Liu Qiangdong made major adjustments within JD.com. What happened to JD.com?

This structural adjustment means that the number of people reporting directly to Liu Qiangdong in the mall business has been reduced. Where he will focus his energy can also be drawn from recent personnel changes.

No company allows business growth to be affected by organizational inefficiencies. This is especially true for JD.com, a large company that manages more than 100,000 people.

Recently, Liu Qiangdong informed all employees in an internal email that the organizational structure of JD.com, a subsidiary of the group, has been adjusted. Adapt to the borderless retail revolution with flexibility and agility.

The core is that the original eight business divisions have been upgraded to three major business groups:

The newly established fast-moving consumer goods business group consists of the fresh food business department, the consumer goods business department and the new channel business department composition. Wang Xiaosong is the president of the business group. He was only appointed as the head of the fresh food business department in January 2016. Earlier, he was in charge of the 3C sector.

The Electronic Entertainment Business Group consists of the Home Appliances Division, the 3C Cultural Tourism Division, and the Global Sales Business Department. The president is Yan Xiaobing, the former head of the Home Appliances Division.

The fashion life business group includes the home life business department, fashion business department, TOPLIFE, and Paipai second-hand business department. Hu Shengli, the former head of the 3C cultural and tourism business department, is appointed as the president of the business group.

The presidents of each business group were promoted to senior vice presidents of the group, reporting to Liu Qiangdong. The heads of each business unit report to the three presidents. In the future, all emerging domestic businesses will be classified into three major business groups based on business attributes.

Liu Qiangdong is more concerned about AI

Liu Qiangdong once explained to the media the logic of past personnel or organizational adjustments: promoting strengths and avoiding weaknesses, emphasizing closed loops, and emphasizing authorization.

In 2016, when JD.com’s stock price was sluggish and its organizational efficiency and combat effectiveness were declining, Liu Qiangdong also reversed the situation through personnel adjustments. In July of that year, Xiong Qingyun, vice president of marketing, who had been in office for less than a year, was transferred. The former vice president of Procter & Gamble (P&G) Greater China subsequently left JD.com. Also in August of that year, Shen Haoyu, the former CEO of JD.com, was transferred. Since then, Liu Qiangdong has never set up the position of CEO of the mall business.

An interesting phenomenon is that Liu Qiangdong often supports important business sectors. Half of his micro headlines are related to fresh food; he flew back from Europe to participate in the Urban Beauty Super Brand Day, and then flew away again the next day; when 3C cooperation required a platform, he did not hesitate. But he has never commented on any of his subordinates in public or in interviews with reporters.

Therefore, Liu Qiangdong himself has no clear explanation for why Wang Xiaosong, a layman, was put in charge of the newly established fresh food business department in early 2016; and now there is no explanation for the transfer of Hu Shengli from 3C to the fashion life business group. Reasons for crossing borders.

Previously, Wang Xiaosong, Yan Xiaobing and Hu Shengli were responsible for a certain business department. After their promotion, it is not clear who will be in charge of the original business department and whether there is a concurrent situation. A voice within JD.com believes that the next priority should be to adjust related businesses, followed by the specific person in charge.

This structural adjustment means that the number of people reporting directly to Liu Qiangdong in the mall business has been reduced. Where he will focus his energy can also be seen from recent personnel changes.

On January 5, former Huawei chief scientist Dr. Pei Jian joined JD.com as group vice president, reporting directly to Liu Qiangdong. The PhD has a long list of accolades: Canadian First Class Research Chair Professor (in the field of Big Data Science), Professor in the School of Computational Sciences at Simon Fraser University in Canada, and Adjunct Professor in the Department of Statistics and Actuarial Science and the Faculty of Health Sciences. All in all, it gives people an unclear and powerful feeling.

In the past four months, JD.com has acquired at least four top scientists in the field of AI. Shen Yuanqing, president of JD Cloud Division, is the former chairman of Microsoft Asia Pacific Technology; Zhou Bowen, who is responsible for the related business of JD AI Research and Platform Department, is the former chief scientist of IBM Watson Group. Both of them report directly to Liu Qiangdong.

The above signs indicate that JD.com is implementing the technology transformation strategy proposed in early 2017.

