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Meet 5G, performance pressure, China Mobile's organizational structure has been greatly adjusted

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A few days ago, the reporter of the Daily Economic News learned exclusively from many insiders of China Mobile that the split of China Mobile's government and enterprise branches, which has been brewing for more than half a year, is finally going to be implemented. As for the split of the government enterprise branch, an insider of China Mobile wrote in the circle of friends that "the competition between the group government enterprise companies and the local provincial government enterprise companies for profits in the past decade will finally end."

China Mobile has a huge government enterprise business system, with annual revenue of more than 70 billion yuan last year, but there has also been a long-term phenomenon of "competing for customers" between the group and the provincial level. This adjustment is also the first major internal organization adjustment after China Mobile Chairman Yang Jie took office.

Insiders said that after the split, China Mobile's government enterprise business in the country will present a "one total, two horizontal and three vertical" pattern, one total is the group's government enterprise business department; The second horizontal includes China Mobile Internet of Things Co., Ltd. and Suzhou R&D Center (China Mobile Suzhou Software Technology Co., Ltd.); The third column includes China Mobile Shanghai Industrial Research Institute, China Mobile Chengdu Industrial Research Institute and China Mobile Xiong'an Industrial Research Institute.

"Internet companies change a little every six months and a lot every year, and the organizational structure of operators should also change." Li Tong from China Mobile's government enterprise system said that only in this way can we avoid internal friction caused by the organizational structure itself and adapt to the trend of 5G vertical industrialization. In addition, Liu Yonghua, an executive of China Mobile's government enterprise branch, said that the transformation of China Mobile to B is more to solve the "big body, small head" problem that has always existed in the government enterprise business. The newly established group's government enterprise business department will be staffed with more than 1000 people.

Major structural adjustment to solve internal competition for profits

According to the official website of China Mobile Group Corporation Government Enterprise Customer Branch (hereinafter referred to as "Government Enterprise Branch"), the company was founded in August 2012, formerly known as the Group Customer Department of China Mobile Headquarters. It is a professional company subordinate to China Mobile that is responsible for operating in the government and enterprise customer markets. Its business areas cover private lines, IDC, cloud computing Enterprise convergence communication and other enterprise communication and information products.

"At the earliest, it was the Group Customer Department, which managed the group customer business in all provinces of the country. Later, for the purpose of professional operation, many professional companies were established, including the whole company, which is now a cycle." Li Tong told the Daily Economic News that the government enterprise branch established in 2012 appeared as a professional company, It is at the same level with other professional companies and provincial government and enterprise departments, and many things need the help of the group to manage.

Li Tong told the reporter that the government enterprise branch, which has lasted for many years, has always had a conflict of interest with the government enterprise business departments in various provinces. Facing the same target customer, it is like two commercial companies competing. Now, after the establishment of the Group's Government Enterprise Business Department, it has become a department of the Group, and the management of the national government enterprise market will be more unified, from a professional business company to a functional management department.

"Although there were some in the past, the province didn't listen, so it's OK to listen, because everyone is at the same level." Li Tong introduced that the government enterprise business department now has more power than the former government enterprise branch. It has the power to issue documents and guide the province, and more importantly, it has the power to manage and assess.

Liu Yonghua revealed that the company previously emphasized professional operation and transformed the functional departments of relevant headquarters into professional companies. "From a functional department to an independent company, it will operate faster, be responsible for itself, be financially independent, and expand its production capacity."

However, it also resulted in a decline in the dispatching capacity of the whole country under this management mode, and it only paid attention to the operation of its own company. "It only counts small accounts, not big ones. With 800 billion yuan of revenue from China Mobile, someone must consider the overall market," Liu Yonghua said.

At the same time, the reporter learned that the personnel of China Mobile Group's government enterprise branch who do industrial products will be divided into three industrial research institutes, which means that these personnel will work in Shanghai, Chengdu, Xiong'an and other places from Beijing. "For reform, people go with things." Li Tong sighed that his department already has colleagues living in Beijing and working in Xiong'an.

