In 2023, the Internet giant "Shadow Warrior" will take the stage

The founder is "half-out of the mountain", and the CEO is in the front.

During the Alibaba Yunqi Conference at the end of October this year, a photo was widely circulated: Alibaba's core management was strolling in Yunqi Town, with Group Chairman Cai Chongxin, Alibaba Cloud Founder Wang Jian and others walking in the front row, while Wu Yongming, Group CEO and Alibaba Cloud CEO, followed behind.

This photo has a certain symbolic meaning: the Apsara Conference has always been an occasion for Alibaba Cloud to "show its muscles", but Wu Yongming, who has just taken office, is not the protagonist of this year's conference. During the conference, Cai Chongxin, Wang Jian and Alibaba Cloud CTO Zhou Jingren gave speeches successively, but Wu Yongming did not speak on stage.

The low-key Wu Yongming is the epitome of the new changes in China's Internet circle in 2023: the founders who originally retired have come out one after another, but for various reasons they have not fully stepped forward to the stage, and those who uphold the will of the founders are the "shadow warriors" who are not familiar to the public.

Ma Yun, who returned to China in April this year, pushed Wu Yongming to the forefront. This Ali 004 employee, the first programmer, and the youngest "Eighteen Arhats", was appointed CEO of Alibaba Group in early September, and concurrently serves as the chairman and CEO of Alibaba Cloud. At the end of December, Wu Yongming was appointed as the CEO of Taotian Group. Prior to that, he had served as the chairman of Taotian Group.

Alibaba Cloud and Taotian are the most important business segments of the entire Alibaba. In the third quarter of this year, the two together contributed about 56% of the company's revenue. Wu Yongming, as the CEO of the group and the number one position in leading the two major businesses, has a broader management boundary than his predecessor.

Wu Yongming

However, Wu Yongming, who has integrated three key CEO positions into one, has not changed his humble posture. In addition to being willing to be a man during the Apsara Conference, his transformation of the entire Ali is also based on the will of the founder.

In an internal letter released in September this year, Wu Yongming listed "user-first and AI-driven" as two strategic priorities, and plans to increase strategic investment in technology-driven Internet platform business, AI-driven technology business and global business network. These strategic initiatives are in line with Jack Ma's "return to Taobao, return to users, and return to the Internet", and echo with "AI e-commerce".

This also reflects that Wu Yongming, who holds the positions of the three CEOs, does not hold Alibaba's "strategic first right", but is more like the interpreter and executor of a series of strategies proposed by Ma Yun after his return.

Xu Ran, another CEO who has just taken office, is also a "shadow warrior".

In the past five years, Xu Ran, who had previously served as the CFO of JD Group, succeeded Xu Lei and was promoted to CEO of the group, and in mid-November, he succeeded the veteran Xin Lijun as CEO of JD Retail.

Similar to Wu Yongming, Xu Ran mastered the core business segment of JD.com, but did not put forward a reform plan with Xu's characteristics. At the 20th anniversary event of JD.com in late June, Xu Ran announced that he would lead all employees to study and formulate a roadmap and implement it around how to implement the "35711" dream.

"35711" was proposed by Liu Qiangdong in November 2020, including a series of development visions for 3 companies with revenues of more than one trillion yuan, net profits of more than 70 billion yuan, and 5 Fortune 500 companies in the next 20 years. Liu Qiangdong is responsible for "dreaming", and Xu Ran is responsible for "dreaming", and the focus of his work falls on the implementation level.

In addition to the two e-commerce CEOs, there is also a relatively alternative "shadow warrior" in the Internet circle - Zhou Shouzi.

Zhang Yiming has always been eager to open up overseas markets, and seven or eight years ago launched the overseas versions of Toutiao and Watermelon Video, and personally finalized the name of TikTok. But his Chinese identity and background have become one of the reasons why Byte has been questioned and embarrassed to go overseas, and in addition, TikTok's commercialization progress has been slow, and the senior management team needs to be reorganized urgently.

From 2021 onwards, Singaporean Zhou Shouzi has become Zhang Yiming's "shadow warrior". In the past year, Zhou Shouzi mediated with the Indonesian government in Southeast Asia, and finally allowed TikTok to escape the catastrophe in these two markets;

The emergence of "shadow warriors" such as Wu Yongming, Xu Ran, and Zhou Shouzi is the two sides of the same coins for the founders of large Internet companies to re-emerge and come to the forefront.

