Banning Telecommuting at Yahoo

SMU-13-0020
BANNING TELECOMMUTING AT YAHOO!

Marissa Mayer, the newly minted Chief Executive Officer at the American multinational
internet corporation, Yahoo! Inc. (“Yahoo”) had been in her role for seven months when she
decided to issue a bold decree to ban telecommuting at the internet powerhouse. Since her
arrival at Yahoo, she had given out perks including free food and smartphones, and introduced
many initiatives such as Friday FYI staff meetings and Process, Bureaucracy and Jams (PB&J).
These initiatives were undertaken with the aim to reboot Yahoo’s culture, and help stimulate
innovation, by luring employees back to Yahoo offices and urging teams to communicate and
collaborate.
You are permitted to view the material on-line and print a copy for your personal use until 3-Feb-2015.
But, some employees still preferred to work from home – a perk that they had enjoyed since
Please note that you are not permitted to reproduce or redistribute it for any other purpose.
joining Yahoo. On Friday, February 22, 2013, a confidential memo arrived from the human
resources department, advising them of a telecommuting ban that would take effect in June.
Purchased for use by Andronicus Torp on 03-Feb-2014. Order ref F221955.

Beginning in June, we’re asking all employees with work-from-home arrangements to
work in Yahoo! offices.
1
— Jackie Reses, Chief Development Officer, Yahoo!
Educational material supplied by The Case Centre
Copyright encoded A76HM-JUJ9K-PJMN9I
Immediately, many disgruntled employees leaked the confidential memo. The memo became a
hot item in traditional and social media as soon as it was released. 2 This new policy was
Order reference F221955
expected to impact around 200 of Yahoo’s 12,000 employees. There would be little flexibility.
Employees must either comply without exception or quit. Even waiting at home for the cable
guy would be frowned upon (refer to Exhibit 1 for full details of the internal memo).
There was strong response from many chagrined employees:
This is outrageous! The main reason why I joined Yahoo was because of work flexibility.
This is definitely a backward step for all working mothers and Yahoo.
3
— An irked Yahoo employee who had requested to remain anonymous
Across the world too, there were many gasps of shock and outrage – criticising the new policy
and Mayer, Yahoo’s fourth CEO in the last five years.
1
Jacqueline D. Reses, “Approved memo from HR – Telecommuting Ban,” Yahoo! Internal Memo, February 22, 2013,
http://allthingsd.com/20130222/physically-together-heres-the-internal-Yahoo-no-work-from-home-memo-which-extends-
beyond-remote-workers/, accessed July 2013.
2
Kara Swisher, “Yahoo CEO Mayer Now Requiring Remote Employees to Not Be (Remote),” All Things D, February 22, 2013,
http://allthingsd.com/20130222/Yahoo-ceo-mayer-now-requiring-all-remote-employees-to-not-be-remote/, accessed July 2013.
3
Maureen Dowd, “Get Off Your Cloud,” The New York Times, February 28, 2013,
http://www.nytimes.com/2013/02/27/opinion/dowd-get-off-your-cloud.html?_r=0, accessed July 2013.
This case was written by Jovina Ang at the Singapore Management University. The case was prepared solely to
provide material for class discussion. The authors do not intend to illustrate either effective or ineffective handling of a
managerial situation. The authors may have disguised certain names and other identifying information to protect
confidentiality.
Copyright © 2013, Singapore Management University Version: 2013-09-09

