Alibaba Group CEO Daniel Zhang announced today in an internal memo circulated to employees that the Chinese e-commerce giant is having another major organizational restructure, marking the first change following Jack Ma’s recent appointment of Zhang to succeed himself as the group’s chairman in a year.
Zhang is now looking to set the foundation and leadership team in place to prepare for another 5-10 years of future development plans of Alibaba.
According to the memo KrASIA obtained, Alibaba is looking to, through the change, boost the operational efficiency and customer experience by optimizing and synergizing the company’s vast ecosystem.
This is an advantage Alibaba has over others as it is one of the larger companies with access to a wide range of data on hand that can be used to improve effectiveness for consumer interaction, marketing, sales, supply chain, logistics to even cloud computing, etc.
China’s Tencent, which has seen its market cap being halved since earlier this year, also announced a similar plan to restructure its businesses.
Some of the changes are as follows:
- The cloud business unit (BU) will be upgraded to Alibaba Cloud Intelligent business unit. Alibaba’s CTO Zhang Jianfeng will oversee the new BU and the goal is to drive greater technology developments and smart internet investments for Alibaba.
- Alibaba’s Tmall (天猫) to become Greater Tmall (大天猫). There are 3 business lines under this new business unit, namely Tmall business, Tmall supermarket business, and Tmall’s exports/imports businesses. Former CEO assistant Li Yonghe will lead Tmall business; Liu Peng will continue to be in charge of Tmall’s exports/imports business.
- Forming of the New Retail Business Group to aggregate the technical strengths from Alibaba’s broad range of services from B2B, Taobao, Tmall, etc.
Below is the internal letter that Alibaba CEO Daniel Zhang circulated to employees of the above changes:
My fellow Aliren,
The results of our 10th annual 11.11 Global Shopping Festival showed that Alibaba has advanced into a new stage of development. Our success is the culmination of our perseverance and dedication; it also means we must start preparing for the future. We have to be relentless in our forward thinking in order to realise our mission of “making it easy to do business in the digital era” and empowering merchants through our Alibaba operating system. We must be continuously upgrading the design and capability of our organisation to build a strong foundation and strong bench of leadership for the next five to ten years.
Following thorough consideration, I would like to announce the following appointments and reorganisation, effective immediately:
*Alibaba Cloud business group will become Alibaba Cloud Intelligence business group. Group Chief Technology Officer Jeff ZHANG will concurrently serve as President of the Alibaba Cloud Intelligence business group, reporting to me. Former Alibaba Cloud President Simon HU will be serving the organisation in a different capacity.
Machine intelligence capabilities developed over the past few years during the establishment of our enabling technology platform, including core competencies such as data computing platform; advanced algorithms; database systems; infrastructure technology platform; and scheduling systems will be fully integrated with Alibaba Cloud and made available to society. Alibaba Cloud Intelligence Platform is an extension and natural progression of the Alibaba Group Enabling Platform strategy. Its goal is to establish an intelligent technology infrastructure powered by cloud computing for the age of the digital economy. I would like to especially recognise and thank Simon for his extraordinary contributions to Alibaba Cloud over the past four years. His leadership allowed for the successful marriage and realisation of Alibaba Cloud’s aspirations in technology and commercialisation.
*Establishment of the New Retail Technology business group, with WU Zeming serving as President and reporting to me. The New Retail Technology business group will consolidate the technology of our wholesale marketplaces, Taobao and Tmall to create a unified strategy to effectively support the unique demands of New Retail.
*Tmall will become “Greater Tmall”, which will be comprised of three main divisions: Tmall business group, Tmall Supermarket business group and Tmall Import-Export business unit. Former Tmall business group President Jet JING will continue to serve as President of Tmall business group; Former business assistant to the CEO LEE Yonghe will serve as President of Tmall Supermarket business group; and Tmall Import-Export business unit General Manager Alvin LIU will continue in his current role. All three will report to me.
Tmall business group will continue to focus on making Tmall the top partner for global brands to realise digital transformation and implement truly integrated omnichannel business operations. Tmall Supermarket business group will consolidate the existing Tmall Supermarket and Taoxianda businesses, and work closely with hypermarket and supermarket partners across the Alibaba ecosystem to advance our vision for a new integrated omnichannel supermarket model. Tmall Import-Export business unit will be responsible for fulfilling the promise Alibaba made at the China International Import Expo to import USD 200 billion worth of goods over the next five years. The Tmall Import-Export business unit is the strategic foundation for Alibaba’s progression from helping China buying globally and selling globally to helping the world buy globally and sell globally.
*Cainiao Network will align correspondingly with the new structure outline above, and establish a supermarket logistics team and a Tmall Import-Export logistics team. The supermarket logistics team will have dual reporting lines to both LEE Yonghe and President of Cainiao Network WAN Lin; the Tmall Import-Export logistics team will also have dual reporting lines to both Alvin LIU and President of Cainiao Network WAN Lin.
*ZHANG Yifen will succeed Chris TUNG as President of Alimama. Chris TUNG will return his full attention towards serving as Alibaba Group Chief Marketing Officer.
*FAN Luyuan will succeed YANG Weidong as the rotating President of Alibaba Digital Media and Entertainment business group in the new rotation.
*Alibaba A.I. Labs will join the Alibaba Group Innovation Initiatives business group, and leader of the Alibaba A.I. Labs CHEN Lijuan will report to me.
The digital economy is upon us, and every facet of our economy and lives is undergoing monumental changes. Not only must we conscientiously embrace change – we must be proactively creating change. This is how we can lead the way and become the driver of innovation in this new era.
Alibaba Group CEO
Editor: Ben Jiang
(Corrections: 7:38 PM, November 26, 2018, an earlier version of the story misstated the names of “Alibaba Cloud Intelligent BU” and “Greater TMall”, the names have been updated to adopt the official translations.)
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