Xiaomi's "partners" are all leaving Lei Jun

Introduction: From the "Seven Musketeers" in 2010 to the "Eight King Kongs" in 2012, from the "second entrepreneurship" of the nine partners in 2020, only Lei Jun and Lu Weibing are left. The Xiaomi partners eventually went their separate ways.

Zhou Dongshi | Author: Stone Business Review | produce

1

Loose partnership system

In 2016, Xiaomi's mobile phone, which has always been smooth sailing, suffered the biggest crisis since its establishment.

Backward design and development, slow upgrading, and even frequent out-of-stock, Xiaomi, known for its extreme efficiency, lost its biggest reliance overnight.

The unilateral supply of the screen by the core supplier Samsung is an important reason for the lag of Xiaomi mobile phones. But at the end of the day, this is a dangerous situation created by Xiaomi's supply chain itself.

This major accident started with a very small story. On the eve of the release of Xiaomi Mi 5 in February 2016, Xiaomi's supply chain team led by Guo Jun had an unpleasant exchange with the senior management of Samsung Semiconductor in China. It is said that at the meeting, Xiaomi employees and Samsung employees had an argument, and the attitude of both parties was unfriendly, and some people slapped the table directly, provoking the Samsung executive to leave angrily.

In the business world, it's hard to tell who's right and who's wrong. Some people in the industry once gave Samsung Semiconductor such an evaluation: extremely strong, like to fight bravely, and say the same... In his speech, he still lamented Xiaomi's unwisdom.

Soon, Samsung Semiconductor unilaterally stopped the supply of Xiaomi AMOLED screens. This farce, based on the employees of both sides, eventually evolved into a unilateral production capacity crisis for Xiaomi mobile phones.

In July 2016, at a seminar of external experts at Xiaomi, Lei Jun personally admitted that this was the bottom of Xiaomi, "this year we have three months of extreme shortage of supply chain", but then Lei Jun changed his words, "I think the rebound is about to begin."

Since then, it has been a well-known drama, after Lei Jun visited the Samsung headquarters three or four times to "pull relations" and "ask for mobile phone screens", Xiaomi's supply chain has taken a turnaround.

Lei Jun, who can bend and stretch externally, is decisive in killing internally.

He first removed Guo Jun, the direct head of Xiaomi's mobile phone supply chain, and then targeted co-founder Zhou Guangping. At that time, Guo Jun's direct reporting object was Zhou Guangping, who was the top person in charge of Xiaomi's mobile phone supply chain. In this drama that offended Samsung, Zhou Guangping is indeed to blame.

Previously, Lei Jun was not very satisfied with the mobile phone products he was responsible for. For example, the Redmi Note3, which has been complained about due to the slow progress of fingerprint recognition and poor experience, and the Xiaomi 5, which is belated due to supply chain problems...

So much so that it is rumored that in the VIP room of the 2016 Xiaomi annual meeting, Lei Jun said to Zhou Guangping in front of the executives, "If the flagship machine in 2016 is not good, you can go to retreat."

I didn't expect it to be a prophecy. Soon after the Samsung incident, Lei Jun took out the R&D and supply chain sector that Zhou Guangping was responsible for and took charge of it himself. Since then, although Zhou Guangping has been appointed as Xiaomi's chief scientist, he has gradually faded out of the center of power.

On April 6, 2017, the 7th anniversary of Xiaomi's establishment, Li Wanqiang, co-founder of Xiaomi, posted the latest group photo of several founders in the circle of friends. In the photo, the founder team has changed from 8 people to 7 people, they are Lei Jun, Lin Bin, Liu De, Li Wanqiang, Huang Jiangji, Hong Feng, who were originally entrepreneurs, and Wang Chuan, who was promoted to co-founder in 2012, except Zhou Guangping.

There is no shortage of other voices about Zhou Guangping. The unanimous opinion of everyone is that he is very individual, not tactful, and will quarrel with Lei Jun, and even embarrass the latter. Once, Lei Jun asked at Xiaomi's internal discussion why OPPO and vivo's supply chain is doing better than Xiaomi, but Zhou Guangping replied, "Then you go to OV's people", which caused the scene to be very embarrassing.

On the eve of Xiaomi's IPO in 2018, Zhou Guangping resigned from all his positions at Xiaomi as expected. In the business world, this is not surprising, but what is special is that he was the first co-founder to be "dissuaded" by Xiaomi. Since then, Xiaomi's partnership system has gradually begun to loosen...

