Yahoo! – Some Thoughts on Regaining Former Glory

Yahoo Building Photo

I try my best not to call out particular companies in my writing though from time to time I have done so. I do so when only absolutely necessary to make a point that I would like to make, basically because it’s not great business to have people (or entire companies) upset with you. Also, though I work for enlightened people who have given me freedom to express my personal ideas through presentations, blogs podcasts, etc., I don’t want to strain that relationship. As always, the thoughts expressed here are my own and not necessarily endorsed by my employer.

Yahoo Building PhotoCaveats aside, I wanted to address something that has been weighing heavy on my mind. I have found that expressing myself through writing has a tendency to clear my mind so you can view this blog as a form of self-therapy. My topic this week is the fall of a company I (still) have a great deal of affection for, one that I continue to support. To me this company “was” the internet and their rise and past prominence represented what was best of Silicon Valley. More troubling is their subsequent lack of direction and downfall represents what can be thought of as the worst of Silicon Valley. I am not the first (and will not be the last) to weigh in on the tragedy that goes by the name of Yahoo!

I have often stated that when a company has hit “rock bottom” (as in my previous blog) it is time to acknowledge some core truths about their business and, only then, can the healing process begin. There is much to heal at Yahoo! I speak not simply about financial concerns. Although these are paramount, in many respects financial difficulties are merely the symptoms of much larger problems, for instance, confidence in Yahoo! as a brand. While many, myself included, continue to use Yahoo!, it has, for some time, lacked the cache’ that brands like Google, Facebook, Apple (and even Microsoft) have. Not only does it not seem to have a particular direction, if it had some direction, that direction would not be seen as “cool”.

rocket photoThis begs the question as to what direction should Yahoo! take. This is where I believe Yahoo! has squandered some opportunity because I believe that the only mission worthy of enticing talent back to a failing enterprise must be a bold one, a moon shot if you will. To date, Yahoo! appears to have taken no real bold moves (with the exception of over spending on Katie Couric). Their competition, the ones “eating their lunch” have – Alphabet (formerly Google) has multiple moon shots, including self driving cars, Elon Musk is in Fremont forging a new future of electric cars and rockets, Apple is rumored to be developing their own car, etc. Technology IS talent and talent will go where it is inspired. I thought of this the other day when I attended an event at AOL. Tell someone that you attended an event at AOL and the first thing out of their mouth is “you mean they are still in business?” Yahoo! will be the same in very short order unless they can change perception. To me that will begin when they find their own “moon shot.” It will not happen anymore with only incremental change.

I remember reading somewhere that the problem with Silicon Valley is there is a tendency to solve the problems of no longer living with your mother. There are a ton of startups not taking on the larger battles society is facing (and many like global warming that society is currently losing). I think there are two lessons for Yahoo in this; one, they must begin acting more like a startup, and two, they must be a startup that is actually solving problems whose solutions will be meaningful and impactful to society at large.

collegeWhile there are a number of societal problems Yahoo could choose to tackle, like global warming or clean and safe drinking water, let me suggest one that I feel would be a good fit – education. In fact, I have a great name for it, Yahoo University (or as my wife affectionately calls it – Yahoo U). Why education? Yahoo is now primarily a content provider so a great deal of infrastructure is in place to begin solving the problems of the current educational system. I think that smart acquisition or partnerships with a number of companies operating in this space (think Khan Academy and the various coding bootcamps) could give Yahoo University an advantage. It would certainly have name recognition (which is one of its few convertible assets outside of Alibaba).

