Kikube optimization of the big factory

Image source @ Visual China

Wen | Lu Jiu Finance

Layoffs in extraordinary periods, layoffs during transition periods, and annual elimination of layoffs, layoffs in large factories, each has its own way. The times are also quietly turning the page.

Big factories lay off employees, popular a new word, partial optimization, and some of the employees who were fired laughed at themselves, more like Kikube optimization, they were so ruthlessly pulled out by the company.

Lujiu Finance learned from Meituan insiders that Meituan Preferred laid off business posts such as BD, and the production and research department also locked HC; Lujiu Finance consulted with Ali and Tencent's public relations departments, and as of press time, no exact news was obtained.

The layoffs of large factories are a comprehensive response to the company's internal and external situation, which departments are moved? Who to move? It's all a rational trade-off.

There are also some optimistic voices saying that after the layoffs of large factories and the reduction of some inefficient and unprofitable "garbage" departments, perhaps large factories will run faster.

In any case, the golden age of the Internet has indeed turned the page.

Is there any logic to layoffs?

In general, layoffs come from financial pressures.

The external environment of the enterprise has undergone relatively large changes, resulting in some businesses can not be carried out, or the company in order to look good in the financial statements, or to survive the economic cycle, or in order to boost investment confidence, at this time, it is necessary to adjust and optimize some departments.

Mr. Wu, who used to work as an HR at Ali, told Lu Jiu Finance that at this time, the company will generally select those businesses that have a greater impact on the data, or even have a negative marginal contribution, and are not on the core track, and may be reduced or even shut down.

"Of course, some of these businesses are in the cultivation period or incubation period, and they must be retained." Those businesses that have been mature in the market for a long time must be cut if the numbers are not good. ”

In addition, if the financial pressure is not very large, some tentative non-main track business can also be retained first. Once there is financial pressure, such a business must be the first to start.

In addition to layoffs, salary adjustment is also a way.

Mr. Wu told Lu Jiu Finance that at present, the whole Ali is strongly contracted. March is the time for Ali to assess and pay bonuses, and this year's salary increase and bonus package have dropped significantly compared with previous years.

In principle, employees above the P8 level do not adjust their salaries, and the P7 and P6 below the P8 level are also greatly reduced, far lower than the standards of last year and previous years. Because Ant Financial's listing is hopeless, many people's options have lost the opportunity to liquidate, so the bonus and bonus package are very generous, and the salary increase is still very high.

"For example, last year's salary increase was ten percent, and this year's ants may become twenty or thirty percent, but the group may only have three percent."

"Generally speaking, when the internal and external situation is not good, some uncertain business levels will be laid off, and the business that needs to be heavily invested will slow down the investment, and the mature business that does not make money will also be laid off." Mr. Li, the headhunter of a domestic top ten headhunting company, told Lu Jiu Finance that in addition to the cost reduction method, that is, to take stock of talents, there are probably the following 5 principles:

Reduce the ratio of products and R&D. For example, the original ratio is 1:10, after cost compression, the overall reduction of 30%, the ratio of products and research and development will become 1:20;

Let the high-level people do the work. For example, a department of a company, the original P8 below the 5 P7, the personnel department will remove the two P7, let the P8 directly do their own work;

Generally speaking, people who perform on the front line are more likely to be laid off if they are more expensive;

New hires are also a high-risk group, and if the department is to be compressed by 30 percent, the priority for new hires to be laid off is high. Because the newcomer's first business is not familiar with it, the impact on the business is relatively small, and the cost of layoffs is also small, because the compensation is not high;

If a person of a higher rank is a little expensive, let him do the first-line work, or feel expensive, will also be cut off, replaced by a lower 1-2 level of people to do.

In addition, there are also some ways to reduce costs in salary payment and position adjustment. For example, the spring promotion rumored by the US group is changed to autumn promotion, so that the promotion salary of half a year can be reduced, and the cost of year-end bonus distribution will also be reduced.

In addition, as the rumors say, ByteDance's monthly salary fell, the annual 15 salary was changed to 18 salary, the total salary remained unchanged, which is equivalent to a decrease in the monthly salary, an increase in the year-end bonus, in order to get the year-end bonus, the internal will be more volume.

People follow the strategy

What kind of people are more likely to be cut? Let's talk about who is more likely to stay first.

Large factories will also lay off employees according to different stages of business development, and at this time, employees with strong comprehensive ability will be more likely to stay.

Headhunter Mr. Li told Lujiu Finance that volcano engine, an enterprise technology service platform under ByteDance, has actually undergone a round of major layoffs after its launch in 2020.

Mr. Li often visits major recruitment websites and analyzes and observes. For a while, he found a surge in the number of people coming out of ByteDance on major recruitment sites, and through interviews with these people, he could find adjustments within the company at the business level.

"For a while, I found that Byte's products are changing, the proportion of Douyin advertising is adjusting, such as the number of live broadcast brands is increasing, the taste is higher than before, and there must be corresponding personnel adjustments within the company."

Mr. Li said that when the volcano engine was first launched, and when the customer was stable in the later stage, the talent structure required was different, so personnel adjustment was inevitable.

When the volcano engine business was first launched, it definitely needed a lot of sales to find customers, and it also needed a lot of planning creatives to propose proposals for customers and serve customers. At this time, it is the stage of "strong reclamation, weak operation" and "strong creativity, weak operation".

