Organizational Culture In Yahoo

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Over the last several decades, organizational culture has been a buzzword and one of the most influential concepts in both academic and popular management literatures. Studies have indicated that a corporate culture can be a source of competitive advantage, and as a prime factor in determining the outcome of a large-scale change effort. In the following paragraphs, this paper will discuss why culture is explored as a key factor for strategic change and the sustainability of company’s success.
What is culture?
A corporate culture can be served as a company’s identity, which defines the company itself and its behavior in order to differentiate itself from other companies. Culture can be regarded as “the way we do things here”. Schein
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In the case of Yahoo, many have pointed out that the organization culture was bureaucratic, and it displayed the characteristics of a role culture (Harrison, 1972), where decisions could not be made quickly. Also, the cohesiveness of Yahoo was fragmented, which certain employees did not have a support framework, and projects were killed or dropped off in the initial stage.
Organizational culture’s effects on Yahoo Inc.
Yahoo was once a giant in the cyber world specializing in Internet-related services and products in the 90s. However as Yahoo steps into the next millennium, it was faced with a significant diminishment of revenue and consequently losing its status among the online community. The main reason of causing the downfall of Yahoo was the organizational culture, which can be divided into two aspects-aged-old business model and human factors.
Aged-old business
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Human Factors
Since 2007, the leadership of Yahoo had changed hands five times, with each CEO staying for less than 2 years. The constant change of leadership is not healthy for the growth of Yahoo as changes introduced by subsequent CEO were not taken seriously by the employees.
To aggravate the already low morale of Yahoo’s employees, the company used an unfair revenue based performance review system to assess its employees, it led to a loss of creativity and long term planning for the company, which are essential elements for an internet-based service company.
Furthermore, the poor performance and outdated culture of Yahoo had led a brain drain as many senior engineer and good executive left Yahoo for better opportunities and leaving behind with executives who did not have enough drive to turn the company’s fortune

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