It can also be seen from the arrangement of reporting directly to Liu Qiangdong that he attaches great importance to AI technology.

The strategic positions of the three major business groups

What are the strategic positions of the businesses managed by the three newly appointed business group presidents in JD.com? Answering this question can help us understand Liu Qiangdong’s intentions to a certain extent.

According to JD.com’s 2017 Q2 financial report, GMV in the quarter was 234.8 billion yuan (unadjusted figures), of which the home appliance category accounted for 115.2 billion yuan, accounting for 49%; general merchandise accounted for 119.6 billion yuan. Although more detailed category proportions have not been announced, it is not difficult to imagine that 3C products will definitely account for the majority of "general merchandise" revenue.

From this perspective, a large proportion of JD.com’s GMV is contributed by the electronic entertainment business group managed by Yan Xiaobing. This is the origin of JD.com’s e-commerce and a relatively stable segment of its online business.

However, its 3C cultural and tourism division has just been newly established for three months. It was formerly known as the 3C division and includes communications, digital, carriers and the Internet of Things, books, entertainment, life and travel and other businesses. On November 1, 2017, Hu Shengli, then head of the business unit, announced the news at JD.com’s headquarters and vigorously promoted the importance of 3C products to JD.com’s “Double Eleven” sales.

At that time, JD.com’s restructuring of this small area was intended to open up the online scene. 3C products have high unit prices, and behind them are a group of high-net-worth individuals. It is natural to be diverted by the sales of travel products.

The fast-moving consumer goods business group that Wang Xiaosong is responsible for has the fastest growth rate in JD.com, focusing on the sales of high-frequency, low-customer unit prices. Considering that the current giants are trying to connect online and offline, it is not difficult to understand that Liu Qiangdong will hand over the new channel business unit dedicated to building an intelligent management system for offline stores to Wang Xiaosong.

Before the official appointment, "Chinese Entrepreneur" interviewed Wang Xiaosong at JD.com's headquarters. Currently, he is mainly focused on the fresh food field where giants are fiercely fighting each other. After the New Year, JD.com’s fresh food supermarket 7FRESH opened. How the slow-moving JD.com can win in the long-distance race is what Wang Xiaosong is most concerned about.

It is worth mentioning that Du Shuang, vice president of the new channel business unit established in December 2015, resigned in June last year. Jingdong insiders revealed that the new person in charge is in place, but has not been disclosed to the public.

Among the three major business groups, the fashion and lifestyle business group is in the most difficult situation. And strictly speaking, all of them are newly established business units in 2017.

On March 16 last year, JD.com’s original apparel and home furnishing division was split into the home life division and the fashion division. Xin Lijun, the former president of the apparel and home division, became president of the home life division and president of the fashion division. Ding Xia, the former vice president of Nielsen Retail Research, will serve as the director.

Last year, the 618 apparel field was affected by the "choose one" controversy. By the second half of the year, the pressure on the fashion division increased instead of abating. Liu Qiangdong admitted at the Q3 financial report meeting that "apparel was JD.com's fastest-growing category in the second quarter, but its GMV growth was almost stagnant in the third and fourth quarters."

In this context, JD.com's growth last year TOPLIFE, an independent luxury goods application, was established. The person in charge previously reported directly to Liu Qiangdong himself. Paipai’s second-hand business department was only newly established at the end of December last year.

The fashion and lifestyle business group shoulders the important mission of achieving breakthrough growth in JD.com’s e-commerce business. When he was in charge of the 3C division, the outside world’s observation of Hu Shengli was that he had a higher appearance rate than Liu Qiangdong and attended more mobile phone conferences than reporters. What changes this energetic newcomer in the fashion industry will bring to the fashion lifestyle business group will have a crucial impact on JD.com.

The following is the full text of Liu Qiangdong’s email:

Dear brothers: The year 2017 that has just passed can be said to be a milestone year in the development history of JD.com Group. Not only did we achieve the goal of exceeding 100 billion in both the 618 and 11.11 promotion seasons, the annual GMV of the entire Jingdong Mall also passed the trillion mark ahead of schedule. At the same time, our logistics sub-group also officially operates independently, and JD Finance also achieved a single-quarter profit.