In 2023, the smartphone market will reach the bottom and need to rebound.
There has never been an industry as contradictory as the mobile phone industry - its transformation is the transformation of the interaction mode between human beings and information, and its chronicle is also a chronicle of the development of the intelligent era; But at the same time, it is also a consumer goods industry in essence, with value and price defined by users and the market.
This legendary label determines that the cyclical fluctuations around the mobile phone industry will be a big storm in the history of human science and technology, and mobile phone manufacturers are the wave riders in the storm.
On the sea, every wave carries opportunities and risks - how can mobile phone manufacturers not only preserve themselves, but also lead the mobile phone industry through the cycle and continue to move forward?
In vivo's view, the answer is an effective "scientific management". "When the environment changes, enterprises should follow the needs of users. They cannot turn around on their own. User needs and user orientation are always the biggest core of Vivo," said Hu Baishan, executive vice president and chief operating officer of Vivo.
This is a speech from a broader perspective, covering the complete core proposition of digital era reform. But what never changes is that this is a sample of China's economic confidence from the mobile phone industry, and also a way for an enterprise to survive through the cycle. It has its own uniqueness, and it is also easy to think about the universal paradigm and value creation.
The best industry needs the best organizational management
"The dike of a thousand miles will collapse in the nest of ants", in the simplest words, represents a typical structural collapse that started from internal negligence, which may happen inside the mobile phone enterprise at any time.
Based on the outstanding ToC attribute of mobile phone products, in the past two decades, the survival and competition narrative of mobile phone manufacturers has been largely focused on the outside: the maturity of the industrial chain, breakthroughs in software and hardware technology, changes in consumer demand, market strategy switching, and multi-dimensional competition between friends. But the factors that really determine the long-term fate of a mobile phone enterprise are always rooted in the enterprise.
For the interpretation of this principle, we can take vivo as a sample. In the view of this enterprise, seeking Tao from the inside is an inevitable lesson for future development. Good management ability can promote the growth of a good organizational structure, give the company the backbone of the general support, so that it can also remain firm in the cyclical fluctuations of the wind.
The birth and verification of this belief has an inevitable logical premise, that is, the mobile phone industry itself has the potential to go through the cycle. At the same time, it is beneficial to build a solid enough internal skill by strengthening organizational management.
At this point, Vivo's attitude does not doubt him. At the "vivo reception hall" held recently, Hu Baishan said that a good industry has the natural attribute of going through cycles, and the mobile phone industry is the best industry in the technology field. "The mobile phone industry has a huge demand for continuous updating and iteration. Like sunshine, air, water and food, it is a necessary item to maintain modern people's lives, and has the natural advantage of going through cycles," he said. This means that this industry deserves mobile phone manufacturers to make every effort to build a matching torso.
Why is mobile phone the best industry? In Hu Baishan's view, mobile phones have replaced more than 40 industries or categories since their birth, and have thoroughly affected and changed the way of human life. As long as the demand for users to connect with the digital world remains unchanged, mobile terminals will always be needed. This means that mobile phones will be the most powerful user portal with strong user stickiness.
In addition to the internal industry, from the external perspective, with the vigorous development of XR, AI and other industries, the cross industry layout of mobile phones has become popular. Car machine interconnection, 6G communication, XR+mobile phones The end to side landing of AI large models and other scenarios gradually become reality. In addition, based on the multi-dimensional capabilities of mobile phone manufacturers such as AI and sensors, Hu Baishan believes that the mobile phone industry is even the industry most suitable for manufacturing humanoid robots. In a word, the future drawings of multi industry integration centered on mobile phones have become more concrete.
At the same time, mobile phone manufacturers have a high degree of industry health because they master cash flow, resources and technology, and as a link that best understands the needs of users, they connect the B end and the C end at the same time; In addition, compared with the traditional manufacturing industry, the mobile phone industry integrates the real economy and the digital economy, which can not only make profits through hardware products, but also through Internet business, with a solid cross industry advantage.
The combination of various characteristics has created the natural advantages of the mobile phone industry. The core is still the high degree of user involvement, which determines that the mobile phone industry has only a period of fluctuation, not a period of recession.
