“Since Kuaishou went public, the market value has evaporated by more than 70%. This is largely due to the company’s internal dual-core governance structure. If you want to quickly get out of this predicament, the most urgent thing is to determine a CEO who can make a decision and hold the absolute right to speak. The company should have one and only one’soul figure’.”
Kuaishou finally ushered in the biggest organizational restructuring since its listing.
Last night (October 29), Kuaishou Technology issued an announcement stating that the board of directors has agreed to the resignation of the company’s co-founder Su Hua as CEO, and has approved co-founder Cheng Yixiao to assume the position, responsible for the company’s daily operations and business development. , The appointment will take effect on October 29, 2021; Su Hua will continue to serve as chairman, executive director, and member of the remuneration committee, responsible for formulating the company’s long-term strategy. However, regarding the reporting relationship between the two, CEO Cheng Yixiao still reports to Chairman Su Hua.
In the second half of 2021, Kuaishou is going through two drastic organizational restructuring to repair the company’s management dilemma from top to bottom.
“You are sick, and you will die if you die.”
Objectively speaking, since Kuaishou went public, the situation of domestic and foreign difficulties has been quite severe. Internally, it is necessary to manage 16,000 employees (the total number of Kuaishou employees exceeds 16,000 as of the end of last year). Shi was also “provocative” by the head anchor (Kaishou anchor Simba had called the Kuaishou official more than once); externally, Douyin was able to beat the dust with 600 million DAU, backed by 1.9 billion MAU bytes. The aggressive WeChat video account is growing strongly.
However, regardless of internal management problems or increased external competition, in the eyes of a Kuaishou resigned employee, it can be boiled down to two problems.One is the road problem (direction problem), and the second is the management problem (team problem).
Kuaishou’s road problem has been verified by the market, but there is still room for discussion on management issues.
“You are sick, and you will die if you die” is the advice of Zhu Lantian, the former 50 employee of Kuaishou to Kuaishou.Before this round of Kuaishou’s adjustment of the CEO’s organizational structure, there have always been voices in the community that the most difficult problem facing Kuaishou today is not from Douyin, but from the internal consumption of organizational effectiveness brought about by the company’s internal dual-core governance.
“Since Kuaishou went public, the market value has evaporated by more than 70%, and some media are also slandering Kuaishou. The main reason is the company’s internal dual-core governance structure. If you want to quickly get out of this predicament, the most urgent thing is to determine one that can make a decision and grasp. A CEO with absolute right to speak, an Internet company should have one and only one’soul figure’.” Tang Bin (investor, pseudonym) said to Hu Xiu.
(Left Suhua, You Cheng smile)
Even Zhang Hao (pseudonym), a former employee of Kuaishou, said, “In the Kuaishou company, the main product traffic and product operations, e-commerce, games, live broadcast and other related matters are in Cheng Yixiao’s hands. Financing, company management. If Cheng Yixiao doesn’t give the resources, Su Hua’s management is like’talking on paper.'”
Take Kuaishou’s long-term benchmarking of Bytedance as an example. Before leaving his post, Zhang Yiming’s impression to the outside world has always been a “soul figure” with strong delayed gratification, extreme self-discipline and mastering the direction of Bytedance. There are even reports that Zhang Yiming will train himself like a machine without too much emotional stuff. He is good at using data to find gaps, and in the end everything speaks with growth.
Kuaishou is different. In 2011, Cheng Yixiao launched the original mobile application “GIF Kuaishou” for users to create and share animated pictures; in 2013, Zhang Fei, a partner of Morningside Capital, matched Su Hua and Cheng Yixiao’s bond.
In order to invite Su Hua to join, Cheng Yixiao was willing to take out half of his 80% shares and half of Zhang Fei’s shares to make up 50% of the shares as an option pool, and distribute most of the shares to Su Hua and his 7-member team. . Soon, Su Hua joined Kuaishou as the CEO (CEO) and Cheng Yixiao as the CPO (Chief Product Officer). The two formed a dual-core governance structure in corporate governance, and the problem was buried.
