Alibaba Group of

Companies
 About
• Founded in 1998, based in Hangzhou, China by Jack Ma
• Primary business : Connect manufacturers and suppliers all over the world for business
• Revenue (2012) : $636 million
• Over 50% of B2B e-commerce and 70% of online shopping for China
• Connects millions of users in more than 240 countries and regions
• Employs almost 17,000 people in B2B sales, computer engineering, customer service (2009)

The Power of PowerPoint |

thepopp.com
2
 Portfolio of Companies

Alibaba.com Alibaba.com.cn Alisoft

International B2B marketplace Domestic B2B marketplace Chinese management software and
cloud computing services

Alimama TaoBao Alipay

Online Advertising exchange China’s largest online shopping Online payment services
website

3
 Company Timeline

1999 2003-04 2007Public

Start New Businesses Offering
Established by 18 founders 2003: Founded Taobao • Listed Alibaba.com on the
HKSE
2004: Launched Alipay
• Launched Alisoft and Alimama

Break even Aquisition

Achieved profitability • Took over operations from
Yahoo! China

2002 2005
4
 Post Case Timeline/ Current
Scenario

2012 2014 2017

De listing US IPO Success
Took publicly traded Alibaba.com Listed on NYSE • Top 10 Valuable companies in
private, delisting from the HKSE the world
at 13.50 HKD/share • 400 USD billion value

Taobao
reorganisation Indian Market
3 separate companies: Taobao • Invested in Snapdeal and
Marketplace, Taobao Mall Paytm
(Tmall.com) and eTao

2011 2016
5
 1 Focusing on B2B solutions

How does Alibaba

create a 2 Problems faced by SMEs

corporate
advantage? 3 Internet based solutions

6
 Is the current degree of competition
among the business units appropriate?
Do you think that Jack Ma should
encourage more cooperation? If so, how?
Freedom to do what is right for their business

Set their own strategy

“Since you don’t know where competition is coming from and firm boundaries are
changing quickly, suppliers and partners can become competition overnight”

“Only the paranoid survive”`

 Benefits of having businesses
under one roof
Synergies between certain cross-business opportunities between Alisoft and Alipay, as
subsidiaries Alisoft customers must use Alipay to complete transactions.

“Alibaba’s governance inspired its subsidiaries to

Internal Competition be leaders of their respective industries”

In addition to independent board of directors and

executive, Jack Ma also encouraged each
Decentralized Strategies
subsidiary to develop their own strategy amongst
each business unit

Encourages further market They can use their experience and

technology to further learn about
understanding consumer behavior and market
trends.
 Major Concerns For Jack Ma and
His C-Suite

High Growth and

Complex Business Increasing complexity in the
Structure business can lead to loss of
control on company assets.

Dual Authority and

Create distances between managers
Miscommunication
and employees directly affecting
performance and satisfaction levels.
Need For
Restructuring The Requirement of centralisation.
Organization

9
 Reasons For
Cost Savings 1 Centralization
Standardised methods and procedures
help in reducing the cost
Relationship
2
Management
To being top management and employees
to work together who can share their
Action Uniformity 3 innovative ideas and views to perform the
best to run the unit. o
Easier to maintain consistency in work
practices.
Rapid Execution of
4
Policies
Few people are involved in discussing and
deciding the strategy and plan of action.
Budget Control 5 Once decisions are made, leaders will
send the directives to lower levels who will
Decisions are made by top management who implement the same.
have control over budgets. They ensure that all 10
the expenses will be under their supervision
 For Smooth Centralization, COO Is
Imperative
Reduce Pressure On Jack
Ma
COO will facilitate centralized reporting from all units thereby reducing pressure on Jack MA

Retention Of Key
Executives
COO will act as a binding force and through personalised attention help in lowering the retention of
key executives who are at the risk of moving to a competitor
Develop Organization Strategy, Create Value And
Optimize Limited Resources
Proper planning which prioritizes customer, employee and requirement of organization
Maintains and monitors all levels in the unit and motivates them to fulfil organizational goals
Formalizes limited resources to most productive uses which creates maximum value to the
company 11
 Way Forward for the New Business As of 2018, Alibaba is a listed group of companies on NYSE with
presence in the following sectors:
Numeric list having 5 items
E-Commerce and Retail Service Platforms

Cloud Computing and AI Technology

1 FinTech and Online Payment Solutions

Entertainment Services

Perfecto
Venture efficiendi
Capitals an vel. Ea duo aliquam iracundia mnesarchum, eu
2 dicta veritus necessitatibus eos, debet intellegam no mea.
Media

One Group – Many Postulant aliquando percipitur an quo. Vix ne malis perpetua, ei dolore
3 denique vis. Pri et dicant corpora.
Directions
Eruditi meliore dissentiunt sea te, qui summo volutpat consulatu te. Ea
4 consequat ullamcorper vix, tantas ocurreret eos id.

Quot omnes appetere ex vel, eos eu ferri interesset delicatissimi. Has at

5 eruditi intellegat maiestatis, erat molestie sed ne.

12
 Way Forward for the New Business As of 2018, Alibaba is a listed group of companies on NYSE with
presence in the following sectors:
Numeric list having 5 items
E-Commerce and Retail Service Platforms

Cloud Computing and AI Technology

1 FinTech and Online Payment Solutions

Entertainment Services

Perfecto
Venture efficiendi
Capitals an vel. Ea duo aliquam iracundia mnesarchum, eu
2 dicta veritus necessitatibus eos, debet intellegam no mea.
Media

One Group – Many

3
Directions
4

13
 Way Forward for the New Business
One Group – Many Directions

Following the GE way Current Scenario

 The Alibaba Group as a whole was made As of 2018, Alibaba is a listed group of companies
public in 2014 on NYSE with presence in the following sectors:

 Utilizing the immense opportunity of  E-Commerce and Retail Service Platforms

standardizing pay scales across subsidiaries
 Cloud Computing and AI Technology
 The subsidiaries continued to be operated as
 FinTech and Online Payment Solutions
separate units, utilizing group synergies
wherever possible  Entertainment Services

 New acquisitions were made in growing  Venture Capitals

markets – either as complements to  Media
established subsidiaries or as completely new
units

The Power of PowerPoint |

thepopp.com
14