Li Ning Co Has Difficulty In Pforming &Nbsp, Or Big Layoffs.

A few days ago, Li Ning Co Ltd, a domestic sports brand enterprise, announced that the group would optimize and adjust its organizational structure.

The amount of staff reduction is unclear.

Li Ning Co said that for front-end business development departments, such as

Lining did not announce the specific size and quantity of the staff adjustment.

In February 8th, Li Ning Co told the China Economic Times reporter that the organizational restructuring is part of the group's ongoing strategic pformation, focusing on core business, optimizing the organizational structure, improving operational efficiency and improving net profit margin.

For this adjustment, including streamlining personnel, integrating resources and motivating excellent employees, while reducing manpower costs, it will also select talents and motivate excellent employees.

However, Li Ning Co did not disclose the number of staff adjustments.

Zhang Zhiyong, chief executive officer of Lining group, said: "in the process of pformation of China's sporting goods industry, it is a necessary step for the group to make continuous organizational changes and personnel adjustment."

Difficult road of pformation

Li Ning Co told our correspondent that the development of China's sporting goods industry has undergone a rapid expansion after many years, and the whole industry is facing pformation.

Changes in competition patterns and external costs, as well as consumer demand upgrading, are the main factors behind the pformation.

In this way, in 2010, Li Ning Co began the road of pformation. What the public knows is "anything is possible" has become "let change happen". "After 90" has become the main group of Lining's products.

Li Ning Co said in an interview that under the background of various changes, Li Ning Co put forward "brand remolding" and "channel reform" according to its brand goals and advantages.

Although Lining insists that he is the first local brand to initiate changes, he admits that he will face difficulties and challenges from the inside and outside.

Data show that in the first half of 2011, Lining net profit decreased by 49.5% over the same period in 2010.

According to Li Ning Co, the growth rate of orders in 2011 was weak and the inventory of some dealers was recovered. The revenue will decline by 6% - 7% compared with 2010.

At the same time, market data showed that the inventory of Li Ning Co in the first half of 2011 was 992 million yuan, and the inventory value at the end of 2010 was 806 million yuan, and the stock amount increased by about 200 million yuan.

Last year, the Li Ning Co suffered a series of departures from senior executives including chief product officer Xu Maochun. This organizational restructuring also involves staff streamlining. This shows that Lining's "brand remolding" road is not so smooth.

There is even a view that the above events indicate that Li Ning Co's "brand remolding" has failed.

The Li Ning Co told our reporter that the strategic objectives and brand strategy of the group will not be changed by the change of any staff. The change is the group's continuing implementation of the initiative change strategy, the further adjustment of the organizational structure of Lining brand, and the foundation for better brand remodeling and the long-term vision of the company.

However, in the interview, Li Ning Co acknowledged that the optimization of the organizational structure can help the group to improve the efficiency of organization operation and save manpower costs.

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2012 became the key year of pformation

At present, China's sporting goods market is facing new changes, the cost of production is rising, the demand of consumers is improving, and the competition between enterprises is very fierce.

Lining has been subjected to fierce competition from domestic enterprises such as Anta, 361 degree, PEAK and other brands. At the same time, he is confronted with the pressure of competition from international brands Nike and Adidas.

In January of this year, Li Ning Co accepted 750 million yuan investment from TPG and GIC, which is a way to deal with challenges before Li Ning Co optimizes and adjusts its organizational structure.

Li Ning Co told reporters that TPG and GIC invest in Li Ning Co and the organizational restructuring is an independent event. The organizational structure adjustment is the initiative of the existing management of Li Ning Co. It is part of the group's ongoing strategic pformation, rather than TPG manipulation.

The existing board of directors has affirmed and strongly supported the initiative of the management of the company to change its strategy and focus on its core business, optimize its organizational structure and improve its operational efficiency.

Meanwhile, Li Ning Co revealed that TPG will nominate new directors to join the board of directors in the future, which will further enhance the board's capability.

They will provide suggestions from the board of directors to group strategic planning.

In addition, Li Ning Co management will fully integrate TPG's expertise and resources to help and enhance Li Ning Co's operational efficiency.

Lining, an independent critique of the footwear industry, remarked in his blog that "from the perspective of cash reserves, the financing of the company is not due to lack of money, but more by introducing external forces, optimizing corporate governance and bringing about new improvements in corporate governance and governance."

The Li Ning Co told the reporter that the most important way to deal with the challenge is to adhere to the big direction of "brand remolding" and "channel reform", which can effectively achieve differentiation competition, strengthen the brand's uniqueness and improve the retail efficiency.

Moreover, Li Ning Co's "brand remolding" is not simply "going to the top end". The most important thing in sports industry competition is to realize differentiation, avoid simple price guidance, attract consumers with unique brand personality and spirit, and good products.

Prior to this, Xiong Xiaokun, a light industry researcher at CIC, told reporters that Lining must define his position in the development, pay attention to differentiated products, highlight his own characteristics, and improve the internal management of enterprises and enhance the core competitiveness of enterprises.

Ma Gang believes that in 2012, Lining's performance is hardly to be promoted to a larger level, but it will be the key year for reshaping Lining, and it should also be a significant year for comprehensive reform.