In a mere six months, Liu Zhanshu has steered Volkswagen Anhui to achieve three significant milestones: streamlining the foundational workflows of the Gold Standard Volkswagen, transitioning market operations from ad-hoc to fundamental actions; refining channel development objectives to emphasize network quality over quantity, ensuring both customer experience and market penetration; and, most notably, initiating a transformation in the pricing strategy of Volkswagen Anhui's offerings, establishing a simplified pricing system from the Zony 08 to the Zony 07 Gold Standard, thereby signaling the end of an era characterized by high-priced niche products and costly trial-and-error methods...

Editor | Li Jiaqi

Image Source | Internet

On May 28, Volkswagen Anhui announced its latest round of personnel changes, with Liu Zhanshu officially taking over from Tang Tingwan as CEO of Volkswagen Anhui starting July 1 of this year. While the appointment of a new Chinese CEO may draw attention, what truly warrants notice is Volkswagen's strategic pivot eastward around Hefei and its efforts to synchronize more swiftly with China's market dynamics through systemic rejuvenation. This personnel shift underscores aspects that merit our closer scrutiny.

If memory serves, since officially joining Volkswagen Anhui as Chief Operating Officer (COO) in November of the previous year and now ascending to the position of Chief Executive Officer (CEO), Liu Zhanshu's rapid ascent is unprecedented among mainstream joint-venture automakers in the past decade. The sole rationale for Volkswagen Anhui's willingness to break conventions and make the seemingly impossible possible is that, in the three years since the inception of the Gold Standard Volkswagen, the company's entire operational framework has yet to achieve absolute cohesion.

For Liu Zhanshu personally, being further entrusted by the company within approximately six months of rejoining the Volkswagen fold at least indicates that the results achieved by his team during this period have been commendable; the overall transformation of Volkswagen Anhui during this timeframe has been highly regarded at the Volkswagen Group level.

Since last year, there have been three instances of foreign automakers appointing Chinese managers as top leaders in China: Beijing Hyundai appointed Li Fenggang, Stefan Jacoby assumed leadership at Volvo, and now Volkswagen Anhui has selected Liu Zhanshu as CEO.

In today's global business landscape, where multinationals often centralize authority and parachute in foreign executives, such bold appointments of Chinese nationals as top leaders are particularly noteworthy. This at least demonstrates that Volkswagen's top echelon not only possesses the resolve to act counter-cyclically but also genuinely believes in the capabilities of local talent. After all, despite Liu Zhanshu's relatively brief tenure back in the Volkswagen system, he has accomplished a great deal.

When Liu Zhanshu rejoined the Volkswagen fold last November, Volkswagen Anhui was navigating through a challenging phase. The COO position had remained vacant for half a year, with only one product under the Gold Standard Volkswagen brand, a mere 80 dealerships, and four disparate brand names in circulation. Stores were underperforming, sales staff were departing, dealer confidence was shattered, investors were hesitant to continue investing, and discussions about "cutting losses in time" reverberated throughout the organization. Facts have substantiated that operating a joint venture company entirely in accordance with the German side's tempo and management style is fundamentally untenable. Volkswagen Anhui needed to identify a more effective tactical executor to facilitate the breakthrough of the Gold Standard Volkswagen.

The inaugural task Liu Zhanshu undertook upon joining Volkswagen Anhui was to harmonize the previously disordered brand names into a unified nomenclature. Within a fortnight, through assessments, research, and internal alignment, the previously perplexing naming conventions began to crystallize into a clear direction: the company is Volkswagen Anhui, the brand is Gold Standard Volkswagen, and the model names utilize "Zony." This corrective measure, substituting German processes with local expertise, signified that from this juncture onward, challenges encountered by Volkswagen Anhui in China would commence to be resolved with Chinese efficiency as the standard mechanism.

Of course, this was not an issue stemming from strategic direction but rather a clash of thinking due to cultural disparities. The German team was concerned with whether Volkswagen's global branding was unified and whether its lineage was pure; however, they were uncertain whether Chinese users could recall or differentiate these names or if they sounded perplexing. Such cultural conflicts, procedural discrepancies, and variations in operational logic implied that projects driven solely by foreign managers often struggled to land precisely without direct Chinese involvement. Being able to discern issues and resolve them, and more crucially, integrate process and efficiency shifts into specific tasks, is precisely where Liu Zhanshu excels.

