Sonya Hatfield

South University Online

Professor Cady

MBA6999

August 1, 2022Project

Alibaba China’s and World’s Largest E-Commerce Company

Introduction

Alibaba is one of the largest e-commerce organization in the world. It is the most popular and fastest growing e-commerce online shopping market with billion-dollar transactions on its online site, more than Amazon and eBay transactions combined. It uses electronic payments services, web portals, cloud computing services, and search engines to provide Business to Consumer (B2C), Consumer to Consumer (C2C), and Business to Business (B2B) sales services. It comprises three sites, Tmall, Taotao, and Alibaba.com, which are the world’s largest B2C, C2C, and B2B. Alibaba’s vision aims at building future commerce infrastructure and aspiring to be a good organization that will last for over 102 years. It envisions that its customers will live, work and meet at Alibaba. Its mission is to make it easy to carry out business anywhere. Alibaba’s vision and mission have a clear understanding of the growth path that it needs to take. They focus on the company’s e-commerce, internet business, and technology, offering a solid foundation for its future business expansion (Leavy, 2019).Project

Alibaba strategic Profile

In order to grow, any e-commerce company relies on strategic information. Therefore, they should concentrate on strategic, financial, and operational systems. Operational information creates competitive advantages for the company as its help in the management of day-to-day activities such as controlling stocks and costs. On the other hand, financial information helps the company conduct budgeting, finance, and accounting operations effectively. Lastly, e-commerce strategies and technologies are linked due to strategic needs. One of the strategies Alibaba has employed is cost leadership. The company targets a vast market and offers low prices; hence, it has expanded fast in the Asian and global markets. As the company’s core business is based on e-commerce, the cost of operations has been reduced due to using technology. Most Alibaba customers are companies that display their goods on the website. Costs associated with purchasing are reduced since manufacturers do not have a physical store for displaying their goods, and customers do not have to travel to China to view and make purchases. Another strategy that Alibaba uses is innovation. Technology and IT have helped shape the e-commerce services and products offered by Alibaba. By forming alliances with MasterCard and Visa, the company has gained a competitive advantage by creating market opportunities. Although the online payment platforms have potential risks, there is a transformation of business features brought about by these innovative ways of doing business (Kwak et al., 2019). Project Since Alibaba has various divisions, it is hard to find an essential solution for all its subsidiary companies; however, with its current strategy, it can implement cost-saving strategies that promote growth in its subsidiaries.

Alibaba’s current business strategy can be labeled as business-to-business as it offers a platform to buyers and suppliers. In addition, it has developed its marketing strategy and gained a target audience through this platform. Thus, the organization is working toward digitizing the entire supply chain infrastructure to have a holistic realm of e-market.Project

Similarly, Alibaba has grown into a significant global e-commerce company seems that its strategy is working for it. The company has been able to achieve its short-term and long-term objectives. Through the cost leadership strategy, Alibaba has maximized revenues through sales by simplifying the goods buying process and retaining the quality of the goods. By continuously pursuing this strategy, the company is expected to gain more success in the future. Additionally, Alibaba will be able to expand its market and gain more customers through this low-risk strategy. It is also crucial that the company find ways to maintain low risks and increase business performance as they aim to maximize profits. Alibaba will increase its performance and customers and reduce risks if it maintains the current strategy. However, the company may need to invest more in research and development to address its market growth strategy (Kwak et al., 2019).Project

Alternative International Market Entry Methods

Alibaba has the opportunity to partner with other global companies to gain more access to the foreign market and grow its customer base through digitization. Even though Alibaba will focus on the growth of one market at a time, if it adopts this method, it will create strong relationships with the target market. Hence, creating a brand recognizable by the customers is the most commonly used platform by the target audience.