“For a company, the existence of a’soul figure’ can ensure the execution of the entire organization and the stability of the personnel, even if it is wrong, it can quickly correct deviations, reduce internal friction and upward management costs.” Tang Bin said to Huxi.
Looking back, Kuaishou did have certain problems with the stability of executives in the past few years. Take the change of Kuaishou executives during 2017~2018 as an example. Former NetEase Deputy Editor-in-chief Zeng Guangming joined Kuaishou as a partner & CMO (Chief Marketing Officer) ( Ben Guoxiao joined as CHO (Chief Human Resources Officer, left after 5 months in office); Liu Xinhua joined as CGO (Chief Growth Officer) and was responsible for overseas growth (leave after only one year in office).
“that period of time,Some of the company’s internal business leaders have a cross-reporting relationship with Su Hua and Cheng Yixiao, and many reports have the right to overturn after one person decides, which will undoubtedly hinder the advancement. “Zhang Hao said to Tiger Sniff.
A corporate strategy consultant said to Tiger Sniff, “In the process of modern corporate governance, many internal organizational adjustments must be made even if it is a’smelly game.’ ‘Smelly chess’ has repeatedly affected judgment.”
The more serious problem is that once the business development speeds up, the compromise solution can only be to change the “boss.” For example, in the May 2020 round of organizational restructuring, Ma Hongbin, the original head of operations, and the original commercialization head strictly emphasized the change of positions; Xu Xin, one of the original product heads, was transferred to be in charge of the user experience center; Wang Jianwei, one of the original product heads, Collect the product and live broadcast business reporting lines and become the highest person in charge of the product. The biggest structural adjustment of Kuaishou since its establishment involves multiple core departments such as commercialization, operation, and products.
In response to this, Qian Hengjia (a pseudonym), another quick-hand resigned employee, told Hu Xiu that the company’s personnel adjustments made the middle managers very painful.“Basically, many old employees have to take over several new businesses one year after another, and they are assigned new tasks by new leaders when they are doing them. As for most of their previous work, they will be put on hold, so everyone slowly learns to do a face-saving project.”
She further added,The “airborne” phenomenon that is common among major Internet companies has to a large extent aggravated the political struggles of the secondary departments, and there will be a lot of excuses and tears in the process of business promotion. “Can you imagine how desperate the team is when only the person in charge is changed for a project? Every leader has a close relationship, and every adjustment will have various meetings waiting for you, just like a ruthless meeting machine, where can I do it? business?”
It seems that in order to prove that this phenomenon is not a deviation of individual perception, Qian Hengjia specifically read from the WeChat collection to the first 50 Kuaishou employee Zhu Lantian published in 2020 on the Kuaishou intranet, “Talking about our company’s disease”, in this internal letter Kuaishou can be described as “all diseases”-disappeared bosses, airborne managers, secretly competing businesses, numerous departments and factions, poor information, pseudo-data-driven, cultural dilution, and so on.
Even, the letter specifically listed the fast-hand executives who secretly competed in business:Xu Xin and Thomas know that they are dissatisfied with each other, audio and video Yubing and Chunyu who are in charge of the client invade each other to infiltrate the business, overseas KT’s Zack and XYZ’s Yuanxi compete, the recommended two mountains and the total sum of Wan Gui; let’s talk about the second level Departments, live Linlin and Zhou Chi, the uncompromising between the commercialized product Zhongtai CI and the business person in charge, the competition between the commercial sales department I and the sales department.
“His (Zhu Lantian) senior employees are complaining about departmental walls, political struggles, and difficulties in promoting business.How can such a team fight Douyin?“Qian Hengjia said.
“Take a strong medicine to cure the disease.”
After Kuaishou “struck” through the first half of 2021, the third quarter began to significantly accelerate the pace of organizational iteration, trying to remove the “root disease” from the inside first.
