Alibaba's Leadership and Strategy: A Case Study

This case study examines the leadership style of Jack Ma, the founder of Alibaba, and how the company beat eBay in the Chinese market. It also discusses the implications for strategy creation and Alibaba's future success.

Assessment

Table of Contents
INTRODUCTION.......................................................................................................................................3
MAIN BODY..............................................................................................................................................3
1. How would you describe Jack Ma as a leader? What does he do?.......................................................3
2. Why and how did Alibaba beat eBay?.................................................................................................4
3. What are the implications for how strategy is created?........................................................................5
4. How well is Alibaba poised to succeed in the future?..........................................................................7
5. If managers no longer command and control and the organization is self-tuning, what is the role of
leaders and leadership teams...................................................................................................................8
CONCLUSION...........................................................................................................................................8
REFERENCES............................................................................................................................................9

INTRODUCTION
Alibaba Group holding limited is an international technology firm which specializing in
retail, technology, e-commerce as well as Internet (Zeng, 2018). This operates many of the
companies internationally in different industries and is recognized as a most respected
organization (Wang and et. al., 2018). Alibaba is largest retailer in world and also e-commerce
firm and on list of the biggest internet firms and artificial intelligence. Present report will be
discussed about the way Alibaba beat EBay Company. Role of leaders and the leadership teams
if the managers no command and control will be discussed.
MAIN BODY
1. How would you describe Jack Ma as a leader? What does he do?
Alibaba Group was founded by Jack Ma who is a Chinese politician, a well-known
business investor and leading magnate. It is global technology based corporation. Jack Ma
supported Chinese economy by their strong marketing approach. Ma indented Jack Ma is
familiar with autocratic management. Ma planned to use his company and the power of internet
to promote globalized trade across borders in order to help SME’s at global level (Jin and Hurd,
2018). He is an independent leader since he provides the important of ideas of its staff members.
He also follows the transformational leadership styles through empowering its staff members and
also motivating them to attain success. On the other hand, Jack Ma hires the staff members with
superior skills and capabilities which make the company successful. Jack Ma works as a leader
with having a clear vision in intensity and says leader should we have a clear vision in senses
(Clark, 2018). The mission of Jack Ma is to change Business processing in china by
implementing new ideas, innovation, adequate skills and by providing quality of products and
services at worldwide. These kind of working qualities, style as well as skills of Chapman help
him to make possibility of run a successful business. Jack ma possesses strong character sense
that aids in developed loyalty as well as strong base for his business Alibaba. He says that a
leader don’t have to sacrifice his/her sense of the humor while they are responsible for some
achievement. Jack Ma understood that it is not easy to convince workers, investor and business
partner easily to listen to him. Thus, instead of uniting them under his command, Jack Ma unites

them with common purpose. It’s an organizational code rather than goal of a leader. On the basis
of case study, Jack Ma announced his plan about step down from $420 billon Chinese Internet
organization in order to pursue the Philanthropy in education. Jack Ma began offering
individuals and small companies a forum to find acceptable customers with Alibaba. Even if the
concept was not fresh, Jack Ma created an online platform for people of China, which was a
major hit in a few years.
2. Why and how did Alibaba beat eBay?
Alibaba is an international technology firm belongs to china which specializing in
Internet, Technology, E-commerce as well as Retail. The organization was founded in year 1999
in Hangzhou, Zhejiang. This organization basically provide small business, and enterprise sales
service to company through web portals, shopping search engines as well as cloud storage
services. It is one of the largest retailers and included in list of Internet firms as well as artificial
intelligence organization (Jia and et.al., 2018). Alibaba attains this through leveraging new
technologies of the data intelligence and also network coordination. This harness effort of the
many businesses of china to develop the network which is smarter, faster as well as well-
organized than the traditional business infrastructures. The online sales of this company and
profit level surpassed US retailers such as Amazon, eBay and Walmart. EBay and Alibaba both
are the main competitors and they developed the strong strategies to compete with the each other
(Zhang and et. al., 2018). When eBay announced its expansion in to China, Jack Ma viewed
American organization as foreign competitor and also rejected the buyout of eBay subsidiary of
Alibaba Taobao. Subsidiaries of Alibaba in the Chinese e-commerce industry have outperformed
eBay by adapting existing technology and gaining trust in China and widening their role by
leading the market with a loss before redefining additional services, claiming a growing
proportion of customers from eBay. Taobao's Alibaaba subsidiary will eventually push EBay to
leave China with shutting its unprofitable China Web operation (Leavy, 2019). On the other
hand, EBay Company is botched to identify that business environment of china is different from
any other western company. In order to direct a chief technical officer from the United States
eBay firm sent German representative and brought him. On the local market there was a
language divide and a lack of comprehension.