2

The short-lived "Nine Partners"

Immediately following Zhou Guangping's departure was co-founder Huang Jiangji.

Although he is not visible in the Xiaomi team, he has a great background. Before joining Xiaomi, Huang Jiangji worked at Microsoft for 14 years, managing more than 100 employees under the WinPhone department.

Huang Jiangji joined Xiaomi because of a chat. At that time, Lei Jun, Lin Bin and Huang Jiangji made an appointment at the Jade Palace Hotel in Beijing, and Lei Jun fully demonstrated his role as an electronic product geek. In Huang Jiangji's words, "I am a Kindle fan and have written about some gadgets to improve it, but I didn't expect Lei Jun to know more about it than I did, because he directly dismantled the Kindle and studied it." In the end, Huang Jiangji left and left a sentence, "What you have to do, count me in!"

But after joining Xiaomi to start a business, Huang Jiangji's journey was not as relaxed as when he chatted. The businesses he has been responsible for such as Mi Talk, Xiaomi Cloud, Xiaomi Router, and Xiaomi Discovery Lab have not caused much market repercussions.

This is not only because Huang Jiangji's business is "not powerful", but more because Xiaomi's core and direction are not here. In addition to WeChat, almost all the chat software of various major manufacturers are stillborn, and there are no more than a few Internet manufacturers that really make their cloud business bigger.

Compared with Xiaomi's mobile phone supply chain in charge of Zhou Guangping, Huang Jiangji is in charge of more like an edge innovation business. With the closure of Mi Talk, Xiaomi Cloud was handed over to Cui Baoqiu, Xiaomi Router and Exploration Lab were handed over to Tang Mu, and Huang Jiangji was marginalized earlier than Zhou Guangping.

Huang Jiangji's departure is just a small episode, the key is who can make up for the power vacuum after Zhou Guangping's departure and really support Xiaomi's supply chain.

Lei Jun quickly found an excellent candidate, and this person was Zhang Feng.

In fact, Lei Jun has a close relationship with Zhang Feng. Even, he is still an early nobleman of Xiaomi and Lei Jun. In 2011, Zhang Feng, who has made a name for himself in the field of foundry, served as the general manager of Nanjing IAC. This year, Xiaomi Mi 1 was busy looking for OEM, and Nanjing Inventec, led by Zhang Feng, was one of the few companies willing to take orders from Xiaomi Mi 1.

In 2012, with the support of Lei Jun, Zhang Feng founded Jiangsu Zimi Electronics, which was also a relatively successful ecological chain enterprise invested by Xiaomi in the early days. With this relationship, coupled with excellent business capabilities, Zhang Feng was recruited by Lei Jun in 2016 to be responsible for Xiaomi's supply chain management.

Zhang Feng used his personal connections (during the OEM) to quickly gain a firm foothold. Its character advantages of "high emotional intelligence" and "good dealing" are gradually reflected in Xiaomi's supply chain management.

An industry insider once analyzed the relationship between (mobile phone) brand owners and suppliers, at the beginning of the brand was Party A, but the supplier became Party A when mass production was delivered, because some raw materials were relatively scarce, and the supplier gave priority to who to fight the relationship.

When doing OEM business, Zhang Feng knew the importance of maintaining a good relationship rather than suffering. There is a case that Zhang Feng initially lost money to help Japan's Kyocera Company produce mobile phones, and was scolded by the leaders, but later Kyocera handed over all the OEM business to IAC, so that the latter made a lot of money.

After taking the helm of Xiaomi's supply chain management, Zhang Feng appeared to be at ease. Since then, Zhang Feng has also participated in the management of the General Staff, the Procurement Committee and the intelligent hardware department and related businesses, and has achieved good results.

In August 2020, Zhang Feng, who is also the president of the major appliance department, became the new partner of Xiaomi Group, together with Wang Xiang, President of Xiaomi Group, Lu Weibing, President of China, and Zhou Shouzi, President of the International Department.

At that time, in addition to Zhou Guangping and Huang Jiangji, Li Wanqiang, another co-founder of Xiaomi and the author of the smash hit book "Sense of Participation: Xiaomi Word-of-mouth Marketing", also left Xiaomi 1 year ago.

