Zhang Yong, the "wind maker", has been at the helm of Alibaba for the past four years

Source of this article: Time Weekly Author: Yang LinglingXiaoyaozi Zhang Yong will no longer continue to roam the business world as Chairman and CEO of Alibaba Group's Board of Directors.On June 20th, Zhang Yong announced through a letter from all staff that he would step down as Chairman and CEO of the Board of Directors of Alibaba Holdings Group on September 10th

Source of this article: Time Weekly Author: Yang Lingling

Xiaoyaozi Zhang Yong will no longer continue to roam the business world as Chairman and CEO of Alibaba Group's Board of Directors.

On June 20th, Zhang Yong announced through a letter from all staff that he would step down as Chairman and CEO of the Board of Directors of Alibaba Holdings Group on September 10th. After that, Zhang Yong will be the chairman and CEO of Alibaba Cloud Intelligent Group.

At the same time, with the approval of the Board of Directors of Alibaba Holding Group, Joseph Tsai, Executive Vice Chairman of the Group, will serve as the Chairman of the Board of Directors of Alibaba Holding Group; Wu Yongming served as the CEO of Alibaba Holdings Group and continued to serve as the Chairman of Taotian Group.

Image source: provided by enterprises

Previously, a media reporter asked in an interview, "Teacher Ma's whereabouts will be everywhere after retirement. If one day you also retire, will you be as lively as him?" Zhang Yong firmly replied, "I definitely like being alone, which is very certain

Ma Yun belongs to a slightly reckless entrepreneur who hands over the baton to Zhang Yong, who understands business better. Zhang Yong calls himself a "wind maker". Zhang Yong, described by the media as an "AI", has a rigorous logic, precise calculation, tirelessly makes few mistakes, and is accustomed to "repairing roofs on sunny days and planning in good times".

But after the golden age of the internet has passed, Alibaba is no longer advancing as vigorously as before. In the past few years, when Zhang Yong was in charge of printing, some of Alibaba's business development has even begun to stagnate, and the market situation has changed, with numerous competitors. Alibaba is no longer the Alibaba that "couldn't find competitors even with a telescope" in the past.

At this moment, the "strict" Zhang Yong also took off his helmsman identity.

As for the successor, Alibaba said that Joseph Tsai and Wu Yongming, with the corresponding vision, experience, influence and appeal, are the best choice to assume the above responsibilities.

The rise of outsiders

Zhang Yong is a native of Shanghainese people. After graduating from college, he joined Andersen, one of the "top five" accounting firms at that time, mainly dealing with numbers. This meant glamour, refinement, and elegance in the 1990s.

After Andersen merged with PwC in 2002, Zhang Yong worked for another three years. At the age of 33, Zhang Yong joined Shanda as CFO, and two years later he resigned and joined Alibaba.

Alibaba is like a large business school, with a vast territory, unique marching culture, talented mentors, and a rapidly changing battlefield. Here, Zhang Yong embarked on his own commercial jungle adventure.

When Zhang Yong joined Alibaba in 2007, his starting point was the CFO of Taobao. Two years later, Zhang Yong took over the dying Taobao Mall. At that time, the development of Taobao Mall was not smooth, and the B2C model was once not favored by the internal market. However, Zhang Yong volunteered and said, "If no one manages it, then I will manage it myself

Four months after taking over, Taobao Mall resumed independent operation, and the breakthrough point was the emergence of the "Double 11". In November 2009, Zhang Yong and his team launched the "Double 11", with sales of 52 million yuan that year. In 2010, it soared to 936 million yuan and increased to 3.36 billion yuan in 2011. Since then, "Double 11" has gradually become a nationwide "shopping carnival".

In 2012, Taobao Mall was renamed as "Tmall" and has since become one of the main players in the entire Taobao series. In the first 8 years of Alibaba, Zhang Yong also carried out the wireless transformation of Taobao, initiated the formation of Cainiao, and made a series of investments in the logistics industry.

Image source: Image insect creativity

From finance to business, Zhang Yong, who was not part of Alibaba's founding team, grew at an astonishing pace. Usually, in companies where the founding team has not yet left the frontline of business, the successor to the top often requires more achievements and fewer mistakes to stand out and win trust. Zhang Yong is one of the few people who can achieve this.

In 2014, Alibaba went public as a whole and began exploring more effective governance methods. Zhang Yong, one of Alibaba's few diversified management talents, began serving as the CEO of Alibaba Group in May 2015.

In the following years, Zhang Yong launched important strategic actions, including leading the promotion of "large, medium and small platforms", exploring new retail, acquiring Yintai and RT-Mart, and investing heavily in Hema.

In media reports, a former Alibaba executive commented that "Lao Xiao doesn't have big theories but works hard", while another person who directly reported to Zhang Yong said, "He has strong endurance, good physical strength, and is willing to get his hands and feet dirty, doing hard work and hard work

Empowerment of the printer

Zhang Yong once recalled a series of decisions at that time, stating that his fate had undergone a significant change after the age of 35. On the first day of entering Alibaba, challenges followed, but this responsibility only reached its maximum value when it was truly implemented.

In 2019, Jack Ma officially handed over the management baton to Zhang Yong. At this point, Zhang Yong shouldered the two positions of Chairman and CEO of Alibaba's Board of Directors.

