Jack Ma, as an iconic figure in China’s E-commerce circle, shoulders Alibaba’s journey to the 2nd largest E-commerce firm global wise. As the founder of the tech giant, he starts his career as an English teacher like the other teaching graduates in China.
The company, founded in 1999 by Jack Ma and 17 co-founders with US$60,000, has declared a plan to thrive for at least 102 years, a target that leaves its corporate legacy across three centuries.
But this September, he surprisingly announced his retirement at the age of 54. According to the succession plan, within a year, the CEO of Alibaba, Mr. Daniel Zhang Yong, will take over and chair the Alibaba officially. But who is this lucky guy?
Yes, Who is Daniel Zhang?
Ma’s successor Daniel Zhang Yong, has been part of the Alibaba hierarchy since 2007, when he was named chief financial officer of Taobao Marketplace after working for PwC and gaming company Shanda.
A finance graduate from Shanghai University of Finance and Economics, the 46-year-old’s number-crunching background and reputation as a quieter personality than Ma could see a change in Alibaba’s overall leadership style.
Zhang has been credited with leading the company’s annual Singles Day shopping extravaganza, which last year saw Alibaba sell 38 billion US dollars’ worth of goods, as well as focusing on data analysis to maximize profits.
Zhang also led the company’s headline-grabbing deal with Starbucks earlier this year. He told CNBC earlier this month “if you’re going to win a race, it’s more important to buy a horse than just bet on it,” reflecting Alibaba’s merger and acquisition strategy in recent years which has seen it take over or take major stakes in Didi Chuxing, Youku and China Unicom.
Zhang also has the firm backing of not only Ma, who promised to “work closely with Daniel to ensure a smooth and successful transition,” but also other senior figures in the Alibaba hierarchy. According to the Financial Times, the company’s executive vice-chairman Joseph Tsai said Zhang is “capable…very creative and has big vision.”
What Daniel Achieved with Jack Ma
Alibaba’s stock has grown 87% since Daniel became CEO of the company in May 2015, and has a market value of around $420 billion, according to Fortune magazine.
The 46-year-old Shanghai native joined the company in 2007 as CFO of Taobao marketplace, Alibaba’s online ecommerce platform, and has gradually risen up the ranks.
Contrast to founder Jack Ma, Daniel has kept a much lower profile.
“We don’t know much about (Daniel) even though he’s been CEO for a while, because he’s by nature a very low-key person, low profile. He’s happy to not be in the limelight,” said Duncan Clark, author of “Alibaba: The House that Jack Built”, according to a Reuters report.
Daniel has admitted as much himself. “Jack Ma is a guy with many ideas. He is very, very creative,” Zhang said in an interview with the Financial Times last year. “But I’m the guy who always wants to put my foot on the ground.”
As mentioned earlier, one of Daniel ‘s iconic achievements at Alibaba is the creation of the “Singles Day” shopping festival, a Black Friday-like online shopping spree held on 11 Nov every year.
Shoppers from home and abroad spent around 168.2 billion yuan ($24.5 billion) during last year’s “Singles Day” festival, and it is now the world’s largest 24-hour shopping festival, dwarfing similar shopping bonanzas round the world, including Black Friday in the US as well as Amazon Prime Day, which last year tallied $1 billion in sales, a SCMP report said.
But for Daniel, success has become a habit. The best team-building method is to move from one victory to another, he said at the closing of last year’s
“Singles Day” festival.
“Track customers’ footprints online and recommend them their favorites doesn’t mean a lot,” said Daniel, “You recommend something that hits their hearts, though they’ve never bought or even seen it, that is real intelligence.”
With “Singles Day” festival as a start, Daniel hopes to keep Alibaba evolving and creating something with disruptive innovation. “To redefine business as Apple Inc redefines a mobile phone,” Daniel said so when describing his goal.
Daniel ‘s continues victory can be attributed to the founder’s continuous let go of power.
Alibaba invested $2.88 billion to obtain 36.16 percent of Sun Art Retail by acquiring shares from food retailer Ruentex in 2017. Huang Mingrui, chairman of RT-Mart, another potential competitor, is said to have never seen Jack Ma even as the negotiations were going on, as Zhang remained the face of Ma.
Alibaba teamed with its financial arm Ant Finance to fully acquire food delivery platform Ele.me early this year. The deal, with a transaction value of $9.5 billion, was solely sealed by Daniel.
“Group decision is a tradition in Alibaba,” said a business insider who once worked at the company. Ma started to let subordinates make decisions five years ago. He spent over 800 hours on planes every year and doesn’t inquire about cases worth less than 30 billion yuan, but the Alibaba Empire still runs well under the management of top executives like Daniel, the insider added.
And now it’s time for Zhang to take over.
As Ma said in his open letter to the public on Monday, Daniel is “an outstanding business leader”. His strategy and responsibility prove he is the correct choice, said Ma.
Market Reactions After Jack Let Go
Shares in Alibaba, which launched a record-breaking 25 billion US dollar initial public offering on the New York Stock Exchange in 2014, fell 3.70 percent in Monday’s trading session, a new low for 2018.
Ma’s announcement comes at a time of uncertainty for investors looking to buy in the Chinese tech sector. Since June 14, Alibaba shares have fallen by more than 25 percent, while rivals Tencent and Baidu have dropped by 23.88 and 21.08 percent respectively over the same period.
Alibaba’s e-commerce rival JD.com has seen its stock price drop even further, plummeting by more than 39 percent in the same period after the arrest of its founder and CEO Richard Liu earlier this month.
One major concern for investors will be how Alibaba can continue without Jack Ma – a personality and figurehead intrinsically linked with the company and China’s tech sector.
Ma is the youngest among Asia’s three wealthiest men. Still, he began thinking about his succession plan a decade ago. He stepped down as Alibaba’s chief executive officer in 2013, promoting Zhang to the job two years later.
Since then, he spent 40 per cent of the year travelling around the world as an evangelist for the benefits of globalisation, free trade and technological advancement.
“This transition demonstrates that Alibaba has stepped into the next level of corporate governance from a company that relies on individuals, to one built on systems of organisational excellence and a culture of consistent talent development,” Ma said.
“Alibaba was never about Jack Ma, but Jack Ma will forever belong to Alibaba.”
Life after Alibaba is unlikely to be filled with wandering hours or idle days, Ma said. Education, the environment, philanthropy through his Jack Ma Foundation, and work with the Alibaba Partnership are the likely pursuits that will keep him busy, he said.
“I still have lots of dreams to pursue. Those who know me know that I do not like to sit idle,” Ma said. “And, the world is big, and I am still young, so I want to try new things. What if new dreams can be realised?”
In his statement, Ma looked to play down his links to the company he founded two decades ago, saying “no company can rely solely on its founders.”
Content Edited from ecns.cn, China Daily, South China Morning Post