It is, however, weird to me that everyone's so quick to blame Mayer for that. She didn't make up the game. The game stays the game. If it wasn't Mayer presiding over the decline of Yahoo --- probably still after acquiring Tumblr! --- it'd've been someone else.
Disagree. If you bought YHOO in mid-2012 before Marissa joined, you'd have doubled your investment by now. I understand there's the option value of having invested in some better stocks, and YHOO's correlation to BABA, but one could still do a lot worse than doubling the investment.
https://www.google.com/finance?chdnp=1&chdd=1&chds=1&chdv=1&...
If someone offered me a shitload of money to run a sinking ship, I would have taken the job, just as she did. With this level of compensation, she's all set for life, does not need another job ever. But, with her connections and name recognition, she will have no trouble finding one - trust me. It is a systemic problem with boards of directors hiring incompetent (but well-known) executives who keep screwing up one company after another. All about connections.
The decision to keep the BABA chunk versus spinning it off or distributing it to shareholders was CEO's decision, there were other interests at play urging other outcomes.
She still had a handle on the cost structure of the underlying business - expenses related to employee headcount, office leases, new project investments, outsourcing vs keeping things in-house - impacted the stock price to some extent, things could've been much worse.
I think she was set for life well before Yahoo! offer, and in light of recent developments with GOOG her Alphabet holdings might have appreciated at faster pace than her Yahoo! holdings.
Moreover, her decisions are not terribly out of line with her predecessors' decisions - Scott Thompson and Carol Bartz layed off, outsourced and cut expenses as well.
Could she have done a better job? Perhaps. Was she the absolute worst CEO Yahoo! could've landed? Probably not.
Columns from cringely paint a interesting, changing picture over the year http://www.cringely.com/tag/yahoo/page/2/
For the sake of exposition, let's say Mayer makes some $$MM/y, the exact number isn't really important to my point past a certain level, which she most certainly is.
What is she being paid that amount for? Let's explore each of the obvious options I see, and an expected common reaction (Had written logical, but that's not what I meant, since many common reactions are far from logical).
- To restore the company.
This clearly did not happen, if this was her job, she failed at it, and for most "normal people", getting paid that $$MM/y seems very off compared to what we might receive in such a failure.
- To as you say, preside over the decline. (age gracefully)
The argument I'll pose for the anti-Mayer sentiment in this case can be applied more broadly, but is most fitting here. One might expect this sort of role, in parity with firings, would include policies of waist tightening at all levels. I'm not even making a stance for or against these things in this argument, but the press about a slew of very exorbitant and very material benefits when paired beside firing of boots on the ground (again, not taking a stance, just observing the contrasting sentiments) give the _PERCEPTION_ of "let them eat cake", to put it glibly.
- To as you say as well earlier, be a face for the markets.
If we chose this explanation, realize the "figurehead effect" is a two way street. A famous CEO makes markets look positively on the company (is the thesis) regardless of the company, so if a company is doing badly, should not that emphasis also be on the CEO? It seems disingenuous that the CEO gets the credit for success but not for failure. I'm not saying this is logical, but it is consistent to placing significant value on a figurehead.
This last argument is the weakest, given that the markets probably take into account perceived CEO skills as part of "figurehead" status, but the BROADER market (sentiment of the people) likely can't inspect that deeply. So if the financial market loves kingmaking, the people get to see a king, and have their own expectations which do go both ways (in terms of lionizing success c.f. elon musk, and demonizing failure)
At the end of the day, each of these universes results in a very negative sentiment towards Mayer, thus my not being as surprised at that outcome.
She's being paid to take the personal risk of career-ending failure. It's a way for her to hedge the bet she made that she could turn the company around.
This goes for all CEOs, the high salary is not compensation for labour, it's a risk premium the shareholders pay to get someone to take the job. For example, in many jurisdictions, the CEO is personally responsible for certain crimes that employees are committing, e.g. the CEO can go to jail if the company commits tax fraud.
That said, it's also a complete old boys' network and the risk premiums are extremely inflated, but that's nepotism for you.
And I don't really think anything is career-ending for that matter. I mean, look at the mess there was after Carly Fiorina and she's found other things to do.
Your final line re: network/inflated premiums seems to agree with the broader sense of what I was saying, unless I'm misunderstanding?
It's here in this picture:
http://static2.businessinsider.com/image/566edfb272f2c150028...