Yahoo CEO gets flak for more rigorous hiring
Yahoo CEO Marissa Mayer challenged her staff to get better at recruiting.
SAN FRANCISCO - Yahoo Inc Chief Executive Marissa Mayer was asked at an all-staff meeting several weeks ago whether her rigorous hiring practices had caused the company to miss out on top engineering talent in Silicon Valley's hyper-competitive job market.
Mayer dismissed the complaint that she had refused good candidates because they did not have degrees from prestigious universities, and instead she challenged her staff to get better at recruiting, according to an employee who was at the meeting.
"Why can't we just be good at hiring?" Mayer said, playing off a line from what she called one of her favorite movies, 1989's "Say Anything", according to the employee. He did not want to be identified because he was not authorized to discuss Yahoo's internal matters.
The question, according to Yahoo insiders, reflects wider concerns among hiring managers and rank-and-file employees over the way Mayer has tightened hiring practices since becoming CEO last July, as part of an effort to transform Yahoo's workforce and culture.
Mayer insists on personally reviewing every new recruit, a practice that supporters say brings needed discipline to the company. Critics, however, say her high standards are hampering Yahoo's already challenged ability to fill vacancies.
Even before Mayer's now-famous ban on working from home drew controversy last month, Yahoo was struggling with the perception that its best days are behind it, according to recruiting consultants. The company also faces fierce competition for talent in Silicon Valley, where Google Inc and Facebook Inc hold more prestige, while startups offer the lure of shares in an eventual IPO.
Rick Girard at Stride Professional Search, who specialises in placing engineers with start-ups, said a Yahoo job offer was still viewed as a "back-up" option by many of his clients.
"We only had one person who ended up taking the job at Yahoo. I think it was because she wanted to be at a larger company," he said.
Yahoo declined to comment for this story or to make Mayer available for an interview. The CEO told investors in January that Yahoo was seeing a marked increase in the volume and quality of job applicants, and that attrition among "highest-performing talent" was significantly lower than in the past.
Still, Yahoo has almost 900 jobs open, representing nearly 8 percent of its workforce of 11,500, according to its website. Some of the openings are months-old. In comparison, Google has almost 1,000 open jobs, but that is just 2 percent of a workforce that is more than four times the size of Yahoo's.
Mayer joined Yahoo after a 13-year stint at Google, during which she helped develop its flagship search product. She is the third CEO in about a year to lead Yahoo, whose revenue had stagnated amid competition from Google, Facebook and other Web companies, an exodus of senior executives, and an internal reorganization that eliminated thousands of jobs.
Mayer quickly nabbed two high-profile executives to join her team: Chief Financial Officer Ken Goldman, who has three decades of experience at leading software and Internet companies, and Chief Operating Officer Henrique De Castro, a former Google colleague. She also quickly won favor with Wall Street - Yahoo's shares have risen about 47 percent since she joined.
"Stopping the hemorrhaging is job one and I think she's accomplished that almost by virtue of her presence," said Neil Sims, a managing director with executive recruiting firm Boyden.
Job two is to modernise Yahoo's dated consumer Web products and services, which have an impressive audience of roughly 700 million people, but have not kept up with trends in mobile computing and social networking. Hiring new talent is critical to that success, analysts said.
"They have a lot of people who create the products that Yahoo is known for, but it's not the same products that Yahoo needs to offer if it's to have the same scale in five years that it has today," said Ken Sena, an analyst with Evercore Partners.
To make Yahoo a more attractive place to work, Mayer has borrowed from the Google playbook and provides employees with free food and the latest smartphones.
But she has also firmly stated at a staff meeting that one Google policy she will not be importing is its famous decree that employees get to spend a fifth of their time on personal projects, according to people who were at the meeting.
It's clear that Mayer wants to impose more discipline on Yahoo's workforce after years of management turmoil.
"From the time she got there, she was kind of shocked by the culture, by the fact that so many people were working from home that you couldn't even have a Friday staff meeting," said another person familiar with Mayer's thinking.
Mayer has more than a dozen ideas to make the organisation more efficient and orderly, the person said, adding, "You're going to continue to see important and sometimes controversial and tough moves made."