Yahoo’s New HR Strategy: Useful Tips for HR Pros

Realigning HR strategy when a company moves in a bold, new direction can be done in a way that’s actually well received by stakeholders.

Yahoo decided to craft a new HR strategy when it transitioned from public ownership under Verizon to private ownership by Apollo Global Management in 2021.

In an episode of the HRMorning podcast “Voices of HR,” Lisa Moore, Yahoo’s chief people officer, shared how a more equitable and flexible HR strategy aligned with the company’s transformation.

New HR Strategy Initiatives

Moore identified two primary initiatives of her new HR strategy:

1. Re-evaluating people skills with a focus on agility: Yahoo placed a strong emphasis on agility as a core competency for its workforce. This shift reflected the company’s need for employees who have an appetite to learn new things and can adapt quickly to change. Transparency about this evaluation process is important, Moore said, because it enables employees to opt in to new ways of working.
2. Promoting inclusivity through benefits: The company expanded its benefits package to be more inclusive. This includes enhanced coverage for same-sex couples and individuals going through non-traditional birth journeys.

“We’ve had some great feedback on that from our employee population. And then that becomes a self-fulfilling prophecy because then our people are talking to their networks, and people learn what we’re doing,” Moore said.

Agile Work Models

Yahoo adopted a “squad” model in several business units, which involves cross-functional teams working together on challenges. This approach encourages:

• asking “what if” questions
• avoiding entrenchment in prior experiences
• embracing innovation and collaboration
• workshops, and
• role modeling.

Moore emphasized the importance of giving employees the opportunity to research and understand new working models, viewing this self-directed learning as an indicator of engagement.

New HR Strategy for Performance Management

In a significant move, Yahoo eliminated annual performance ratings. Instead, the company is focusing on:

• frequent one-on-one check-ins between managers and employees
• encouraging regular feedback throughout the year, and
• developing specific success criteria for each business unit to guide feedback conversations.

This new HR strategy aims to make feedback more comfortable, expected and actionable, without the pressure of impacting a year-end rating.

“What we will do in roundtable discussions with leaders in the business is discuss talent in a qualitative way. Ultimately, yes, we have to be able to [identify] a pool of people, let’s say 5% to 10% of people, who deserve [a bonus] this year. … So without using a rating, we can stack rank and then when the compensation tool in Workday opens up in January, there’ll be [an option] to pull down discretionary amounts into individual bonus allocation,” she said.

Because of bonus bias concerns, Moore also talked about equitable, “pay for performance” measurement of quality of contribution. “From my team’s side and from the leaders’ side, we have to engage in really thoughtful, comprehensive dialogue around our strongest performers or strongest contributors and why we deem them to be stronger, relativity speaking, than everybody else. … We can pull down into those extra-strong, going-over-and-above types of contributions, and again, linking the over-and-above nature of the contribution to agility, curiosity, coming up with ideas and following through, taking accountability,” she said.

Lessons for HR Professionals

Moore provided HR pros with a valuable road map for navigating significant organizational changes and creating a more agile, inclusive and effective workplace culture.

Some strategic takeaways that you may be able to apply in your own organization:

• Embrace transparency and be open about organizational changes
• Prioritize adaptability and the willingness to learn as key traits in your workforce
• Look for opportunities to make your benefits package more inclusive, especially for underrepresented groups
• Consider moving away from annual performance reviews to more frequent, less formal feedback sessions, and
• Ensure that your people strategy directly supports the company’s overall mission and objectives.