Without ever meeting Carol Bartz, I realized pretty quickly that her hiring was a CEO gamble as her experience was not in line with what was needed at a media company. I outlined my thinking in January of 2009. When you have one of the most-visited websites in the world, you don’t hire someone with no web experience to run it. Yet, that is what the Yahoo! board did. It is stupefying and part of the reason I said it was time for Bartz to go this past June.

But even worse than the hiring of Bartz was the firing – she was let go on the phone which is understandable as she was traveling and the company didn’t want to deal with leaks. But what is unfathomable is that there is no replacement.

I suppose this is understandable as well because news of the CEO search would leak back to Bartz and if she wasn’t let go first this could cause even larger problems. But then again if they promoted from within then this wouldn’t be as big of an issue. Isn’t it amazing that with such a massive staff, there doesn’t seem to be an insider who the board believes can permanently run things? Talk about a shallow bench.

Yahoo! stock performance under Bartz (click to enlarge)

When people complain about the large amount of CEO pay they should realize that the stock appreciation-based wealth creation for employees and shareholders is directly tied to effective CEO performance. And the beneficiaries are often pension funds and 401K holders. And as we can see from Yahoo!’s stock performance, there hasn’t been positive change while Carol Bartz was at the helm.

Moreover, Yahoo! has hopefully learned that it competes with Google and they need a leader who can go toe to toe with the search giant on apps, mobile and in the numerous areas such as video where Google has left the company in the dust.

Bartz was tasked with increasing the stock price of the company and she hasn’t been too successful in this regard. Moreover, strained relations with Alibaba which many blame on Bartz didn’t help boost her longevity.

So now that she is out, CFO Tim Morse is acting CEO and a management team of vice presidents and the executive counsel are helping to run things.

What the company needs more than anything is someone with amazing vision and execution ability – a person who can rebuild the corporate culture of the company and get the whole organization excited about the future and make them competitive. The problem is I don’t recall Yahoo! ever being competitive so this is a tall order. And that is the sad part – one of the best assets in the world might not ever see its revenue maximized.