Disclaimer: I was at Yahoo when she came and implemented this policy.
It irritates me to see uninformed people making such blanket comments. You have no idea what the policy was; I do. Let me explain it, in the hope that you (and others with this mindset) may learn something about it, and maybe even change their views.
There was a group of Yahoos ( < 200 ) who had a permanent work-from-home exemption (if you can call it that; there was never much of an enforced policy earlier). They never came in to an office (except for the occasional IT issue and package pickup). There were a couple of incidents where these remote workers were found to be moonlighting. So a study was done to see how many of these remote workers actually VPNed in. After a month or two, it turned out, a good number of them were actually working part-time. So a blanket ban was issued, with the caveat that if you could make a compelling case, you would still be allowed to WFH. In fact, a colleague of mine continued to work from home after this policy change. A number of strong people continued to WFH; a few were let go; and the rest had to hoof it to office.
Now, the mistake Marissa made wasn't with this policy; but it was in how she didn't go the next step: holding the managers of the shirkers responsible.
Which brings me to my thinking about why it's so hard to turn around Yahoo: the middle management. (Please do me a favor and read PG's excellent post http://www.paulgraham.com/yahoo.html after you're done reading this). Yahoo is filled with managers whose sole contribution is survival. There is no accountability for screwing up. Fucking up products badly has never gotten anyone fired.
Did you know Yahoo went through 3 different iterations of an attempt at a "social network"? Each and every time, sane minds pointed out that the concept was bad, the UX was bad, etc.; and yet the managers prevailed and it went down in flames, as predicted.
The joke in Yahoo used to be: throw everything into version 1.0, because you never know if there will be a version 1.1.
Marissa is failing not because she's a bad CEO (having seen Yahoo CEOs like Terry Semel, I can assure you she's the best they've had in the last 10 years); it's because she has no supporting cast. She trusts people too much. One manager once said to me (about her): meh, she'll be gone in a couple of years; I'll still be around. He had been there since 2001, and had no intention of moving anywhere. Collected fat paychecks by taking credit for others' work. And he was just one of many, many in there. Over the years I encountered so many people like him, where you had no idea what actually they contributed to the company.
/rant