Susan Decker, the president of Yahoo!, has stamped her authority on the struggling internet group, creating a new division that will generate the lion’s share of revenue and will be headed by a close ally.

The new Global Partner Division will include Yahoo!’s sales operations and will oversee all advertising business – including search, display, mobile and video. It will also take “responsibility for all of our ‘partners’ – advertisers, agencies, resellers, publishers, ad networks, developers, or others,” Ms Decker wrote in a memo to staff.

The division will be led by Hilary Schneider, the former head of Yahoo!’s local markets division and a protégée of Ms Decker. Gregory Coleman, the former head of sales, will leave in February.

In July, Jerry Yang, the Yahoo! co-founder who became chief executive when Terry Semel left the company, said he would unveil a new strategic plan for the company within 100 days.

However, the subsequent prominence of Ms Decker will reinforce suggestions that Mr Yang is likely to focus on technology and play a secondary role to commercial matters.

Yahoo! recently signed deals with eBay, Comcast and a host of US local newspaper websites to supply adverts to their sites. Ms Schneider, who spearheaded the newspaper deal, will be charged with forging further similar agreements.

Ms Decker also argued that the new structure would make Yahoo! more nimble in serving ads on outside sites. “We will be able to much more quickly identify and secure the ad inventory that best meets our advertisers’ objectives,” she said.

For months there have been calls from investors and even executives within the company for a radical shake-up at Yahoo!, which has failed to keep pace with Google, the leader in online advertising, and has seen its shares slump by nearly half since January 2006.

That weakness has seen Yahoo! labelled a potential takeover target. In May the stock surged nearly 20 per cent in one session on reports that Microsoft was once again weighing a bid and had asked for formal talks to be renewed.

Yahoo! has also employed Stone Yamashitu Partners, a consultancy noted for helping technology companies to refine their business models. "Basically, they help you decide what kind of business you really want to be, something Yahoo! has struggled with,” one technology consultant said.

However, Ms Decker acknowledged that Yahoo! had seen a disquieting churn of senior staff in recent months, most recently when the company’s chief sales officer, Wenda Harris Millard, departed in June.

“I know there have been many changes at Yahoo! over the last few months, and I know that change is not always easy,” Ms Decker said in the staff memo.

“I am confident that we are putting the right people in the right positions to focus on the right opportunities.”

Times Recommends

• C&G axed - 1,660 jobs to be lost
• UK house prices rise 1.1% as buyers return
• Mixed reaction to US banks repaying bailouts