Wu Jianguo: How to set up an organizational evolution mechanism that matches the company's development strategy?

This article originates from the sharing of Wu Jianguo, former vice president of Huawei's human resources, in the Jingwei Billion Entrepreneurship Camp and Organization Module, and this sharing specifically talks about two topics:

1. How to build and grow together as a core team?

2. How should organizational structure evolve? How can you make your organization change with demand, agile and flexible?

In the early investigation of students in the Matrix Partners Entrepreneurship Camp, these two topics are the key issues that everyone focuses on in organizational growth. As one of the builders of Huawei's talent system, Mr. Wu Jianguo combined his years of consulting and counseling experience with many companies, presented a large number of methodologies and landing steps in detail in this sharing, and answered these two questions well, which is very informative. I hope this note can also solve your puzzles.

The big theme I shared today is "Organizational Ability Growth Method". Why pursue organizational growth? Because in this era, we must be able to make the enterprise organization change with the needs, and the evolution ability of the organization is the key to the healthy and long-term development of the enterprise. The topic of organizational growth is very big, and today we will only talk about two of your most concerned points: core team growth and organizational structure evolution.

How to build and grow together as a core team?

1. The foundation of the core team is the first: build a "true core" team of 2-3 people

Enterprises start from entrepreneurship, the organization develops from a gang to a team, how to call it a team? It's the real core that emerges in the organization, which we call eu-core. In some enterprises, everything is decided by the founder, which is not called true core; in some enterprises, the five-member committee voting system is very democratic, and it is not true core. What does eukaryotes look like? Tencent has Ma Huateng, Martin Lau, Zhang Zhidong, Huawei has Ren Zhengfei, Sun Yafang, the true core team should have full trust in each other, constantly communicate and collide, to solve various conflicts and contradictions, is a decisive role in the overall development of the company.

The combination of eukaryotic teams is actually very flexible, the first common combination is the commander and political commissar; the second is the combination of CEO, COO and CPO (chief talent officer); and the third is to form a complementary relationship around the CEO's capabilities and strengths. If the CEO is a product manager, it can be paired with the core of CTO, sales and operations; if the CEO is a leadership type, it must be paired with the core of strong operations management.

The first and third, everyone is actually more familiar, the second kind of CPO this concept may not be particularly understood, this is also a new emergence of a core position in recent years, more suitable for our fast-growing startups. The difference between CPO and HRD is that HRD is passive execution, while CPO is one of the CXOs to assist and support the CEO's organizational decision-making. McCord, the author of the Naifei Culture Handbook, is a very outstanding chief talent officer.

So what exactly does the CPO do? For example, many of our startups, the execution of the organization is very strong, but often lack the ability to evolve the organization. How to be hermaphrodite with the CEO and help the organization continue to evolve is actually the main responsibility of the CPO.

2. The foundation of the core team is two: solve the problem of core talent integration

For the startups we are here, the age of the enterprise is relatively young, and in the process of building the core team, the introduction of airborne talent has become very common and important. And everyone will find that compared with the start-up team, it is actually difficult to integrate the airborne talent into the core. But it's hard to do, and it's hard to do well, because it's the foundation that's necessary to make your core team. Here are two sets of integration schemes, divided into preferred solutions and alternatives.

• Preferred protocol

1) A person is responsible for the "soft landing" program, that is, to arrange for someone to conduct special counseling for the airborne executive, with the purpose of helping him understand the company's culture and business model and integrate into the company's team. This person often has to be the CXO level of the company, and he is mainly responsible for the integration of this person.

2) The "gradual" turn of the newcomer, that is, to give the newcomer a turnaround period of 3-6 months. During this time, giving him offers and titles can be your original goal, but the responsibilities given to him should be gradually improved. For example, if you invite a chief marketing officer to do sales, when he first came, he was not familiar with the original sales team, nor did he understand the company's sales model, and it was difficult to be the first person in charge. At this time, he can be allowed to work as a deputy or assistant first, and then gradually ascend to the position. Using this gradual process allows him to truly integrate into the company's culture, business, organization and people. This is a hundred times more important than letting him come up and directly create performance, because only by successfully passing through the integration cycle can we enter the value creation cycle and truly play a full role.

