, according to

the 2008 Internet Advertising Revenue Report, released by Interactive Advertising Bureau and

PricewaterhouseCoopers LLP (Pwc).

4

3 Federal Communication Commission (FCC) adopted flexible access rules for users and wireless

resellers in conjunction with the agency’s early 2008 wireless spectrum auction.

4

4 As broadband prices fall, ISPs are pursuing new business strategies, such as bundling Internet

access with voice and video services.

3

5 The industry, due to its low barrier entry-technical and regulatory –makes the projection of its

business viability for existing companies difficult.

3

6 There are 1.1 billion internet users around the world and 211 million in the USA as of end of

2006.

7

Total 26

SP Average : -22 ÷ 7 = -3.14 IP Average : 26÷6 = 4.3

CP Average : -14 ÷ 6 = -2.3 FP Average : 13÷7 = 1.86

Directional vector coordinates X- axis -2.3 (+ 4.3) = 2

Y –axis -3.14(+1.88) = -1.26

Yahoo should opt for competitive strategy

Yahoo! Inc.

SPACE Matrix (5/5)

Q7

FS

IS

ES

CS

Possible strategy:

Horizontal Integration

Market Penetration

Market Development

Product Development

Yahoo! Inc.

IFE Matrix (1/6)No Key Internal Factor Weight Rating

Weighted

Score

Strength

1 The core of Yahoo’s strategy and operations is to become the starting

point for internet users, to provide must buy solutions for the world’s

largest advertisers and to deliver industry-leading open platforms that

attract developers and publishers.

0.10 4 0.40

2 Yahoo!’s full year revenue in 2008 exceeded by $ 2.2 billion compared

to 2007.0.10 4 0.40

3 For the 2nd quarter of 2009 cost cutting allowed Yahoo! to post 7%

increase in profit up to $ 141.4 million. 0.06 4 0.24

4 Revenue generated by Yahoo! marketing activities has always being

increasing between 8% from 2006 to 2007 and 4 % from 2007 to 2008.0.06 4 0.24

5 Yahoo is the second leading global internet brand and one of the most

trafficked internet destinations worldwide.0.08 4 0.32

6 Yahoo, together with it’s owned and operated online properties and

services; it also provides advertising offerings and access to internet

users beyond Yahoo through its distribution network of 3rd party

entities.

0.02 3 0.06

7 Vast product offering 0.12 4 0.48

8 Yahoo has offices in more than 25 countries, province or territories. 0.02 3 0.06

9 Part of Yahoo’s code of ethics – Customer Fixation (Customer Centric) 0.02 3 0.06Q8

*Assumption: Weightage given based on the international benchmarking exercise.

Yahoo! Inc.

IFE Matrix (2/6)

No Key Internal Factor Weight RatingWeighted

Score

Weakness

1 Failure to strike partnership with Microsoft. 0.17 2 0.34

2 Declining business in certain area (closing twenty video

services, including network site Yahoo! 360 and its Web hosting

service)

0.05 2 0.10

3 Declining internet traffic. 0.05 2 0.10

5 Decline in Net Income of Yahoo in 2008 was $ 424,298 0.05 2 0.10

6 Yahoo! advertising business is also deteriorating rapidly. 0.04 2 0.08

7 Yahoo! lost 1% in rich media revenue, 1% in sponsorship and

2% in percent in 2008.0.03 2 0.06

8 Yahoo! posted 78% in 1st Qtr. 2009 profit decline. 0.01 2 0.02

9 Stock raise to high of $ 120 in 2000 but for most 2009 it has

been trading under $ 14. 0.02 1 0.02

Total 1 3.08

Q8

IFE Matrix summarizes and evaluates the major strength and weakness in the functional

areas of business, identifying and evaluating relationship among those areas. Our IFE total

weighted score stands at 3.08 which indicate we have a strong internal position (> 2.5),

with several areas of improvement.

*Notes: Regardless of how many factors, the total weighted score from a low of 1.0 to high of 4.0, with the average score being 2.5.

Total weighted score below 2.5 characterise Company that are weak internally and vice versa. Weightage is based on international

benchmarking exercise.

Yahoo! Inc.