Attempts to solve the problems of education for the way we work today have been made by many parties, but no satisfactory solutions have been made. At issue is creating education that is actually useful to the general populace in positioning them for gainful employment in our quickly shifting, knowledge-based economy. Traditional classroom education has suffered because it still dictates “what” to learn instead of “how” to learn. For example, what good is it to teach someone Objective C when it is no longer being used or desired in the real world? What happens when the world has moved on to Swift? The real issue is to teach someone how to teach himself or herself to learn Objective C so that when they need to learn Swift they have the skills to teach it to themself. In other words, we must move away from content for content’s sake and teach the mental agility necessary to survive. Technology has existed for sometime to solve this particular issue yet we have done little to use technology for this goal. Instead we have used the technology to shovel content. It’s as if we teach people to drive a Ford and when given a Chevy they cannot drive it.

moneyWhile I could rant more on this topic, I feel it is important to also address how one would go about making real money from such an endeavor and how Yahoo can reinvigorate its sagging stock prices. It would be most obvious that Yahoo University could borrow the model from existing online educators such as the University of Phoenix, but this would be a mistake. Anyone paying attention to this space would know that the fortunes of private sector online educators is bleak. I, myself, worked for the Apollo Group, the parent of University of Phoenix and personally know some of the problems that have crippled them over time – things like over-reliance on government-backed student loans, high tuition costs, students with high debt and poor prospects of repaying debt, etc. Online education was a brief success and made some wildly prosperous – just not necessarily the students.

stock marketI propose a more radical solution for Yahoo University – free education. But how can you make money providing education for free? You can, if the education you provide actually has a value to the world at large. I propose that students entering courses that have a good prospect of being placed in real jobs be given a free education with the stipulation that Yahoo University be reimbursed when they student is placed in a job related to their education. This aligns the motivation of the educator in doing what is necessary to provide marketable skills and the motivation to actually ensure that the student get a job! Being in the staffing industry I know that a properly educated and placed individual can provide enough compensation on the back end to justify the expense on the front end. In talking with my friends in software development, this is exactly what is happening in countries outside the United States with H1-B candidates taking the jobs that could be filled with Yahoo University graduates.

As to the issue of stock value, I think that taking this course of action will make it much easier to increase shareholder value. If I were the CEO of a company on the course described above, I would take my argument not only to Wall Street but to Main Street. The incredible societal value of providing free and meaningful stock marketeducation and job placement would inspire investor outside of Wall Street. While I am the last to wrap myself in the flag, there is certainly not only something not only highly practical to this plan, but something downright patriotic in solving American problems with American citizens. I don’t find it hard to imagine that people would want to purchase shares of a company that had such a unique and worthy vision. Of course, it would not hurt that as Main Street bought shares that Wall Street would join.

I do not know Marissa Mayer and it may be that where Yahoo! is now has nothing to do with her leadership. She may be the most competent individual on planet earth (we all know she was successful at Google), but what matters is perception, and right or wrong, the perceptions of Marissa Mayer are predominantly negative, both with the public at large and within the employees (and ex-employees) of Yahoo! I cannot see how Yahoo! could make the necessary transition without removing the current CEO.

I guess you can file this blog under the title of a modest proposal. I wish Yahoo all the best and I am sure that there are many others who agree and would like to see this once proud company bounce back. If you, dear reader, agree, I would suggest that you take the time to share this post with others, like this post, or feel free to leave your comments. Perhaps the folks at Yahoo will take notice. Perhaps if they did they might find something valuable as they face the tough times ahead. At the very least one can hope.

Agile – It’s All About Making Better Decisions

cognitive bias

I’ve been spending a lot of time recently doing research, reading and presenting on human cognitive biases. To the initiated, cognitive biases are defined as

“…a systematic pattern of deviation from norm or rationality in judgment, whereby inferences about other people and situations may be drawn in an illogical fashion. Individuals create their own ‘subjective social reality’ from their perception of the input.” (Wikipedia Definition)

In other words, cognitive biases exist when there is a gap between our perception of reality and objective reality. For example, there is the “confirmation bias” which is our human tendency to seek out or interpret information that confirms one’s existing opinions.

everestWhile the term “cognitive bias” is relatively new (it was coined in 1972 by Amos Tversky and Daniel Kahneman), researchers have already uncovered literally over a hundred cognitive biases, some which are relatively tame like the “google effect” (or digital amnesia), where there is a tendency to forget information that can be easily researched, to ones that can lead to more disastrous consequences like the Sunk Cost Fallacy where people justify increased investment in a decision based on prior investment instead of looking only at future efficacy. The Sunk Cost Effect, along with the Overconfidence Effect and Receny Effect, played a role in the May 1996 mountain climbing tragedy, made famous in the movie Everest, that resulted in the death of five experienced climbers.

