Vanke began to adjust its structure and personnel again.

Original Zhongfang Daily China Real Estate Daily

“

The original core team remains unchanged.

China Housing News reporter Fu Shanshan, Shanghai Report

Vanke, in deep trouble, adjusted its organizational structure again.

On October 11th, Vanke disclosed its latest measures of organizational change, involving regional adjustment and personnel arrangement. In this round of adjustment, Vanke further strengthened the organization and intensive construction of development and operation business, and the development and operation headquarters further sank the front line of business, directly responsible for the management of product origin and the trading of major projects.

The headquarters in East China, South China, Beijing, Southwest China and Central China have streamlined their functions and positioned themselves as the "front headquarters" stationed by the Economic Development Zone, and only set up business functions directly related to the project, and no longer set up back-office support functions.

At the same time, the northeast region and the northwest region were adjusted to the head office, which only set up a set of management functions to intensively manage the projects in various cities in the area.

Shanghai Company and Guangfo Company, which have many major projects and large production capacity and value, are adjusted to the direct management of the development and operation headquarters, so as to strengthen professional control over resources revitalization, operation efficiency improvement, delivery quality and cost management.

In addition, Vanke has also set up a new business department-Office Division, focusing on improving the efficiency of office assets, and jointly promoting the further development of Vanke in the field of commercial and office assets with the existing business division.

With the adjustment of organizational structure, personnel changes are also the focus of the industry.

According to Vanke, the original core team will remain unchanged in this adjustment. Zhang Hai will still be in charge of the development and operation headquarters as a whole, Sun Jia will continue to be the head of the commercial division, and Wu Yong, Zhou Yiqun, Li Wei, Yi Ping-an, Guo Jixun and Zeng Wei will continue to be the heads of their regions or head offices.

The only change is that Cao Jiangwei, the former general manager of Guangfo Company, succeeded Lu Bing and returned to the north to take charge of the Beijing area, while Lu Bing was transferred to the newly established office division as the person in charge.

━━━━

The development and operation business is further intensified.

Intensive management of its development and operation business is the core of Vanke’s organizational adjustment. Overall, the changes are mainly reflected in two aspects.

First of all, the five regional headquarters streamlined their functions, only setting up business functions directly related to the project, and no longer setting up back-office support functions.

Bai Wenxi, vice chairman of China Enterprise Capital Alliance, believes that Vanke’s move will help improve organizational flexibility and efficiency, and make decision-making more rapid and efficient by streamlining organizational structure and reducing management levels.

However, in the eyes of some insiders, it is not difficult for Vanke to achieve organizational intensification, mainly because of cultural conflicts. How to keep the "front headquarters" in line with the headquarters. After streamlining functions, how to arrange employees with similar back-office support functions is also a problem that Vanke will face.

"It depends on the specific implementation of Vanke." Bai Wenxi believes that, in theory, streamlining functions may lead to post adjustment or optimization of some backstage support functions. For the existing security functional personnel, Vanke may take internal transfer, training and upgrading, or other reasonable personnel arrangement measures to ensure a smooth transition. The specific personnel arrangement and influence need to be determined according to the detailed adjustment plan and implementation details announced by Vanke.

The second change is that Vanke divides Shanghai Company and Guangfo Company from the corresponding regions and directly manages them by the development and operation headquarters.

The main difference between direct management and regional management lies in the concentration of management and the control of key projects. These two companies are regional companies with large value of projects and production capacity under Vanke, and they are also the main sources of performance contributions.

These two companies are directly managed by the headquarters. The advantage lies in that they can trade and manage key projects more directly and intensively, improve decision-making efficiency and response speed, and at the same time, they can allocate resources and control costs more effectively. The disadvantage is that they are not as flexible as regional management in management and sensitivity to local markets.

━━━━

Cao Jiangwei succeeded Lu Bing in returning to the North.

Generally speaking, organizational changes are accompanied by personnel adjustment. However, Vanke’s overall adjustment has maintained the original core team. The only change is that Cao Jiangwei, the former general manager of Guangfo Company, succeeded Lu Bing and returned to the north to take charge of the Beijing area, while Lu Bing was transferred to the newly established office division.

Lu Bing is an "old man" in Vanke Beijing. In 2005, he served as the deputy general manager of Vanke Beijing Company and won several projects for Beijing Vanke. Later, Lu Bing was transferred to Tianjin to take charge of Tianjin Vanke, and returned to the northern region as the deputy general manager in 2019, assisting Liu Xiao, the head of the district at that time, to take charge of the work of Beijing Company.

2021 is a turning point for Lu Bing. In this year, Liu Xiao, the former chief partner of Vanke’s northern region, left Beijing and was transferred back to the headquarters. Lu Bing began to serve as the chief partner of Vanke’s Beijing region.

However, according to public information, in 2021, Vanke Beijing contributed only 13.79% to the Group’s operating income. In that year, the region’s equity net profit also lost 383 million yuan, and the overall equity net profit was -1.45%, which was the only negative area among the seven regions of the Group at that time.

