Announcement comes day after founder Jack Ma spotted in China
Chinese e-commerce group Alibaba Group Holding will reorganize into six business groups and pursue public listings for five of them, in the most significant governance overhaul since the company was established 24 years ago.
The company announced the move on Tuesday, a day after founder Jack Ma’s surprise return to China following a lengthy stint abroad. The six business groups will focus on sectors such as cloud computing, e-commerce and logistics.
“This transformation will empower all our businesses to become more agile, enhance decision-making, and enable faster responses to market changes,”chief executive Daniel Zhang said in a letter to employees.
The six new groups will be: Cloud Intelligence Group, Taobao Tmall Commerce Group, Local Service Group, Cainiao Smart Logistics, Global Digital Commerce Group and Digital Media and Entertainment Group.
Each of the groups will be run by its own CEO and board of directors, with the CEOs assuming full responsibility for company performance.
Zhang will remain chairman and CEO of Alibaba Group, which will follow a holding company management model. He will also serve as the CEO of the Cloud Intelligence Group, which will be responsible for the company’s cloud and artificial intelligence businesses.
Zhang became acting president of Alibaba Cloud Intelligence after its cloud service suffered what the company described as “the longest large-scale outage in more than a decade” in Hong Kong in late December.
Alibaba’s growth has started to slow in recent years as China’s consumer spending cooled amid the country’s economic downturn, partially due to the three years of strict zero-COVID measures. With e-commerce user growth slowing, Alibaba has been betting on its cloud computing services, but sales of that segment, usually one of its fastest-growing, increased just 3% on the year in the December quarter to 20.2 billion yuan ($2.9 billion).
Taobao Tmall Commerce Group, the main source of revenue for the e-commerce conglomerate, will be led by Trudy Dai, one of the original members of the company and a student of founder Jack Ma from when he was an English teacher.
Jiang Fan will be the CEO of the Global Digital Commerce Group, which spans the Southeast Asian-focused Lazada, AliExpress, Trendyol, Daraz and Alibaba.com.