Microsoft’s new Viva tool gives ‘productivity’ a more human definition

Getting more done is still the plan, but Microsoft's trying to help keep everyone sane, too.

Microsoft Viva Connections

Viva Connections is just one part of Microsoft's new way of thinking about the employee experience.

Image: Microsoft

Microsoft is launching a new set of tools designed to help companies be more productive. That's not a terribly revolutionary thing for Microsoft to do, but the approach this time is quite different. The new set of tools, called Microsoft Viva, is less about increasing operational efficiency or hitting your KPIs faster, and more about making sure employees are happy, sane and feel taken care of.

While Viva is a set of tools, it's ultimately part of an even larger family: Microsoft's building a new "Employee Experience Platform" to try to help redefine, quantify and achieve a new definition of employee success. The industry Microsoft is trying to capture is worth hundreds of billions of dollars a year, dominated by companies like ServiceNow. And Viva is Microsoft's first foot into the fray. So far, Viva is four things: Viva Learning, a hub for all of a company's training and courses; Viva Topics, an automatically curated library of various internal videos, presentations and other content; Viva Connections, a Facebook Workplace-style intranet that can help people find resources within the company; and Viva Insights, which aims to measure and help improve employee experience.

Most companies already have a lot of this stuff, but it's in a dozen different systems that nobody ever remembers to check. Microsoft wants to collect it all in one place, and then by integrating it into Microsoft Teams, make it available in the place everyone spends their time.

In the long run, Viva Insights is the key to understanding what Microsoft is trying to do with Viva, and with EXP in general. In the early days of the pandemic, Microsoft began hearing a lot of the same question from its customers: How do I find out how my employees are doing? Not just whether they're getting any work done (though there was a bit of that, too), but whether employees are burned out, struggling to manage work-life balance, feeling lonely, all the things so many people have felt over the last year. They wanted to know if Microsoft could offer some insight.

Even within Microsoft, coping with the new ways of work has been a challenge. "I transitioned about a year ago into this new job that I'm in," said Kirk Koenigsbauer, who is now COO and CVP of Microsoft's experiences and devices group. "I haven't met 80% of my team." The day we chatted, he was gearing up for an all-nighter in his New Hampshire home, in order to do a quarterly catch-up with a team in India. "I've seen so many people I work with, with their kids, their grandparents, their spouses, their cats, their dogs. It's all just there. So how do you keep employees connected?"

Microsoft Viva Insights Viva Insights tries to put numbers — and solutions — to questions about employee productivity and well-being.Image: Microsoft

Things like connection and burnout are hard to measure, but Koenigsbauer is hopeful Microsoft can at least help shed some light on things. "If I'm a manager, I can very quickly kick off a quick survey and get insights. I would call that quantitative data." And here he's careful to note that Microsoft is trying to do this in a privacy-preserving way, anonymizing individual data and only sharing it with bosses in aggregated form. After the backlash to the "Productivity Score" that automatically showed managers a lot of individual data about users' activity, Microsoft's eager to not repeat the same mistake.

Koenigsbauer said there are other ways Microsoft is learning to measure employee well-being, but also acknowledged that there's always going to be a qualitative side of the story. He pointed to Viva's partnership with Headspace as an example: "If you have some of this high-level trend information," he said, "they can provide a bunch of tools to help employees, whether it's meditation or a bunch of different services that they're going to provide."

These insights aren't meant to just be for managers, either: Employees can turn to Viva for help remembering to take breaks and set calendar boundaries, and to ensure they're spending time on the right things. Koenigsbauer pointed to Microsoft's recent Virtual Commute feature, which automatically sets aside time for employees to get ready for work even when they're working from home, as an example of the sort of simple, automated system that can make work better.

Most companies will handle these things in different ways, he said, and there will always be outliers who demand ruthless production at all costs. "But generally speaking, people's interests are aligned," he said. "Successful, happy, non-burned out employees are what's going to keep things going."

Koenigsbauer acknowledged that Viva is new, that the world of work remains in flux, and that a lot is likely to change even in the next several months. "What if two of us decide to go into the office and the other person doesn't want to?" he asked, just to name one example. "Will the fear of missing out happen again?" But he's confident that EXP is a big business going forward, and thinks Microsoft's well-equipped to lead it. The company already knows so much about how its customers work. If it can figure out how to measure that in a way that is both respectful of privacy and useful to all parties — which will be no small task — it can help nudge everyone in better directions.

Image: Yuanxin

Yuanxin Technology doesn't hide its ambition. In the first line of its prospectus, the company says its mission is to be the "first choice for patients' healthcare and medication needs in China." But the road to winning the crowded China health tech race is a long one for this Tencent- and Sequoia-backed startup, even with a recent valuation of $4 billion, according to Chinese publication Lieyunwang. Here's everything you need to know about Yuanxin Technology's forthcoming IPO on the Hong Kong Stock Exchange.