In year 2002, eBay entered in market of China and at that time, this was processing
already $15 Bn worth of the gross merchandise by its platform and also earning more than $1Bn
in the revenue per year. In year 2002, it made $30 Mn investment in order to acquire the 33% of
Eachnet, Chinese C2C market in order to gain foothold in fastest developing internet market.
Other than this, eBay has enters the China with a plan to control its market. Alibaba was a
Chinese local firm which was helping SMEs to operate online business. Most Westerners had
never heard of it (Chaffey and Ellis-Chadwick, 2019). Jack Ma, Alibaba's was worried, when
eBay entered the Chinese market that 'once again, eBay was moving towards us.' He understood
too well that in China there was no apparent gap between small companies and individual
consumers. In protection, Ma decided to introduce rival auction platform for consumer-to-
consumer (C2C) which is not to earn funds but also to avoid taking Alibaba's customers away
from eBay (Tu, Tung and Goes, 2019). In year 2006, Taobao had outstripped eBay EachNet to
been leading consumer / consumer market in China (C2C) with 67% of the user market, while
eBay EachNet still had 29% of the market share. In year 2006, eBay taken part in press
conferences for announce about its new joint venture with the Tom Online an Internet portal
based on Beijing which offers digital services with wireless added values (Lu and et. al., 2017).
But the truth is, there has been a formal announcement that eBay is withdrawing from China's
online auction market. EBay closed its China website, eBay EachNet, and took back seats in a
firm with $173 million in turnover and no online auction experience.
Other than this, eBay failed to identify the market of china as well as also the
environment of business that is diverse from Western business (Mitchell, 2019). Other than this,
they spent lots of money on the wrong things like Internet advertising in a country where it was
not used by small businesses and they didn't understand local market. The reality that eBay in
United States had a strong brand doesn't make China a strong brand.
3. What are the implications for how strategy is created?
Alibaba is mainly specialising in providing of several goods as well as services to the
customers. These are e-commerce, internet, retail and technology (Sun and et.al., 2018).
Company has given number of business chances for small as well as medium scale organisation
to leverage unique technology to compete more resourcefully in domestic and international level.
Vision of Alibaba is that New Retail within an international prospect of retail. The first portion

of strategy of Alibaba is “the gateway to China” to get recognized international brands within
developed markets or countries to work with open market by building it more easy for them to
request to and target large number of customers of china (Kim, Zhang and Zhang, 2016). In
order to accomplish business success in this complex world, number of strategies implicated by
Alibaba including marketing and promotional strategy, distribution channels and many other.
These strategies are beneficial for the success and growth of company in marketplace. In
addition, Alibaba is more capable to affect large number of clients on the platform, as well as to
formulate advertisement, customer's data and keyword bidding for profit. Accurate credit model
of Alibaba supports them to expand a trustworthy and strong reputation in marketplace and in
customer’s mind. There are many goods as well as services that are offered by company in its
marketing mix. There is Alibaba.com; it is the largest business to customer sales platform for
small business in all over the world (Turban and et.al., 2018). Autonavi which gives maps within
the market leader within navigation in China. Competitive pricing strategy is used by Alibaba for
selling its products to the customers. This strategy helps them in increasing large number of
customers and also maximising sales of the company within a given time period. In order to
promote their services and products to the customers and in marketplace Alibaba uses numerous
media channels. They use traditional media such as advertisement on radio and television. This is
more beneficial due to its huge reach and capability to attract maximum number of customers.
They also use online as well as social media advertising for promoting their products. It is
beneficial due to the rising usage of the internet. All these strategies are created by Alibaba for
developing strong brand image in marketplace. This will help them in improvement of its
success and also in accomplishment of competitive advantages within predetermined time
duration (Ter Chian Felix Tan and Pan, 2016).
There are different implications used by Alibaba for developing strategy such as communication
and align, development of training program, effective working environment etc. These are
effective ways that used by company for successfully implementing strategy in marketplace. It
will be beneficial and essential for the business success and development globally and
domestically (Anwar, 2017). There are number of ways used by Alibaba for implementing
strategies such as creating of strategic plan, translating of each business goals, developing an
executable task list, delegate tasks and the authority essential for accomplishing them and