Distributed by The Case Centre North America Rest of the world
www.thecasecentre.org t +1 781 239 5884 t +44 (0)1234 750903
case centre All rights reserved f +1 781 239 5885
e info.usa@thecasecentre.org
f +44 (0)1234 751125
e info@thecasecentre.org
SMU-13-0020 Banning Telecommuting at Yahoo!
I knew from the moment the then-pregnant Mayer parked her Louboutins beneath the grand
desk in the corner office of her Fortune 500 company, vowing to take only a short working
maternity leave with her firstborn, that your girl would not and had no plans whatsoever to
help the American workforce pave the way for a newer, more modern employment
paradigm for working mothers.
—
Denene Millner, a blogger at MyBrownBaby.com4
But despite the many publicised outcries against the policy change, there were also those
Yahoo employees who supported Mayer’s decision, and claimed that it would be a good move
towards turning around this company – which was seen to be losing ground as an internet
powerhouse. Mayer had made resetting Yahoo’s culture a priority and wanted to make Yahoo
‘the absolute best place to work’.5 The ban on telecommuting was one of the steps, as she
believed this new policy would help drive innovation through greater in-person collaboration.
To become the absolute place to work, communication and collaboration will be important,
so we need to be working side-by-side. That is why it is critical that we are all present in
our offices. Some of the best decisions and insights come from hallway and cafeteria
discussions, meeting new people, and impromptu team meetings. Speed and quality are

often sacrificed when we work from home. We need to be one Yahoo!, and that starts with
physically being together.
6
—Jackie Reses, Chief Development Officer, Yahoo!
One week after the leak, Mayer was still in need of a solid communication strategy that
leveraged her leadership towards capturing employee trust, and redressing the negative
sentiment that had come about from the telecommuting ban.

Bringing a Piece of Google to Yahoo
Yahoo’s market position and stock had declined significantly after a management decision to
reject a US$44.6 billion bid from Microsoft in 2007 (refer to Exhibit 2 for Yahoo’s stock
graph).7 The 18-year old company, once valued at US$120 billion, was now a fraction of its
former size. Yahoo had been struggling to keep pace with the other internet giants – Google
and Facebook.
It was apparent that innovation was desperately needed at Yahoo. A culture of communication
and collaboration to drive great ideas was absolutely crucial. And if this meant getting its entire
workforce back together at its premises to drive the creative think tank, then this was what
Mayer was ready to do.
Prior to joining Yahoo, Mayer had spent 13 years at Google.8 Her experiences at Google had
influenced her belief that one key reason for Google’s successes was in-person collaboration,
4
Denene Millner, “Marissa Mayer & Yahoo’s New ‘Work At Home’ Rules: The Mom CEO Show’s She’s Just One Of the Boys,”
My Brown Baby, February 26, 2013, http://mybrownbaby.com/2013/02/marissa-mayer-Yahoos-new-work-at-home-rules-the-
mom-ceo-shows-shes-just-one-of-the-boys/, accessed July 2013.
5
Patricia Sellers, “Marissa Mayer: Ready to rumble at Yahoo,” CNN Money, October 11, 2012,
http://postcards.blogs.fortune.cnn.com/2012/10/11/40-under-40-marissa-mayer/, accessed August 2013.
6
Jacqueline D. Reses, “Approved memo from HR – Telecommuting Ban,” Yahoo! Internal Memo, February 22, 2013,
http://allthingsd.com/20130222/physically-together-heres-the-internal-Yahoo-no-work-from-home-memo-which-extends-
beyond-remote-workers/, accessed July 2013.
7
8
Robert Hof, “What Google Veteran Marissa Mayer Can Do As Yahoo's New CEO (Updated),” Forbes, July 16, 2012,
http://www.forbes.com/sites/roberthof/2012/07/16/surprise-googles-marissa-mayer-is-yahoos-new-ceo/, accessed August 2013.
2/7
even though the company allowed employees to work from home on a case-by-case basis.9
Mayer initially tried to lure Yahoo employees back to the company with the offer of free
food.10 However, this did not have the desired effect.
Mayer also believed that the best ideas in Google came from face-to-face meetings.11 When she
was Google’s vice president of search and user experience, she started an initiative called
“office hours” for 90 minutes every day at 4 pm, during which time, employees could meet
with her for mini 15-minute slots.12 There was a whiteboard outside her office for employees to
book time to see her on a first-come, first-serve basis.
Bucking the Trend
The telecommuting ban was clearly contradicting the popular workplace trends of the 21st
century. According to the Bureau of Labour Statistics, one in four workers in the U.S. worked
from home some of the time. 13 Telecommuting grew by 73% between 2005 and 2011. 14
Studies also showed that telecommuting increased productivity and job satisfaction. 15
Telecommuting was a commonly offered perk in the Information Technology (IT) industry16