What does Yuanxin do?

There are many ways startups can crack open the health care market in China, and Yuanxin has focused on one: prescription drugs. According to its prospectus, sales of prescription drugs outside hospitals account for only 23% of the total healthcare market in China, whereas that number is 70.2% in the United States.

Yuanxin started with physical stores. Since 2015, it has opened 217 pharmacies immediately outside Chinese hospitals. "A pharmacy has to be on the main road where a patient exits the hospital. It needs to be highly accessible," Yuanxin founder He Tao told Chinese media in August. Then, patients are encouraged to refill their prescriptions on Yuanxin's online platforms and to follow up with telehealth services instead of returning to a hospital.

From there, Yuanxin has built a large product portfolio that offers online doctor visits, pharmacies and private insurance plans. It also works with enterprise clients, designing office automation and prescription management systems for hospitals and selling digital ads for big pharma.

Yuanxin's Financials

Yuanxin's annual revenues have been steadily growing from $127 million in 2018 to $365 million in 2019 and $561 million in 2020. In each of those three years, over 97% of revenue came from "out-of-hospital comprehensive patient services," which include the company's physical pharmacies and telehealth services. More specifically, approximately 83% of its retail sales derived from prescription drugs.

But the company hasn't made a profit. Yuanxin's annual losses grew from $17 million in 2018 to $26 million in 2019 and $48 million in 2020. The losses are moderate considering the ever-growing revenues, but cast doubt on whether the company can become profitable any time soon. Apart from the cost of drug supplies, the biggest spend is marketing and sales.

What's next for Yuanxin

There are still abundant opportunities in the prescription drug market. In 2020, China's National Medical Products Administration started to explore lifting the ban on selling prescription drugs online. Although it's unclear when the change will take place, it looks like more purely-online platforms will be able to write prescriptions in the future. With its established market presence, Yuanxin is likely one of the players that can benefit greatly from such a policy change.

The enterprise and health insurance businesses of Yuanxin are still fairly small (accounting for less than 3% of annual revenue), but this is where the company sees an opportunity for future growth. Yuanxin is particularly hoping to power its growth with data and artificial intelligence. It boasts a database of 14 million prescriptions accumulated over years, and the company says the data can be used in many ways: designing private insurance plans, training doctors and offering chronic disease management services. The company says it currently employs 509 people on its R&D team, including 437 software engineers and 22 data engineers and scientists.

What Could Go Wrong?

The COVID-19 pandemic has helped sell the story of digital health care, but Yuanxin isn't the only company benefiting from this opportunity. 2020 has seen a slew of Chinese health tech companies rise. They either completed their IPO process before Yuanxin (like JD, Alibaba and Ping An's healthcare subsidiaries) or are close to it (WeDoctor and DXY). In this crowded sector, Yuanxin faces competition from both companies with Big Tech parent companies behind them and startups that have their own specialized advantages.

Like each of its competitors, Yuanxin needs to be careful with how it processes patient data — some of the most sensitive personal data online. Recent Chinese legislation around personal data has made it clear that it will be increasingly difficult to monetize user data. In the prospectus, Yuanxin elaborately explained how it anonymizes data and prevents data from being leaked or hacked, but it also admitted that it cannot foresee what future policies will be introduced.

Who Gets Rich

  • Yuanxin's founder and CEO He Tao and SVP He Weizhuang own 29.82% of the company's shares through a jointly controlled company. (It's unclear whether He Tao and He Weizhuang are related.)
  • Tencent owns 19.55% of the shares.
  • Sequoia owns 16.21% of the shares.
  • Other major investors include Qiming, Starquest Capital and Kunling, which respectively own 7.12%, 6.51% and 5.32% of the shares.

What People Are Saying

  • "The demands of patients, hospitals, insurance companies, pharmacies and pharmaceutical companies are all different. How to meet each individual demand and find a core profit model is the key to Yuanxin Technology's future growth." — Xu Yuchen, insurance industry analyst and member of China Association of Actuaries, in Chinese publication Lanjinger.
  • "The window of opportunity caused by the pandemic, as well as the high valuations of those companies that have gone public, brings hope to other medical services companies…[But] the window of opportunity is closing and the potential of Internet healthcare is yet to be explored with new ideas. Therefore, traditional, asset-heavy healthcare companies need to take this opportunity and go public as soon as possible." —Wang Hang, founder and CEO of online healthcare platform Haodf, in state media China.com.

Zeyi Yang
Zeyi Yang is a reporter with Protocol | China. Previously, he worked as a reporting fellow for the digital magazine Rest of World, covering the intersection of technology and culture in China and neighboring countries. He has also contributed to the South China Morning Post, Nikkei Asia, Columbia Journalism Review, among other publications. In his spare time, Zeyi co-founded a Mandarin podcast that tells LGBTQ stories in China. He has been playing Pokemon for 14 years and has a weird favorite pick.

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