A great number of cognitive biases have been found through the work of behavioral economics researchers like Dan Ariely who wrote the wonderful books Predictably Irrational and The Upside of Irrationality. Underlying all of classic economics is the concept of homo economicus, or economic man who behaves in rational ways to maximize individual returns and acts in his own self-interest.   Unfortunately, this is not the case and humans often act irrationally (and predictably so) because of their inherent cognitive biases. Humans all have biases for loss aversion and would choose to avoid loss over a larger corresponding potential gain and thus act as “homo irrationalis” as discovered by behavioral economics instead of “homo economicus” as predicted by classic economics.

It is our cognitive biases that cause us to make irrational decisions. Since behavioral economists found many of these cognitive biases, it was not a great leap to see how cognitive biases would be a paramount concern for the economics of software development. In my coaching practice, a great deal of my time and effort is used in helping organizations make better decisions about software development. Many times the optimal decisions are counter intuitive to people’s inherent biases so my job (and my passion) is helping companies see the world of software development differently so that, when it comes down to making a decision, they have all the knowledge necessary to make the optimal economic decision.

smokestackOne of the most prevalent biases in software development is to see the world in a mechanistic / Tayloristic manner. Taylor’s viewpoint was fine for the old world of physical work, but does not hold up in the complex knowledge work being done by software development professionals today. Unfortunately, most of the people making software development decisions are predominantly influenced by this old, less optimal way of viewing the world, and, as a result, make sub-optimal decisions. For example, in the mechanistic worldview, adding more people to an effort results in a corresponding increase in output. If there is an existing team of seven people and we add seven more then we would (if we hold this mechanistic bias) expect the work to be approximately twice as fast. However, like the behavioral economists that found the real world to be counter intuitive to homo economicus, actual studies have found that the need for increased communication of knowledge work nearly outpaces any incremental increase in individual productivity (see Top Performing Projects Use Small Teams). I have always said that if you want to double productivity of a fourteen person team all that is necessary is to create two teams of seven.

The mechanistic bias can also be seen in many of the ways that the Agile philosophy is implemented. For example, the scrum framework is often trained as a series of ceremonies and actions with little or no understanding of the reason such mechanistic actions are successful. “Scrum Masters” are “certified” with only two days of training and a simple test. The training deals with ideal situations, but when the scrum master actually has to implement scrum, he or she is woefully unprepared. In the real world compromises and decisions must be made. Without understanding the underlying “why” of agile and the basic nature of software development, the decisions and compromises that are made are not optimal. In my experience, this is why project managers are tougher to train than people with no project management experience. When faced with ambiguous information and the need to make optimal decisions, project managers tend to fall back on existing mechanistic knowledge and the decisions made range from mildly irritating to completely disastrous. As I have often pointed out, to say that one was successful with waterfall reeks of confirmation bias because it begs the question of whether or not one would have been more successful using another methodology or framework like Lean or Scrum.

rental carIn addition to the mechanistic bias, software development suffers from another bias, the project-centric bias, which is the tendency to see all work done in terms of projects. Unfortunately, the project-centric bias is so ingrained in companies that there needs to be some radical changes to the way we view software development across all areas, including accounting. Viewing work as a project when we are actually working on software products results in a whole raft of poor software economic decisions like concentrating on features more than quality and security. Remember that no one washes a rental car.

As I think back on my coaching work in agile, the blogs I have written, the many discussions I have had and the presentations I have made, I think that all of these boil down into one very simple thing – my work is all about helping people understand the true nature of the software development business process and, thereby helping them to make better decisions. Understanding our cognitive biases, therefore, is extremely important for my clients and myself because, in the end, Agile is all about making better decisions.

