What did Zynga's abolition bring to Chinese employees?

Zynga China has been abolished and another US internet company has failed to enter the Chinese market. Zynga Gaming is a social network that falls on the mobile side of the tide. Zynga's failure in China, in addition to its lack of understanding of the Chinese market, is rooted in a series of decision failures by the US company.

The company's share price suffered an unexpected plunge after it was officially abolished at the headquarters of Zynga China, the day before Zynga released its 2014 Q4 and full-year earnings. After the earnings announcement, Zynga's shares have fallen from 2.8 U.S. dollars on February 11 to about 2.2 U.S. dollars on February 13, down more than 20% per cent. The reason for the cliff-like decline in Zynga's share price is self-evident – that investors are not bullish on the seemingly sensible, reckless behavior of Zynga's withdrawal from the Chinese market. One thing we need to understand is that with so many Chinese companies listed, Wall Street is already more knowledgeable about capital markets than Zynga's top executives, and more about the Chinese market.
Zynga shares suffered a cliff-style decline following the abolition of Zynga's China district

Reduced staffing, simple and rough

In a previous report on Zynga's Chinese abolition, Sina's game has analyzed the main reason for Zynga's China shutdown to give shareholders a better earnings report, so they chose to close the Chinese office in the balance of pros and cons. In fact, this claim has been affirmed by former Zynga China general manager Tian: "When U.S. listed companies are under financial pressure, their first reaction is to reduce the number of people, how to reduce it?" It must be starting from what they think is the non-core line of business. It is also a model of a typical US-listed company cutting costs so they can explain to Wall Street. "But as it turns out, these investors from Wall Street don't buy this one from Zynga," he said.

As early as 2012, Zynga made a decision to close the Japanese office. In the ensuing 2013 years, Zynga headquarters implemented a massive layoffs, and 30 of its employees from China were sacked in the layoffs. According to former Zynga employees who have been laid off, "Zynga China is the least-cut department in 2013 years of layoffs." ”
Zynga closed its Japan office in 2012

In the layoffs that lasted from June 2014 to August, the company, which has been unable to transform from a page-tour to a successful transition, has finally hit the killer, cutting some 520 serving employees, accounting for 18% of the firm's total workforce, and the last time the layoffs were aimed at closing some offices and cutting costs. "The only thing they can do in the face of pressure from Chinese investors is to shrink, a simple and crude way to control costs and tell investors they are" focused, "Tian said.

Zynga's Bloom and decline

About Zynga's rise and decline, 1000 people have 1000 views, but which is the most close to the truth? Let's take a quick look at some of Zynga's memorabilia from its inception.

In June 2007, the social gaming company Zynga was made by Mark Pincus, Michael Luxton, Eric Lexton (Eric Schiermeyer), Justin Waldron. ), Andrew Chulede (Andrew Juno) and Steve Schoettler, a co-founder. The names of these founders are mentioned here because none of them has been at the top of Zynga's executive level so far.

But let's go back to Zynga's history. The company, headquartered in San Francisco, has emerged with the rise of web games, with almost all of its early games posted on social networking sites such as Facebook. With Zynga's early launch of "City Ville", "Farm Ville", "Empires & Allies", "Zynga Poker", and "Treasure Isle", "Texas Hold ' em" As well as a series of popular games, Zynga has grown into one of the world's largest game makers.
"Zynga Poker"

Zynga officially launched its IPO tour in 2010, but Zynga's over-reliance on Facebook has come to light, but it has not received enough attention.

In May, Zynga announced the acquisition of XPD, a social gaming company created by Tian and Robin Chan, and founded Zynga China, Tian as general manager. After that, Zynga continued to acquire several companies, including YoVille, investigative business and my Mini, and Zynga has been on the road to globalisation's expansion.

If 2010 is the first critical time for Zynga to decline, then 2013 is another important time point.

The global tide of hand-swimming has sprung up in the 2013, but Zynga, the home of the tour, has missed the best chance of getting into the mobile gaming world. In addition, a shake-up of Zynga's headquarters management has laid the groundwork for the abolition of Zynga China. Also in the same year, Zynga China veteran Tian left the company that was originally founded by him.

2013 years later, Zynga's performance went down like its share price.