Four months prior to the pre-sale of the Zony 08, he convened the national sales channels in Hefei for an intensive closed training session. He standardized financial plans, implemented standardized sales SOPs, conducted examinations, and had dealers sign performance pledges. For channel management, he mandated that dealers adhere to prescribed actions before venturing into ad-hoc ones. This execution (executive force) that dared to race against time ensured that Volkswagen Anhui's innovative channel management could swiftly standardize, supplanting endless deliberations with robust execution. This is not about overexertion but ensuring that Volkswagen can maintain pace with China's market fluctuations while adhering to German quality standards.

In a mere six months, Liu Zhanshu has propelled Volkswagen Anhui to accomplish three major tasks: streamlining the foundational workflows of the Gold Standard Volkswagen, transitioning market operations from ad-hoc to fundamental actions; refining channel development objectives to prioritize network quality over quantity, ensuring both customer experience and market penetration; and, most crucially, initiating a transformation in the pricing strategy of Volkswagen Anhui's offerings, establishing a simplified pricing system from the Zony 08 to the Zony 07 Gold Standard, thereby marking the end of an era characterized by high-priced niche products and costly trial-and-error methods.

There is an ancient Chinese proverb: "A solitary traveler is swift, but a group travels far!" Regardless of how adept a tactical executor may be, they are merely one cog in the machine. True tactical implementation necessitates the strength of team collaboration. Volkswagen Anhui has clearly recognized this. In March of this year, Volkswagen Anhui invited Li Pengcheng, who also boasts years of Volkswagen experience, to join as Chief Marketing Officer (CMO), fundamentally aiming to collaborate with then-COO Liu Zhanshu in managing the external branding, user engagement, and visibility of the Gold Standard Volkswagen.

As representatives of the post-80s generation of local professional managers, both Liu Zhanshu and Li Pengcheng comprehend Volkswagen's system, grasp the operations of Chinese new forces, and are even more attuned to the actual needs of Chinese users for new energy products... By leveraging lower communication costs and enhanced execution, Volkswagen Anhui aims to gain time through spatial adjustments. Behind this approach lies Volkswagen's courage to break conventions and appoint localized talent to construct a localized system.

Now, with Liu Zhanshu serving concurrently as CEO and COO of Volkswagen Anhui, it signifies that Volkswagen Anhui has clarified its intentions for the Chinese market, with several major tasks ahead for the Gold Standard brand:

1. Reform the traditional joint venture development model through a robust executive team, truly integrating the strategies and philosophies of Gold Standard Volkswagen with the characteristics of Chinese market demands to better align with Volkswagen's development plans in China.

2. Break free from the traditional joint venture automaker's discourse system, interpreting German quality, intelligent configurations, and electrification experiences in a localized context, better translating Volkswagen's technological heritage and product advantages into expressions that Chinese users can comprehend and embrace. Let Volkswagen's formidable product capabilities truly penetrate the market and resonate with consumers.

3. Combine Volkswagen's global strategic philosophy while fortifying the brand personality of Volkswagen Anhui, fostering new premium capabilities for Volkswagen's third brand in China, and constructing a sales team capable of swiftly adapting to changes in the Chinese automotive market.

The battle for joint venture new forces is no longer solely about scale. Volkswagen Anhui's organizational adjustment this time fine-tunes the synergy between market and brand. Simply discussing individual changes oversimplifies Volkswagen's adjustment.

Looking ahead, the Gold Standard Volkswagen is not merely about calculating short-term sales fluctuations but evaluating whether a more localized approach can be efficacious. From the launch of the Zony 08 to the Zony 07 and the subsequent rollout of the Zony 09 in the latter half of the year, Volkswagen Anhui aspires to convey a mindset of waging a protracted, sustained battle. Only with this mindset can one truly grasp the true intent behind this adjustment.

End