Alibaba’ Challenge of Growth
Ankita Uppugunduri, Wenzhao (Larry) Bai, Christina Tarr, Xia (Sandy) Sang, Ying (Alex) Chu
BSBA

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Subject area:                  Logistics Integration Strategy

Region:                           Greater China Area

Industry:                        E-commerce

Company:                      Alibaba

Challenge:               

In December 2020, Jack Ma of Alibaba was facing the challenge of how to keep his company growing despite constant pressure and scrutiny from the competitors and legal challenges within China. The stakes of finding the most effective and efficient way to implement this project were high. If the company decision failed to be implemented within the given parameters, Alibaba faced serious consequences. Our consulting team created an innovative solution for Alibaba to integrate its advantageous resources to offer more premium services to e-commerce customers. 

 

 

Investment in Personal Capital: Elucidating Professional CORE

 

In 2021, Wenzhao (Larry) Bai, Ying (Alex) Chu, Xia (Sandy) Sang, Christina Tarr, Ankita Uppugunduri, undergraduate students at the D’Amore-McKim School of Business at Northeastern University, were preparing to take on their professional journeys in their respective fields within Finance and Computer Science after graduation. Before beginning their full-time careers, all of them wanted to gain experience and a more in-depth understanding of their respective fields and show their potential employers the skills, expertise and knowledge they were ready to confidently offer and put into work. After conducting research on certain sectors that have been able to outperform and generate high revenues, despite the ongoing COVID-19 pandemic, Larry, Alex, Sandy, Christina and Ankita decided to embark on Alibaba Inc., as it continued to generate high revenues and make continuous advancements within artificial intelligence (AI), e-commerce, cloud computing and other technological advancements.

 

Investments in Social Capital: Building Trust within the Company and Industry

 

To have a better understanding about Alibaba’s challenge and recommend a possible option for its future development, the team conducted various types of research from looking at various news outlets and articles, to utilizing the company’s website. Chinese members in the team also looked at some Chinese websites to collect additional information and provided some perspectives from their knowledge and previous experiences. Moreover, they also conducted some interviews with peers and professionals who have worked at Alibaba or have worked in organizations connected closely to the corporation. By analyzing the internal and external environment of Alibaba, the team acquired the knowledge of the company’s current trajectory and focus, their current competitors in the industry and future opportunities, trends and threats. The team also collected and dug into statistical data and visual charts to learn more about the company and compare Alibaba to its competitors from a performance and cultural perspective.

 

Investments in Professional Capital: Analysing Market Needs, Crating an Industry Map

 

With Alibaba being such a large corporation, the team focused on breaking down each market segment that the company is currently in and utilized the collected data to understand where and how Alibaba should expand. The group researched and analyzed multiple different options, while taking into consideration how it would affect the global market and by applying multiple analysis tools such as the PESTLE model, VRIO framework  and SWOT analysis. After their thorough research and analysis, they decided to provide Alibaba with two different options on where to possibly proceed. The first option was creating Alibaba Cargo Airline, a cargo airline service that offers premium delivery to their customers. The second option was to build up a well-regulated AliCloud service, which would essentially be a cloud service similar to AWS for the East.

 

 Capital Utilization: What’s next? 

 

The project on Alibaba helped the team members develop a better understanding of the complicated structure of a giant corporation, and how different SBUs can interact deeply to build up such a business network with innumerable service coverage. The convoluted yet exciting project has helped the consulting team gain necessary skill sets and acquire critical and innovative visions and projections that they need for their future career path, especially for those who are pursuing careers in large corporations after graduation within Finance and Computer Science. Last but not least, the dilemma of Alibaba’s regulation problem also taught the team to always keep the ethical problems in mind, and take into consideration the Blue Ocean strategy, as it will help pursue, create and capture uncontested market space and will bring about differentiated and low-cost opportunities.