China pays the wrong decision

Under the double pressure of performance and finance, Zynga China has finally become a victim of its policymakers ' missteps.

According to Sina Games, Zynga Beijing Studios have been profitable for the past two years and have done a pretty good job of localizing it. Tian, who has resigned from Zynga, said to reporters: "I personally think that Zynga China has done a very good job over the years, with three points to it: first, the people of Zynga's China team are excellent, which is obvious to the entire industry; That is, prior to 2013, senior executives have a lot of support for China, which is very helpful to growth in China; third, the domestic industry sees only a few moves by Zynga China in the domestic market, but in fact Zynga China is positioned as a global product studio, Several new games are being developed for the international market, such as Dream Heights, War of Fallen,ruby Blast, and so on, which have achieved good results in the international market. ”

But 2013 years later, the change of management and the inauguration of the new CEO have pushed the battered Zynga to the other side of the story.

Don Mattrick, a Microsoft Tang Matrick, replaced founder Mark Pincus as Zynga's new CEO who was in charge of the Xbox business before joining Zynga. "After he took office, the accumulation of Zynga's market in China and the layout of the strategy were completely lost, because Don's Xbox business has been limited in China, so he has only a negative feeling about China." , Tian the management of Zynga.

Tian added: "After the new CEO comes to power, the business is under great pressure to salvage the decline of Zynga's headquarters business and he is less likely to take the time to understand the Chinese market." So the American interpretation of China is that China is a marginal business, in fact, in my opinion, They do not understand the potential of China's gaming market, which is a gap between Chinese and American multinationals. ”

"A lot of big decisions, in the final analysis, is the global CEO of a person's past experience, perceptions driven." "But the missteps of Zynga's policymakers have to be paid for by Zynga China itself."

An anonymous person to the Sina game revealed: "Zynga China has been close to talking about tens of millions of dollars in Greater China, but its headquarters have abandoned the Chinese sector, as well as the company's headquarters ' ignorance of the opportunities and potential in the Chinese market. ”

Even so, Zynga's headquarters will have to abandon China to beautify its already completely impossible to "beautify" the financial results, such a move should not be called to lose the car, or even called smart.

"Zynga's global decline can be rooted in two root causes: leaders and strategic judgments. Zynga founder Mark Pincus bought my company and set up Zynga China, a strategic judgment. Zynga misses the big trend in the mobile industry and is also a strategic judge. The survival of small companies depends on a product, opportunity, but the rise and fall of large companies is based on strategic judgment, no matter how good you implement level. "Tian made the remarks in a circle of friends after the media mistakenly interpreted Zynga's abolition of its China office.

How many injuries can the "n+4" compensate?

After Zynga China was officially dissolved, the retrenched employees were compensated for by "n+4", and Zynga said 71 Chinese employees were affected by the company's earnings, which will save $7 million a year after the cuts.

Even if "n+4" is a fairly "lucrative" compensation for the outside world, how can these employees compensate for the feelings of Zynga China? Some employees are very emotional about the company, so this cut is a huge injury to them, and the damage takes time to resolve. "Although Tian has been in China for many years, many old men have talked to him about how they felt after the layoffs," he said.
What did Zynga's abolition bring to Chinese employees?

Just as the May 2013 Gree China office was closed, and the withdrawal of the EA mobile division in July 2013 was similar to the closure of China's only branch in early 2014 Konami, Zynga's withdrawal revealed a dilemma for foreign gaming companies in China and, on the other hand, made it clear to the masses of the unknown. The impact of a faulty decision on a large multinational.

But it is a blessing in disguise, just as Google withdrew from China, allowing a large number of Google's talent to flow into all walks of the Internet, to be at the top or to start their own business, including Tian, the former head of Google's mobile industry. Zynga withdrew from China, and the talent flowed into the industry. According to incomplete statistics, the former Zynga employees started the company has more than 10, such as the Yahoo acquired by the former CTO Zhenghao's start-up company, "Heaven" of the world, but also at the helm of large companies, such as Jin Shanyun partner, FEI president. Of course, it also includes tens of thousands of users of the Tian new start-up companies touch. A lot of games and internet companies are also looting Zynga's talent these days, and we want to see what Zynga's "help" will accomplish in the years ahead.

What do you think?