3) The CEO has to bear the key responsibility for the integration of the airborne troops, that is, the CEO must do a lot of buffer work between the new people and the team to promote their communication and integration, which is often a lot of contradictions and conflicts, mostly from work habits, work methods and other factors. Unless it is a conflict of core values, other conflicts should be reconciled by the CEO as much as possible. This coordination work can only be done by the CEO, and cannot be shirked.

If the above preferred solution does not achieve good results, then we have alternatives, and the alternatives may better solve some of your urgent needs.

• Alternatives

1) Start as an expert and then take up a management position. Because professional identity is less involved in organizational and personnel relations and other things that are prone to contradictions, in some times when the integration is not smooth, let the professional executives who are parachuted in do professional rather than management things.

To take a Huawei example, when Huawei's supply chain was tutored by IBM, we dug up the supply chain president of IBM Asia Pacific, but after only two months he wanted to leave, because the culture was not adapted to and it was difficult to integrate into the organization. But IBM helped Huawei do the supply chain, and no one knows better than him, so what to do? Ren Zhengfei blocked his departure, asking him not to be the president of the supply chain first, but to become the chief expert of the supply chain, specializing in the construction of the supply chain system.

2) Select/adjust the direct supervisor of the "newcomer". If the parachuted talent and the supervisor always have conflicts, such as conflicts in personality or behavior, they can choose to arrange for his supervisor to take charge of other work.

3) Operate "independently" first, and then integrate into the large army. This last approach is to take business development as the first consideration, start independently, and then gradually seek integration in the future. The most typical is Ma Huateng's acquisition of Zhang Xiaolong's team that year, Tencent gave WeChat independent operating space and freedom, but this situation requires the leaders of independent teams to have the ability to establish tacit understanding with the CEO.

3. The construction of the core team: integrate corporate culture into leadership construction

Integrate the eukaryotic and executives of the previous sequence into the foundation, and you can start to build the core team. At this time, the culture must go first, the leadership construction must keep up, and the core team will have cohesion. All great companies are driven by mission and vision, which sounds very vain, but it is actually very real, and the difficulty lies in how to build corporate culture. Edgar Schein, a well-known scholar of corporate culture at MIT, has a classic thesis that corporate culture and leadership are two sides of the same coin, so the best solution is to put corporate culture and leadership construction together, and leadership integrated into corporate culture is the engine of corporate organizational evolution, which is the first step in building a core team.

• Clarify the bottom line of cadres: Huawei's "eight cadres"

The corporate culture must reflect what you resent and what you encourage. This culture of explicit agreement is sometimes the bottom line of a company's behavior. Huawei's "Eight Articles for Cadres" has been revised several times, that is, as a bottom-line requirement, no Huawei cadre can have any negative behavior listed in it.

Correspondingly, there is a set of cultural three questions at Huawei, which evaluates the bottom line through a minimalist five-point standard: First, have you done it? Second, have you spread it? Third, did you act when you found positive and negative behaviors? For each behavior score, the first one must be more than 3 points, as long as there is a negative one, it cannot be a cadre. If it can still spread, it can be added. If you can stop negative actions & encourage positive behavior, you can get a high score.

• Achieving Intergenerational Transmission: Incorporating Culture into Leadership Model Evaluation

With the bottom line drawn by culture, let's look at Huawei's nine leadership models. The customer-centric, cross-departmental cooperation, and mission-driven aspects of the leadership model can be said to be derived from culture, from the "eight cadres", or in other words, Huawei has implanted some key points emphasized in the culture into the requirements of the leadership model.

The logic of the entire leadership model is to develop the individual first, then the organization, and finally the business. Each of the leadership models has a hierarchical description based on key behaviors, making it easier for evaluators to score objectively. Specific behavior description is actually not difficult, the design logic is to first go up to the sky, then stand on the ground, first list the ideal situation you want to achieve, and then say the bottom line, and then do the behavior classification in the middle. Taking "mission-driven" evaluation as an example, the four-level behavioral evaluation criteria are:

Once this leadership model is implemented through the evaluation system, the most difficult part of corporate culture can be realized, that is, intergenerational inheritance. The essence of corporate culture is not only reflected in the senior management team, but also reflected and inherited in the middle and grass-roots employees.