and widely practised in 63% of companies in the U.S.17
However, Mayer had good reasons to believe that telecommuting did not work for Yahoo. Data
available from Yahoo’s IT network suggested that many telecommuting employees were
shirking – they were not as productive as those who came into the office and were not logging
onto Yahoo’s IT network on a regular basis.18 This could be a symptom of ineffective remote-
employee management and a lack of trust between management and employees. Aligning
employees to a company’s strategy and maintaining robust communication channels where

employees contributed ideas and created innovation were paramount for a company’s success –
these were difficult propositions for a scattered workforce.
Mayer did what she must have believed any good CEO would do. She cut off telecommuting –
the unproductive practice, and declared it unacceptable.
Marissa Mayer is a CEO first and a woman second. Indeed, she is a role model for many
precisely because she made it to the top job. And as a CEO, her first job is to save her
company.
— Anne-Marie Slaughter, professor at Princeton University, previously the
director of policy planning for the U.S. State Department 19
9
Claire Cain Miller and Catherine Rampell, “Yahoo Orders Home Workers Back to the Office,” The New York Times, February
25, 2013, http://www.nytimes.com/2013/02/26/technology/Yahoo-orders-home-workers-back-to-the-
office.html?pagewanted=1&_r=0&hp, accessed August 2013.
10
Ibid.
11
Carmine Gallo, “Marissa Mayer's 'Surprise' Work-From-Home Ban Isn't A Surprise To People Who Know,” Forbes, February
26, 2013, http://www.forbes.com/sites/carminegallo/2013/02/26/marissa-mayers-surprise-work-from-home-ban-isnt-a-surprise-
to-people-who-know-her/, accessed July 2013.
12
Carmine Gallo, “How to Run a Meeting Like Google,” Business Week, September 26, 2006,
http://www.businessweek.com/stories/2006-09-26/how-to-run-a-meeting-like-google/, accessed August 2013.
13
David Amerland, “The Real Problem in Working From Home (It’s Not What You Think),” Forbes, June 24, 2013,
http://www.forbes.com/sites/netapp/2013/06/24/working-from-home/print/, accessed August 2013.
14
Ibid.
15
Ibid.
16
The Economist, “Corralling the Yahoos,” The Economist, March 2, 2013, http://www.economist.com/news/business/21572804-
technology-allows-millions-people-work-home-big-tech-firm-trying-stop, accessed August 2013.
17
Aliah D. Wright, “Yahoo Phases Out Telecommuting,” Society for Human Resource Management, February 26, 2013,
http://www.shrm.org/hrdisciplines/technology/articles/pages/Yahoo-bans-telecommuting.aspx, accessed August 2013.
18
Michael Schrage, “Marissa Mayer Is No Fool,” HBR Blog, February 26, 2013, http://blogs.hbr.org/schrage/2013/02/marissa-
mayer-is-no-fool.html, accessed July 2013.
19
Anne-Marie Slaughter, “Marissa Mayer's Job Is to Be CEO—Not to Make Life Easier for Working Moms,” The Atlantic,
February 28, 2013, http://www.theatlantic.com/sexes/archive/2013/02/marissa-mayers-job-is-to-be-ceo-not-to-make-life-easier-
for-working-moms/273584/, accessed August 2013.
3/7
While some business leaders applauded her action, others criticised her for not trusting her
employees.
To successfully work with other people, you have to trust each other. A big part of this is
trusting people to get their work done wherever they are, without supervision.
— Richard Branson, Founder of Virgin Group20
Others accused Mayer for having double standards – as she would bring her son to work and
place him in the nursery located next to her office which she built at her own expense.
I wonder what would happen if my wife brought our kids and nanny to work and set ‘em
up in the cube next door?
— A husband of an employee who would lose her work-from-home privileges21
Marissa Mayer

