Liu Qiangdong, who has a deep sense of crisis, has three purposes for washing out some executives, first to save money for the company, second to put pressure on all managers, and third to give opportunities to young people. Big companies change their blood and lose weight, which is good for health.
After announcing a reduction in the cash salaries of JD.com’s senior executives, JD.com’s founder Liu Qiangdong made a strong move against JD.com’s retail managers.
In this adjustment, Feng Yi (Carol), the person in charge of the fashion home furnishing business group, Liu Lizhen, the omni-channel business group of Dashang Chao, and Lin Chen, the person in charge of the platform business center, became the victims of this adjustment. Jingdong Guan Peisheng Kong Xiangying and Wu Shuangxi took the lead.
Among them, JD.com’s 3C home appliance business group was split into the home appliance business group (the person in charge is Li Shuai) and the computer communication business group (the person in charge is Wu Shuangxi). Head of business department.
The fashion home furnishing business group was changed to the fashion beauty makeup business group. The former person in charge Feng Yi (Carol) retired and Kong Xiangying took over. Lin Chen, the former head of the platform business center, resigned, and the business was managed by Shao Jingping.
JD.com’s intracity business department and platform ecology department have not yet adjusted. The person in charge of the same city business department is still He Huijian, and the person in charge of the platform ecology department is still Han Rui (Simon).
After the completion of this adjustment, JD Retail has 4 major business groups – Dashangchao Omni-channel Business Group, Fashion Beauty Makeup Business Group, Life Service Business Group, Enterprise Business Business Group and 3 major business divisions – Home Appliances Division, Communication Digital Business Department and City Business Department.
The above-mentioned persons in charge report to Xin Lijun, CEO of JD Retail.
According to a person familiar with JD.com, Yao Yanzhong’s experience is similar to that of Sun Jiaming, the former vice president of JD.com. Sun Jiaming is an old employee of JD.com and was in charge of home appliances. After that, he was adjusted to be in charge of JD.com’s supermarket business. extension. This time, Yao Yanzhong was adjusted. JD.com should have considered that under the current circumstances, it is more stable to use veteran employees with 3C experience to control the market.
“Li Shuai is the person in charge of JD.com’s retail finance. He is relatively young. It’s a surprise that he is in charge of the business alone this time. Liu Lizhen was originally a subordinate of Feng Yi (Carol), and his health is not very good. This time, the two retired together.”
The strange thing is that Liu Qiangdong, the powerful founder, has made such a big change to JD Retail, but he hasn’t released an internal announcement yet. Jingdong Group has not made a public response to this.
Rebuke JD executives for deviating from the core of the company’s business strategy
Just a few days ago, Liu Qiangdong, who was in Hong Kong, berated the management, especially the retail business executives, at the JD. Talking about cost, efficiency, and experience is too little.”
According to a later disclosure, Liu Qiangdong believes that executives have deviated from the core of business strategy—that is, cost, efficiency, and experience. Liu Qiangdong believes that if the core strategy is not grasped enough, it will be difficult to lead the team to go on in the long run.
Then last week, Jingdong just released a financial report. The financial report shows that JD Retail’s revenue in the third quarter of 2022 will be 211.923 billion yuan (about 29.792 billion U.S. dollars), an increase of about 7% from the 198.1 billion yuan in the same period last year. This performance growth of JD Retail is considered to be worse than expected.
Due to factors such as the downturn in the market, the outside world can still understand the performance of JD Retail, but in the context of the rise of Pinduoduo and the strength of Douyin e-commerce, as the founder, Liu Qiangdong has a sense of crisis. Liu Qiangdong believes that JD.com has given some consumers the impression that it is becoming more and more expensive. JD.com should serve multi-level consumers, considering both rich and ordinary people.
Liu Qiangdong also warned managers that they should not ignore the demands of many grassroots consumers just because their lives are better now, and they still pursue the ultimate cost-effectiveness of products in consumption. Liu Qiangdong believes that the management of JD.com has become arrogant and self-satisfied, and no longer pays attention to our low price advantage. If this continues, it will become the second Suning sooner or later.
“If the retail business customer experience is divided into three elements – price, quality and service, low price is “1”, quality and service are two “0”, losing the advantage of low price, all other so-called competitive advantages will return to zero. “
Behind these three hours of lectures and the current major adjustments, it is estimated that many executives of JD.com will break out in cold sweat.
