On March 28, Daniel Zhang, Chairman and CEO of Alibaba Group, issued a letter to all employees, announcing the implementation of organizational adjustments: upgrading the internal six major business groups and opening the "1+6+N" group structure, that is, creating a "1+6+N" structure of "Alibaba Group + 6 major business groups + N business companies".
According to Daniel Zhang, the purpose of this group reform is to further deepen Alibaba's concept of diversified governance, but mainly to "make the organization smaller, make the decision-making link shorter, and make the response faster."
01 What exactly is the "1+6+N" architecture?
Many people may just see the "1+6+N" structure is not very understanding, in fact, in layman's terms, it is to establish 6 business groups with Alibaba Group as the core, and then rely on the business group to establish N business companies. Alibaba Group, on the other hand, has actually changed from a group company to a holding company. The aim is to make the business groups independent.
As with the current separation of business and enterprise, in more layman's terms, in the future, whether it is a business group or a business company, it will be self-sufficient. No matter what kind of salary system it is, no matter what kind of benefits it is, these are all decided by the CEO of Yego Group.
In this way, each business will be more interoperable and convenient in decision-making and approval, which can solve the inconvenience of complex and cumbersome business processes.
02 The role of employees has changed
Once such a model is implemented, then to put it bluntly, it is "eight immortals crossing the sea, each showing their powers". No matter which business group, no matter which business company, as long as you can do a good job, you often have the right to decide whether to go public or not.
In this way, for ordinary employees, the meaning is different. Employees in the same position may be rewarded several times more than before. For example, listed companies generally set up equity incentives, and employees can also hold a certain percentage of stock. At this time, the role of employees changed from the former "migrant worker" to "entrepreneur".
You can put yourself in the shoes of the fact that we create value in the process of labor, and we get equal returns, then our enthusiasm and initiative will be greatly improved. In this way, the so-called "flatteners" and "rotten people" may be eliminated.
Because if you don't bring certain benefits to the company, then the company will not feed idlers in vain. Especially for those who have some "nepotism", it is really like a thunderbolt.
In this way, for different business personnel, as long as they can create a certain amount of value with their own efforts, I think it must be different from before: at the very least, the return on their own efforts in the future will be fairer than now.
03 The private economy does need to inject new blood
Alibaba's implementation of such a business structure and adoption of such a business model is to allow different businesses to return to their own unique business tracks.
If nothing else, we can take a look at the "Rookie Station". Today's "rookies" are almost all for their own "Taobao" and other services. After this architectural model is operational, the "rookie" has reduced contact with its "brothers". In the future, it can also rely on its own unique advantages to unite other major e-commerce platforms, make decisions according to its own market operation model and its own business platform, and truly achieve business in business, so as to bring itself the highest cost performance.
From the perspective of the global economic development pattern, it is currently in a state of recovery and recovery. Although the recent "ChatGpt" has caught fire, Internet companies have entered a period of equilibrium and it is difficult to break through.
You can see how difficult it is to find a job now, and many companies are laying off employees on a large scale every day, in this environment, enterprises can only actively respond to external challenges by seeking transformation and upgrading.
Of course, Ali Group gave an answer sheet today, and regardless of the results, this step is always very brave. I believe that I also look forward to more private enterprises handing over their answers, so that everyone can see the vitality of private enterprises.
04 Detail the background of Ali's reform this time
In fact, since taking over Alibaba Group, Daniel Zhang has also been promoting management responsibility reform, and has established boards of directors for each business group and business company, which are responsible for their own business results.
The "1+6+N" structure reform proposed this time is to further deepen on the basis of promoting the management responsibility system.
In fact, after such a reform, the flexibility and controllability of each business group have been qualitatively improved, and after independence, the innovation ability and business vitality have suddenly risen to a level.
Especially for employees, even if they are still in their previous positions, previous ranks, and may not be able to compare their own rewards with their own efforts. However, with such a reform, the return of employees will definitely change with the self-responsibility of each business. Once there is a well-done business, the listing is just around the corner. At that time, the return will be not small.
05 Ali's reform conforms to the trend of historical development
In fact, in 2015, Alibaba's "big middle platform, small front desk" strategy also pushed Alibaba to a market value of $900 billion, and this big reform, I think it will once again re-stimulate Ali's vitality, even in the economic downturn, it may also bring opportunities to break the pattern.
