Daniel Zhang, Executive Chairman and CEO of Alibaba Group, addresses an audience of business partners at the Alibaba ONE Business Conference on December 18 in Hangzhou, east China's Zhejiang Province (COURTESY PHOTO)
The Double 11 shopping carnival, a listing on the Hong Kong Stock Exchange and Alibaba's technical committee Chairman Wang Jian's membership of the Chinese Academy of Engineering are examples of Alibaba's three-pronged strategy to drive growth, namely, promoting domestic consumption, upholding globalization, and developing big data, AI, and cloud computing technologies.
The remark was made by Daniel Zhang, Executive Chairman and CEO of Alibaba Group, at its ONE Business Conference on December 18, 2019 in Hangzhou, east China's Zhejiang Province.
Alibaba, which initiated Double 11, also known as Singles' Day, the biggest shopping festival in China, in 2009, achieved sales of 268.4 billion yuan ($38.36 billion) this year, an increase of 26 percent compared to 2018, setting a new sales record.
Zhang believes China is stepping into a period of big data and cloud computing, and efforts should be made to develop new products, win new customers, and create new organizations to achieve growth in the digital economy.
He pointed out that the new business operation model is transcending from product-centered to consumer-centered and the more aware business owners are of the consumers, the more tools and means they will have in attracting new customers.
Zhang said that at a time when everything is connected to the Internet and consumers are digitalized, the ways to attract consumers are also more diversified than before.
Driven by big data and AI technologies, a whole new operation mode has emerged which combines online and offline sales. And new products are developed according to tailored needs of consumers.
According to Alibaba, L'Oréal, a French beauty brand, reshaped its products, channels, and sales in accordance with the Chinese market and achieved over 1 billion yuan ($14.29 million) in sales during this year's Double 11 shopping carnival.
"Now there is no difference between online and offline businesses; the difference is only between businesses that are digitalized or not," said Zhang. "Three years after the concept of New Retail, we have reached the consensus on one common business, in which we serve the same group of consumers."
According to Zhang, a digitalized business world does not solely refer to the commodity market but also means that each and every trade is linked to the digital economy.
"The Alibaba Business Operating System is an idea as well as a methodology. It is not reasonable to regard it as a product or a tool. Alibaba aims to release stimulating forces to match with internal capabilities of companies and speed up chemical reactions," he revealed.
The term Alibaba Business Operating System was introduced by Zhang at the first Alibaba ONE Business Conference on January 11. It means stimulating new business growth drivers through achieving digitalization of brand, products, sales, promotion, channel management, service, capital flow, supply chain logistics, manufacturing, management and information technology systems.
In less than one year, the new innovation in the business world has achieved tremendous growth for Alibaba's partners, Zhang said.
He said organizations could benefit from digitalized tools and platforms and then achieve digital operation, but stressed that building a new kind of organization remains a challenge.
"With more business partners joining hands with Alibaba Business Operating System, we have achieved success," Zhang said. "But the system alone is not enough; the growth of the internal structure of companies, such as the forming of a digitalized, coordinated, and refined management style, is also important."
Digital transformation brings in structural changes to an organization and it has to be supported by the top management.
"The top management at companies are leading innovations to raise productivity, but more importantly, they must lead innovation in the corporate structure," Zhang said.
(Reporting from Hangzhou)
Copyedited by Madhusudan Chaubey
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