The VW Scandal as a Cautionary Tale – Cultivating Fear Always Ends Badly

culture of fear

For those who might have been taking a long vacation from reality, Volkswagen recently became embroiled in a scandal regarding some of its cars with diesel engines. It seems that when these cars where tested for emissions, a “defeat device” (a software program), would detect that the cars were being tested and change the performance accordingly. This led to claims that their diesel cars were better for the environment than their competitors. In all there appears that over 500,000 of these “clean diesel” cars are currently on the road, mostly in the United States.

vw emissions testShortly after this scandal broke, the finger pointing began. Under pressure from a United States House of Representatives Oversight and Investigations panel, Michael Horn, Volkswagen’s United States Head, stated, “This was a couple of software engineers who put this in for whatever reason.” While I find it very disingenuous and slimy to through your software developers “under the bus”, albeit one with flowers and the smell of Patchouli oil, the question that remains, assuming Horn was not involved, is why would these “rogue” developers decide to create something like a “defeat device” in the first place?

When I first heard of the “rogue” developer explanation, I realized there are two possible reasons – the developers do not care about their work or the developers acted out of fear for their jobs (or both). In either case the root cause is that there is a culture that discourages employee disengagement and fear. This means that while Mr. Horn might be accurate that it was “rogue” developers who are responsible for the act of creating the malicious software, the responsibility for corporate culture rests squarely with leadership. Since Horn was the top leader then he bears the brunt of the responsibility for the culture that would allow/coerce developers to make such a disastrous decision, one that could cost VW billions.

vw diesel engineThat is not to say that the developers who made the changes should be held blameless, but it is not unusual for corporate culture to treat developers more like minions than the professionals that they are, shielding them from making decisions we would expect respected professionals to make. Fear for their very jobs, while puzzling in an environment where good developers can pick and choose, was most likely the final calculation that allowed the developers to write this malicious code. And not only developers, but where was the Quality Assurance during this process? Again, it is poor culture that allows such misdeeds to flourish.

My educated guess received some support in a recent column in Road and Track by Bob Lutz, a former Genera Motors executive. Lutz placed the blame for the recent scandal directly on the shoulders of ex-Chairman Ferdinand Piech. Lutz stated that Piech’s tenure was distinguished by a style of leadership which was “a reign of terror and a culture where performance was driven by fear and intimidation.” Lutz described one exchange with Piech regarding the body fits of the new VW Golf where Piech bragged about his “recipe” for better body fits.

“I called all the body engineers, stamping people, manufacturing, and executives into my conference room. And I said, ‘I am tired of all these lousy body fits. You have six weeks to achieve world-class body fits. I have all your names. If we do not have good body fits in six weeks, I will replace all of you. Thank you for your time today.”

While this leadership style might work from time to time, it is motivational junk food. It creates a toxic culture where the long-term effects will one day negatively manifest themselves, in this case, with “defeat devices.”

Studies have shown that only about 30% of US workers are engaged in their work. That fact, along with dozens of years of experience, have led me to believe a huge percentage of companies use fear as their primary means of motivation. My advice to leaders is to pay attention to the VW scandal and heed its warning. You will most certainly reap what you sow, karma will catch up with you and cultivating fear will always end badly.

You Say You Want to Change the World?

Eye on World

Do you really want to sell sugar water, or do you want to come with me and change the world?

—Steve Jobs, recruiting John Sculley to become Apple CEO, 1983

We’re here to put a dent in the universe. Otherwise why else even be here?

—Steve Jobs

Changing the world. That’s some pretty heady stuff. I’d like to think we all want to change the world, to put our own dent in the universe. I know that when I talk about my work with SIS and 10XP Solutions I frequently mention that my goal is to change the world of staffing and change the world of software development. Both of these are laudable goals, but this merely begs the question, how does one go about changing the world?

The answer is deceptively simple, but, like so many things in life, it is hiding in plain sight. The problem is that most of us fail to approach the problem correctly. We believe that if we are to change the world that we have to perform some action on the world itself – we need to create something that didn’t exist, we need to convince someone of something new – but this is the wrong place to begin. If we wish to change the world, we must first change the way we view the world.

