Creative Leadership Under Crisis: An Interview with Yang Nan, General Manager of Didi Chuxing Luxury Car Division

Creative Leadership Under Crisis is a series of conversations with Chinese business leaders on how they are spearheading changes and building future-facing capabilities in a post-COVID-19 world.

In this opening interview, we invited and talked to YANG Nan, General Manager of Luxury Car Unit at Didi Chuxing. Since joining Didi in 2016, YANG Nan has been in charge of the Luxury Car Unit, which currently operates across nine tier one and two cities in China. He shared with IDEO how he led the team to cope with a sudden drop in the overall travel demand during the coronavirus epidemic.

Below, YANG Nan describes how he leveraged the constraints in this challenging period to explore new initiatives and business directions, ultimately creating value for users and inspiring thinking about future growth.

1. Unconventional Measures in the Special Time

Q: How is your company resuming operations and work at the moment?

Our work resumption policy varies according to local regulations of different cities. In Beijing and Tianjin, management teams are required to work out of our offices. For some of those who meet the requirement of ending isolation and are in good health, they are also returning to the workplace.

Q: What are the important trends and changes you are observing in the market? Are there any particular examples of companies responding in a creative way?

Honestly, I didn’t see a lot of creative cases, but some forced countermeasures instead. For example, five-star hotels have started to provide take-out service. In the past, because they focused on brand building, catering service was exclusively available to hotel guests only. But you can tell how helpless everyone is when Marriott starts to offer unlimited breakfast at RMB 500, and even Bvlgari Hotel starts to do take-out service.

Q: What are some of the impacts of COVID-19 on your industry and your business? How did you respond to these impacts?

The mobility industry is significantly affected on the demand side. The Spring Festival is usually an off-season for us, and this time we were hit by the pandemic as well. Although everyone did not go out, there were still needs for running errands or delivering goods within the city. So, our Luxury Car Unit leveraged the idle driver resources to provide “errand” service. In addition, in order to accelerate the recovery of demand, we also adopted some promotional measures, such as discount packages.

In terms of service design, Didi Luxury Car Unit also conducted a comprehensive risk assessment of customer supplies during the outbreak. Less practical supplies such as plants and refreshments— which were originally equipped in our luxury cars—have been temporarily removed during the pandemic. We have also refined the design of protective equipment. For example, we added a disposable seat cover in the car and provided each passenger with a sterile protective kit containing disposable gloves and hand sanitizer.

On the supply side, a very important part of the luxury car business is driver training. In the past, we used classroom training that included a seven-day course for new hires and one day per month intensive training. Because of the pandemic, we cannot do this anymore. Therefore, we launched an online course called "Hao Xiang Ting" for drivers. Although it is offered online, we do not compromise on the content of the course. Actually, this form of training has turned out to be more effective and cost-efficient. It can also help reduce workload. We shall continue to use it in the future.

2. Crisis Is an Opportunity

Q: From your perspective, what type of organization is the most fit to survive crises like this and likely to be sustainable in an ever-evolving market?

When responding to such emergencies as the pandemic, Internet companies have some natural advantages, as we can move faster and immediately act on an idea once it’s born.

For example, our team responded quickly to the situation during the Spring Festival. This speed mainly depends on two aspects: a more streamlined and clear decision-making mechanism, as well as cross-team and cross-functional collaboration. Our product, design, data, and service teams are accustomed to efficient collaboration all the time—they launch new products and features on a weekly and daily basis. So we just responded as quickly as usual during the pandemic.

Q: What are the creative ways you are de-risking the investments to enable scaling in this unknown environment?

The pandemic gives customers an opportunity to examine those companies and brands that they use and engage with. Some brands have gained trust, while others have lost trust.

For example, Didi Luxury Car Unit has done a lot of work in optimizing the customer experience, such as hand sanitizer in the car and disinfectant supplies for the driver. These anti-pandemic sanitizing measures have increased the cost of service, but they have helped build user trust and enhance the brand image. The demand for travel is only temporarily reduced. If we have this trust, we can seize the opportunity once the demand is back.

Leverage the crisis to win trust, and leverage the turnaround to win market share!

Users’ real needs must be kept at the core of everything an enterprise does. As to whether these measures may pose a potential investment risk, it depends on what kind of investment return cycle the company is measuring against. But I believe, as long as you put in effort to create value for users, the outcome will definitely be rewarding.

Q: What’s your view on implementing short-term emergency measures vs. long-term business-building activities? Are they conflicting or complementary to each other?

The extreme constraints from the market and the external environment have prompted us to think more deeply about what kind of value we could bring to users and the role of mobility in people's lives.

Especially in the case of luxury cars, as more and more people have their own cars, it will have a negative impact on our business. Therefore, we must rethink the value of our "service" and our unique proposition. For example, what a customer needs is no longer a driver to send them from point A to point B, but perhaps a "butler" instead.

This kind of thinking allows us to reprioritize our business goals and put things that were previously neglected or done slowly back on the agenda. For example, we have recently entered into strategic cooperation with UnionPay, offering Didi luxury car service as a preferential benefit for UnionPay’s high-end users. We actually tried some similar B2B initiatives before, but it is the current extreme conditions and accelerating pressure that have led to such new attempts and explorations.

3. Navigate Uncertainties With Values

Q: How can businesses help teams navigate uncertainties?

For teams, the most important thing is to stay true to your purpose. At Didi, our purpose has always been "creating value for users," and it hasn’t changed over the past three years. In the upcoming stage of "recovery growth," we need to keep close track of users to see how their habits and needs are changing.

So when it comes to selecting talent, what I value most is whether this person shares a common value with the company. When a group of people work as a team, they should really want to create value together, rather than embracing a speculative mindset. At Didi, product reliability, specificity, user experience, and safety are all key to generating user value, and we will do it regardless of the pandemic.

April 8, 2020