For example, a few years ago, a small technology company recruited grassroots managers from Huawei, and the founder of this company said to me that within a week, there were three candidates from different departments of Huawei, and the teams were very different, but the interview invariably made people feel the customer-centric and strivers-oriented spirit of Huawei's culture. He was shaken, and if the managers on his team could do the same, the team would be invincible.

• Use opportunities to drive growth: Promotions are linked to leadership assessments

Culture falls on leadership, leadership falls on actual assessment, and the results of assessment must fall on the final opportunity for promotion. You must have a mechanism of opportunity to pull, you must let his personal interests and development be linked to what you emphasize, and this is really the landing, otherwise no one cares about the thing you think is important.

Therefore, Huawei cadres have four grasps, grasp culture, grasp goals, grasp rules, and grasp teams. Grasping culture must also be before grasping the goal, because culture is actually a big goal, and culture is a longer-term strategy. How long is the strategy cycle? Generally three years. How long is the vision cycle? Usually 10 to 20 years, or even longer. So suppose your vision has a minimum cycle of ten years, which means that you are iterating out of three strategic cycles into one vision cycle, so culture is a longer-term strategy.

And many of our companies are easy to obsess over short-term goals, that is, performance, which is difficult to support your long-term development. Therefore, grasping culture, grasping rules, and grasping the team are important parts of whether cadres really meet the standards of ability and whether they should really be promoted.

Many people may have seen this four-quadrant chart, but we must figure out what the logic of including leadership in the selection and promotion evaluation criteria of cadres is, it stems from the requirements of the cultural bottom line, implemented in the leadership model, and finally the guidance of behavior is reflected in the promotion and development opportunities, so that it can be done realistically, thoroughly, and truly implemented in the organization.

4. Team Growth Accelerator: "True Teaching"

Many enterprises have corporate universities that call on employees to learn, but they are often still in the form, employees are tired, and the training results are not obvious.

Here are two of Ren Zhengfei's cognitions about employee learning and training:

• Cognition 1: Learning is only a process, growth is the result
• Cognition 2: Let excellent talents cultivate more excellent talents

• The basic logic and paradigm of the "QuanzhenJiao" training system

Don't learn for the sake of learning, learning is not the goal, growth is. How many trainings are organized for employees, how many books are required to be read, and how many training camps are not important, what is important is to transform into growth, and it is the degree of achievement of the growth goals you set. At the same time, the "generals" and experts in the company must play two roles, commanding battles while being coaches, so that the excellent people who have been verified can cultivate more excellent people. I summarized this training model of "moving the battlefield into the classroom and letting the classroom enter the battlefield" as "QuanzhenJiao".

What to teach? It must be a case based on real scenes and needs. Many of Huawei's business is a major project for the B-side, so project management training must be based on Huawei's most important business scenarios in the future, and use real cases to do practical training, otherwise it is difficult for other things to really make the team have a harvest that can be transformed, only the passion and pain when listening to the class.

Who will teach? It must be the "general" who has fought in the war to be the teacher. The requirement for the teacher is to at least do a major project from beginning to end, otherwise he is not qualified to teach others. At this point, our concept of billions of dollars coincides with Huawei.

How to teach? It must be a highly participatory co-creational learning. That is to say, you can't just listen to others, it's a report meeting, you must analyze real or simulated cases and problems, and everyone must participate in the process of proposing solutions.

How to see the real effect? There must be an emphasis on the transformation of action. The core is the full truth defense plus actual combat verification, the simulated defense is to let everyone in the short-term training familiar with the way of thinking and solving problems, the real results also need to be verified on the real battlefield, in the process of actual work to examine the growth conversion rate. That is, learn war in war, learn to swim in swimming.

• The application of the "QuanzhenJiao" training system in echelon growth and horizontal replication

I'll talk about two of the most important scenarios.