World SculptureThe world only exists as we perceive it. This perception exists regardless of whether there is (or isn’t) an objective reality. Of course, we should try to passionately and unwaveringly pursue objective reality, but we should always acknowledge that our view of reality might not be correct and the way we behave, as a result of our perception, might not be optimal. Therefore, when contemplating the qualities that will allow us to be the leaders that change the world, we must never forget humility or curiosity. Our world will never change until we allow the freedom for our perception of the world to change.

When we look at those things that we say have changed the world, what, in fact, has changed? Is the world really radically different or is it our perception that has changed? I think if we give it any thought at all we would easily conclude that the world really doesn’t change much, but when new things, whether products or ideas, come our way and these allow us (or force us) to see the world differently, then the world itself has changed.

World in my handThe first step then when we want to change the world is to first change our own world by changing the way we view the world. Once we have changed the world in that manner the next step is to figure out how to lead and convince others that our worldview is the correct one. This is where the advice from my last blog, “You Can Be Right or You Can Be Successful” comes into play. We need to help people see the new world, not because we are right, but because we have made the fundamental mental shift ourselves and find that the new worldview is more successful.

Steve Jobs made monumental changes to the world; he certainly made his dent in the universe. It is my opinion the reason he was successful was because before he changed the world, he changed himself and his view of the world. If we wish to follow in his footsteps and the many others who have changed the world, we need to have the curiosity to keep seeking, the humility to acknowledge that we don’t have all the answers and, once we have seen the world change by the new views we hold, the patience and compassion to lead others to see the world as we now see it.

You Can Be Right or You Can Be Successful


I recently had lunch with one of my friends and we spoke about some issues that one of his teams was having. As a new team, they were still in the storming and norming stages and they were having some fairly heated discussions around some philosophical issues of software development. For those not familiar with software development you might think there is not really anything to get all worked up about, in which case you would be surprised at the level of intensity some folks have. The discussions the team was having bordered on “a holy war” and there appeared to be little hope for compromise.

I asked my friend a simple question, “would you rather be right or be successful?” This question is one I like to use and is a variation of the quote “you can be right or you can be happy” which I have, until I did the research for this blog, incorrectly attributed to Dr. Phil McGraw (for those who care, the quote is from Gerald Jampolsky). Basically, there are times when we can be right and we can be happy but often we have to make a choice. The same applies to success at work. There are times when we can have it all, but sometimes we need to choose whether we wish to be right or effective.

Recently there has been an outbreak of measles in the United States due to the fact that some parents have not been vaccinating their children. The reason these parents were not vaccinating was due to false science that has since been refuted. In other words, the truth is unequivocal; vaccines do not cause the reactions that anti-vaccination parents fear. These parents are 100% wrong.

Since these parents are 100% wrong and not vaccinating children can lead to adverse health issues in the community, it makes sense that public health officials would try to change the minds of the “anti-vaxxer” parents. They did try. Their first approach was to try and convince the parents by presenting the scientific facts. They theorized that by knowing the true facts, people would make the correct decisions. That effort failed. It seems that merely presenting facts did not change peoples’ minds.

succes04If presenting facts does not work, public health officials concluded the reason for the resistance was emotional and that emotional arguments would be more effective in convincing parents to vaccinate their children. That effort failed as well. (For a more details analysis see

This was surprising. Furthermore, not only are people not convinced by facts or emotion, but that when presented with factual or emotional arguments, the anti-vaxxer parents in the study were LESS likely to vaccinate their children. Evidence suggests that once someone has a strong belief in something, anything (or anyone) contradictory to that belief is seen as a threat. People who are threatened will cease to listen, much like a child will put a finger in their ears. People will erect walls to keep you out.

Knowing this, should we just give in to despair? Of course not. We need to stop trying to be right, whether presenting factual or emotional arguments, and concentrate more on being successful. The question is – what works in convincing people with strong beliefs to change their position? There is something that has been shown to work, something that lowers peoples’ walls and defenses and that thing is listening.

