Text | New Entropy, author | Gu22, editor| Yi page
Everyone is familiar with the passage of "elephant refrigerator", which takes three steps in total: open the door→ put it in→ close the door. But when it comes to developing into a large enterprise of the size of an elephant, how many steps does it take? Today's Alibaba CEO Daniel Zhang is trying to answer this question by delegating power.
According to Phoenix.com Technology reported on November 27, Alibaba Group CEO Daniel Zhang is delegating power to the heads of the company's various business units to respond more flexibly to the growing number of challenges. The move is intended to speed up decision-making so that each department can better withstand competition, revive sluggish sales, and reshape the company's overall image.
In the report, the person familiar with the matter was quoted as saying: Daniel Zhang may delegate more power to the heads of the company's various business units, so as to maintain a higher degree of adaptability and flexibility in the competition. For example, local life, cloud computing, etc., each business unit will form a role similar to "MINI-CEO".
In addition, this practice can also pave the way for the independent listing of branch businesses in the long run. Relatively mature businesses that can be spun off and listed in the future, such as Cainiao, Hema, Local Life, overseas e-commerce Lazada, Trendyol, etc. The new management model has not been officially announced internally. But over the past few months, building a more flexible organization has become a consensus within the company.
If the above content is true, as a trillion-dollar market value of the business empire, Ali may be trying to seek new development vitality through the form of decentralization, to achieve the elephant turnaround.
At present, as the CEO of Alibaba Group, Daniel Zhang is mainly responsible for e-commerce business, but other businesses, such as community group buying and local life, have their own presidents. If the decentralized management model comes true, it will also mean that this move reverses the centralized management method that Ali has been promoting and forming in the past.
Previously, in May, Ali had already made a round of organizational adjustments to implement plate governance. The direct action is to integrate AutoNavi map, local life, and Fliggy into a life service section. The idea of such adjustment is to build more engines outside of Taobao through plate governance.
Breaking the problem of a single source of power for Ali with Tao e-commerce as the core is the understanding of Ali under the rule of Daniel Zhang for the elephant to turn around.
So why does Ali need to turn around? Can delegating the power to turn around solve this problem? What are the benefits of decentralization beyond business? The answers to these questions may be buried in Ali's past business history.
In 2012, There was a discussion within Alibaba Group about "What does China need most in the next 10 or 20 years?" " was the subject of a great discussion. Founder Ma Yun asked himself: "After 10 years, what is the most lacking Chinese?" Double H！ Health and Happiness. ”
Behind the double H strategy, Big Health values the commercial value, and happiness values the traffic value.
Under the guidance of this strategy, in June of the following year, Daniel Zhang, then CEO of Alibaba Group, issued an internal letter to all employees on the "Notice on the Establishment of Alibaba Group's Grand Cultural and Entertainment Work Leading Group", announcing the formal establishment of the Alibaba Group Grand Entertainment Work Leading Group, which is responsible for realizing Alibaba's happy traffic.
However, the final result is that 10 executives have been rotated in five years, three ideas have been changed, and with the shutdown of Shrimp Music, Ali Entertainment has gradually been marginalized. At the same time as the happiness strategy failed, Ali's traffic anxiety is also deepening, according to the financial report, its customer acquisition cost has risen from 150.4 yuan / person in 2015 to 530.4 yuan / person in 2019.
Under the traffic anxiety, whether from the future strategy or the current business, Ali must find new traffic sources.
In addition to the big entertainment, Ali's other synchronous way of obtaining traffic is mainly through investment. Daniel Zhang said that Ali's current strategy is to create other apps in addition to mobile Taobao to form a mobile app matrix through incremental investment.
In layman's terms, different users will have different preferences in different scenarios, which require different products to undertake differentiated needs, which is also known as "multi-terminal strategy". The early multi-terminal competitive strategy was to launch Tmall in 2012, through brand upgrading, to face JD.com's consumption upgrade competition.
After the Tao e-commerce system, the super App that integrated into Alipay to form a local life through the acquisition of Ele.me was also one of the main multi-terminal traffic strategies. In 2020, Ant Financial CEO Hu Xiaoming announced that Alipay was officially upgraded to an open platform for digital life, and at that time, some media comments called Alipay "Meituan".
However, with the suspension of listing in the second half of 2020, as the main app of Ant Financial, many of Alipay's businesses have begun to be forced into a period of adjustment.