EFE Matrix (3/6)

Q8

No. Key External Factors Weight RatingWeighed

Score

Opportunities

1Yahoo is the second leading global internet brand and one of the

most trafficked internet destinations worldwide.0.20 4 0.8

2There are 1.1 billion internet users around the world and 211

million in the USA as of end of 2006 0.10 4 0.40

4 Growth in internet advertisement. 0.16 4 0.64

5 Broadband price drop (cheaper). 0.04 2 0.08

6Internet advertisement revenue in USA remains strong, topping $

23 billion.0.05 3 0.15

7

Federal Communication Commission (FCC) adopted flexible

access rules for users and wireless resellers in conjunction with

agency‘s early 2008 wireless spectrum auction.

0.04 2 0.08

8Increased recognition that consumers spend more and more of

their time online.0.02 4 0.08

Yahoo! Inc.

EFE Matrix (4/6)

Q8

Threat (1/2) Weight RatingWeighed

Score

1Economic growth in the USA and the world has slowed amid crisis

in housing and credit market.0.02 2 0.04

2Rising unemployment and problematic geopolitics to the mix and

USA had difficult economic back drop.0.02 2 0.04

3

In 2009, number of internet content and advertisement companies

reported disappointing financial results and lowered their forward

financial outlooks.

0.04 4 0.16

4

Yahoo operates in the internet products, services and content

markets, which are highly competitive and characterized by rapid

change, converging technologies and increasing competition.

0.05 4 0.2

6

Although internet related business have perhaps held better than

their non-digital counterparts, but have still suffered from

macroeconomics malaise.

0.06 1 0.06

7

From its first year of operation as a public company (2004), Google

has increased its operating profit to $ 6.7 billion from a modest $

852 million.

0.05 3 0.15

Assumption: Weightage given is based on international benchmarking exercise.

Yahoo! Inc.

EFE Matrix (5/6)

Q8

Threat (2/2) Weight RatingWeighed

Score

8During 2008, Google had 72% of internet traffic while Yahoo

only possessed 17% followed by MSN at 6% and IACI at 4%.0.05 4 0.20

9

Due to changes in legislative requirements concerning

technology sharing, patents rights and information security,

future expenses and profitability of the companies operating

with the industry are harder to predict.

0.02 1 0.02

10Technical and regulatory makes the projection of its business

viability for existing companies difficult.0.03 1 0.03

11

Future innovations and shifts in technology also make long

term strategies regarding the internet and software services

industry difficult

0.05 3 0.15

Total 1 3.28

EFE Matrix allow us to summarize and evaluate economic, social, cultural, demographic,

environmental, political, governmental, legal, technological, and competitive information.

Our IFE total weighted score stands at 3.08, which indicate we responding in good ways to

existing opportunities and threats, with several areas of improvements.

Yahoo! Inc.

IE Matrix (6/6)

Q8

Dimension IFE Matrix

EFE Matrix

IFE = 3.08

EFE = 3.28

STRONG

(3.00 - 4.00)

AVERAGE

(2.00 – 2.99)

WEAK

(1.00 – 1.99)

HIGH

(3.00 – 4.00)

I

Grow

II

And

III

Build

MEDIUM

(2.00 – 2.99)

IV

Hold

V

And

VI

Maintain

LOW

(1.00 – 1.99)

VII

Harvest

VII

Or

IX

Digest

Based on the IE matrix,

intensive (market

penetration, market

development, and product

development) or integrative

(backward, forward, or

horizontal integration)

strategies can be most

appropriate for Yahoo..

For instances, Yahoo need to

compete in market and

product development in

addressing new millennial

lifestyles and mobile

revolutions, in addition to

seamless integration.

Q9

*IE matrix summarised two dimension of key findings which are internal (IFE), and external

(EFE). It is easy to understand, focused to internal and external, and have multipurpose.

Yahoo! Inc.

Generic Competitive Model

Q10

Yahoo! Inc.

Value chain

Q11

General Administration

Human Resource Management

Product R&D, Technology and Systems Development

Procurement

Supply

Chain

Managem

ent

Operatio

ns

Distributio

ns

Sales &

Marketing

Service and

Support

PRIMARY ACTIVITIES

SUPPORT

ACTIVITIES

Assumption: Yahoo is going to ‘listen’ more from customer from emerging third world country.

Yahoo! Inc.

Ishikawa method and Pareto

Rule (1/4)

Q12

Ishikawa is a thought process to frame the cause and effect and mainly

used in identifying the root cause of the effect. Like a mind map, the

outcome of this exercise is in fishbone diagram.

Pareto Principle (also known as the 80/20 rule) the idea that by doing

20% of the work you can generate 80% of the benefit of doing the entire

job where, 20% is the ROOT CAUSE and 80% is the EFFECT

Yahoo! Inc.