Back in time a month ago (afternoon of September 28), Kuaishou just completed a round of organizational restructuring:
Kuaishou announced the transformation of its organizational structure and the establishment of the main station production and transportation line. The person in charge is Wang Jianwei, a member of the Kuaishou Management Committee, senior vice president, and original product leader, reporting to the founder Cheng Yixiao; the original e-commerce business leader Xiaogu will serve as the e-commerce business department The person in charge, together with Xu Jie, the head of the game business department, reported to Cheng Yixiao; and the former head of the commercialization business, Ma Hongbin, became the head of the commercialization business department. China Report.
From the perspective of Kuaishou’s internal letter, the adjustment not only consolidates the main site product department, operation department, user growth department, game ecology, search and other businesses, but also sets up an e-commerce business department, a commercialization business department, There are four major business divisions: International Business Department and Game Business Department.
In other words,Kuaishou is gradually transforming from an organizational structure based on functions in the past to a divisional structure. Kuaishou officials believe that this can further improve efficiency under the premise of strengthening the closed-loop management of the business unit.After all, the organizational structure systems of Internet giants such as Ali, Tencent, and Meituan are all based on products, services, business clusters or profit centers to form business units.
Moreover, unlike previous major personnel appointments in Kuaishou, in the process of power change at the end of September, Kuaishou Senior Vice President and member of Kuaishou Operation Management Committee Yan Qiang was “out” (Yan Qiang announced his resignation in the form of an internal letter)-as A veteran who joined Kuaishou in 2016, Yan Qiang is one of the executives whom Su Hua personally interviewed and supported. During his tenure in charge of Kuaishou’s commercialization, he successfully completed the advertising and marketing revenue target set by the K3 campaign.
However, as early as in the first round of organizational restructuring of Kuaishou’s listing in July this year, Yan Qiang no longer served as the head of user growth. This may be seen as a buffer for the transfer of power before his departure. Moreover, according to Caixin reports, many Kuaishou employees said they were not surprised that Yan Qiang had left, and called it “Cheng Yixiao’s victory.”
Look at this round of organizational restructuring (October 29): After Cheng Yixiao is the CEO, responsible for the company’s daily operations and business development, Kuaishou has a soul figure from top to bottom. Compared with the previous internal reporting efficiency of the company, it reduces internal consumption. All have been optimized to a certain extent.
This has played a very important role in stabilizing “market sentiment and confidence”, and it is also an adjustment in line with capital market expectations, because before this round of Kuaishou’s CEO change, some analyst friends predicted that when chatting with Tiger Sniff,“Su Hua and Cheng Yixiao are in Kuaishou. Either one fully surrenders power, or both of them retreat behind the scenes. It can be a way to soothe the market and boost the morale of Kuaishou.”
As for why the Kuaishou Board of Directors chose to let Cheng Yixiao succeed Su Hua as Kuaishou CEO, it is difficult for the outside world to give an exact statement. However, the reason behind this may originate from Cheng Yixiao or Su Hua.
History has proved that Su Hua is not a “very obedient” person. Tencent, as a major shareholder of Kuaishou, logically says that Su Hua should “come three points”, but this is not the case.For example, last year there were rumors that Kuaishou acquired Sogou, and Sogou was the cake that Tencent had coveted for many years; for example, there were media reports that Kuaishou refused to merge the game live broadcast business with Huya Douyu, and Tencent had pushed for the merger of Huya Douyu, although It has now fallen through, but its ambition to unify the live broadcast of the game has long been known to passers-by.
Moreover, whether it is the acquisition of station A, the launch of the Kuaishou live broadcast PC platform, or the strategic measures such as going out to sea and pursuing 300 million daily activities, most of the results are not satisfactory now, andKuaishou’s investment and financing, overseas, and company management, which have been questioned the most, are all areas that Su Hua focuses on. Therefore, if you have to find someone to take responsibility for Kuaishou’s current plight, Su Hua, the CEO who was pushed to the front, is obviously more responsible.