An obvious feature is that in 2020, the traffic entrance reserved for Ele.me local life will add "takeaway", "food/fun", "hotel accommodation", "movie performance", "civic center" and other content, and the five application portals are in the first row, and users are not allowed to add and delete by themselves.
In the latest update and revision of Alipay, all of which can be closed and removed, obviously in a more stringent regulatory environment, as a payment tool, Alipay is separating from the product attributes of the local life traffic entrance.
Alipay, which has entered the business adjustment period under the tightening of supervision, is also declining in user activity. According to the "December 2020 Mobile Internet APP Ranking" released by big data monitoring platform Trustdata, the ranking data of the number of monthly active users shows that Alipay ranks fourth with 614.5 million monthly active users, down 3.88% month-on-month.
Its own traffic acquisition is in trouble, on the other hand, Ali Group is also facing the phenomenon of "eating big households" in the era of stock competition.
For the Ali Empire with a wide commercial layout, from the source of customers, its business can be mainly divided into two parts: one is the consumer Internet based on e-commerce, and the other is the industrial Internet based on cloud computing. Although in the field of cloud computing, Ali occupies a first-mover advantage, but the industrial Internet as a new direction that has just developed in recent years, more possibilities lie in the future.
The key to looking to the future is to stand on your feet. However, Alibaba, which has the consumer Internet as its main business, has been facing cannibalism from competitors from different directions and smaller scales in the past few years.
In the field of e-commerce, in the face of competition with JD.com and Pinduoduo as the mainstay, supplemented by jitter live e-commerce, the market share is falling from 62% in 2019 to 57% in 2021; the local life field, after the acquisition of Ele.me, has been difficult to compete with the Meituan, even if alipay is remodeled in 2020, the competition pattern of the Meituan has not changed substantially.
From 2011 to 2019, Ali's traffic acquisition has gone through four era changes. In the search era, Ali blocked Baidu's external links through the early e-commerce dividends and the advantages of infrastructure such as e-commerce supply chain and logistics, making Taobao an entrance to e-commerce traffic.
In the social era and the new retail era, Ali takes buying and buying to obtain traffic. It has successively invested in Momo and Weibo, launched online contacts, banned products such as mushroom street and beautiful saying on shopping guide websites; and further consolidated traffic by laying out new retail formats, acquiring Ele.me, and investing in RT-Mart.
However, in the content era, Ali's buy-buy-buy strategy began to fail, and content companies with short video content as the main force, typically represented by Kuaishou and B station, have achieved independence through listing, and another giant byte is growing into a business empire. Xiaohongshu, a content company in which other shareholdings, currently has no intention of joining the Ali family.
External traffic is difficult to merge and join the Ali family, and the internal multi-traffic strategy has obviously become one of the few choices for Ali at present.
Choosing to decentralize the activation of traffic vitality may also be verified within Alibaba. Take Taote, which is currently regarded as the new favorite of Ali traffic, as an example, it has acquired 240 million users in 18 months, and has been mentioned 9 times in Ali's recent financial report. Independent of Taobao, it has become an independent App, which is considered by relevant people to be one of the reasons why Taobao can achieve high growth rate.
Before Taobao, Ali's strategy for the sinking market was mainly based on Taobao, such as launching the entrance to the sinking market crowd such as juhuasuan on the product side.
On the other hand, Haidilao, who has the same name as Ali CEO Daniel Zhang and also manages a business empire in Daniel Zhang the hot pot circuit, has also used decentralization to activate the traffic growth momentum of enterprises.
Unlike Ali' traffic anxiety, which mainly comes from online apps, for Haidilao, the traffic of the hot pot empire comes from stores.
In the history of Haidilao's development, when Haidilao first opened a branch, it also used the "family system", that is, the centralized system. Daniel Zhang, the founder of Haidilao, personally went to the battlefield to stimulate the service enthusiasm of employees with family affection. As a result, in 10 years, Haidilao has only opened 7 stores, but it is enough to tire the boss and half die.
There is no way to open more stores, which means that there is no traffic of hot pot business. As a result, Haidilao began to adjust the store, re-set the structure, and divided into three management levels: the headquarters management area, the regional management community, and the community management store. After this adjustment, the expansion rate of stores began to increase, and the number of stores increased from 7 to 39.
