Update: Yahoo reorganizes ... again

Yahoo  has shaken up its top management ranks once again, as the struggling Internet giant continues tweaking its organizational structure to boost advertising sales, its main source of revenue.

In the latest shift, Yahoo President Susan Decker announced in a memo to staff that the company's top sales executive is on his way out and that a new global sales organization has been created.

Major management shakeups have become frequent at Yahoo in the past 10 months, as the company urgently tries to compete better, not only against archrival Google Inc. but also against nimble startups, and turn around its generally disappointing financial performance.

Brian Bolan, a financial analyst at Jackson Securities, expects Yahoo to unveil at least one more major reorganization by mid-October at the end of the 100-day, top-to-bottom review the top managers announced during the company's last earnings conference call in mid-July.

That they decided to push out this latest change now as opposed to waiting until the end of the 100-day period shows that management is trying to be proactive in fixing what's broken, he said.

"This is a statement saying, 'We're going to continue to make these changes, and we'll make them as needed as opposed to waiting,'" Bolan said. "It's a positive sign that they're following through with what they said they would do."

Two months ago, co-founder Jerry Yang took over as CEO and chairman from Terry Semel, while Decker, former chief financial officer and head of Yahoo's advertiser and publisher group, became president, a drastic change driven by widespread investors' dissatisfaction with the company's direction.

In particular, Semel took the fall for Yahoo's inability in recent years to profit as heavily as Google has from search engine-based pay-per-click advertising and for missed opportunities in hot markets like social networking and video sharing, where the company lacks strong services.

A week after Semel's demotion to non-executive chairman, Yahoo combined its search and display advertising sales teams in the U.S. It was an attempt to extend the company's long-standing, core display advertising client relationships to the pay-per-click business, which generates about 40 percent of the industry's online advertising.

Just seven months earlier, in December, Semel had rolled out a major reorganization, creating three main business units to focus on Yahoo's key customer segments: consumers, advertisers and publishers. At the time, Semel also announced that Dan Rosensweig, then chief operating officer, would leave the company.

That reorganization was preceded by a widely publicized internal memo that was leaked to the media in November and came to be known as the Peanut Butter Manifesto. In the scathing memo, Brad Garlinghouse, Yahoo's senior vice president of communications and communities, called for a major reorganization, saying the company lacked "a focused, cohesive vision" that had made it "reactive" and eager to be "everything to everyone."