Alibaba used several company structures as support systems when it entered the digital market segment. Its divisional and functional structures permitted the organization to succeed in the global market as they exist in the company as a single matrix structure. One will realize that Alibaba uses its structural model to handle its goals in particular economic situations (Kwak et al., 2019). However, Alibaba can operate globally across all states with a few exceptions, with the current matrix organizational structure offering competitive advantages and keeping processes running.

Choice Of Structure and Alibaba’s Chosen Strategy

The matrix technique has affected Alibaba in many ways, including its objectives. Premises for the business expansion are designed immediately since the matrix model suggests that tools of the structural organization are included in the corporate framework. However, the matrix structure has assisted the company in expanding into the international market, which is essential for initial growth and positive influence in the global setting. It has also allowed Alibaba to align its processes within the supply chain management framework. Hence, Alibaba has developed systems of managing its resources to capitalize on the effectiveness of the current approach and maintain uninterrupted performance processes (Leavy, 2019).

Conclusion

Alibaba has the most remarkable and innovative business model in the modern business world. It is more significant in size than most e-commerce platforms combined. It uses strategic information systems to control costs, differentiate itself, determine its business processes, and develop innovative services and products online—the company technology offers services and products without physical and time limitations. The company utilizes one or more strategies in planning business processes to realize organizational goals. The company has successfully expanded into the digital market after analyzing consumer preferences changes.

Moreover, interactions across its supply chain, which are crucial for the company, are kept organized and orderly. Through the use of the matrix technique, rapport is established with its employees. Alibaba was the first company to link foreign firms directly to manufacturing firms through its website. It made outsourcing for production materials easy and cost-effective since intermediaries were eliminated that making the prices of materials rise (Leavy, 2019). It has also exposed the China economy to the global market as many foreign firms are drawn to do business with China; hence there is an increase in orders placed with Chinese firms.

References

Kwak, J., Zhang, Y., & Yu, J. (2019). Legitimacy building and e-commerce platform development in China: The experience of Alibaba. Technological Forecasting and Social Change, 139, 115-124. https://www.sciencedirect.com/science/article/pii/S0040162518309636

Leavy, B. (2019). Alibaba strategist Ming Zeng:“Smart business” in the era of business ecosystems. strategy & leadership. https://www.emerald.com/insight/content/doi/10.1108/SL-01-2019-0006/full/html

Course Project Task 3

Note: This course has major project assignments that will be due in Weeks 3 and 5. It will take more than a week’s effort to adequately complete them. Plan time to start the research and other work for those assignments earlier than the week in which they are due. Project

Alibaba is China’s—and by some measures, the world’s—biggest online commerce company. Its three main sites—Taobao, Tmall, and Alibaba.com—have hundreds of millions of users, and host millions of merchants and businesses. Alibaba handles more business than any other e-commerce company.

Begin your paper by briefly summarizing key details about the Alibaba organization, including its purpose and vision. Your summary should be clear enough that anyone could pick up your paper and get a basic understanding of the organization.

Next, analyze the strategic profile of Alibaba, including the following issues:

• Identify the business strategy Alibaba seems to be following internationally: multi-domestic, global, or transnational? Defend your choice with research, rationale, and appropriate examples.
• Assess the appropriateness of Alibaba’s strategy. Project
  • Evaluate the rationale for developing international competitive capabilities.
  • Distinguish among the alternative methods of international market entry that are available to Alibaba, including the strengths and weaknesses of each option. Assess whether Alibaba is utilizing the best method.
  • Distinguish among the organizational structures used to implement the three-alternative international corporate strategies. Assess whether Alibaba’s choice of structure aligns with their chosen strategy.

Finally, summarize two or three important take-aways from your research into Alibaba. In essence, what did you learn and what strategic development and implementation lessons might you apply?

Submission Details: 

• Project
  Present your analysis as a 4–5-page report in a Microsoft Word document formatted in APA style.
• Support your responses with examples.  Cite any sources in APA format.
• Name your document MBA6999_W3_LastName_FirstInitial.doc
• Submit your document to the Submissions Area by the due date assigned.