On May 25th, a leaked online speech from Liu Qiangdong, the founder of JD Group, revealed his clear intention to gradually eliminate non-performing and non-competitive employees through various means. Some observers believe that Liu’s statements may be laying the groundwork for layoffs at JD under significant market and performance pressures.
The internal online speech by Liu Qiangdong was made on May 24th, in which he firstly announced a 20% to 100% salary increase for all sales staff and then proceeded to deliver a motivational talk.
Liu stressed that in-depth industry knowledge and adaptability to internal and external environments are essential qualities at JD. The company will never tolerate a large number of employees who are slacking off.
During this speech, Liu explicitly stated that non-performing and non-competitive employees will be gradually phased out through various means.
Liu Qiangdong emphasized, “If your performance is good, you will never need to work overtime, and the company will always appreciate you with very good compensation. If your performance is only average, as long as you work hard, the company will never dismiss you. But for those with poor performance and no ambition, this company can never tolerate them. We will gradually phase them out through various means.”
In this instance, Liu Qiangdong revisited his definition of “brothers” by stating, “I understand that everyone has different life choices. We have employees who prioritize enjoying life over work, and that’s fine. However, I can only say, you are not our brothers, but strangers. What is a stranger? Someone who is neither my friend, nor my brother, nor my enemy. We should not work together because your presence severely harms the interests of our hardworking brothers, which is highly unfair to them.”
Liu Qiangdong is known for his “brotherhood doctrine”. In 2018, amidst rumors of JD laying off 80,000 employees, he declared, “We will never dismiss any of our brothers.” In 2019, he stated on social media, “Those who waste their days are not my brothers.”
Mainland Chinese observers suggest that Liu Qiangdong’s reluctance to acknowledge “brothers” could be a precursor to impending layoffs in response to immense market and performance pressures.
On November 29th last year, news of “JD’s market value evaporating by 70 billion in a year” went viral on Baidu’s hot search list. A few days later, JD employees raised operational issues in a post, including the complexity of promotional mechanisms.
In response, Liu Qiangdong admitted, “We always say customers come first, but in our work, we often think selfishly! We often talk about only aiming for the top, yet we always play defensively and never think about how to take the initiative! Many talk about innovation every day, yet all they do is copy others.”
Acknowledging the prevalent issues, Liu stated, “Of course, all these problems stem from my poor management, and I am extremely self-critical.” He added, “The current organization is bloated and inefficient; changing it will indeed take time.”
Around “Double 11” in 2022, Liu Qiangdong criticized JD internally for losing its low-cost advantage. This year, JD has made several personnel adjustments, with JD Group’s CEO, Xu Lei, and JD Logistics’ CEO, Yu Rui, stepping down.
Since 2023, JD-related companies’ stock prices have continuously declined. Within 9 months, JD’s Hong Kong stocks plummeted by over 50%. As of January 12, 2023, JD’s market value had evaporated by 58%, totaling 58.3 billion US dollars in a year. International institutions like Morgan Stanley downgraded JD’s rating in October last year.