Xiaomi's early partners are three out of eight, and the old five (Lei Jun, Lin Bin, Hong Feng, Wang Chuan, Liu De) and the new four people form Xiaomi's new top decision-making level, starting the next decade of "re-entrepreneurship".

At the same time, Lei Jun announced in an internal letter that Xiaomi's core strategy for the next decade will be upgraded to mobile phone xAIoT. Xiaomi's three iron laws that will never change are technology is king, cost performance is the key, and making the coolest products.

However, Xiaomi's new nine partner team has only lasted for more than half a year. In March 2021, Zhou Shouzi bid farewell to Xiaomi and switched to ByteDance. At ByteDance, Zhou Shouzi first served as CFO and then as CEO of TikTok. In March 2023, at a special hearing in the U.S. Congress, Zhou Shouzi fought against the crowd and shined.

At the end of 2022, Wang Xiang, another new partner of Xiaomi, stepped down as president. Almost at the same time, Hong Feng and Wang Chuan, the two early partners, also took a back seat.

As of this time, there are only five of Xiaomi's nine partners left, including newcomers Zhang Feng and Lu Weibing, as well as the old people Lei Jun, Lin Bin and Liu De. And although Lin Bin and Liu De are still working in Xiaomi Group, they are gradually fading out.

Compared with other co-founders, Lin Bin is a little more special.

For a long time, he was recognized as the No. 2 person in Xiaomi, second only to Lei Jun in status. When Xiaomi went public, only he and Lei Jun were executive directors, and no one else was on the board. In Xiaomi's AB dual-class share structure, Lin Bin is the only partner other than Lei Jun who owns Class A shares, and his voting rights are much higher than Class B.

In 2019, with the resignation of Lin Bin as president of Xiaomi, he also gradually withdrew from the front-line core management.

In addition to Lei Jun, the only Xiaomi partners who are really working the front line are Zhang Feng and Lu Weibing. The dam of Xiaomi's partnership system opened a hole from the moment Zhou Guangping left, and then gradually grew larger until the embankment burst.

3

The new organization ends the partner decision-making mechanism

At the end of January 2023, Xiaomi announced the establishment of the Group Operation and Management Committee and the Group Human Resources Committee. Lei Jun called it the first major event of the new year, and it was "a far-reaching change in the history of corporate governance". The Xiaomi Economic Management Committee includes almost all the current senior executives of Xiaomi, including Lei Jun, President Lu Weibing, President Zeng Xuezhong of the Mobile Phone Department, Zhang Feng, President of the Major Appliance Department, Chen Bo, General Manager of the Ecological Chain Department, Wang Xiaoyan, President of China, Lin Shiwei, CFO, Pan Jiutang, Chief of Staff, etc. Its core role is to oversee business strategy, planning, budgeting, execution and day-to-day business management.

Lei Jun personally served as the director of the Economic Management Committee, Lu Weibing served as the deputy director, and Pan Jiutang served as the chief of staff.

With the establishment of the Xiaomi Economic Management Committee, the Xiaomi partner management mechanism began to exist in name only. Considering that there are few partners left in Xiaomi, this is not an attempt to actively transfer Xiaomi's decision-making center. And this attempt has further accelerated the end of the partnership system.

At the end of 2023, another partner chose to say goodbye, this time it was Zhang Feng, president of the major appliance department. According to the plan, Zhang Feng will leave the company after completing the handover in December this year.

Regarding Zhang Feng's departure, the outside world is full of curiosity. Not only because Zhang Feng has made a lot of contributions in the process of reshaping Xiaomi's supply chain, but also because the large appliance business he is in charge of has also performed well.

In the second quarter of 2023, the revenue of Xiaomi's smart home appliance business will grow by more than 70% year-on-year. Among them, Xiaomi air conditioner shipments rose by more than ninety percent year-on-year, and Xiaomi refrigerator shipments also exceeded 500,000 units. According to Aowei cloud network data, in the first half of this year, Xiaomi TV ranked first in TV shipments in Chinese mainland.

The smart home appliance sector has become an important factor driving the growth of Xiaomi's IoT and consumer products segments. In the second quarter, the IoT and Consumer segments contributed 33% of Xiaomi's revenue (28.2% year-on-year), while the smartphone business contributed 54.3% of Xiaomi's revenue (60.2% year-on-year).

With Zhang Feng's departure, the Xiaomi major appliance department he is responsible for has also been reorganized.