Despite being crowned as CEO, the "Shadow Warrior" has a very different power position from the founder, and plays more of a role as an obedient and executor. The founder has real decision-making power, but due to internal and external reasons, it is inconvenient to take the helm directly, and he also needs a loyal "shadow warrior" to do it for him.

Ma Yun, Liu Qiangdong and Zhang Yiming are firmly behind the scenes, using "shadow warriors" to govern the company. Advance can be attacked - drastically refresh the personnel structure and change the direction of the company's movement; retreat can be defended - if the "shadow warrior" is mediocre and difficult to convince the public, he can change the commander again.

Ma

However, if the "Shadow Warrior" can faithfully implement the will of the founder, translate the latter's strategic guidance into a business method that can be implemented, and finally lead the company to break the ceiling and return to the growth track, it may not be impossible to be promoted to the new No. 1 position.

2023 is a year for the founders of Internet companies to return to the foreground, and it is also a year for founders and shadow warriors to dance hand in hand and govern with each other. Ali and other large Internet companies have been trying to establish a sustainable succession order, but in the face of the great changes in the Internet, the founders can only temporarily put aside the idyll, return to the business world, and launch the "Shadow Warrior" to fight on their behalf.

A

The common characteristic of the "shadow warriors" sent by the founders of Internet companies is that they are detached most of the time, and have nothing to do with the old business routes of their predecessors.

Some "shadow warriors" have been away from the company's operation for a long time, and they are behind the scenes and willing to be green leaves.

For example, Wu Yongming has been in charge of the technology sector of Taobao, Alipay, Alimama and other businesses, and has been the chairman of Ali Health for 5 years. In 2015, Wu Yongming faded out of Ali and established Yuanjing Capital, which invested in many entrepreneurial projects of Ali people.

There are also "shadow warriors" who come from a financial background and are not too involved in the southern and northern wars of specific business.

Xu Ran first worked at PricewaterhouseCoopers, joined JD.com in 2018, first as the CFO of JD Retail, and was promoted to group CFO two years later, while Zhou Shouzi previously worked for Russian venture capital DST, and then was selected by Lei Jun as the CFO of Xiaomi, and his first title after joining Byte in 2021 was also CFO.

Xu Ran

With a technical and financial background, the "Shadow Warrior" is a leader in terms of brains, knowledge and experience, and more importantly, compared with a veteran who has been immersed in specific businesses for a long time, it is easier for the "Shadow Warrior" to break away from the old line of the previous manager and look at the company from an outsider's perspective to find real problems and real answers.

In addition, the "Shadow Warrior" is not very involved in specific business, and it is not easy to form an intertwined descendant ecology, and when it touches the existing interests of different teams, there are fewer worries and entanglements, so that they can act faster and more powerfully. That's what the founders are putting them on the front of the stage.

In contrast, the former ministers of the former dynasty who made great military achievements are easy to fall into the dilemma of self-transformation "in this mountain". Taking Ali as an example, in recent years, its organizational structure has been frequently adjusted, and the management has been repeatedly replaced, although it has achieved certain results, but it has not fundamentally completed the "aircraft carrier U-turn", the performance growth is slow, and the market value has been surpassed by Pinduoduo.

After Wu Yongming took the throne, Ali's transformation suddenly accelerated. Especially at the end of December this year, only two days after Wu Yongming took over as CEO of Taotian, he announced a large-scale adjustment of middle-level managers, involving Taobao, Tmall, Taobao Live, Alimama and other business departments.

Wu Yongming put forward a request in an internal letter: "Face up to the status quo and start a new business." This rather harsh wording, coupled with the thunderous means of personnel changes, was not common in Taotian or even the entire Ali before.

The founder's replacement of the "Shadow Warrior" is itself a way to convey dissatisfaction and pressure to the current management.

At the end of last year, Liu Qiangdong whipped at an internal meeting, opening the prelude to JD.com's great changes. Since the beginning of this year, Jingdong has made a big fuss about low prices, including the launch of tens of billions of subsidy channels, lowering the threshold for free shipping, double compensation for expensive purchases, and setting the theme of double 11 as "really cheap", etc.; Jingdong RetailCEO Xin Lijun also proposed"Four battles to win",The first battle is the sinking market。

Liu Qiangdong

But the results were not immediate. In the third quarter, JD Retail's revenue only increased by 0.06% year-on-year, stagnating. Almost at the same time as the release of the financial report, Xu Ran replaced Xin Lijun and became the new CEO of JD Retail.

Other times, the "Shadow Warrior" needs to wield the "Shang Fang Sword" on the battlefield beyond the reach of the founder's whip to clear the situation and turn things around.