Insiders said that the staff of China Mobile Group's government and enterprise branch to do industrial products will be divided into three industrial research institutes. The Group's government and enterprise business department will retain the first product department, the second product department and the key customer department, the government and enterprise department of the marketing department will be under the government and enterprise business department, and the China Mobile Intelligent Bank will be under the China Mobile Shanghai Industrial Research Institute.

Centralized management adapts to 5G application trend

In 2012, when the government enterprise branch was just founded, it was in the embryonic stage of China Mobile's 3G construction, with 280000 3G base stations and 20000 4G test base stations. At that time, the power of China Mobile's government enterprise business was only focused on developing optical broadband access capabilities for group customers. The revenue of government enterprise business was 26 billion yuan, which was classified as "other revenue". The government enterprise business was not "standing in the middle of the stage" business.

In 2012, China Mobile Internet of Things Co., Ltd. was officially listed in Chongqing. In 2014, China Mobile set up a research and development center in Suzhou, focusing on cloud computing, big data and IT support systems. Last September, China Mobile (Chengdu) Industrial Research Institute was inaugurated with a registered capital of 2 billion yuan, focusing on 5G and AI ecology.

New technologies are increasingly driving China Mobile to set up more specialized companies, and the top-level design at the group level is also imminent. Liu Yonghua said that the main core of this major adjustment of China Mobile's government enterprise business is to strengthen the command and control of the government enterprise and to B market.

Liu Yonghua introduced that at present, there is a group customer management office in the marketing department of China Mobile's headquarters, which is nominally responsible for dispatching and commanding the national to B market, but a department level structure level and less than ten people is far from enough. It can not mobilize the whole country, which will lead to the phenomenon of "big body, small head".

"In the 5G era, industry markets such as government and enterprises are the granaries of the world." Li Tong told reporters that the adjustment of China Mobile's government and enterprise business is mainly to meet the trend of 5G vertical industrialization.

Liu Yonghua introduced that the "two horizontal" adjustment of the organizational structure is to focus on 5G, IOT and cloud basic technology. In the "Three Verticals", Shanghai Research Institute is responsible for 5G industry applications in industry, transportation, finance, etc., Chengdu Research Institute is responsible for 5G industry applications in education, medical care, agriculture and commerce, etc., Xiong'an Research Institute is responsible for 5G industry applications in the fields of party, government and military, smart city, etc.

Liu Yonghua also revealed that the company's decision-making meeting on the major adjustment of government and enterprise business has passed, and it will be implemented in the next month or two. The leadership will be set up first, and then other personnel will be adjusted.

The insider told the reporter of the Daily Economic News that Dai Zhong was the general manager of China Mobile's government enterprise branch before. It is unclear who is responsible for the newly established group's government enterprise business department.

Less than half a year after taking office as chairman, Yang Jie has chosen the government enterprise business line, and the government enterprise business is also seen as the main opportunity for China Mobile's future growth. According to the signing meeting of the letter of responsibility for the operating performance of central enterprise heads held by the State owned Assets Supervision and Administration Commission, China Mobile's total net profit target for 2019 is 12% higher than that of the previous year. In the current situation, profit growth of 12% is a challenging figure.

The above insider of China Mobile told the reporter that "the government enterprise market is relatively weaker than China Telecom, and the organizational restructuring must be a re layout of the market." Yang Jieyuan was the chairman of China Telecom, and China Telecom's government enterprise business has always dominated the competition among the three operators.

According to the 2018 annual report, the revenue of China Telecom's cloud business grew 85.9% year on year, and the revenue of China Telecom's emerging businesses represented by government and enterprises accounted for 51.9% of the service revenue. China Mobile has fallen behind China Telecom in seeking new business transformation. Liu Yonghua introduced to the reporter that China Mobile Suzhou Research Center will be transformed into the cloud capability center of mobile companies, benchmarking the cloud business department of China Telecom.

"After Yang Jie arrived at China Mobile, the first thing or the biggest thing he focused on was the reform of the government enterprise (business) structure, and the rest was just in the stage of proposing ideas." In Liu Yonghua's view, attaching importance to the "to B" market is the industry trend in the past two years, especially with the saturation of the "to C" consumer Internet market, the "to B" industrial Internet is a blue ocean, It is also a new growth space. The organization following strategy should be flexibly adjusted. Compared with BAT, the operator's organizational structure adjustment is slow.

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