Alibaba has entered the era of Zhang Yong and ushered in unprecedented centralization of power. For a long time, Zhang Yong had to take care of businesses with completely different business models and team genes, such as online retail, offline supermarkets, online wholesale, logistics, and cloud computing. He received direct reports from over 30 people and was the busiest CEO in China.

His focus is basically on how to maintain the smooth operation of a complex multi sector company. However, with changes in the internal and external environment, Alibaba has still entered a practical dilemma of reduced efficiency in the middle stage and slower growth in various businesses.

Image source: Enterprise official website

According to financial report data, from 2019 to 2023 fiscal years, Alibaba achieved revenue of 376.844 billion yuan, 509.711 billion yuan, 717.289 billion yuan, 853.062 billion yuan, and 868.687 billion yuan respectively; The net profits for the same period were 80.034 billion yuan, 140.35 billion yuan, 143.284 billion yuan, 47.079 billion yuan, and 65.573 billion yuan, respectively. The ability to attract gold has significantly declined.

A senior Alibaba executive believes that Jack Ma is more sensitive to change, but his retirement has left a gap in corporate governance. Before retiring, Jack Ma's decision was the rule.

Later, he further abstracted these rules into "culture", such as insisting on "customer first" when there is a conflict of interest on the platform; 'Because of trust, it's simple' is to hope for sincere and transparent cooperation and communication within the organization; Embracing change "is a requirement for the business.

However, as the founder retired and the partners gradually retreated behind the scenes, this "culture" gradually became diluted and could not become an effective way of governance. When faced with internal website posts such as "To Alibaba" and incidents of sexual assault by female employees of Alibaba, Zhang Yong seemed at a loss.

In 2021, he thinned the middle platform and promoted diversified governance. He established a new "CEO in charge" between himself and the CEO of the business group, who will be responsible for Alibaba's four most important business sectors, further reducing the number of reporting relationships with him.

At the beginning of this year, Zhang Yong once again planned a "1+6+N" major adjustment. "This change is unprecedented in Ali's 24 year history, and it is the most dramatic change in Relations of production," said Zhang Yong.

The plan shows that under the Alibaba Cloud Group, six business groups and multiple business companies will be set up, including Alibaba Cloud Intelligence, Taobao Tmall Business, Local Life, Cainiao, International Digital Commerce and Dawen Entertainment. Business groups and business companies will establish separate boards of directors, implementing a CEO responsibility system under the leadership of the boards of directors of each business group and business company, while Alibaba Group will fully implement holding company management.

It seems that it is expected that Zhang Yong will go to the front line of business and lead Alibaba Cloud in its development.

Xiaoyao ZiTurn aroundDifficulties with Alibaba

Zhang Yong, 51, is about to start his new journey - Alibaba Cloud.

As the most thoroughly split business segment of Alibaba Cloud, Zhang Yong is the chairman and CEO of Alibaba Cloud. According to Zhang Yong's internal letter, Alibaba Cloud will complete the spin off and listing in the next 12 months.

Image source: Image insect creativity

At present, the complete separation of Cloud Intelligence Group has started, and it is at the most critical moment. It is required to fully invest in it, "said Zhang Yong.

But the situation Zhang Yong is facing is not optimistic. The data shows that the revenue growth of Alibaba Cloud business from 2019 to 2022 is 84%, 62%, 50% and 23% respectively (after offsetting the impact of cross segment transactions), showing a downward trend year by year. By 2023, the revenue growth of cloud business will be reduced to 4%.

In the past few years, many of Alibaba Cloud's regular customers are difficult to provide growth, and some even disappear directly: the number of customers in the online education industry has decreased significantly, and the growth of the online game industry is rare. By 2021, ByteDance, which once accounted for nearly 1/3 of Alibaba Cloud's revenue, will begin to move out.

It is AI that has changed the prospects of Alibaba Cloud and even the whole cloud computing market in China. In the face of ChatGPT and the big model opportunities behind it, the common feature of Chinese technology companies is that the leader personally follows up. The same is true of Alibaba. In April this year, Zhang Yong released the ChatGPT like product "Tongyi Qianwen" at the Alibaba Cloud Summit.

Back in Alibaba, according to the China Internet Network Information Center (CNNIC), as of December 2022, the number of Internet users in China has reached 1.067 billion, and the Internet penetration rate has reached 75.6%. This means that the internet market has shifted from increment to stock, and the growth rate of online transaction scale closely related to internet increment is also showing a downward trend.

Alibaba, which used to be "unable to find an opponent with a telescope," is being surrounded by powerful enemies and its core business is being eroded. The Three Kingdoms killing pattern of "cat and dog fighting" has been replaced by the separatist rule of the masses, and new formats are constantly emerging.

No enterprise can always shine, and so can Alibaba. Jack Ma hopes that Alibaba can span three centuries: Alibaba was born in 1999 and lived for over a year in the 20th century; Live over 100 years across the 21st century; Live another year in the 22nd century, a total of 102 years.

Now, facing the dilemma of growth, Ali, 24 years old, has returned to the front line and charged again. Joseph Tsai and Wu Yongming play the role of "airborne soldiers". Can they do better than Zhang Yong?

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