The first is the growth of echelons. Although the middle and high levels of the team can also be solved by external introduction, after passing the initial stage, the improvement of internal hematopoietic capacity is a more cost-effective way to spend and time. First of all, a group of candidates who may become high-level candidates are selected, and the full-time training is carried out, and the unified course of no more than 10 days is used to enhance the abilities he needs to become a senior person, such as strategic thinking, operation management, and cultural construction. Then three months were battlefield teaching, and their direct supervisor was their coach, making breakthrough improvements in the leadership model for each person's two most core projects.

The second is horizontal replication. With the expansion of the scale of enterprise organizations, more and more talents of the same type are needed, which is a practical problem encountered by many companies in the rapid expansion of their business. For example, store managers in the restaurant industry, regional leaders during regional expansion, product managers, and so on. However, the replication of capabilities is very slow, and Huawei also used "QuanzhenJiao" training to solve this problem. Around 2003, Huawei's business was in more than 20 countries, and at that time, it had a plan to expand to more than 100 countries in the next five years, and the immediate need was to cultivate and fill the talent gap of these 80 country representatives in a short period of time.

In this context, five of the original 20 country representatives were selected to be the most outstanding, distilling the key factors of their market success, and finally combining and extracting 8-9 of the most critical issues, such as local employment issues, local government relations, international taxation, customs affairs, etc. These topics are condensed into eight courses, and these five most outstanding representatives are allowed to teach. After about two weeks of training on 8 topics, candidates from the target countries for future expansion can be selected. In the feedback we received, these people said three months after they arrived on the battlefield that 70-80% of the core competency points mentioned in the class were highly consistent with the actual scene.

• How to improve the motivation of coaches?

An important problem with practical training is that the teacher does not like to teach, that is, your "generals" do not have the will to do the training. This is a big problem to achieve hematopoiesis and talent replication within the organization. So how do you fix it?

First of all, Huawei was referring to IBM and GE, proposing that the middle and senior managers who could not train successors in this position could never be promoted. Cultivating talent is at least as important as creating performance, because performance is short-term, and the team's combat effectiveness is long-term.

Second, the effect of talent growth is included in the important assessment indicators of the core backbone. In the high-level, this matter should reach a consensus, the key is not to make adults stare at people, but to do the layer to keep an eye on the layer, and the top management to focus on the growth effect of the middle management. Now Hua has two candidates for each senior management position, only in this way can a long-term talent hematopoietic mechanism be formed.

Third, closely combine the effect of personal growth with the talent selection mechanism, so that they have better development opportunities, in order to stimulate the enthusiasm of active learning. For the middle and senior management, cultivating candidates is a necessary condition for their own continued development.

To sum up, the closed-loop management process of the core team is to first do talent assessment and inventory for the core team through the leadership model and ability assessment model, and after finding the main gaps, the "full true teaching" training method is adopted in a targeted manner to empower and improve in actual combat. Finally, the learning results are cross-evaluated with tutor Q&A guidance and practical application, which drives the ability growth of the entire core talent echelon, and then leads the continuous evolution of the entire organization.

Evolution of organizational structure and agile mechanism construction

1. The basic form of organizational evolution of startups.

For startups, it is still necessary to understand the evolution of organizational forms, so that they can be more comfortable and not confused when change occurs. We are now interested in a smart mechanism (agile organization) that many startups are interested in, and I will also integrate into the part of the platform organization for interpretation, and you can refer to the actual situation of your own company.

The first is the project type, starting from a project to make a product, and then slowly expanding the scale based on the project. For the project type, the decision-making power is relatively concentrated, the advantage is that the speed of iteration can be accelerated, which is the basic organization and decision-making mode of the start-up enterprise, note that it is not recommended that the entrepreneurial enterprise do the organizational model of distributed decision-making.

After that is the functional type, after the project is more, the scale of personnel will gradually increase, at this time it is necessary to do a professional division of labor, marketing, product development, operation management, etc. separate to form an independent department. Startups generally embark on a specialized division of functions after a rapid expansion of personnel, which is also the simplest form of organization.