Remind the wage earners to make new achievements and not to rest on their laurels
In fact, JD.com will have a round of major adjustments every few years. The last major adjustment can be traced back to 2019. At that time, Jingdong had just experienced Liu Qiangdong’s turmoil in Mingzhou, morale was low, and the stock price was low. Facing the crisis, Liu Qiangdong attacked the senior management team, and professional managers lost power. At that time, Jingdong’s CPO (Chief Public Affairs Officer) Lan Ye and CTO Zhang Chen , Chief Legal Officer Long Yu resigned in 2019.
At the end of 2020, JD Digits, which failed to hit the sci-tech innovation board, made a major adjustment. JD Group integrated its cloud and AI business into JD Digits to form JD Technology. During the same period, Chen Shengqiang stepped down as CEO of JD Digits; and in December 2020, Jingdong Logistics CEO Wang Zhenhui resigned.
At the Davos event held in Switzerland in 2019, Xu Lei, Chen Shengqiang, and Wang Zhenhui also made a collective appearance as the heads of the three major businesses under JD.com, forming a management echelon within JD.com. In just over a year, Chen Shengqiang and Wang Zhenhui stepped down as CEOs one after another. Wang Zhenhui is the most regrettable, falling in the half a year before JD Logistics went public.
Behind this series of adjustments, Yu Rui, the second management trainee of JD.com, became the CEO of JD.com Logistics. Li Yayun, the former chief compliance officer of JD.com Group, was the CEO of JD.com Technology. Liu Qiangdong’s former female assistant, post-90s Guan Peisheng Zhang Yu He also became the Chief Human Resources Officer of JD.com.
Xu Lei overcame difficulties all the way, not only helping Jingdong Group to stabilize the situation, step by step from the CEO of Jingdong Retail, to the president of Jingdong Group, and then became the CEO of Jingdong Group in 2022.
Of course, no matter whether the status of the old team in Jingdong is further improved, or Guan Peisheng is promoted, the actual controller of Jingdong is still Liu Qiangdong.
As of March 31, 2022, JD.com’s shareholding structure
The annual report submitted by Jingdong shows that as of March 31, 2022, Liu Qiangdong holds 13.8% of the shares and has 76.1% of the voting rights. After Tencent distributed to its shareholders about 460 million Class A ordinary shares of JD.com, the shareholding dropped from 17% to 2.3%, and he was no longer the largest shareholder, Liu Qiangdong had a greater voice in JD.com.
Just recently, Liu Qiangdong announced that starting from January 1, 2023, the cash salary of JD.com’s senior managers will be reduced by 10%-20%, and the higher the position, the more the reduction.
Just a month ago, the Liu Qiangdong Mingzhou case, which lasted nearly four years, reached a settlement. This time, Liu Qiangdong’s 3-hour lecture and the adjustment of the executives were all regarded as a signal for Liu Qiangdong to come out again.
Of course, Liu Qiangdong is still in Hong Kong. According to people familiar with the matter, Liu Qiangdong still said in the lecture that Xu Lei is mainly responsible for the overall situation of the company, and he is only assisting Xu Lei in the management of the company.
With such a large-scale adjustment of JD Retail this time, Xin Lijun, the CEO of JD Retail, is still not passive. The reason is also that Liu Qiangdong needs reliable people to help him work. Otherwise, how can Liu Qiangdong manage effectively if no one is in the company.
Regarding Liu Qiangdong’s recent actions, some analysts pointed out that behind the founder Liu Qiangdong’s move at this time, and even bluntly saying that JD.com does not want to become the next Suning, there is also a deep sense of crisis.
“Enterprises are faced with economic cycles rather than unlimited expansion. For large enterprises, different management systems are required for building a country and sitting in a country. They should be thin and fat, and they can span cycles and eventually become a great company. Also remind Wage earners, you have to make new achievements without resting on your laurels.”
In addition, Liu Qiangdong also wants to remind employees that as the environment deteriorates and competition intensifies, returning to the main business is the best policy, and the company’s roots must be firmly established.
At this time, washing out some current executives also has three purposes in terms of management. First, it saves money for the company, second, it puts pressure on all managers, and third, it gives opportunities to young people. Big companies change their blood and lose weight, which is good for health.
Author: Lei Jianping, source: Lei Di, original title: “Liu Qiangdong’s attack on JD.com’s retail: Remind wage earners to make new achievements and not rely on their laurels.”
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