As an important sales pillar of the Group, Vanke’s performance in Beijing has fluctuated in recent years. By the end of 2023, the contribution of Beijing to the Group’s sales was only 13.5%, far less than 34.2% in Shanghai and 23.7% in South China.

In recent years, the organizational structure adjustment of housing enterprises is performance-oriented, and the ability is superior, and vice versa. The achievements of Vanke Beijing in recent years may be an important factor in this substitution.

Cao Jiangwei succeeded Lu Bing in managing the Beijing area. According to public information, Cao Jiangwei was born in 1977. In 2002, Cao Jiangwei joined Vanke and served as general manager, assistant general manager and deputy general manager of Shenyang Vanke Engineering Management Department. In 2010, Vanke entered Shanxi and established Taiyuan Company, and Cao Jiangwei was appointed as the general manager of Taiyuan Company. In 2019, Cao Jiangyan was transferred to Vanke Qingdao Company as the general manager. A year later, he went to Vanke Guangzhou Company. During his tenure as general manager of Guangzhou Vanke, the real estate market faced downward pressure, but many projects of Guangzhou Vanke still achieved good results, and many projects entered the TOP10 sales in the city.

The takeover of Vanke Beijing area is Cao Jiangwei’s return to the north and a new starting point of his career. Whether Vanke Beijing area can get out of fatigue and achieve a breakthrough in the fierce competition environment will be a challenge for Cao Jiangwei.

As a veteran of Vanke system, although Lu Bing left the Beijing area, Vanke still arranged a new position for him-the head of the newly established office business department.

The main responsibility of this department is to further improve the operating efficiency of Vanke’s commercial and office assets. In other words, the department focuses on operational business.

According to public information, during his tenure at Vanke, Lu Bing was committed to launching new businesses and "small town lifestyle", and had practical experience in the fields of long-term rental apartments and urban renewal, which also means that Lu Bing may have certain management capabilities in operational business, which is more suitable for Vanke’s new business department.

━━━━

Passive "slimming" of sales performance

In the industry, Vanke has always been an enterprise with high market sensitivity. Whether it is the first to shout out "live" or internal organizational optimization, Vanke has certain industry vane significance.

According to the past experience of housing enterprises, the organizational structure is generally adjusted on an annual basis, and Vanke is no exception. However, since the beginning of this year, Vanke has adjusted its organizational structure more frequently and vigorously.

In fact, Vanke has adjusted its organizational structure in several regions earlier this year. For example, in March, Vanke adjusted the southern region and Shanghai region, in which the southern region was changed from 12 companies to 8 companies, while the Shanghai region was reorganized from 15 city companies to 8 regional companies; Then in April, Vanke Beijing area also began to merge cities. It is not difficult to see that Vanke’s areas where the organization "moves the knife" are all its major performance towns, and these adjustments are intended to promote the integration of resources between cities and the flexible deployment of talents, concentrate advantages on managing resources and improve efficiency.

After all, under the current situation, housing enterprises are still under pressure at the sales end, and Vanke, as the head housing enterprise, is no exception.

At the same time as the news of organizational restructuring came out, on the evening of October 11th, Vanke disclosed the sales in September 2024 and the recent new projects. Overall, Vanke’s sales performance is still passively "slimming".

The data shows that in September 2024, Vanke achieved a contracted sales area of 1.231 million square meters and a contracted sales amount of 17.42 billion yuan. Compared with August, Vanke’s sales situation has rebounded, but compared with the same period last year, Vanke’s sales area decreased by over 36% and the sales amount decreased by over 45%. In the first nine months of this year, Vanke achieved a total contracted sales area of 18.184 million square meters and a contracted sales amount of 280.61 billion yuan, basically the same as last year.

However, before the National Day this year, a number of heavy property market policies were released in a centralized manner, which also significantly boosted market confidence. According to statistics from third-party organizations, during the National Day this year, the subscription area of real estate in 22 key cities increased by 12% month-on-month and 26% year-on-year. Taking advantage of the east wind of the policy, sales in many regions of Vanke during the National Day also created new records. For example, the sales in seven days of the National Day in the southern region of Vanke exceeded the sales in the whole month of September, and the number of projects visited alone exceeded 2,000, and the transaction also set a record for the number of local sales.

In the eyes of the industry, Vanke’s choice to optimize the organizational structure at this time is not only a practice, but also a trend. I hope that with the support of this wave of new policies, we can better grasp the market window period, improve quality and efficiency, and provide momentum for performance growth.

For this adjustment, Vanke also said that the company will routinely carry out organizational review and corresponding optimization every year to better adapt to changes in the situation and development needs. The further intensification of this organizational structure will help to further improve the operational efficiency and benefit of the project, especially to concentrate on building key projects. Under the background that various policies to support market stability are introduced one after another, it will also help the company to better grasp the market opportunities brought by the policies.

Original title: "Vanke began to adjust its structure and personnel again"

Read the original text