At 37, Mayer was the youngest CEO of a Fortune 500 Company – Yahoo, and was recognised
as one of the most powerful women in business. She was also the first woman to become a
CEO of a Fortune 500 Company while pregnant.22 Mayer had a Bachelor of Arts and Science,
and Master of Science from Stanford University. Her focus for both degrees was on artificial
intelligence.23
Mayer enjoyed defying stereotypes. She announced that she was gender ‘unaware’ and
extremely passionate about technology. Nicknamed the ‘Googirl’, she was Google’s 20th
employee and its first female engineer. She was responsible for the elegance and clean interface
of Google.com, spearheading the development of more than 100 products, and launching many
iconic products including Gmail and Google Maps.24
I refuse to be stereotyped. I think it's very comforting for people to put me in a box. “Oh,
she's a fluffy girlie girl who likes clothes and cupcakes. Oh, but wait, she is spending her
weekends doing hardware electronics”.
—
Marissa Mayer as told to New York Times in 200925
Her interests transcended her background in engineering – Mayer also loved fashion and baking
cupcakes, and once paid US$60,000 at an auction to dine with Oscar de la Renta, a world-
renowned fashion designer.26
20
Richard Branson, “Give people the freedom of where to work”, Richard’s Blog, Virgin, February 23, 2013,
http://www.virgin.com/richard-branson/give-people-the-freedom-of-where-to-work, accessed August 2013.
21
Kara Swisher, “Survey Says: Despite Yahoo Ban, Most Tech Companies Support Work-From-Home for Employees,” All Things
D, February 25, 2013, http://allthingsd.com/20130225/survey-says-despite-Yahoo-ban-most-tech-companies-support-work-
from-home-for-employees/, accessed August 2013.
22
23
John D. Sutter, “Know Yahoo's Marissa Mayer in 11 facts,” CNN, July 19, 2012,
http://edition.cnn.com/2012/07/17/tech/web/fast-facts-marissa-mayer/index.html, accessed August 2013.
24
John D. Sutter, “Marissa Mayer: From Google 'geek' to Yahoo CEO,” CNN, July 18, 2012,
http://edition.cnn.com/2012/07/16/tech/web/marissa-mayer-bio/, accessed August 2013.
25
Laura M. Holson, “Putting a Bolder Face on Google,” New York Times, February 28, 2009,
http://www.nytimes.com/2009/03/01/business/01marissa.html?_r=5&adxnnl=1&src=tp&pagewanted=all&adxnnlx=136306157
6-YzRRY641ZzY4fcuC6eA1AA&gwh=2B179B005BF246DAAE327D4A8B86C990&, accessed August 2013.
26
John D. Sutter, “Know Yahoo's Marissa Mayer in 11 facts,” CNN, July 19, 2012,
http://edition.cnn.com/2012/07/17/tech/web/fast-facts-marissa-mayer/index.html, accessed August 2013.
4/7
While Mayer was clear about her vision and strategy for Yahoo (as outlined in her first
interview as Yahoo’s CEO with Patricia Sellers from Fortune),27 she demonstrated a lack of
emotional intelligence and traits of transactional leadership when she was quick to put a ban on
telecommuting and institutionalised a new hiring practice, which required all new hires to be
signed off by her.28
And in line with her philosophy to work with the smartest people, she wasted no time in
replacing and recruiting eight out of 11 leaders on her executive team.29
In need of a strong communication strategy
What was surprising about the telecommuting ban was that Mayer did not formally announce
this ban publicly, and chose to remain silent about this issue. Only time would tell whether this
telecommuting ban was the right decision for Yahoo.
But at the moment, one week after the leak, what could Mayer do to signal the company’s

