Haier's AI Management Model: Decentralization and Value Sharing

Chinese appliance giant Haier uses AI to reshape its organizational structure. Since 2005, Haier's RenDanHeYi model connects employee contributions to user value. The company eliminated over 12,000 middle management roles to empower frontline teams. This decentralization enables faster responses to customer needs and market shifts. Haier's strategy extends beyond internal operations, using digital platforms to connect with customers and partners. HomeGPT, for example, engages millions of households, providing data for service improvements. The company emphasizes equitable value distribution among ecosystem participants. Incentives link directly to user value delivered, not internal metrics. This focus on collaborative success aims to foster stakeholder alignment. Haier's approach offers insights for businesses seeking to adapt to dynamic markets. By prioritizing autonomy, collaboration, and outcome-based incentives, companies can address challenges from rapid technological change. The company's model provides a framework for improved agility and responsiveness. Haier's experience demonstrates the potential of AI to facilitate organizational change and enhance value creation. The shift towards decentralized decision-making and customer-centric value sharing is a key element of their success.