Framing cause and effect (2/4)

Q13

LACK OF TALENT

Bad Remuneration Strict Culture Lost to Competitors

Departure Of Head HR

Passive Hiring

Budget Restriction Long Working Hours Many Competitors

Lack of Good Candidate

Yahoo not their 1st choice

Low Popularity

Losing Market share

Yahoo! Inc.

Pareto Analysis (3/4)

Q13

FACTORS RATING(Company Evaluation)

WEIGHT(Market Survey)

WEIGHTED RATING

RANKING CUM. %

Strict Culture 8 50% 4.00 51% 51%

Bad Remuneration 9 30% 2.70 35% 86%

Passive Hiring 8 5% 0.40 5% 91%

Lack of Good Candidate

6 5% 0.30 4% 95%

Lost to Competitors 5 5% 0.25 3% 98%

Low Popularity 3 5% 0.15 2% 100%

7.80 100%

Yahoo! Inc.

Pareto Analysis (4/4)

Q13

0%

20%

40%

60%

80%

100%

120%

0%

10%

20%

30%

40%

50%

60%

Strict Culture BadRemuneration

Passive Hiring Lack of GoodCandidate

Lost toCompetitors

Poor CompanyFuture Outlooks

PARETO DIAGRAM

RANKING

Cumulative %

Vital Few Trivial Many

Yahoo! Inc.

Evaluating Possible M&A

using 7’s McKinsey

Framework (1/2)

Q14

Yahoo! Inc.

Evaluating Possibility of M&A (2/2)

Q14

Dimensio

n

Issue Risk Alignment Compliance

Yahoo Alibaba Yahoo Alibaba Yahoo Alibaba Yahoo Alibaba

Strategy Planned Opportunistic Lost of IP Transfer of

Knowledge

Strong legal

bind with

protection

National Law

protection to

encourage

innovation

Not complied

as fail to

negotiate with

Gov.

Not complied

as regulated

by China.

Structure Elitist Pluralist Less control Respect Cross cultural

staff swap

Cross cultural

staff swap

Complied Not complied

as regulated

by China

Systems Mandatory Discretionary Lost of IP Transfer of

Knowledge

Strong legal

bind

National Law

protection to

encourage

innovation

Not complied

as fail to

negotiate with

Gov.

Not complied

as regulated

by China.

Staff Individuality Collegiality Self interest National spirit Team building Team building Complied Complied

Style Transformat

ional

Managerial Company

Interest

National interest

(communism)

Universal

Cultural Belief

Universal

Cultural Belief

Complied Complied with

modification

Skills "Meta-Mize" Maximize Talent

retention

Talent

Deployment

based on

national interest

Staff’s

Exchange

Staff’s Exchange Complied Complied

Shared

Values

Hard Minds Soft Minds Clash of

values

Clash of values Universal

Cultural Belief

Universal

Cultural Belief

Complied Complied

*Assumption: Board asked Yahoo Management team to study the impact if Yahoo to merge with Alibaba due to growing list of

buyer and seller in Asia.

The merger between Yahoo and Alibaba is not possible where both party unable to agree on several dimension i.e. strategy, structure, and system.

Yahoo! Inc.

Strategy Map

Q15

CustomerPerspective

Internal Perspective

Learning & GrowthPerspective

Financial Perspective

Improve Cost Structure

Increase Asset Utilisation

Enhance Customer

Value

Expand Revenue

Opportunities

Price QualityAvailabilit

ySelection Function Service

Partnership

Brand

Productivity Strategy Revenue Growth Strategy

Production Service Attributes Relationship Image

Operations Mgmt. Processes

Processes that produce and deliver products

and services

Customer Mgmt. Processes

Processes that enhance customer value

Innovative Processes

Processes that create new products and

services

Regulatory and Social Processes

Processes that improve communities and the

environment

Human Capital

SkillsTraining

Knowledge

Information Capital

SystemsDatabasesNetworks

Organisational Capital

Skills / TrainingKnowledgeTeamwork

Sustained Shareholder Value

+ +

Customer Value Proposition

Mission: To connect people to their passions, their communities, and the world's knowledge. To ensure t

his, Yahoo offers a broad and deep array of products and services to create unique and

differentiated user experiences and consumer insights by leveraging connections, data, and use

participation

Vision: Yahoo! powers and delights our communities of users, advertisers, and publishers — all of us

united in creating indispensable experiences, and fueled by trust

Yahoo! Inc.

Documents

Yahoo