Finally, the BU type, with the development of business, the project began to fission, independent business support became just needed, BU system (division system) appeared, forming different product lines or business units. However, while fission should adopt a functional model for each unit, in addition to the organization with products and businesses as the unit. This model, in many cases in practical applications, is the intersection of functions and BU, that is, the matrix organization that everyone is familiar with.

It must be emphasized here that the organizational model of startups is to match the organizational strategy, and the organizational model born out of some large enterprises is not necessarily suitable for your stage. For example, I don't recommend that startups do a platform-based organization from the beginning, that is, the model of a small team in the front and a large platform in the rear.

Taking Huawei as an example, from 1987 to 1998, Huawei mainly provided mainstream communication products for China, and at that time, it was mainly functional organizations. From 1999 to 2014, Huawei was already very large, providing communication solutions for the world, and Huawei was mainly based on matrix organizations. After 2015, Huawei's business has developed from information and communication technology to the Internet of Everything, and the organizational capabilities need to meet the needs of customers and the professionalism of technology at the same time, so it has moved to a platform-based organization, the front end to understand and grasp the needs, and then let the rear platform provide strong support.

2. What kind of company is suitable for a platform-based organization?

So how do you evolve into a platform-based organization?

First think about why McDonald's opened stores so quickly, some people say that standardization is done well, modularization is done well. Standardization and modularity are necessary conditions for replication, but the more important premise is that the work that can be standardized must be relatively simple work. McDonald's has weakened the front-end sales and marketing functions, and McDonald's stores only have operational functions, which can become an easy-to-replicate model.

Therefore, to copy, the front end should be done lightweightly, because the heavier the front end, the worse it is to copy, and no amount of standardization can change the fact that the pattern is heavy. The front end is to be able to quickly focus on customer needs, quickly solve problems, and at the same time have the ability to be reproducible, and the platform is to empower the front end to solve these problems. For platform-based organizations, it is also divided into two different evolutionary directions, one is a liquid organization that emphasizes front-end innovation capabilities, and the other is a modular platform-based organization that emphasizes operational efficiency.

First, mostly toC companies, especially similar to ByteDance and many game companies, put great emphasis on front-end creativity, and their organizational model will gradually move towards liquid, and its core is a small team and a light platform. Because the creativity of the front-end small team constitutes the main source of the company's innovation power, the front-end is a little heavier, and the platform is slightly lighter, which can stimulate individual creativity.

Second, companies like Huawei and Ali, contrary to tocC companies, will make the platform more and more heavy, because the platform needs to provide directly utilizable modular functions and efficiently support the front end to create value for customers.

3. The key elements of a platform-based organization

I also know that a lot of the companies here think they're going to go to a platform organization because you're all growing very fast. Therefore, I have also summarized to you the six important links or elements of building a platform-based organization, whether you are a toC or a toB company, these key points are established, and you can judge and work hard against your actual development.

• Distribution decisions. Let the people in front of you hear the gunfire to make decisions, this sentence has been widely circulated, but this is also the basic feature of the platform organization. Because, in the midst of strategizing, the traditional decision-making model of winning thousands of miles away can no longer meet the requirements of modern response to rapidly changing markets.
• Closed-loop operation. The company must form a cross-departmental collaborative project organization, generally with the project as the basic unit, rather than the function as the basic unit like the functional organization, which is very important, because this positioning determines whether it can solve the problem of different departments pulling through and forming an internal end-to-end synergy.
• Goal synergy. It is necessary to be able to do a good job of networking and target alignment of target management. The goals of traditional enterprises are often vertically decomposed, in fact, not only traditional enterprises, many of our innovative startups are also accustomed to vertical decomposition. But when we go to achieve customer value, we also need to carry out horizontal collaboration, so the management and dismantling of goals will be networked.
• Transparency. Information asymmetry is the key to influencing the quality and efficiency of decision-making. Welch has said that there is a premise for evaluating the level of decision-making of two people, that is, the information of two people is similar. The common problem of Chinese enterprises is that the upper echelons have too much information, and the project leaders who really need to make decisions and actions cannot have enough information to make high-quality decisions.
• Effect incentives. Be able to dynamically strengthen incentives around value creation. There are three major integrations in the rapid change of enterprises: the integration of brain and body, the unity of people and posts, and the integration of lili and li, and many companies are still using annual assessments to stimulate rapidly changing businesses, and the two are not matched at all. We need to design different goals and reward models as the project changes, preferably with immediate incentives for differentiation based on different businesses.
• Technical applications. Be able to apply digital technologies to improve organizational effectiveness. Many businesses do a good job of digitizing their businesses, but the digitization of organizational capabilities is particularly poor. If you do a digital portrait of the best and worst 10% of your employees, will this data help you select and nurture better employees? If different regions and stores can be digitized, then you can try different incentive schemes and choose the best effect to do rapid iteration. The long-term accumulation of organizational talent digital database is a huge wealth, after continuous iteration, it can provide an important reference in employment decision-making, recruitment decision-making, and education decision-making, thereby improving the efficiency of organizational management.

