Bartz to Be Named Yahoo CEO: Now What's Next?
It looks like Carol Bartz will be taking on the thankless role as new Yahoo CEO.
Sources close to the situation told BoomTown–which had first named the former Autodesk CEO the top pick last week–that Bartz (pictured here) has been approved for the job by the Yahoo board and has accepted it.
The pick is one of the safest Yahoo (YHOO) could have made, which is typical for it, choosing an experienced and strong public company CEO, but one without a lot of experience in advertising or the Web 2.0 Internet.
Sources close to the CEO search said that the Sunnyvale, Calif.-based company’s headhunter, Heidrick & Struggles, has told many that Yahoo would also be looking for a strong No. 2 with more Internet and product experience if a CEO with less online background was selected.
Candidates for that position are numerous.
That job is not likely to fall to its current incumbent, Yahoo President Sue Decker, although Bartz could choose to keep Decker, given her experience and depth of knowledge about Yahoo.
But it could be a little odd, too, if Decker stays, since she was also vying for the CEO job and was one of the top internal candidates.
But sources close to the Yahoo board said that many inside and outside the company would have reacted badly to a Decker appointment as CEO, given that she has been No. 2 to outgoing Yahoo CEO and Co-founder Jerry Yang.
The pair have presided over a decline in Yahoo’s business and an even deeper one of its stock.
Sources who have spoken to Decker said it is more likely she will leave the company, and had stayed this long out of loyalty to Yang.
Most controversially, some are concerned about Bartz’s possible closeness to Decker and Yang–Bartz serves on the Cisco (CSCO) board with Yang and the Intel (INTC) board with Decker–seeing the choice as an attempt by Yang to stay in power at Yahoo.
Yahoo’s board has also gotten a lot more rebuffs from outside execs than expected for the top spot, because of its major challenges. While rich in assets and online traffic, the company has suffered over the last year from a range of internal and external troubles.
In a reaction piece to the possibility of making Bartz the CEO of Yahoo I posted last week, the reaction was mixed, with some lauding it as an important move to steady the long troubled company, while others called it problematic for the Yahoo leader not to have a deep Web background.
One thing is sure: Bartz does know tech, unlike former CEO Terry Semel, who hailed from Hollywood. And she also knows how to run a company like clockwork, unlike Yang, who–while inspirational–has had a rocky tenure and has been considered weak in execution.
With an upcoming fourth-quarter results report on Jan. 27 likely to be a disaster, Bartz will have a lot on her plate, including working out a much expected search partnership with Microsoft (MSFT) and deciding what to do about the constipated deal to buy Time Warner (TWX) online unit AOL.
And, oh yes, fix Yahoo’s troubled graphical ad business and weak morale!
Early investor response to Bartz has been muted, at best, despite her solid credentials.
Bartz, 60, is certainly an experienced and very well-regarded tech exec, with the talent to turn things around. She served as chairman, president and CEO for 14 years at the San Rafael, Calif.-based Autodesk, which makes computer-aided design software for engineers.
While there, Bartz presided over huge growth at Autodesk (ADSK), stepping down in April of 2006 to spend more time with her family, and has since served as its executive chairman.
She also put in stints at other big tech companies, including Sun Microsystems (JAVA), Digital Equipment Corporation and 3M (MMM).
According to her resume on Autodesk’s Web site, Bartz holds an honors degree in computer science from the University of Wisconsin.
Bartz is also on the boards of a blue chip list of tech companies and organizations, including Intel, Cisco Systems, NetApp (NTAP), and the Foundation for the National Medals of Science and Technology.
She is also exactly the kind of serious, seasoned public company CEO with tech experience whom Yahoo’s board has told investors and others it is looking for, with skills to pull off mergers and think strategically.
But Bartz also was in charge of a more old-school kind of tech company and has less experience in the faster-moving Web environment that prevails now.
Although she toughed it out successfully, Bartz underwent difficult times during the Web 1.0 era, in fact, when investors were worried about Autodesk’s prospects in the online era.
Most critically, Bartz also has less advertising experience, which is Yahoo’s principal business.
In addition, Autodesk is half the size of Yahoo.
Nonetheless, she is well-liked in the tech community and has ties to key companies Yahoo must deal with, including Microsoft.