How Layoffs optimise Lark's AI Competitiveness？
On 26 March, Xie Xin, CEO of Lark, released an all-staff letter announcing information, announcing layoffs.
ByteDance's office software Lark is set to undergo a new round of organizational adjustments. On 26 March, Lark CEO Xie Xin released an all-staff letter announcing information, announcing layoffs.
In the letter, Xie Xin stated that while Lark had achieved certain breakthroughs in its business, there are still a series of internal issues such as redundant team sizes, insufficient organizational efficiency, decreased effectiveness, and lack of centralized power, which are detrimental to the long-term development of the business. In the future, Lark will continue to make long-term investments, with AI capabilities being a top priority.
According to internal staffs, Lark currently has around 5,000 employees, and the current reduction is less than 20%, with compensation or job transition opportunities offering to related employees, and there will be no further layoffs in the future.
Relevant personnel confirmed the authenticity of this information.
Economical and Practical
Originally, Lark was the internal communication tool in ByteDance. Since 2012, ByteDance has used various domestic and foreign office software such as Skype, WeChat, WeCom, Slack, and DingTalk.
By the end of 2016, ByteDance initiated a self-developed office software project, integrating functions such as instant messaging, shared calendars, online documents, audio and video conferencing, and cloud storage. From 2017 to 2019, Lark gradually realized three major steps: internal application within the enterprise, domestic internal testing and promotion, and the formal version to the whole industry.
In November 2021, ByteDance CEO Liang Rubo announced the establishment of six business segments, namely Douyin, Dali Education, Lark, Volcano Engine, NUVERSE and TikTok, in which Lark officially becoming a major independent business. In 2023, ByteDance conducted a large-scale adjustment of its non-core businesses, strengthening investment in its main businesses (information platforms, e-commerce), while for emerging businesses (gaming, education, PICO, etc.), emphasizing the need for "imagination and maintaining a calm mindset".
Lark stated that this adjustment is not only on the team scale but also aims to return to "Day 1" of a startup company——"more focused, more efficient, and more competitive." However, grass-roots are more concerned about their actual destiny.
In 2020, COVID-19 propelled the market for collaborative office tools into a period of rapid growth. By 2022, there were already 6,000 people in Lark’s team. However, meanwhile, the ROI of Lark was surprisingly unsatisfying.
Data released by QuestMobile indicated that as of April 2023, the MAU of the "three giants" in collaborative office software, DingTalk, WeCom, and Lark, were 199 million, 102 million, and 12 million respectively. Therefore, despite Lark's software subscription revenue surpassing $200 million in 2023, achieving double-digit growth from the previous year, but on average, each team member only generated around 280,000 yuan in related revenue per year, significantly lower than the average salary cost of approximately 800,000 yuan per employee at ByteDance.
Given this weak ROI, it was not surprising that Lark became a transformation target as ByteDance began to subtraction on it.
At the beginning of this month, signs of "optimization" had already appeared in Lark. Industry insiders revealed that there had been delays in performance communication at Lark, while other departments operated smoothly, leading to some speculation. Following this round of optimization, the size of the Lark team will be reduced by one-third from its peak, but still greater than the combined number of employees at DingTalk and WeCom.
However, as Xie Xin stated in the letter: "Only by continuously and qualitatively investing can we do well in the B2B business and serve a broader customer base."
An AI "Makeover"
With the advent of AI large models, entering AI business was an inevitable change for Lark.
On April 11, 2023, as Alibaba released its self-developed large model "Tongyi Qianwen," ByteDance also unveiled its AI veil—Lark launched the AI assistant "My AI." It is understood that this product provides various functions such as text optimization and continuation, scheduling creation, automatic summarization of meeting minutes, and internal knowledge base search in a conversational form, aiming to "lay scenario down to technology," promote the automation process of domestic work.
In November of the same year, Lark proposed the "AI Ready" goal and launched the "Lark Intelligent Partner," which does not rely on large models and can be used in business scenarios such as content creation, content summarization, data analysis, scenario construction, and system building.
In 2016, ByteDance established the AI Lab artificial intelligence laboratory, bringing in many industry elites. However, the products mainly focused on ByteDance's own operational needs, such as the Byte Translator translator, Xiaomingbot AI robot, and search services for Douyin and Toutiao.
By 2023, OpenAI's ChatGPT emerged strongly, leading various companies to fiercely compete in the field of AGI (Artificial General Intelligence). Consequently, ByteDance shifted its focus to this field, gradually downsizing its PICO (VR business) and Chaotianyuexing (gaming business) departments by the end of the year.
Subsequently, ByteDance continued to strengthen its efforts in AI large models, establishing a large model group and recruiting internally, with research and business as its main focus.
In February 2024, Zhang Nan resigned as CEO of the Douyin Group to join ByteDance's editing business. Over the past year, Zhang Nan has personally led the team to focus on AI-assisted creation, and a new generation of AI-generated image and video products is about to be launched. Recently, ByteDance's Flow department has also developed an AI character interaction app called "Hualu." "AI+" has thus become the theme of ByteDance's product development in 2024 across various departments.
Amidst the wave of AIGC, traffic strategies solely focused on scale effects have become ineffective, while under the blessing of large models, the growth mechanism triggered by the functional characteristics of the products themselves has become a new entry point in the field of collaborative office work. It now appears that Lark and ByteDance have both entered their new round of iteration.
·Original
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