Before 2021, TikTok successively appointed two managers: former Disney executive Mayer, and former YouTube executive Pappas. Two executives from the content industry have made TikTok comparable to Douyin in terms of user base, but have been slow to commercialize.

According to previous media reports, in 2022, Byte's revenue in China will be US$69 billion, and the revenue of overseas businesses, including TikTok, will be US$16 billion, and the daily active users of the two businesses will be 850 million and 840 million respectively. In the case of a similar number of users, TikTok's revenue scale is far inferior to Douyin.

In May 2021, Zhou Shouzi was appointed CEO of TikTok, and Pappas, who was COO at the time, was in an awkward position. Zhou Shouzi asked the latter to show the input-output ratio of creator incentive activities, and at the same time invest more resources in live streaming and e-commerce business. Eventually, Pappas announced his departure in June of this year.

At the same time, TikTok e-commerce entered the fast lane. The business started in 2021 with a GMV of about $1 billion that year, $4.4 billion in Southeast Asia alone in 2022, $20 billion in 2023, and $50 billion next year.

Zhang Yiming was limited by his identity and could not personally rectify the personnel, and the "Shadow Warrior" Zhou Shouzi was ordered to come and swept away the influence of Mayer, Pappas and others in less than two years, and brought TikTok to a new track. TikTok has made a major breakthrough in commercial monetization, and Zhou Shouzi, who has an iron fist to "clean up the portal", should be the first to work.

B

A few years ago, the founders of large Internet companies successively chose to let go and hand over the power to long-cultivated elite soldiers. The latter has led the company through the cycle and maintained growth, but it has also fallen into new bottlenecks in the past year or two.

In this case, Ma Yun and others re-emerged. But the return of the founder does not mean that he will re-carry the burden of CEO.

Ma Yun, Liu Qiangdong, Zhang Yiming, etc. still have a keen sense of smell and strategic insight into the Internet. For example, Ma Yun proposed "three returns" and Liu Qiangdong proposed that "low price is the only basic weapon", both of which are accurate insights overlooking the overall situation. But at a finer level of business granularity, they may not be the best candidates to lead the company into battle.

For various reasons, Ma Yun and others have not been away from the front line of business for a short time: Ma Yun has ceased to be the CEO of Alibaba Group since 2013 and stepped down as chairman of the board of directors in 2019; Liu Qiangdong has been "invisible" for a long time after the Mingzhou incident in September 2018; Zhang Yiming stepped down as CEO of Byte at the end of 2021 and turned his energy to public welfare projects such as education and public welfare, brain diseases, and digital sorting of ancient books.

According to Ren Zhengfei's theory, they all belong to the people who "can't hear the sound of cannons", and they can grasp the corporate strategy, but they are inevitably slow to make specific judgments and decisions. Even if you are the founder and have the appeal to respond to every call, it is not suitable for them to take office again, and it is more reasonable to let the "shadow warrior" who is more familiar with the business serve as the CEO.

Ren

On the other hand, over the past two decades, Chinese Internet companies have continued to explore modern corporate governance paradigms, and leading companies such as Alibaba have gradually formed a culture of intergenerational inheritance of management. This culture helps ensure the longevity of the business and prevents founders from stepping down and becoming CEOs on their own terms.

Based on internal cultivation and intergenerational inheritance of the fittest, it helps Internet companies to maintain efficient and transparent decision-making, minimize the founder's own surprises, and protect the interests of enterprises, employees and investors. The basic logic is: after the company reaches a certain stage of development, the founder relinquishes his management position and retreats into the background, and the tempered professional manager steps into the C position and becomes the new helmsman.

Ali has done the most fully and farthest in this regard, and the results are obvious to all.

Ali's last "No. 1 position" was Daniel Zhang. In 2015 and 2019, Daniel Zhang took over as CEO and chairman of the board of directors of Alibaba Group, and led Alibaba to defend the country in the following years.

Daniel Zhang

Complementing the succession system is the Ali partnership system. Under this system, Mr. Ma decentralizes his power as founder to more than two dozen partners, who are mainly composed of Alibaba's core management. According to Alibaba's prospectus, this move not only maintains the values built by the company's founders, but also takes into account the replacement of partners after retirement, "replacing individual founders with a group of partners, which makes it easier for the company to inherit." ”

Although the intergenerational inheritance mechanism of other companies is not as complete as Alibaba, it has also made arrangements for the founder's successful retirement in advance.