The mobile phone industry has the core of carrying the cycle, so it needs corresponding organization and management. After clarifying this fact, the improvement of the management ability of mobile phone manufacturers has become an essential skill for enterprises to adapt to the trend and accelerate transformation. However, the improvement of management ability is not achieved overnight, but should follow a scientific way to cultivate into internal skills. In this regard, vivo has set out a practical path for the industry to refer to.
Scientific management of vivo
At the beginning of last century, management scientist Frederick Winslow Taylor took the lead in putting forward the theory of "scientific management". This theory emphasizes that management should be scientific and standardized, and its ultimate goal is to improve labor productivity. Today, more than a hundred years later, the situation in the mobile phone industry is similar, but it has a higher pursuit.
Scientific working methods and harmonious internal relations are also needed here, but not only the functional operation at the level of "production efficiency" to achieve production goals, but also how to maintain the correctness of their own actions and the health of long-term strategies when facing environmental changes as a business life.
Therefore, vivo redefined how technology companies achieve "scientific management".
Since 2020, the smartphone market has experienced volatility contraction of different extents. In this process, vivo has not only shouldered the cyclical pressure at the business level, but also completed the transition of corporate nature at the enterprise level.
According to the data, more than 60 countries and regions have officially shipped Vivo, the number of global stock users has exceeded 500 million, and the revenue level is stable and growing. At the same time, after years of development, vivo has changed from a regional private enterprise to a global enterprise.
The internal force supporting this positive change is Vivo's "scientific management". In the aforementioned round table conversation, Hu Boshan mentioned that Vivo has divided its capabilities into three major aspects in the past 20 years, namely, the scientific corporate governance system, innovation system and cultural values.
As far as the innovation system and governance system are concerned, on the one hand, Vivo has continuously increased its investment in the long track; on the other hand, it has adopted the "ECR" management method to constantly test its business health and check whether the current measures are correct - which is crucial to the long-term development of an enterprise. "Scientific governance system is very critical, especially after the enterprise is big," said Hu Baishan.
"ECR" consists of three closed loops, namely, Experience, Commercial and Recognition. It is a prism reflecting the health of enterprise operation.
Vivo's understanding of the three closed loops has a logical level of progression. The first is to recognize the causal relationship between the three, build a stable system of integration of the three, complete business goals, and form positive feedback through closed-loop linkage. The deepest understanding is to recognize the order of the three - that is, experience closed-loop first, promote cognitive closed-loop through commercial closed-loop, and finally form a commercial achievement of "experience+cognitive support", which is also Vivo's long-term summary of practical methodology.
"When a product does not solve user problems, there is no 'cause' to talk about business closed-loop and mental closed-loop, so we put the user's experience first. After completing the experience closed-loop, we can consider business closed-loop and mental closed-loop." Hu Baishan explained.
There are also methodologies for completing these three closed loops. Taking Vivo's overseas market expansion as an example, Hu Boshan said, "It must be the waist, not the low price and the upper part. The waist is the place where there is room to satisfy consumers, business partners, internal employees, shareholders and other stakeholders." He pointed out that doing low prices directly cannot satisfy all partners, If the price is directly high, it will cause problems in user acceptance. "This is our historical methodology to solve how to safely cross the cycle."
In fact, the essence of the three closed loops of experience, business and mind is Vivo's orderly and clear integrated understanding of users, market and brand based on the trinity. Only the enterprise management and organizational structure with this as the core can develop the simple habit of always paying attention to the correctness and health of actions, and then promote the deep and long track R&D investment. R&D is an important starting point, which is sufficient to promote the formation of experience closed-loop and business closed-loop, and further challenge the mental closed-loop.
As a management tool for enterprises to span the cycle, Vivo's understanding and practice of "ECR" are also accompanied by different stages, for example, the entrepreneurial period and the development period have different closed-loop focuses.
Vivo believes that in the entrepreneurial period, experience closed-loop and business closed-loop are more important, because differentiated user value and positive cash flow enable enterprises to survive first; In the development period, more importantly, it has become the business closed loop and the mental closed loop. This is because the enterprise has begun to pursue the sales proportion of products in the high price range, and the mental and business determine whether the enterprise can succeed in this price range.