On the other hand, Cheng Yixiao, who has been “invisible” behind the scenes in the past few years, has a personality similar to Zhang Xiaolong, but he is full of product manager qualities. Under Douyin’s aggressive offensive in the past two years, its responsible product operations, e-commerce, etc. have firmly bit the second position, ensuring the stability of the Kuaishou basic disk, reflecting strong “product toughness” and tenacious eagerness. Xin, even in the eyes of many people, “because everyone overestimates Douyin, so they greatly underestimate the far-reaching impact of the Kuaishou product on the entire Chinese Internet.”
Moreover, Kuaishou’s “old iron” basic disk is mainly due to the dual-line product design and traffic distribution method. The product is largely affected by Cheng Yixiao’s will, andHe himself insists on “inclusive distribution” and the product insists on the concept of focusing on ordinary users, which has deeply entered the DNA of this product of Kuaishou.
In addition, before Kuaishou adjusted its CEO, some people familiar with the matter said that Kuaishou’s investor relations department recently sent a signal that “Q3 quarter, the company’s user data and revenue data are good”. This time point is very intriguing.
so,The major shareholders finally stood on the side of Cheng Yixiao. Perhaps they hope that the adjustment of the organizational structure will bring some positive changes to the promotion of Kuaishou’s next development, but the more far-reaching impact is that Kuaishou is passing through bold organizations time and time again. The structural adjustment is top-down to repair the company’s management dilemma.
“Recreate a fast hand”
Chinese Internet companies have two common troubles: First, business and scale development are too fast, management level, organizational capabilities, and corporate culture construction are seriously lagging behind; second, the success of the first product comes from opportunities of the times and is difficult to replicate.
The first question has been discussed above and will not be repeated. As for the second question, take Kuaishou’s high hopes for going overseas as an example. In the 2021Q2 quarterly financial report, Kuaishou included overseas market expansion as “one of the core strategies” in the financial report for the first time. : Kuaishou believes that the short video and live broadcast industries have relatively low maturity in overseas markets and are still in the early stages of development and commercialization. The low user penetration rate represents a huge and extremely diversified monetization potential, and the future is full of growth. And development opportunities.
The question is, can Kuaishou really achieve “second development” by going to sea?
Kuaishou’s overseas growth target for this year is 250 million MAU, corresponding to US$1 billion in “grain and grass” prepared for overseas markets. However, according to “LatePost” report, in only three months in 2021, Kuaishou spent at least $250 million. This aggressive money-burning strategy was confirmed by Kuaishou’s CFO Zhong Yiqi in the Kuaishou earnings call. “In the Q2 quarter, overseas sales expenses accounted for about 1/3 of total marketing expenses.”
According to a rough estimate of public data,In the first half of 2021, Kuaishou has spent at least 80% of its budget (US$250 million in the first quarter and US$550 million in the second quarter), but the net increase in overseas users of Kuaishou in Q2 was only 30 million (150 million in Q1 and 150 million in Q2). 180 million).
If you want to reach the 2.5MAU overseas growth target, at least 70 million new users need to be added within 6 months. However, according to the intensity of the “coins” in exchange for growth in the Q2 quarter, it can barely maintain the growth rate of 10 million people per month. Therefore, it is hard to imagine how difficult it is to maintain the growth rate with only 20% of the budget left.
To make matters worse, Kuaishou officially closed its short video product Zynn on August 20. Kuaishou has only two of its overseas “three sons”. Kuaishou can only rely on Kwai (South America) and SnackVideo (Southeast Asia, South Asia) to pull overseas. User added.And in terms of operating strategy, Kuaishou also lacks a mature system. Taking Zynn as an example, it only took more than ten months to rush from the first download list in North America to the abandonment of operations.
Even without mentioning the issue of operational capabilities and sufficient “grain and grass”, ByteDance began to deploy overseas as early as 2015. Tik Tok’s expansion map has local offices all over the world, and it also hires a large number of local employees and international students. In response, Zhang Yiming said in an interview with Qian Yingyi, Dean of Tsinghua School of Economics and Management, “Our strategy is to globalize products and localize content.”