Today's global economy is not good enough, and many migrant workers are also laid off or even laid off. We can also see that the development of Internet companies has also fallen into a bottleneck period, and if they do not actively seek change, it is often a dead end. Ali chose this way of living: each business is independent and lets go of each other.
Everyone will eat large pot rice, but after eating for a long time, there is no freshness. We can understand that even if there are differences or even gaps between different businesses, but I think, "a skinny camel is bigger than a horse", Ali itself is an "aircraft carrier", even if it does not do well, I think it will not be worse.
There were losses before, and there were brothers in general to help, and there were still people to give themselves a pocket, all mixed together, nothing. But now everyone has to be self-sufficient, and only if you do a good job will you have the opportunity to eat meat. If you don't do it well, you won't even have to drink the soup, or even be eliminated. Everything is determined by oneself, and how the result is tested by the market.
So, what are the benefits of being independent? Everyone has to do it, good work is good, bad work is over. If you do a good job and go public independently, you may achieve financial freedom!
06 Seize the dividend period and achieve the transformation perfectly
In the past two decades, the development of the Internet has benefited countless ordinary migrant workers, and many rural children have also achieved class leaps through the Internet. Yet for many Alibaba employees today, they missed Alibaba's earliest days. But now there are opportunities, especially Alibaba Cloud, Cainiao and other businesses have great potential to go public, which means that Alibaba Cloud employees are likely to get a lot of shares, thus obtaining huge returns. This hope is highly anticipated, and many people have become more motivated and hardworking, whether it is to go public or to make a living, and will definitely actively respond to changes in the market to create value and bring benefits.
In the past, Alibaba Group was a branch and lacked independent decision-making power. However, today, Alibaba has become the head office and has a greater voice, especially for business lines with good development potential, such as Alibaba Cloud, Cainiao, Tmall Taobao, etc., employee benefits are bound to be more generous and icing on the cake.
Second, as the number of companies increases, more and more companies are eager to improve decision-making efficiency and simplify organizational structures. However, Alibaba Group's huge organizational structure faces the rapidly changing market demand, and different business lines have to rely on their own judgment and response to respond.
Therefore, this restructuring is an important step towards improving decision-making efficiency and simplifying organizational structure.
At present, we can no longer rely on the "big pot of rice" in the distribution system to solve economic problems. Regions that were once relatively backward must also think about how to be self-sufficient.
Perhaps, this situation can be seen as an opportunity for organizational transformation, where companies and individuals need to find ways to adapt to the new economic environment, or even adopt a dead-and-die strategy.
When everyone has the opportunity to go public independently, only true ability can speak. So give it a try and maybe you'll succeed in moving to the next level.
07 Flat management brings more possibilities
In order to improve efficiency, the company has implemented flat management and formed a synergy through the combination of dots and lines. For an aircraft carrier-class enterprise, such a drastic change represents a firm belief in sustainable development.
As businesses grow, so do the problems. Previously, some people thought that Alibaba was heading for decline, but this change is undoubtedly inspiring.
After many twists and turns, we sincerely hope that Alibaba will get better and better, and continue to improve.
According to current news, at least six sectors will operate independently. The management and finances of the different segments of the Group are independent but still belong to the same group. This way of changing is, in my opinion, a huge plus.
08 Epic reform, let's wait and see
The biggest problem facing group companies is that they influence each other's decision-making, which is constrained by each other within the same framework, resulting in many limited decisions.
If these sectors operate independently, they will bring about earth-shaking changes in decision-making efficiency and operational freedom, which is a benefit that cannot be ignored. But it also comes with certain risks, and it takes someone to be bold to achieve.
Daniel Zhang clearly possesses this boldness, and the fact that he has implemented such drastic reforms shows that he is very determined and courageous. But the current shape of these six plates is not the final form, just the beginning.
Judging from Alibaba's internal news, in the future, eligible projects may also adopt independent operation and independent listing to achieve greater development opportunities.
Therefore, this wave of reform can be said to be an epic reform of the group company. While it has brought a lot of positive changes, it also requires careful handling of the risks that may bring.