Tech

Alibaba splits itself into Chinese and overseas ops

Chinese e-commerce giant Alibaba is splitting in two.

Or as the company put it in a blog post: “Alibaba Introduces More Agile Organizational Structure to Accelerate Domestic and International Growth.”

The structure will see a new unit called “International Digital Commerce” deal with retail and wholesale customers outside China. Current Taobao and Tmall president Jiang Fan will lead the organisation, which will include AliExpress, Alibaba.com and Southeast-Asia centric e-tailer Lazada.

Alibaba veteran Trudy Dai gets to be boss of a new “China Digital Commerce” operation that gets everything in China.

The megafirm’s post quotes a letter explaining the move, written by CEO and chair Daniel Zhang to Alibaba staff.

“As we continue to build a multi-engine approach to drive future growth, a ‘diversified business governance’ will become Alibaba’s new organizational strategy as we look towards the future,” the post quotes Zhang as writing.

“We want to explore new business governance approaches to drive more innovation and creativity across our teams and businesses.

“We will continue to focus on becoming a truly globalized company, and we believe that overseas markets present many exciting potential opportunities for us to capture,” wrote Zhang in his letter. “We have confidence in our local teams, and we are charting a path forward with a holistic strategic blueprint and organizational stability for winning our overseas markets.”

The company has also appointed a new CFO. According to a filing [PDF] to the Hong Kong Stock Exchange, Mr Hong Xu will succeed Ms Maggie Wei Wu in the role from April 1, 2022. Ms Wu will continue as a partner in the Alibaba Partnership and a director.

No reason for the change of CFO was offered, nor did Alibaba’s post explain what advantages its new structure might confer.

The Register is willing to speculate that data protection laws may have a lot to do with it. Recent Chinese laws have made it harder for citizens’ data to leave the Middle Kingdom. Western nations are increasingly nervous about their carriers and people encountering Chinese infrastructure.

Splitting Alibaba into domestic and Rest of World operations gives the company plenty of incentive to create discrete operations that are less worrisome to regulators everywhere.

The company’s post offers no details of the operational requirements of the new structure, nor when it will come into effect. Alibaba’s cloud also didn’t rate a mention, despite already having both Chinese and overseas operations. The Register has asked Alibaba for details on the fate of its cloud and will update this story if we receive useful information. ®

UPDATE: Alibaba has confirmed there will be no organisational changes to its cloud division, and Jeff Zhang remains in charge.


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