Yahoo's Bartz Making All the Right Moves

Yahoo CEO Carol Bartz is expected to announce a company-wide reorganization as early as Wednesday of this week, according to reports. In order to streamline decision-making and cut expenses, Bartz will dismantle Yahoo's bloated and confusing matrix management structure in favor of a flatter, more centralized organization.

This will be a classic top-down management restructuring that will include group and divisional consolidation and the deletion of entire layers of management. I also expect Bartz to opt for direct control of operations, as opposed to bringing in an operating chief to replace outgoing president Sue Decker.

Just six weeks after taking office, the reorg is a Bartz's top priority for two reasons. First, it's a necessary initial step in cutting expenses and improving operating profits. Second, strategic changes can then be implemented far more readily and quickly. And that's what's coming next. Once Bartz has her key lieutenants in place, they will determine which products and projects to focus on and which to cut. It's about time.

For the record, I don't expect Bartz to sell Yahoo's search business. It's simply too critical a growth engine and that's what Yahoo needs.

Finally, after years of meandering, Yahoo will again have leadership and direction. Top executives will be empowered to carry out their mission in an organization streamlined for decision making and execution.

I believe we are seeing the beginning of a successful, Mark Hurd of HP-style turnaround. Jonathan Schwartz (Sun), Dan Hesse (Sprint) and all the rest, pay attention; this is how it's done.