Xiaomi undergoes company restructure to promote young talent and ensure longevity

 

Beijing-based Xiaomi, known for its value-centric approach to the smartphone market, launched its Hong Kong IPO in July and raised US$5.4bn.

 

According to South China Morning Post, which reported on the internal letter to Xiaomi staff, the restructuring will include the creation of two new departments.

 

One of these new departments will oversee hiring, promotion, and training, while the other will be tasked with managing the company’s development strategy as well as monitoring the progress of individual business units.

 

Channel NewsAsia said that Xiaomi’s restructuring “will rejig its businesses and create new leadership positions aimed at building a second tier to CEO Lei Jun, amid increased scrutiny of governance and successions at Chinese tech firms”.

 

“It also would reshuffle its four main business units into 10 to promote younger managers”, Channel NewsAsia continued.

 

“A majority of the newly-appointed leadership belonged to the post-1980s generation”.

 

 

 

The restructuring comes alongside pressure in China’s tech industry to ensure sustainable hierarchies.

 

“There has been concern that companies like JD.com are too leader-centric and it is almost the same for Xiaomi as Lei Jun is the face of the company”, said Professor Lawrence Loh, director of the Centre of Governance, Institutions, and Organisations at the National University of Singapore.

 

“Investors and stakeholders are concerned about these one-man internet companies where the company rises and falls with one iconic figure”.

 

Xiaomi’s restructuring therefore demonstrates an effort to mitigate this risk.