Although people come and go is a common occurrence in the Internet industry, and the year-end assessment of Internet manufacturers is not a paper tiger to watch, when the changing era is superimposed on the changing large group, the fate and whereabouts of individuals have attracted more and more attention.
On the evening of May 25, Alibaba denied the layoffs on its official Weiwei, "Rumors about layoffs in Taobao Tmall, Alibaba Cloud, Cainiao, and local life are very strong, but rumors are rumors." At the same time, Alibaba also announced that in 2023, Alibaba's six major business groups will recruit a total of 15,000 new people, of which more than 3,000 will be recruited.
Behind the close attention of the outside world, Alibaba, which carries the lives and dreams of many employees, has changed, and this super factory with more than 200,000 employees is carrying out a series of self-revolutions that "move to the foundation": whether it is the spin-off of 1+6+N, or the planned listing of Alibaba Cloud, Cainiao and Freshippo, the path of seeking growth regardless of cost has changed.
"Slimming" visible to the naked eye
Every May, after the "big events" such as earnings reports and last year's year-end results, the news of Alibaba's "layoffs" will come out in waves.
Optimization is a big source of "layoffs" rumors. According to the reporter of the "China Times", Alibaba's annual "361" internal assessment will bring corresponding personnel changes. Every year, Alibaba's internal performance score (4 is the highest), 30% of employees will get 3.75, 60% will get 3.5, and the remaining 10% or so will get the lowest score of 3.25. In the year of getting 3.25, employees cannot get a salary increase and promotion and do not have a year-end bonus, and if they get 3.25 for two consecutive years, they will have to leave. Based on Alibaba's total workforce of about 235,000 as of March 31, 10% of the workforce has 23,500.
The uniqueness of this year is that Alibaba just announced the organizational changes of 1+6+N in March this year.
On March 28, Daniel Zhang, Chairman and CEO of Alibaba Group, issued an all-staff letter announcing the establishment of six business groups, including Alibaba Cloud Intelligence, Taobao Tmall Commerce, Local Life, Cainiao, International Digital Business, and Dawen Entertainment, as well as a number of business companies under Alibaba Group. This round of change has also been called "Alibaba's most important organizational change in 24 years Daniel Zhang
As a huge aircraft carrier was split into a combined fleet, an Ali employee had previously predicted in an exchange with reporters that after the announcement of 1+6+N, there would be a wave of personnel turnover in Alibaba's various businesses, "The company has become smaller and does not have so many seats." The boss has no room to rise, what to do with the people below? ”
Although Ali stressed that the flow of personnel is normal, before announcing the 1+6+N organizational structure change, the giant was already "slimming" visible to the naked eye.
According to the above financial report, as of March 31 this year, Alibaba's total number of employees was 235,216, 4,524 fewer than the end of the year, and nearly 20,000 less than a year ago.
For Ali's latest recruitment information, Li Chengdong, founder of Dolphin Think Tank, believes that layoffs and recruitment are not contradictory, he told the "China Times" reporter that Ali's purpose is to reduce costs and increase efficiency, replace old employees with higher costs, use cheap new people, the total amount remains unchanged but salary expenses are greatly reduced, in addition, "old employees can not do it, replace some motivated young people." He also believes that with AI big model technology, many positions no longer need so many employees.
Behind the split
When every micro individual re-plans their career in the face of the workplace, the Internet giants behind them have made choices at a fork in the road of transformation and evolution.
On the surface, the organizational structure adjustment and job changes brought about by Alibaba's 1+6+N change have triggered corresponding personnel flow. Taking Alibaba's large middle office business for many years as an example, according to the reporter, in this adjustment, Ali split and packaged the original middle office business into Taotian, Alibaba Cloud and other business groups. The above-mentioned Ali employee told reporters that as far as he knows, there are middle office colleagues who do not accept job transfers and choose to leave with "N+3".