Instead of telling or implying people are wrong, we need to take the time to ask them about their position. We need to stop threatening them. Given the space to explain their position, people will not only feel less threatened, but also they will have to defend their own position and when tasked with defending their own position, people will slowly be able to see that they might not be the experts they think they are. This is where the walls and defenses are lowered so that other arguments might be entertained and listened too. Furthermore, showing respect to individuals and spending time with them will also make it more difficult to not listen. We listen to our friends not our antagonists.

A study of midwives in India found that arguments did not work with them either. What did work was “the rule of seven touches” which marketers know well. You must have meaningful contact and get to know someone (seven touches) before they are willing to trust and listen to you.

succes03This applies to my work of transforming companies from waterfall to agile approach. While I may be 100% correct and it may make me feel good to be right, by presenting my viewpoint as THE way, I will not meet my objective. If I choose to be successful then I must take a different approach. I need to get to know the people involved, understand their concerns, not threaten their ideas, but allow their defenses to be lowered by listening to their ideas and then, and only then, if my ideas are truly right will I have the chance to convince them of or, better yet, guide them to the truth.

In the end you can be right or you can be successful. You can’t always be both.

Accenture Ends Annual Review (and Admits Earth Orbits the Sun)


Recently I read an article from the Washington Post titled “In big move, Accenture will get rid of annual performance reviews and rankings” which was in a section called “On Leadership”. I like my headline better (though it has probably blown any shot I had to work at Accenture).

To classify this as somehow a bold or “big move”, place it in a section titled “On Leadership” only highlights the complete lack of scientific understanding of what actually works and does not work. This is not leadership, but a damning indictment of the lack of leadership in the workplace. The real issue is this is “big news” and it takes companies so long to not only admit the obvious, but to act on overwhelming scientific evidence suggests some of their unquestioned practices are utterly wrongheaded.

orbitIn the case of annual reviews we have such a wealth of evidence they do not work it is amazing so few companies have actually done away with them. Daniel Pink, in his book Drive, states

…performance reviews are rarely authentic conversations. More often, they are the West’s form of kabuki theatre – highly stylised rituals in which people recite predictable lines in a formulaic way and hope the experience ends very quickly.

Pink’s book has been out for six years now, but it is based on scores of science that was conducted years and decades prior to its publication. We don’t need to look farther than W. Edward Deming, who wrote way back in 1986, in his seminal book “Out of the Crisis”, that annual reviews are “Deadly Disease #3” and

The performance appraisal nourishes short-term performance, annihilates long-term planning, builds fear, demolishes teamwork, nourishes rivalry and politics… it leaves people bitter, crushed, bruised, battered, desolate, despondent, dejected, feeling inferior, some even depressed, unfit for work for weeks after receipt of rating, unable to comprehend why they are inferior. It is unfair, as it ascribes to the people in a group differences that may be caused totally by the system that they work in.

whyWhat amazes me most about this annual “kabuki theatre” is everyone intimately involved with the system (managers and front-line employees) literally hates this process. Even if the people at the top of the company bury their heads in the sand when it comes to real, scientific evidence, how can they fail to acknowledge the tidal wave of anecdotal evidence from their own people?

Steve Jobs was once asked how he learned to run a company in his early 20s since he had no formal business training. His answer sheds a great deal of light on why only 6% of fortune 500 companies have gotten rid of annual reviews and rankings though the evidence is overwhelming that they do not work.

You know, throughout the years in business I found something, which was I’d always ask why you do things. And the answers you invariably get are, “Oh, that’s just the way it’s done.” Nobody knows why they do what they do. Nobody thinks about things very deeply in business. – Steve Jobs – The Lost Interview

So, if Jobs was right, as I believe him to be, then a plausible explanation would be that even highly compensated CEOs are unable to properly ask the “why” of things or perhaps top-down control has led to a culture where why is not asked out of fear or complacency. I would guess the CEO of Accenture, since he is quoted in the article, was the decision maker of the “big move.” While he might think himself progressive since he is on the vanguard with respect to his peers, the more appropriate “why” to ask would be “why did it take so long?” and “why haven’t others made the change?” or maybe “which CEO will be next to admit that the world is indeed round?”