Alibaba Group Strategic Management Analysis: A Comprehensive Study

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Alibaba Group Strategic Management Analysis
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Alibaba Group Strategic Management Analysis
Introduction
Alibaba is a Chinese company that operates various businesses. The company runs a
conglomerate industry, meaning there is a combination of multiple business entities operating
in different sectors under one corporate group. It is an online market store that specializes in
e-commerce retailing that is internet-based technology created by Jack Ma in 1999 (Qin,
2017). Alibaba is a parent company with multiple business entities underneath operating in
different industries. The company has three sections, which are Alipay, Taobao, and
Aliexpress. The company's strength lies in its global influence, its position in the market, and
its high evaluation. It has a wide scope of functioning and able to target a vast number of
buyers and consumers, which makes the organization successful. Besides, the company's low
brand recognition and inefficiency to compete outside China with its worldwide competitors.
Alibaba's weakness includes its inept delivery period, lack of global reach as well as
advertising, which makes it more difficult for the company to expand to other countries like
the competitors. Our analysis is to come up with recommendations that will help the
organization to overcome its problems to be able to have a competitive advantage in the
online marketplace with its competitors.
1.0 Mission Statement
A mission statement is a concise description of a company's underlying purpose. It
answers the question, "Why does our business exist?" the mission statement explains the
business purpose to both the people or employees in the organization and for the public or
other stakeholders of the organization. It gives an in-depth description of the organization's
abilities, analyses and examine possible stakeholders and determine the nature of what the
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organization must do to continually for its survival. This statement is mostly put together at
their strategic management level of the organization. As a result of instability in the order of
business, stakeholder preferences, and technology, which leads to competition among
organizations, a mission statement of an organization must be revised and redefined from time
to time. The Mission statement has three components, thus the mission or vision of the
organization, an account of the core values that shape the actions and behavior of the
employees and statement of the goals and objectives of the organization. A proper mission of
an organization must be executable and achievable.
The mission of the Alibaba Group’s to conduct business at ease globally. Their
objective is to build an e-commerce future infrastructure platform. The group envisions that
its clients will work, live, and meet at the Alibaba online store. They hope to serve their
customer in existence to market for not less than 102 years. We embrace change, teamwork,
customer first, passion, integrity, and commitment.
2.0 External analysis of Alibaba
2.1 Porter's "Five Forces"
The threat of new entrants is Low
Alibaba Group has the advantage of an early start and positioning itself in the e-
commerce industry. The group has thus seized from its competitors a golden development
period. It is, therefore, has a high degree of remaining in the dominant position within the
online market even in the future. Besides setting up a large online market as Alibaba requires
a substantial investment, getting manufacturers, which will pay for the registration on the
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Alibaba platform, requires their trust.
Power of suppliers is Low
The leading suppliers of the Alibaba Group are also e-commerce service providers. To
win more market share, Taobao, for instance, should ensure to publish a lot of its information
in the Alibaba main pages. This means that Taobao does not have bargain power. However, on
matters of technology, like advertising and researches, the company champions these services;
thus, it has an advantage over its rivals. In that line, Alibaba's mere supplier having strong
bargain power in its position is the logistics. It is essential to mention that support of business
logistics is significant for its growth realization. Logistics quality, as well as efficiency,
significantly impact on the experience of the consumers moreso on online buying.
Power of buyers is moderate
Alibaba’s significant customers can be grouped into two: individual buyers and Small
Medium-Sized Entrepreneurs (SMEs). The two categories of customers are very much
different from each in the market. Due to their power limitations, SMEs have no choice but to
comply with online services for them to perform their transactions. They have a complex as
well as diverse e-commerce service demand like warehousing, micro-finance, and marketing.
Alibaba Group provides a variety of products and services to meet SMEs' needs. Several of
the customers experience a high switching cost. This makes their power to bargain low.
Individual online customers are entirely different. Because of the functionality of the
internet, buyers may opt for a different platform instantly in case they do not find their
intended merchandise on the platform of Alibaba. Some of the primary reasons could be if
they question the quality of the products, or else if they are not pleased by payment services
as well as service delivery. Unlike SMEs, these customers experience no switching charges,
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