Monitor performance. These are biggest and useful ways for used by business for developing
business strategy in effective and efficient manner.
4. How well is Alibaba poised to succeed in the future?
Alibaba Company is able to leverage on more customers on platform and also use
advertisement, data of customers and keyword bidding for profit. The accurate credit model of
Alibaba is helpful to develop trustworthy goodwill between consumers. Initially, Alibaba was
founded in apartment of Jack Ma in Hangzhiu in year 1999 before the Alibaba.com was launched
in same year later. In year 2003, in China number of the Internet users reached at 80 million.
After that, Alibaba launched the Aliwangwang and Alipay to complete buying process in Taobao
(Cusumano, Gawer and Yoffie, 2019). In year 2007, in China, number of the Internet users rose
to 210 million and also Alimama was developed and launched as advertisement transaction
platform (Naughton, 2020). The same year Taobao began to commercialize. In year 2008, Tmall
launched as the B2C and C2C platforms run by Alibaba. Alibaba Cloud was established in 2009
to highlight the dedication of Alibaba, as part of its strategy, to prioritizing Big Data (Wei,
2017). As part of Alibaba's growing emphasis on mobile payment, the following three services
were introduced in 2010: AliExpress (an international shopping market), Juhuasuan (a C2B
platform) and Mobile Taobao application. A wide variety of products is available to a large
range of target customer groups through focusing on small businesses. In 2014, Alibaba
managed a record CNY 2.3 billion transaction value (Wang and et. al., 2018).
Alibaba firm charges for the services in the technical support and marketing than the
admission. It contributes to robust and large market share that made of the loyal consumers. The
profits of Alibaba are primarily generated from advertising and keyword offers that account for
57 % of total income. The second largest source of income (25%) is from technological services
focused on large-scale customer behavior data. Alibaba offer a comfortable shopping
environment and positive customer experience which leads to high user engagement. Alibaba
provides a variety of support services which help salespersons maintain a positive relationship
with purchasers to achieve maximum customer satisfaction (Poujol, 2019). The online spending
in China is developing faster than the retail sales but also weakening as the economic
development decelerates. Rather than this, Alibaba developed its success due to ever expanding
the in Chinese middle class and that segment is adapted has gone up. According to survey, it

showed that customers of Alibaba still purchasing and also loyal to company. Alibaba Cloud
continued to expand rapidly and rise by 62% a year, taking its cloud revenue to 7%. Cloud is the
foundation of Alibaba's data intelligence (Micklethwait and Dimond, 2017). All e-commerce
companies have recently migrated their data systems into a public cloud that helped Alibaba
produce more than 544,000 orders per second on top of last quarter's demand. Management
claims that the transition of its companies to the cloud will increase operational efficiency and
enable other companies to use Alibaba Cloud for the cloud infrastructure.
5. If managers no longer command and control and the organization is self-tuning, what is the
role of leaders and leadership teams.
It is necessary for the managers to command and also control on the employees and
company so that they can work well in an effective manner. Leaders are those which guide and
control the activities of team members so that they can perform better and focus on attaining the
specific objectives. Leader needs to guide the team members and providing them right direction
so that they can perform in better manner (Havinga, Hoving and Swagemakers, 2016 ). In case if
the managers have no longer command as well as the control and also company is self turning
then there are some roles of leaders and leadership teams given below:
Provide Vision- It is a role of leader to providing vision for a team or team members. In
this, team members cannot be anticipated to participate in common effort if they do not know
objectives of practice. It is necessary for a leader to communicate the vision to leadership teams.
When the leadership team know about the vision and objectives of practice, they are focused
more as well as understand how the role of an individual aids to drive success of business.
Hold team members accountable- It is necessary that each team member should be held
to similar excellence standard regardless of training and more experience. On the other hand,
precise task of each person will vary and committed of leadership teams completing job should
be unweaving (Watters, 2016).
CONCLUSION
It has been concluded from the above mention report that Jack Ma is one of the most
successful leader and developed effective strategies to make its business successful by dealing

with its competitors. This has been concluded that Jack Ma uses the Democratic leadership by
including its staff members in the process of decision making and also motivates them. There has
been discussed about the strategies developed through Alibaba to be succeeded in future.

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Online

How EBay Failed In China. 2020. [Online]. Available through:
https://www.forbes.com/sites/forbes-personal-shopper/2020/04/16/7-of-the-best-blue-light-
glasses/#f68f4b4f36c0.