JDD Leaders Series: Cao Peng: Witness of JD Digits’ Development

JDD Leaders Series: Cao Peng: Witness of JD Digits’ Development

by Yuchuan Wang

Cao Peng is vice president and head of AI technology and robotics at JD Digits. His team is committed to promoting the full integration of a range of cutting-edge technologies including AI, big data, and blockchain with finance, retail and other businesses.

With the effects of demographic and data dividends gradually waning, internet giants are rushing to the “2B” service battlefield, also known as the “Industrial Internet.”. Internet companies have sought to increase their market share by providing business-to-business technology solutions. At the same time, under the influence of COVID-19, companies in traditional industries have increased urgency for digitized solutions.

JD Digits has been at the forefront of this trend toward digitization for almost a decade. Established under JD.com in 2013, JD Digits has moved from focusing exclusively on consumer services to delivering business solutions—allowing it to become one of the world’s leading digital technology providers. Currently, the company is focused on core businesses, including AI technology, intelligent robotics, intelligent cities, digital marketing, and Fintech solutions.

Cao Peng, vice president and head of AI technology and robotics at JD Digits

From multinational corporation to Richard’s little shop

Cao Peng met Richard Liu, Founder and CEO of JD.com in the early 2000s. At the time, Liu ran an offline store in Zhongguancun (known as the “Silicon Valley of China”) that sold authentic-only laser technology products such as compact discs and CD burners. He happened to meet Richard on an internet forum when he was browsing information regarding how to identify fake CDs.

“Twenty years ago, there was significant fraudulent business activity in Zhongguancun. It was quite rare that Richard chose to sell only authentic ones.” Said Cao.

After graduating from college with a degree in computer science, Cao went to work for a leading multinational consulting firm. Not long after, Liu sought Cao’s help to build website for his Zhongguancun store. In January 2004, Cao successfully helped launch the website “jdlaser.com”, the predecessor of JD.com, in his spare time. Liu gave him two CD burners as a reward for his effort. “I still have one of them under my bed,” said Cao.

Website: jdlaser.com

Pioneering a new journey

In 2007, JD received over $10 million in its first round of funding. The fast-growing e-commerce company urgently needed professional managers. Again, Liu went to Cao—this time to recruit him for technology research.

There is a Chinese saying: “A man should be independent by the age of 30.” That year, Cao was 29.

“I wanted to be a programmer who impresses others.” Cao remembered. Although enjoying a successful and stable career, he was tired of the same routine. A doorstep away from 30, he wanted to challenge himself.

“Richard is a reliable man. He keeps his promises and never disappoints his customers.” Cao said. What surprised him the most was that he had never seen a company that could survive in Zhongguancun for five years—most go bankrupt in just one year. Even former employees who handled Cao’s disc orders continued to follow Liu. “‘He must treat his employees very well,’ I thought.”

Since then, JD.com has gradually become China’s largest retailer by revenue, while Cao has fulfilled his dream of becoming a leading technology professional. From transactions and supply chain to accounting and human resources, Cao has been heavily involved in all phases of JD’s technical infrastructure. He has spearheaded countless technological innovations to help build the company into a giant up from the ground.

When JD.com was preparing for its initial public offering on Nasdaq in 2013, Shengqiang Chen, the company’s former CFO, established JD Finance, the predecessor of JD Digits.

Cao, who had planned to retire, soon decided to join Chen to establish the new financial empire.

“I really enjoy starting new businesses from scratch. The process is a lot of fun, and seeing something built through my own efforts is deeply fulfilling.” Leveraging his expertise in technology, Cao first helped Chen build the JD Finance website and then helped JD Digits build the fundamental technology system.

From financial to digital

“We decided to move towards fintech in 2015 because we realized that focusing exclusively on financial products wouldn’t maximize our market share considering the number of players from both traditional and internet industries,” Cao said, “By expanding into fintech, we discovered that not only can we empower the financial sector, but our AI and big data capabilities were advanced enough to be replicated in other industries. That’s why we further adjusted our strategy in 2018 to become a digital technology company.”

JD Digits is determined to become the partner of industrial digitization.

Companies that focus exclusively on technology typically invest a significant amount when entering new spaces, not to mention the high cognitive barriers traditional sectors face with new technologies. Compared to tech-only providers who have no application scenarios, JD Digits has its clear strengths. “Take computer vision technology as an example, in both JD’s retail and payment businesses, there is a great demand to ensure the technology can be verified through reliable applications.”

By opening up its technologies, JD Digits hopes to help traditional sectors become digitized and intelligent, ultimately reducing costs and improving efficiency.

This vision has been repeatedly verified in Cao Peng’s business lines.

Taking his blockchain business as an example. As of June this year, it has collaborated with over 1,000 brand owners and helped track more than 90,000 SKUs (stock-keeping units) on JD ranging from fresh produce, baby and maternal products, liquors, beauty products, medicine, and luxury and cross-border products. The system has had more than 7 million inquiries by consumers.

The blockchain technology, which was originally designed to ensure a transparent supply chain of authentic products to online consumers, now also serves clients for purposes well beyond retail, such as guaranteeing e-contract signing and trade secret protection.

Robotics

Unlike other departments, intelligent robotics is the only first-level department of Cao’s team. He and his team believe the development of IoT, cloud computing, and AI technology will accelerate the application of robotics in various scenarios and help upgrade traditional industries.

The robotics family of JD Digits

Starting from serving the financial industry, Cao’s team spent nearly a year researching their first robot, the “Intelligent Inspection Robot,” for bank data centers (IDCs). Powered by AI technology and multiple sensors, the robot is designed for environment and equipment checks in IDC. It has the ability to check a single server’s status in 30 seconds and help banks reduce IDC operating costs by up to 50%.

Cao’s robotics business has expanded beyond the banking industry to other industries such as medical and railways.

To help medical staff on the frontlines fighting COVID-19, Cao and his team helped launch the “Indoor Delivery Robot” earlier this year in a Shanghai hospital treating coronavirus patients. The robot helps transport medical supplies to contaminated areas, thereby reducing the risk for medical personnel from being exposed to the highly contagious virus.

Indoor Delivery Robot in a Shanghai hospital

Inspection robots are also used to inspect railways. According to JD Digits, the technology has helped reduce the human resource and time costs by 50%. Data collected by the robot may also be useful for future railway planning.

“We don’t plan on manufacturing robots. Our strategy is to establish the technology infrastructure and platform so third parties can build their own robots as quickly as possible.” Cao explains, “An IT company looking for robotics solutions for bank clients should be able to quickly create robots on our platform that fully meet the demand.”

The versatility of technology allows JD Digits to expand its offerings in everything from financial technology to digital technology, just like computer vision technology can be used to identify tea and also inspect data centers.

“Like most people who explore in the dark, we have encountered numerous challenges. Our ideals convince us to persevere, and the results are proving strong. AI is indeed helping people in their work and personal lives.”

 

(yuchuan.wang@jd.com)

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