Two thousand unlucky Yahoo (YHOO) employees are going to be cut today, and that is just the beginning. Thousands more will be laid off in weeks and months to come reports All Things D. Yahoo currently has 14,000 employees. Don’t feel bad for them, these are fat cats that have sat of their fat behinds for almost a decade, thats why the company is in such as messy. Apparently, the most work many Yahoo employees have done for the most part of a decade was to collect a big fat cheque and file papers with the SEC to sell their stock options.

The layoffs will be company wide but the hardest hit will be the product division, search division and possible sale of its Ali Baba division. Michael Smith, a former Yahoo business development manager in Asia, has posted a scathing rant about how the company was mismanaged.

He says the layoffs, could eliminate 20 to 25 percent of Yahoo’s staff “without actually cutting much of its capabilities.”

Here are some choice bits:

• Lots of talk, no action. “I remember going to meetings where we discussed how to make plans. In fact many product people where tied up for most of 2011 working on 2012 planning. Planning that was probably a colossal waste of time and money since the guy who spearheaded that level of planning is already out of the company.”
  

• Why keep a search team around? “Yahoo gave search to MSFT …. I have no idea if Yahoo or [new CEO] Scott [Thompson] can unwind that deal but at the very least it could cut the rest of the search team, search research and tiger team to save more of the costs from the deal. The amount of people working on search experiences is still way too high. The reality is, if Yahoo outsourced search it should really do it. Get rid of all search related employees. Put a search box up and when a user clicks the button the rest is done by MSFT.”

• Microsoft middle managers have taken over. “I can’t begin to count how many new execs have been brought in from MSFT over the past 2 years – all of whom, great people aside, have been doing more planning than doing. We used to joke that although MSFT didn’t actually buy Yahoo – for the most part MSFT was running Yahoo.”

• Yahoo has done a horrible job with business deals. “Anyone remember the Zynga deal? Waste of time. Zimbra? Xoopit? Dapper? Inquisitor? You can read the list here: http://en.wikipedia.org/wiki/List_of_acquisitions_by_Yahoo! . Very few of these deals made Yahoo a better, more able company but when you have corp dev people doing their own thing regardless of how it fits the product or business needs – then it makes sense to see a list like this …. I won’t even get into how the corp dev deal team handled integrations. It’s too painful to write about.”

• Why Yahoo’s suing Facebook. Under a deal signed a few years ago, “Yahoo got single sign-in, which is great, and Yahoo users were able to share more easily on FB – worked wonders for Yahoo pageviews but FB got to easily export Yahoo address books and gleaned all the resultant data. Anytime Yahoo product managers tried to export the other way around or use the data we usually found that the agreement did not support that or that FB got to personally veto the Yahoo product idea. So FB got the spoils, Yahoo lost social and made FB even stronger in the process. My guess is Yahoo wants the deal looked at again while threatening with patents – sure this is a shitty strategy but such is life once you start losing.”

Despite all this, Smith closes by saying that Yahoo is still an “amazing” company and he praises Scott Thompson for making decisions.