
Yahoo investors rankle at spin-off plan, one suggests laying off 9,000 - pavornyoh
http://arstechnica.com/business/2015/12/yahoo-investors-rankle-at-spin-off-plan-one-suggests-laying-off-9000/
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makecheck
I'm really sick of "investors" thinking that trimming every little cost here
and there is going to somehow fix things. As if they didn't have dozens of
historic examples to show them what penny-pinching will do? Employees will be
pissed off! The ones that stay will basically reduce their enthusiasm and
valuable work output to 0%, if not actively sabotaging you by aggravating your
remaining customer base with incompetence. The rest (probably the most
talented ones) will leave, dooming all projects so that in 3-6 months the
company will want exactly the same cuts again.

Here's a different approach: cut at least one big idea or product line that
isn't going anywhere, that your competitors have long since dominated. Then,
aggressively refocus the company on making the remaining products great. And
that doesn't mean being cheap; indeed, they may want to _hire dozens or
hundreds_ to help the focus areas become as unique and valuable as they
possibly can be. It may even be necessary to make some pitches to attract new
investors around those products. And yes, keep giving those people iPhones and
free food; don't be ridiculous, you _need_ that to offset the fact that
there's a dozen other places they could be.

It also sure wouldn't hurt if they could at least try to get back into the
public eye. When's the last time you saw a commercial for Yahoo, or could even
name what it is that they _do_?

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dereg
I think investors could rightfully say that they "are sick of 'online
commenters' thinking they know what Yahoo should do without having any skin in
the game."

You cannot "aggressively refocus" without cutting something. For a company
like Yahoo, resource allocation is a zero sum game. Moreover, if Yahoo sees
iPhones and free food as the only things keeping an employee from leaving,
aren't they doing themselves a favor by letting those employees quit at will?

~~~
Eridrus
> Moreover, if Yahoo sees iPhones and free food as the only things keeping an
> employee from leaving, aren't they doing themselves a favor by letting those
> employees quit at will?

It's not that iPhones and free food keep people, it's the signal that even the
little expenses are going to be penny pinched with no regard for employee
morale. Which seems like a pretty good reason to get out IMO.

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steven777400
Employee morale must be terrible. Even worse is the idea that a significant
improvement will come from "eliminating employee perks like free food and
company iPhones", which are a tiny fraction of the total cost of an employee,
but the cutting of which sends a strong negative signal and may result in
further loss of productivity and morale.

~~~
shostack
Not to say there aren't issues with this, but I think there is also something
to be said around expectations. If your company is not healthy, perks tend to
suffer because at the end of the day, they don't matter if you have to fire
everyone. There's a certain type of individual who picks a company based on
perks, and when a company is in trouble, you'd much rather have employees that
are there for the business and the mission.

Now, that said, this is Silicon Valley. Free food and company phones are table
stakes for any company wanting to hire and retain top tech talent. Combined
with the fact that these two perks in particular enable improvements in
employee productivity, and I think that would be a very dumb move.

~~~
threatofrain
Free food is also a great way to transfer value to the employee without it
being taxed multiple times over. It's an under-the-counter method of payment.

------
atarian
[http://steveblank.com/2009/12/21/the-elves-leave-middle-
eart...](http://steveblank.com/2009/12/21/the-elves-leave-middle-
earth-%E2%80%93-soda%E2%80%99s-are-no-longer-free/)

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thinkingkong
From the article it seems like one institutional investor wants to lay off
9000 people.

Im not sure whats worse. The layoffs or the story circulating in the media.
Would love to hear what morale is like right now, over at Yahoo.

~~~
buserror
They are not real people for "institutional investor", they are just numbers
that costs money, money that could be /in their own pocket/ instead of wasted
buying food and other perks.

Clearly what he means is that she's not a Carly grade of CEO, firing 10k+
employees [0] and deeming the whole episode a resounding success.

[0]: [http://carlyfiorina.org/](http://carlyfiorina.org/)

~~~
yuhong
I agree, but the sad thing is that I think doing a mass cutting of middle
management would probably actually be a good idea.

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steve19
Could someone explain the tax situation to me?

If putting the Alibaba holdings into a separate company would incur tax, why
can't they just put everything else into a separate company, called say "Yahoo
Media", and leave YHOO with just the Alibaba ownership?

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georgeott
I don't get it. Why shouldn't Yahoo pay the taxes? They invested in Alibaba,
and have made HUGE gains, and if they want to realize those gains, they need
to pay the taxes.

~~~
phamilton
The shareholders of YHOO will pay taxes regardless. If YHOO wants to spend the
money from Alibaba, it will (and has already done so) pay taxes. The question
is whether YHOO should pay taxes before returning the gains to the
shareholders, who will then pay taxes.