The TV department of the original major appliance department was merged into the mobile phone department, with Pan Jun continuing to serve as general manager and reporting to Zeng Xuezhong, while the new major appliance department business includes ice air washing, with Shan Lianyu as the general manager and reporting to Lu Weibing, president of the group.

Analysts believe that Xiaomi's integration of the TV sector of the major appliance department into the mobile phone department is to follow the mobile phone xAIoT strategy and further promote the interconnection between mobile phones, TVs and other devices;

The analyst also pointed out that "not everyone agrees with this change, but it is not the new organizational management center (big management) and the adjustment of the major appliance sector that accelerated Zhang Feng's departure." ”

4

epilogue

From the "Seven Musketeers" in 2010 to the "Eight King Kongs" in 2012, from the "second entrepreneurship" of the nine partners in 2020 to only Lei Jun and Lu Weibing, the Xiaomi partners finally went their separate ways.

As a result, Lei Jun's remarks of "no partners are tolerated" began to spread out, but this conclusion was arbitrary. The different genes and endowments of enterprises determine the different employment styles of the top leaders.

For example, Huawei has always adhered to the grayscale management method. Ren Zhengfei once said: Whoever I scold, who I love. Yu Chengdong was scolded the most by me, you see him, it's crazy! We can't focus on praise, we must have gray scale in management, correct incorrect places, and let him go on the right path.

But many times, Ren Zhengfei was also questioned and denied because his opinions were "not professional enough", but all executives still respected him, supported him, and couldn't do without him. The end result is that Ren Zhengfei has built one of the most stable and efficient senior management teams in the world, and each of Huawei's 17 board members has worked for Huawei for at least 20 years.

Tencent's senior management team has also maintained stability for a long time, and the humble Ma Huateng has a unique charm that brings executives together. The same is true of Alibaba's partner team, although they are often hidden behind the scenes, but at the critical moment of the current year of change, they can also come out of the mountains and come to the front of the stage for the second time.

In contrast, Xiaomi pays more attention to pragmatism in employing people. A former Xiaomi executive close to Lei Jun bluntly said that according to the needs of business development, he likes to reuse those who can do things in the short term and can do things peacefully. The most representative is Zhang Feng, who has strong supply chain practical skills.

In a sense, Lei Jun is also quite famous for knowing people.

Whether it is the early Eight King Kongs, or the new four later, Lei Jun seems to be able to gather a group of partners with extraordinary resumes and outstanding personal abilities. Moreover, they all voluntarily bring personal resources and technology to join the gang, and many of them are able to take charge on their own. Li Wanqiang, China's first-generation UI designer, Lin Bin, who switched to Microsoft and Google Engineering Research Institute, and Zhou Shouzi, who has extraordinary ability in investment, financing and internationalization........

Even, in many cases, as long as Lei Jun values a certain person (ability), he can "reduce talents without sticking to one pattern". Guo Jun was initially discovered by Lei Jun because of his strong government connections, and was later appointed to be in charge of the supply chain.

And Lei Jun himself is a "very determined" and "very strong" person, whenever there are many differences of opinion, Lei Jun will say, "There is no need to fight, listen to me, and when you reach my height, we will fight again." ”

These short-term pragmatic employment principles based on personal judgment have largely directed the rapid rise of Xiaomi, and it is also easy to cause employment bias, and it will also cause an embarrassing situation of not being able to retain "useful" people in the long run.

Lei Jun once said that there are only two ways to find excellent people: one is that the founder spends enough time every day to find people, and the other is to do a good job in the existing products and business, show the company's good product business, as well as future development space and opportunities, so as to achieve the effect of building a nest and attracting phoenixes.

If attracting talent is compared to going from 0 to 1, then fully tapping the value of talent and retaining talent is from 1 to 100. In essence, Lei Jun is a good hand at introducing talents, but he is not satisfactory in retaining people.

Up to now, Xiaomi is like a talent transfer station, and all partners who share hardships are leaving Xiaomi. Perhaps, this is what Lei Jun, the "leading brother", should reflect on the most: how to form a centripetal force culture and create a real sense of cultural belonging. Especially at the moment when Xiaomi is upgrading its strategy of "people, cars, and home ecology" and building cars, it is urgent and urgent for Xiaomi to rebuild trust among its senior management team.

*Resources:

"The Story of Mi's Rebirth" deep web