"We want to achieve mental closed-loop. With experience closed-loop and business closed-loop, we will ultimately pursue the brand to make a deep impression on users, so that we can become a healthier and long-term world-class enterprise," Hu Baishan concluded.
Under the flexible deduction of vivo, the "ECR" management method itself has also broken away from the shackles of "theory" and become a set of living, changing and sustainable scientific management paradigm. Such enterprise understanding is also an important cornerstone of vivo.
Stabilizing the storm and leading the industry
What is more scientific than the "ECR" management mode is that vivo has made valuable long track investment in the real gold and silver parallel.
Before that, Vivo had released the technology brand "Blue Technology" to build an innovation system based on user orientation, and achieved a number of long track technological breakthroughs in combination with the industrial chain. The health of this decision will be perfectly verified in 2023.
"2023 is not only the 'year of confidence' for economic recovery, but also the 'year of innovation' for multi point flowering of Vivo's technological achievements," said Hu Baishan. In this year, vivo brought five blue technologies, including blue chip technology stack, blue ocean endurance system, blue heart model, blue river operating system and image strength.
Among them, the blue chip technology stack, as the core technology, achieves dual core collaboration with Vivo's first self-developed image chip V3 with 6nm manufacturing process, bringing users a real experience of software hardware integration; The blue ocean endurance system has improved the "lithium ion transmission efficiency" through the carbon element restructuring technology, increased the mobile phone's endurance and shortened the charging time, breaking through the industry's technical bottleneck; The big model of Blueheart ranges from 1 billion to 175 billion, covering all kinds of use scenarios with five parameter scales; Blue River operating system has completed vivo's reconsideration of the relationship between artificial intelligence, users and ecology.
So far, the management style with "ECR" as the core, as well as the R&D investment with the long track as the target, have together created a strong life breath for vivo cage. This momentum has infiltrated into the product level from the inside out, and has continued to bring product achievements to this enterprise that has accumulated strength for many years.
In 2023, vivo will release its annual flagship product X100 series, and its cumulative sales volume on the first sales day will reach 1 billion yuan, breaking the first sales record of all new machines in the company's history. Compared with the previous generation X90 and X90 Pro, the sales volume will increase by 740%. The newly released vivo S18 series pre installed Blueheart small V also achieved excellent performance in many aspects with the support of Blueheart big model and OriginOS 4.
In fact, both the R&D achievements of the long track and the sales performance that can withstand the industry cycle cannot be separated from the centripetal force with "ECR" as the center. It is the flywheel effect gradually formed by the three closed loops, which makes Vivo a calm wave rider on the waves and can always smoothly cross the industry cycle.
This can be regarded as a sample of enterprise management for the mobile phone industry. Vivo has completed the extraction of the core value elements of the mobile phone industry, identified the underlying equation, and personally verified that under the guidance of this paradigm, mobile phone manufacturers are able to withstand all repeated script challenges.
It is not difficult to copy this theoretical framework, but it is difficult to have the enterprise strength to implement this framework - it is modelled on Vivo's practical experience of nearly 20 years of development, and embedded in Vivo's cultural philosophy of self evolution for many years.
At the cultural level, vivo not only inherits the psychological constraints based on the oriental culture, but also integrates the scientific paradigm of modern strategic management, which is influenced and nurtured by the world's top technology enterprises. This trade route, which is both Chinese and Western, has shaped Vivo's management philosophy and implementation strategy of doing things with his own heart and focusing on reasons; At the practical level, Vivo attaches great importance to logic and effect, and has a strong user demand oriented R&D concept, as well as research goals of popularizing applications and enhancing capabilities, all of which are capable and sharp in strategic expression.
Only on this basis can Vivo scientifically understand "ECR", step on the big waves of the digital era and smoothly cross the cycle under its traction.
Vivo not only proved the conquerability of mobile phone market fluctuations, but also demonstrated a scientific sample of an enterprise to correctly adapt to the industry trend - after the storm, it will continue to forge ahead and lead the industry to deeper unknown waters.