However, after a year or two, KA (large customers) and LA (small and medium-sized customers) have run through, and they have begun to enter the stage of "weak creativity, strong operation" and "weak reclamation, strong operation", and the sales staff responsible for KA and LA will become the object of layoffs (or human resource optimization).

"Because after working for a year or two, they have basically got 70%-80% of the industry's customers, to maintain these customers, they need more operations personnel, and the development of new customers, less than so many people." Mr. Lee said.

Similarly, creative planners are facing a wave of layoffs.

"In the beginning, whether it's headline ads, or TikTok ads, whether it's snacks, clothing shoes and hats, and consumer electronics, their packaging ads need a set of ideas to satisfy. After a period of time, these customer-facing services have been standardized, process-oriented, and have a very mature program. Proposals can be copied directly to customers. At this time, the dependence on planning ideas is not so high. ”

Mr. Li told Lu Jiu Finance that the big factories have a very mature human resource management system, and the development of the company is a dynamic process, in this process, they will make calculations, in addition to layoffs, they will also arrange appropriate people to transfer jobs. Some people can also be transferred to operational posts, which can avoid layoffs. At this time, people with more comprehensive abilities will be more likely to stay. As Wang Huiwen, co-founder of Meituan, said, people who have cognition in two fields have the power not to be 1+1, but to add 0 after 1.

Large factories lay off employees, with different ideas

The logic behind the personnel adjustment of various well-known factories is different.

The US group belongs to the streamlined functional faction.

Meituan Preferred made a big adjustment in 2020. At that time, Meituan merged the original operation department and procurement department, and re-appointed the original Yunji CMO Hu Jianjian to be in charge. The purpose of meituan's adjustment is: procurement and operation business are highly correlated, and combined into unified management, which can reduce internal friction and improve the efficiency of collaborative work.

Meituan's store-to-store business group has launched a small yellow card business to help stores acquire customers and increase the frequency of customer consumption. When Meituan invested heavily in the preferred, it suspended the small yellow card business, and more than 200 members of the small yellow card team were all supplemented to the preferred business.

Tencent belongs to the business optimization faction.

Tencent's current round of layoffs seems to be based on the idea of strengthening the body and optimizing the allocation of resources. Tencent's recent rumored layoffs are the hardest hit areas of the two major divisions, CSIG (Smart Industry Business Group) and PCG (Platform and Content Business Group), CSIG is mainly 2B business, including Tencent Cloud, Smart Retail, Education, Medical and other industry solutions, with slow growth and relatively limited revenue. What Lujiu Finance learned is that Tencent's senior management hopes that this 2B business can make its own blood, cut redundant personnel, and reduce costs.

PCG mainly includes online video BU, news and technology middle office. In fact, PCG made an adjustment in April 2021, when Tencent Video, Weishi and App Bao were merged, in order to integrate resources and fight a protracted battle with Douyin and Xiaohongshu in the long and short video area. That adjustment also laid the groundwork for this year's layoffs, the merger of business departments, coupled with the fact that the profitability of this business was not good, it was also expected that the personnel would make appropriate adjustments.

There are also profit-making factions similar to iQiyi.

Video companies like iQiyi, which rely on Baidu, can only honestly reduce the number of personnel in various departments to control costs when the overall situation is not good. Not long ago, in the company's earnings conference call, CEO Gong Yu said that iQIYI has taken measures to open source and reduce expenditure, in addition to saving costs related to people, but also to make the organizational structure flatter.

In addition, some layoffs are actually the company's routine assessment elimination, the above-mentioned Ali person Mr. Wu said, as far as he knows, Ali's local life has not moved at all, and external rumors are likely to be rumors. "Ali will be eliminated at the end of the year every year, about 10%, and the end of March is the time when the assessment comes out." This is not a layoff, it is a normal change. ”

In addition, like the dissolution of the Byte War Investment Department, I believe that many large factories will also have similar measures, one is because of the external social environment, enterprises began to shrink, in addition, it has a lot to do with the poor development of the entire Internet industry.

The times have turned the page, and the scenery of the big factory is no longer there?

Enterprises are choosing employees, and employees are also choosing enterprises.

Headhunter Mr. Li revealed to Lu Jiu Finance that the flow of the talent market is now different from before, and the people of the big factories are going out and flowing to some emerging unicorn companies, such as carbon neutrality, new energy, cross-border e-commerce, etc.

"Big factories use stock incentives, after all, the number of stocks is limited, the space for storytelling is no longer there, in addition, the business adjustment cycle of large factories is very long, and some people can't stand it, thinking that they want to achieve value in fast-growing companies."

The scenery of the big factory is no longer what it used to be.

The Internet has been surging for 30 years, the traffic has peaked, no longer like before, there is more than imagination of the development space, everyone is more and more rational, this is one.

In addition, in the past few decades, large factories have been in strategic layout considerations, crazy expansion in various fields, some money-losing business has been continuing to do, and now it is time to come out.

As the tide recedes, investors are also becoming more rational and want to see positive cash flow for companies.

Coupled with domestic and international environmental factors, Dachang has also entered a period of rational development, and more and more hope that its business can develop healthily. Therefore, they are all taking a pay cut or layoff to keep the company on the road to healthy development. Moreover, this round of layoffs occurred after the Spring Festival, and employees received bonuses at the end of the year, which is also the conscience of the industry.

The golden age of the Internet is no more, and the times are being renovated.

Where is the next gold industry?