4. Construction and assessment of the front-end iron triangle

The key elements of the platform organization mentioned above are more summarized for the entire organizational model. For platform-based organizations, the front-end, converged "iron triangle" is a key part that needs to be interpreted separately. In this regard, Huawei has done almost nothing beyond the right. The iron triangle refers to the fact that the front end of the platform generally has three functions, even if the front end is only done by one person, it must also have these three functions:

• Customer relations and commerce, that is, sales functions
• Products and solutions, i.e. technical capabilities
• User service, i.e. delivery of functionality

These three features are required, but the front-end scale can be changed accordingly according to the actual business. For example, in the face of super B-end customers such as China Mobile and China Telecom, the three functions will be implemented in the form of three teams. If you face small and medium-sized customers, the meaning of sales may be heavier, and the technology and delivery functions can be reused. Therefore, the team should combine these three functions based on the size of the customer, the complexity of the product solution, and the return on investment ratio.

The Iron Triangle team should form a set of value chains, that is, the distribution and assessment modes between them should be related to each other, otherwise it will definitely affect the working status of the entire Iron Triangle team. In Huawei's best practice, at least one indicator on the assessment indicators of three different functional personnel in the Iron Triangle is interlocked, and these three indicators must not be completely separated, but must become "grasshoppers on a rope".

The front-end iron triangle can ensure the alignment of goals and incentives through benefit sharing. But it is impossible for all people to do project work, and it is also mentioned here that the middle and back-end personnel of the platform-based organization also have to undertake the work of the platform itself. Therefore, for the middle and back end, the assessment is relatively difficult. For these personnel, it is necessary to use two assessment dimensions, one is the project assessment dimension, as long as you participate in a certain type of project more than 10% of the time, you must be included in the project assessment, according to different projects to determine the weight and total weight of the project. The other is the functional assessment dimension, that is, the original department work, and the assessment and evaluation of two dimensions and different weights is the general model of the platform organization.

Because the focus of today's course is not on salary and incentives, we will not focus too much on this part, just to remind everyone. Because when I understood everyone's learning requirements in the early stage, I saw that many students, especially toB startups, were entangled in how to evolve into a platform-based organization, how to do a good job in organizational coordination and benefit distribution before and after. As I mentioned to you earlier, it is not recommended that you adopt a platform organization one-size-fits-all, and the evolution of the organization is not because it can make your management simpler, but because it is more in line with the needs of strategic development.

Finally, to sum up. The main line we are discussing today is the growth of organizational capabilities, because organizational capabilities are the fundamentals of ensuring that in addition to our pursuit of short-term financial growth, we can ensure the longevity of our enterprises, and companies with sufficiently good organizational capabilities may be able to do everything well, and it will be easier to survive in the era of great changes.

In the organizational ability, I hope that everyone can build their own true core, can do a good job in the integration of airborne talents, and the consolidation of these foundations can make you better implement leadership to guide the growth of behavior and better build an internal talent hematopoietic mechanism.

At the same time, we must have a clearer understanding of our organizational stage and form, be able to judge which form we should evolve into in the next stage, and be able to adapt our strategy with the most appropriate organization.

Thank you!

Limited by the rights and interests of on-site students and the length of the problem, some of the shared content is no longer released, and this article is about one-third of the complete content.

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