But in essence, after Alibaba's big split, the independent business units are responsible for their own profits and losses, which makes cost reduction and efficiency increase their top priority: the good old days of relying on Taobao Tmall blood transfusions to seize the market at all costs are over. Hu Chuncai, a retail expert, told the "China Times" reporter that if profits do not grow, it is necessary to reduce costs and increase efficiency, and reducing people is the first step, "Everything is related to people, people can't be reduced, don't talk about anything else." ”
In particular, Alibaba's just-announced timetable for listing plans makes their need to reduce costs and increase efficiency more urgent. On May 18, Alibaba's board of directors announced the listing plan of three businesses in one go, hoping to complete the spin-off listing plan of Alibaba Cloud in the next 12 months, the listing plan of Freshippo in the next 6 to 12 months, and the listing plan of Cainiao in the next 12 to 18 months.
Alibaba's 2023 fiscal year financial report released on the same day as of the end of the first quarter of this year showed that the adjusted EBITA of China's commercial sector in the current period was 184.862 billion yuan, which was the best in the dust; Alibaba Cloud's indicator was 1.422 billion yuan, which has been able to independently support the portal. During the same period, although the losses of other Alibaba's business segments narrowed year-on-year, adjusted EBITA remained negative. Among them, the local life sector with the largest loss, adjusted EBITA was -14.021 billion yuan, and Cainiao's indicator was -391 million yuan.
Behind this slimming, two of China's most profitable businesses of China's leading Internet manufacturers are facing a slowdown in revenue growth.
Alibaba Cloud's revenue of RMB77.2 billion in fiscal 2023 increased by 4% year-on-year, but its year-on-year growth rate was 23% in the previous year. In addition, customer management revenue in Alibaba's retail business in China fell 8% year-on-year in the current period, mainly due to reduced consumer demand, ongoing competition, and supply chain and logistics disruptions due to the new crown pneumonia, which led to a mid-single-digit year-on-year decline in GMV (excluding unpaid orders) of online physical goods on Taobao and Tmall.
As a wholly-owned purse of Alibaba, Taobao Tmall Group contributed US$25 billion in free cash flow to Alibaba in the last fiscal year. Hu Chuncai also told this reporter that as an "old" e-commerce company, Ali has been robbed of a lot of market share by new platforms such as Douyin, Kuaishou and Pinduoduo in recent years, and is facing great pressure.
"Burning money" for the era of growth has passed
Alibaba is also under pressure to grow in the capital markets.
On May 26, Alibaba's Hong Kong stock closed at HK$78.65, down nearly 3%. That's down 20 percent from the start of the year. In late October last year, it also posted a 52-week low of HK$60.25. For reference, Alibaba's highlight in Hong Kong stocks was HK$309 in October 2020.
It should be mentioned that in the late October period of last year, the other two Internet giants, Tencent and Baidu, also appeared their own 52-week lowest stock prices: Tencent's 52-week low of HK$187.3, less than 60% of the closing price on May 26, and Baidu's 52-week low of HK$73.7, about 63% of the closing price on May 26.
It is worth mentioning that not only Ali, but also Tencent's slimming action is also underway. According to Tencent's financial report released on May 17, it had 106,221 employees in the first quarter of this year, a decrease of more than 2,000 from the previous month and nearly 10,000 from the same period last year.
Behind the continuous slimming of the top manufacturers, in the three years of the epidemic, cost reduction and efficiency improvement to replace high growth have increasingly become the main theme of Internet manufacturers. When communicating with reporters, many industry insiders believe that once backed by sufficient online demographic dividends and external capital, the era of Internet giants "burning money" for high-speed growth has passed, and the focus is now on being able to support themselves.
In the period of rapid expansion, things that seemed to be taken for granted such as changing jobs and raising salaries are now a different story. An employee of an Internet company told the "China Times" reporter that now the budget of his department has not only shrunk a lot, but also put it together and packaged, "Just so much money depends on how you choose, fortunately we chose a guarantor." An employee of an Internet company told reporters during the exchange that according to his understanding, because he knew that it was difficult to find jobs outside, some departments suspended employee promotions, "I dare not move anyway." ”
Mo Daiqing, director of the online retail department and senior analyst of the e-commerce research center of NetEconomics, also told reporters that the Internet industry has begun to take the initiative to brake, since the epidemic has been released, major Internet companies have chosen to maintain stability, save costs, and need to find new increments. Under such circumstances, the development of Internet companies focuses more on "fattening and thinning".
Responsible editor: Huang Xingli Editor-in-chief: Han Feng