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Yahoo's Organization Structure - Research Paper Example

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Yahoo uses a hybrid organizational structure that combines geographical, functional and product structures. This is demonstrated on the company’s management page where there are heads of different divisions some categorized geographically and others functionally (Yahoo Para 1)…
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Yahoos Organization Structure
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Download file to see previous pages For example Executive Vice President, Service Engineering & Operations demonstrates division by function while Executive Vice President, Americas and Senior Vice President & MD, EMEA Region show division by geography. Yahoo has been too reliant on its U.S. business over the years which mean that the approach it uses in the US would not be the same as what it needs to use in the other regions where it is still growing its market share. This makes it sensible to separate the US business unit from those of other geographies. For an organization of its size with more than 13,700 employees division by function makes it easier to demarcate responsibility for revenue targets and expense management. What is your company’s strategy? Is it successful? Yahoo demonstrates two strategies. In its dominant US market, the company is pursuing organizational renewal to reverse organizational decline and put the firm back on a more appropriate path to success. The company’s decline was largely due to over-expansion of its product line and inability to deal with shifts in consumer demand for platforms that are provided by its major rivals: Facebook and Google. Yahoo’s new CEO plans to do away with about 50 properties to enable the company refocus on its core business (Scott Para 1). According to the new CEO, Yahoo has been doing way too much of which only a few things were being done really well (Scott Para 5). The second strategy that Yahoo is pursuing is growth through international strategy. Yahoo’s internationalization is for market-based reasons. Currently Yahoo is too reliant on its U.S. business. The company seeks to capture part of the market share of the growing middle class in emerging economies. Part of this international market development strategy will be through offering of country-specific services. So far none of these two strategies have been implemented long enough to evaluate whether they are successful or not. Does your company operate within NAFTA or the European Union? Do those free trade agreements/ free trade union benefit or harm your company? Yahoo operates both within NAFTA (US, Canada, Mexico) and the European Union (Germany, Italy, Scandinavian countries etc.). Through its numerous offerings Yahoo is essentially a service-provider. NAFTA eliminated trade barriers in most service sectors and a couple of products as well. This reduction / eliminations of tariff increases trade within the region and hence give confidence to more individuals to use Yahoo platforms to advertise or sell their products or services within the region. This way NAFTA benefits Yahoo. Using the same argument one could say that by increasing trade within continental Europe, the European Union also indirectly benefits Yahoo by increasing the need for an intercontinental platform to advertise or trade in products and services. The company acknowledges as much, though indirectly, in its annual report where it highlights that fluctuations in foreign currency exchange rates as a possible risk factor. Does your company operate in low or high labor rate countries? How does your company try to reduce labor costs? The majority of Yahoo’s staff is located in the US. The company does not have a specific policy geared towards obtaining low or high labor rate countries. Moreover, the company’s core business is largely dependent on proprietary software which is mostly developed in the US. The company has however in some instances purchased technology and license intellectual property rights (Yahoo, Yahoo! Annual Report 2010 11). Yahoo’s solution to lowering labor costs is to eliminate non-performing business units and then to reduce headcount. The company has conducted six ...Download file to see next pagesRead More
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