cultural reboot and win employee buy-in for the new policy and trust? And if she had delivered
the policy differently, would she have avoided all the negative press? How could Mayer reboot
the culture at Yahoo to make it more innovative?
27
Patricia Sellers, “Watch: Full interview with Yahoo's Marissa Mayer,” CNN Money, November 28, 2012
http://postcards.blogs.fortune.cnn.com/2012/11/28/marissa-mayer-full-interview/#sthash.nD0pIvic.dpuf, accessed August 2013.
28
Reuters, “Yahoo's Rigorous Hiring Practices, Imposed By Marissa Mayer, Get Flak Within Company,” Huffington Post, March
12, 2013, http://www.huffingtonpost.com/2013/03/12/yahoo-hiring_n_2859068.html, accessed August 2013.
29
Owen Thomas, “8 Of Yahoo's 11 Leaders Are New,” Business Insider, March 1, 2013, http://www.businessinsider.com/yahoo-
executive-team-2013-3, accessed August 2013.
5/7
EXHIBIT 1: YAHOO’S INTERNAL MEMO ON TELECOMMUTING BAN
YAHOO! PROPRIETARY AND CONFIDENTIAL INFORMATION – DO NOT FORWARD
Friday, February 22, 2013
Yahoos!
Over the past few months, we have introduced a number of great benefits and tools to make us
more productive, efficient and fun. With the introduction of initiatives like FYI, Goals and
PG&J, we want everyone to participate in our culture and contribute to the positive momentum.
From Sunnyvale to Santa Monica, Bangalore to Beijing – I think we can all feel the energy and
buzz in our offices.
To become the absolute place to work, communication and collaboration will be important, so
we need to be working side-by-side. That is why it is critical that we are all present in our
offices. Some of the best decisions and insights come from hallway and cafeteria discussions,
meeting new people, and impromptu team meetings. Speed and quality are often sacrificed when
we work from home. We need to be one Yahoo!, and that starts with physically being together.

Beginning in June, we’re asking all employees with work-from-home arrangements to work in
Yahoo! offices. If this impacts you, your management has already been in touch with next steps.
And, for the rest of us who occasionally have to stay home for the cable guy, please use your
best judgment in the spirit of collaboration. Being a Yahoo isn’t just about your day-to-day, it is
about the interactions and experiences that are only possible in our offices.
Thanks to all of you, we’ve already made remarkable progress as a company – and the best is
yet to come.
Jackie
Source: Swisher, Kara. “Yahoo CEO Mayer Now Requiring Remote Employees to Not Be (Remote).” All
Things D, February 22, 2013, http://allthingsd.com/20130222/Yahoo-ceo-mayer-now-requiring-all-remote-
employees-to-not-be-remote/, accessed July 2013.
6/7
SMU-13-0020
7/7
EXHIBIT 2: HISTORIC FLUCTUATION IN YAHOO’S SHARE PRICE

Source: Sellers, Patricia. “Marissa Mayer: Ready to rumble at Yahoo”, CNN Money, October 11, 2012,
Banning Telecommuting at Yahoo!


Banning Telecommuting at Yahoo

Uploaded by

Document Information

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Banning Telecommuting at Yahoo

Uploaded by

Copyright:

Available Formats

SMU-13-0020

BANNING TELECOMMUTING AT YAHOO!

Purchased for use by Andronicus Torp on 03-Feb-2014. Order ref F221955.

There was strong response from many chagrined employees:

Copyright © 2013, Singapore Management University Version: 2013-09-09

Purchased for use by Andronicus Torp on 03-Feb-2014. Order ref F221955.

sentiment that had come about from the telecommuting ban.

Bringing a Piece of Google to Yahoo

Bucking the Trend

Purchased for use by Andronicus Torp on 03-Feb-2014. Order ref F221955.

employees to a company’s strategy and maintaining robust communication channels where

Purchased for use by Andronicus Torp on 03-Feb-2014. Order ref F221955.

In need of a strong communication strategy

Purchased for use by Andronicus Torp on 03-Feb-2014. Order ref F221955.

EXHIBIT 1: YAHOO’S INTERNAL MEMO ON TELECOMMUTING BAN

YAHOO! PROPRIETARY AND CONFIDENTIAL INFORMATION – DO NOT FORWARD

Friday, February 22, 2013

Purchased for use by Andronicus Torp on 03-Feb-2014. Order ref F221955.

http://postcards.blogs.fortune.cnn.com/2012/10/11/40-under-40-marissa-mayer/, accessed August 2013.

Purchased for use by Andronicus Torp on 03-Feb-2014. Order ref F221955.

You might also like