Internet firm Yahoo (NASDAQ:YHOO) has ousted Carol Bartz as its Chief Executive and named Chief Financial Officer Timothy Morse as interim replacement, effective immediately.

In addition to Morse, who will also continue in his role as Chief Financial Officer, the Executive Leadership Council would include Michael Callahan, Executive Vice President, General Counsel and Secretary; Blake Irving, Executive Vice President and Chief Product Officer.

Meanwhile, the Co-founders of Yahoo, David Filo and Jerry Yang, will each continue as Chief Yahoo and will provide counsel to Tim and the Executive Leadership Council.

The Board sees enormous growth opportunities on which Yahoo can capitalize, and our primary objective is to leverage the company's leadership and current business assets and platforms to execute against these opportunities. We have talented teams and tremendous resources behind them and intend to return the company to a path of robust growth and industry-leading innovation, said Roy Bostock, Chairman of Yahoo.

The Board is commencing a search for a permanent Chief Executive Officer and expects to engage the services of a nationally recognized executive search firm to help it identify candidates for the position as expeditiously as possible.

Will the latest management change do any good for Yahoo? The answer is a big NO, says Global Equities Research analyst Trip Chowdhry.  Chowdhry feels Tim Morse is much worse than Bartz.

We think this is the right move, but sadly a year too late - Yahoo's business has already been damaged, Chowdhry wrote in a note to clients.

Both Carol and Tim should have been fired together as they both have damaged Yahoo's business and repairing it will be extremely difficult, the analyst added.

Chowdhry said Morse just kept cutting costs, which was the easiest thing to do.  Both the CEO and CFO are completely clueless of the velocity of innovation that is needed to succeed in the Internet space. 

Analysts had pointed out that Bartz lacked experience in advertising and the Web 2.0.

Seems to us that both the CEO and CFO were happy living in their comfort zones, and congratulating themselves on delivering a few new features here and there on different Yahoo properties...None of which are revenue drivers, Chowdhry noted.

He criticized that both the CEO and CFO have lacked the ability to think big, bold and execute fast...their time horizon has been years, while it should have been days not years.

Commenting on whether the company would be able to attract the top talent, Chowdhry said: We don't think Yahoo will be able to attract the Top Talent - and probably Yahoo will need to settle with the left over talent that is available in the market today.

Bartz succeeded co-founder Jerry Yang as CEO of Yahoo in January 2009 with the task of turning around the company's dipping fortunes amid the stiff competition from Google (NASDAQ:GOOG) and Facebook.

As part of Bartz's turnaround strategy, the company laid off hundreds of workers, closed or sold several of its less popular services. Yahoo has also been selling stakes to raise billions of dollars, with which it could buy a good startup to boost its results. However, Bartz's efforts have not come to fruition.

Yahoo, which offers most of its products free, requires more of ad revenues to boost its performance. But, the company faces tough competition in search from Google and also from increasing popularity for social networking sites such as Facebook. Yahoo has continued to lose market share to Google.

When Carol was hired by Yahoo in early 2009, she was paid an annual base salary of $1 million. She was eligible for an annual 400 percent bonus and received 5 million shares in addition to an equity grant of $18 million of stock.

In 2010, proxy voting firm Glass-Lewis named Bartz as the most overpaid CEO when she received more than $45 million in compensation.

Investors welcomed Yahoo's move as the shares surged 6 percent, or 81 cents, to $13.72 in the afterhours trading on Tuesday on Nasdaq.