After the Mingzhou incident, Liu Qiangdong was "hidden", and Xu Lei came to the forefront. Before he was appointed in danger, Xu Lei was already Liu Qiangdong's right-hand man, in charge of marketing, corporate sales, government public relations and other sectors, and in the following two years, Xu Lei successively took over the positions of president and CEO of Jingdong Group. Liu Qiangdong even shouted internally, "Whoever disagrees with Xu Lei is disobedient to me." ”

In terms of bytes, Zhang Yiming handed over the CEO position to Liang Rubo at the end of 2021, and the latter immediately started to adjust the organizational structure, dividing it into six major sections: Douyin, Dali Education, Feishu, Volcano Engine, Chaoxi Lightyear and TikTok; The large, wide-ranging, and rapid implementation of this personnel adjustment is not something that Liang Rubo can promote in a single thought.

The intergenerational inheritance mechanism is the crystallization of the long-term experience of Internet enterprises. When the company's development encounters a bottleneck, if the founder becomes the CEO of the group or a business again, it will inevitably cause damage to the intergenerational inheritance. Expectations of career advancement across the company will be shattered, and management changes will regress from rule-based to the personal will of the founders.

At this time, the founder managed the company as a "shadow warrior", and was able to practice his will to the greatest extent while maintaining a reasonable flow of management and succession as much as possible. The continuity of corporate governance and the adherence to the boundaries of behaviour after the founder's retirement is no less important than the company's business development.

C

After coming to power, the "Shadow Warrior" was manipulated by the invisible hand of the founder. As professional managers, they manage the company's big and small things, and form a "two-headed governance" pattern with the founders, but they do not really grasp the direction of the enterprise, nor are they really the anchor of the sea.

However, Internet companies have a tradition of "shadow warriors" on the top.

For example, Alibaba's Daniel Zhang, after joining in 2007, promoted the company's transformation to the mobile Internet, pioneered Double 11, cultivated Tmall as the core of Tao e-commerce, built a "small front desk, large middle platform" organizational structure, acquired AutoNavi, Ele.me, etc., and made great achievements, which became Ali's second helmsman after Ma Yun.

JD.com's Xu Lei had a similar experience. After joining JD.com in 2009, Xu Lei was responsible for sales, marketing, branding, platform operations and other positions, and was appointed as the president and CEO of JD.com after the Mingzhou incident.

Xu Lei

Judging from past experience, the founders chose "Shadow Warriors", in addition to sharing their daily work, but also to investigate and cultivate them as successors. This can be seen as part of the intergenerational succession of business management.

However, in the new situation, the founder's attitude towards the "shadow warriors" has changed subtly: they no longer withdraw in stride, delegate power on a large scale, but help them get on the horse, give them a ride, and even hold on to it for a long time.

In the vast majority of Internet companies, the founders have accumulated strong qualifications and popularity in the stage of fighting the world. Even if they resign from management positions and no longer hold a controlling stake, they are still able to exert a powerful influence on the company in unconventional ways.

Interacting with employees in the company's internal forums is the founder's latest way to "flex his muscles". In the past two months, Ma Yun replied to employees on the intranet, saying that he "firmly believes that Ali will change" and congratulated his competitor Pinduoduo; Liu Qiangdong said more fiercely, saying that "we must change, otherwise we have no way out", and directly pointed out the chronic disease of "a large, bloated and inefficient organization".

The founders are taking the opportunity to convey their attitudes to the management and the company as a whole by leaving the reporting hierarchy and discussing the development of the enterprise directly with the grassroots employees. It helps to refresh the spirit of the enterprise as quickly as possible, but it also puts more pressure on the "shadow warriors".

The founder's resignation is a natural shackle that the "shadow warriors" have to face, and it is also a stubborn disease that is always difficult to overcome in China's corporate governance.

Under the two-headed governance mechanism, the founder made trade-offs and concessions in his position by sending "shadow warriors". However, when the "shadow warrior" feats and wings grow, enterprises will still face the problem of intergenerational inheritance, and may face new fluctuations. Whether the founders can break the "retreat without stopping" and truly decentralize power will determine the duration and scope of this fluctuation.

Resources:

Fukadu Cross, "Lively Yunqi Conference, Quiet Wu Yongming"

36kr, "TikTok e-commerce GMV target next year is 50 billion US dollars, Southeast Asia and the United States go hand in hand"

Yan Xi, "Ali Handover: Scenery Retreats, Tracks Drive Forward"

Tencent Technology, "Attack on Zhou Shouzi: Decisive Killing, Forcing TikTok American Female Executives, Bet on E-commerce and Live Streaming"

Photon Planet, "Wu Yongming, Jack Ma's "Shadow"