Is equivalent to saying,Remote collaboration, office systems, management systems, and even many underlying basic capabilities are being built simultaneously. Coupled with the acquisition of local teams and localized operations, Tik Tok has produced a huge synergy under the blessing of algorithms, organization, and operations.
In contrast, Kuaishou,When the number of domestic users was close to the ceiling in 2017, and the domestic short video market dividends tended to peak, we began to deploy overseas and launched Kwai against TikTok. Moreover, in related media reports, Kuaishou’s overseas team did not work locally in the early days, but at the Beijing headquarters.
In this regard, the senior product manager and former employee judge of Kuaishou believes that the lack of localization of overseas business is actually more like “cloud going to the sea”: “Assuming that there is also an old iron market overseas, it does not mean Kuaishou can do it. First of all, Kuaishou has not done so yet. The second influential product lacks a methodology that has been validated by the market; secondly, overseas business is a test of operational capabilities and localization, and this is precisely the weakness of Kuaishou.”
In response, Tu Kun (pseudonym, investor) analyzed: “After an Internet company’s growth rate has slowed down, capital will pay special attention to the company’s ability to make money. If it still can’t make money, the company’s ceiling will be directly suppressed. As for Kuaishou, whether it is a discussion of the basic market or the value of the product, the final valuation will be decoupled from Douyin.”
Moreover, open the official website of ByteDance in Chinese, and in the product column, eleven products including Douyin are listed, most of which live more than 10 million a day; open the official website of Kuaishou, the product column gives “Kaiying”, ” “AcFun”, “One Sweet Camera”, and the previously launched special effects camera “One Sweet Camera”, news aggregation platform “Quick Look”, grass-growing community “Bean Field”, mobile game “Love You Dou Dizhu”, game live broadcast platform Products such as “Dianmiao Live” and “Kaishoudianwan”, a mini game of Kuaishou, have not been seen.
A Kuaishou R&D staff said to the self-media “Qiopai”, “The company’s support for the new APP has been unclear, and it is difficult to get the support of the main website. The senior management of Kuaishou thinks that they started from scratch in the past, and now the new APP is also You should prove yourself from scratch, and then find a company to support you.”
However, it is also preying on popular entertainment content. Compared with the algorithm network of Douyin, it seems that the idling of a certain gear has caused the failure of the content layering of the entire community. People are surprised to find that the “old iron” has been the original spiritual imprint to this day. It is still synonymous with Kuaishou. In addition, the public label of Kuaishou is “fuzzy.”
For example, an employee of a large factory once complained about tiger sniffing.Whether it is fast-handed old iron culture or upward compatibility, the growth bottleneck is actually stuck in the algorithm, and poor user hierarchy leads to poor personalized push. “Originally, I was looking forward to the Kuaishou Olympics this time. I think there will be good data growth if we operate well.However, during the Tokyo Olympics, I turned on Kuaishou every time I swiped two or three screens, only to pull a few Olympic videos, I was really amazed at Kuaishou’s operational capabilities.。”
In this regard, the judge believes that “the core competitiveness formed by early users and content of Kuaishou has become a burden when out of the circle.Kuaishou is now reluctant to bear the old iron basic disk. De-old iron will make Kuaishou lose its characteristics, and greedy first- and second-tier users to make content and brand promotion. The problem is that the content production and content consumption tastes of these two groups of people are very different. As a result It’s “the content climbs upwards, the old iron pulls downwards”, which is particularly divided.”
And, in his opinion,“Regardless of DAU, MAU or commercialization capabilities, Kuaishou and Douyin are not of the same order of magnitude. Kuaishou should abandon the’traffic hungry syndrome’. There is no need to benchmark Douyin and make the current 300 million DAU clear. It’s also good to live.”
Source of this article: Tiger Sniff APP, author: Huang Qingchun, the original title is “Quick Hand Changed CEO, Declaring Its Dual-Core Governance Failure”
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