But as the number of stores increases, there are three management levels, resulting in too many leaders and slow decision-making. Therefore, Haidilao once again made organizational adjustments, cut off the regions and communities, retained only one level of stores, delegated power, and selected experienced store managers to serve as "coaches" to directly guide the operation of each store.
At this time, Haidilao entered an independent small unit management model of decentralization, business-oriented, and store operation as the center. While focusing on independent stores, the introduction of "piece pay" and "last place elimination" to mobilize the enthusiasm of single stores and employees. However, the "last-place elimination system" has also brought about the left-right hand competition between the left and the right of the self-store, and the excessive competition between neighboring stores.
In order to solve the problem of in-store consumption, in 2016, Haidilao once again reorganized its internal structure and introduced the organization of "hugging group": 5 to 18 stores distributed in the same area formed a hugging group, elected the "group leader" by itself, and implemented interest binding and regional autonomy.
The effect of this "decentralization and invigorating" was immediate, and the number of Haidilao stores surged from 176 to 768.
If each store is likened to an independent combat unit, that is, corresponding to the multi-strategy App matrix entrance behind Ali's decentralization, the group group corresponds to the autonomy of different plates of Ali's business ecology.
There is no doubt that although not the same track, not even the same business model. But the essence of efficient business is to exert humanity, and in this regard, Ali Daniel Zhang may need to learn more from Haidilao Daniel Zhang.
In addition to traffic anxiety, which needs to be solved, the main business faces the problem of commercial competition, the other side of decentralization is to reshape the overall image of the enterprise.
In 2009, i Dark Horse had an article "Ali Centralized Power", which compared Ali to the Qin Empire, unified currency, weights and measures, and words, established a unified large market, reduced the cost of exchange of ideas and goods transportation, and was conducive to the establishment of centralized power.
For example, in the early days, through Alipay's unified e-commerce shopping payment method, it brought a good shopping experience; at the same time, Ali culture became one of the representative cultures of China's Internet industry. For example, the internal common working terms input, output, focus, alignment, link, mind, and somatosensory, because it covers all the key nodes in the work link, and improves the communication efficiency of cross-departmental cooperation, and then gradually becomes a wide range of Internet black words.
There is a Douban post titled "A Little Feeling of Working in An Ali Company" that believes that as a super-large enterprise with multi-service development, the differences between departments are sometimes greater than between companies. Baidu and Tencent have expressed similar views: cooperation with other business departments is really not as smooth as finding external similar companies. The centralization of power in Ali will inevitably lead to frequent cross-departmental communication, and having a unified discourse system will undoubtedly improve a lot of efficiency.
However, there are inevitably advantages and disadvantages, along with the Ali workplace incident that has been widely discussed and fermented on social media in recent years, many people have begun to question the Ali workplace atmosphere and corporate culture under centralized management.
In terms of creating corporate culture and enhancing corporate image, decentralization may also have a certain effect.
The service industry where Haidilao is located has always been characterized by fragmentation, low customer unit price, and labor intensity, making it difficult for catering enterprises to establish a modern management system, so that it is difficult to push the brand to a higher height.
However, Haidilao Daniel Zhang made a "hand-throwing treasurer", not participating in specific business and data, fully delegating power to subordinates, decisions below 300,000 yuan, and the branch manager himself can make the decision. In Daniel Zhang's view, he is not managing things, nor money, but people.
The way of management is to fully decentralize under a certain system, front-line employees have the right to send fruit plates, snacks, discounts and even free orders to customers, and this trust and decentralization is even written into the MBA case textbook to become the brand gene of Haidilao.
In this fully trusted corporate atmosphere, Haidilao's employees also provide customers with the ultimate service.
Now Ali's Daniel Zhang, perhaps in haidilao Daniel Zhang, you can also glimpse the pros and cons behind some decentralization, and this may really make Daniel Zhang lead Ali out of Ma Yun's era and into the new imperial stage under his rule.
Resources:
Ali centralized – i dark horse
Alipay Hero Twilight - Burning Dimension
Alibaba Jingdong Pinduoduo: Sell traffic or sell goods? ——Guojin Securities
Close shrimp rice? Anxious Ali, began to stop "centralizing" - 21Tech
A bowl of white rice sells for seven pieces, why has haidilao increased its price? ——Tokawa Business Review
With the "benefit sharing" management system as the core and the hot pot operation as the carrier, the catering giant - Guosheng Securities