On the occasion of the first anniversary of Alibaba's restructuring, on April 10th, Alibaba founder Jack Ma posted on an internal forum titled "Towards Reform and Innovation", highly affirming the courage of the new management team composed of Cai Chongxin and Wu Yongming to change, stating that Alibaba has returned to a healthy growth track and supports continued reform. This is Jack Ma's first lengthy sharing of his thoughts on the company's reform, innovation, and future prospects in five years after retirement.
Jack Ma praised the new management team composed of Cai Chongxin and Wu Yongming in his post. Over the past year, he has "faced problems and the future directly, believed in young people, fully authorized the young team, and made decisive and clear choices about what we want and don't want.". Jack Ma said, thanking Joe (Cai Chongxin) for his courage and responsibility, "There are mistakes that are not scary, no one who doesn't make mistakes, what is truly scary is not knowing, not admitting, and not correcting mistakes.".
Recently, Alibaba co-founder and Chairman of the Board, Cai Chongxin, admitted in an interview that "in the past few years, Alibaba has fallen behind" and reflected on Alibaba's mistake - "We have forgotten who our true customers are and have not truly focused on creating value for our users." Cai Chongxin stated that he is reorganizing personnel and adjusting organizational structure to align with strategy.
On April 9th, China Securities Journal published "We smashed our own feet!" Cai Chongxin reflected on how "lagging behind" Alibaba "returned"?, conducting a deep review and analysis of Alibaba's reform and restructuring over the past year, from business spin off to focusing on collaboration.
The picture shows the coverage page of China Securities Journal on April 9th
A year ago, on March 28, 2023, Alibaba announced its largest reform action in 24 years - "1+6+N" - by splitting Alibaba Group into one holding group, six business groups, and N business companies. In May 2023, the listing and financing plans of Alibaba Cloud, Hema, and Cainiao were announced. However, this restructuring plan subsequently began to "correct", with Alibaba Cloud no longer splitting up and Hema's IPO announced to be temporarily suspended. Now Cainiao has also withdrawn its IPO application.
At the same time, Alibaba's management has undergone significant changes. From the perspective of the group, Cai Chongxin succeeded Zhang Yong as the Chairman of the Board of Directors, and Wu Yongming became the CEO of the group. From the perspective of various business sectors, Dai Shan, CEO of Taotian Group, stepped down in December 2023, Yu Yongfu, Chairman and CEO of Local Life Group, stepped down in March 2024, and Hou Yi, CEO of Hema, recently announced his retirement.
These strategic and personnel adjustments and changes have left many employees at a loss for Alibaba Group, which has a large workforce of 219000. On social media platforms, some employees have reservations about the repetitive decision-making process. Cai Chongxin also admitted, "In the past three years, morale has been poor.".
And in the year when Alibaba hesitated to decide whether to dismantle or not, there were significant changes in the domestic and international market landscape. Currently, almost every field of Alibaba's business is facing fierce competition that may shake its original advantageous position. In particular, the basic domestic e-commerce market that Ali is proud of has been quickly "cannibalized" by Pinduoduo, Tiktok, etc.
Jack Ma also expressed his views on the numerous doubts and pressures over the past year and beyond in the article. Jack Ma emphasized that "the path of reform and innovation will never be accompanied by applause.". He said, "The most crucial change this year is not to catch up with KPIs, but to recognize ourselves and return to the path of customer value. We have taken a step back from being a slow decision-making organization to putting efficiency first and market first, making the company simple and agile again. The new management team is facing problems, facing the future, trusting young people, fully empowering young teams, and making decisive and clear choices about what we want and don't want."
Jack Ma stated that not only should we bravely acknowledge and promptly correct yesterday's problems, but we should also reform towards the future. He predicted that three or five years of innovation would be "as long as a century, enough to bring about earth shaking changes" to the Internet industry. He encourages employees to always challenge themselves and constantly do things that others dare not do, do not want to do, and have not done before. "The AI era has just arrived, and everything has just begun. We are at the right time! In the future, we need to be more proactive and rapid in changing ourselves. We need greater reform to establish a vibrant future for Alibaba."
The following is the original text of the internal letter: