E-COMMERCE ORGANIZATION
Introduction
An E-commerce organization is an electronic means of buying and selling goods and services electronically using the internet base. The transaction of funds and payments for goods and services is cashless for it is done electronically. The E- commerce platforms are restrained to buying and selling if goods and services for social networking is not allowed. E- commerce has benefited all sectors from individuals to mega cooperation, from small and medium enterprises to companies in a manner of identifying goods and service provider easily.
According to Ceruzzi, P. E. (2012). Marijuana was the first item sold electronically in 1972. The Stanford university student in California used the Arpenet platform to sell weed. Twenty two years later, a what is considered a successful and legit E-commerce was done by Dan Kohn (Fessenden, 2015) when he sold Ten Summoner’s Tales disc using a Netmarket website.
There are four types of E-commerce models, namely, business to business, business to customer, customer to customer, and customer to business. Business to business deals company to company with no consumer involved. Business to consumer is where the company electronically sells goods and services to the consumer. The company displays their offers to a website where consumer browses products that includes their real photos, brief description as well as reviews. Thirdly, consumer to consumer is a platform where consumer has a direct with another, trading personal items like in OLX. Finally, there is consumer to business where consumer renders goods and services to the company such as developing and selling a software to the company. Examples o the world wide known E- Commerce networks are Amazon, OLX, eBay, Quikr , upwork and Alibaba. This paper discuses choses to discuss Alibaba company as an example of an Electronic commerce, biased on it history and background, organizational strategy, organizational design and its effectiveness and changes that would improve its operations.
Historical Background
Alibaba is one of the biggest E-commerce in the world, established on 4th April 1999 in China by Jack Ma , Joseph C. Tsai , Cathy Zhang , Trudy Dai et al.Its headquarters are based at Hangzhou, China with over one hundred thousands employees under Daniel Zhang as the chief executive officer. Alibaba is the most popular E-commerce market in the world through Taobao, Tmall and Alibaba.com sites.
E-commerce has a wide range of advantages. E- commerce overcomes the geographical barrier for the transaction platform is virtual without hindrance of location. At any continent, one needs to browse the Alibaba site, search for any goods from their store, make an order by adding item to the cart, and wait for delivery within the agreed time. This ensures conveniences for goods are delivered quickly hence making Alibaba very popular and fast growing industry. The platform for consumers to raise and settle complains at Alibaba, saves a lot of time and energy for both company and consumer.
The absence of literary building as shops that employs dozens of services provider as security guards, cleaners, shop attendants, cashiers, accountants makes Alibaba and other E- commerce companies enjoy a big margin of profit. The cost of maintain the buildings, land rates and accruing insurance substantially withdraws hidden costs, making the transaction cost significantly low. The E- commerce business, unlike the shop offers costumers opportunity to shop 24/7since are functional all times.
Most of business collapse due to lack of proper and speedy communication and transactions. This has mostly been enhanced by the intermediaries who earns more than product owner. The E – commerce has provided a direct interface between the business and the customers. This has not only reduced the cost but also provided a personal touch.
Organizational Strategy
Organizational strategy is the plan set by the organization with the intention of achieving long term goals which is also known as strategic plan. The board of directors and managements creates the strategic plan as they monitor its implementation by middle and lower carder step by step. Henry Mintzberg refers to organizational strategy as a five “p” strategy (Weick, K. E. 1995). plan, pattern, position perspective and ploy.
A good plan leads to a possibility of achieving set goals. The management, therefore, should give with clarity the objectives of the company and the role for each team player. When Jack Ma found Alibaba in 1999, his goal was to put him and China in the world map for the next one hundred and two years. However, he knew can’t live for that long and therefore he planned to sell some shares as well as train Daniel Zhang for period of twelve months (Writer, S. 2018)A good study and evaluation should be conducted on how previous results were achieved so as to come up with a pattern to achieve future results. Successful pattern should be upheld while weak behaviors be excluded in the strategy. The position of Alibaba Group of companies was to be the global leading electronic trading market which was sired at the onset. Jack Ma has been engaging the board of director in order to examine and drive this position. Perspective is the art of evaluating feedback from the targeted customers in order to find how they perceive E-commerce, find out how employees treat its customers as well as how employees regard their boss.
Organizational strategy is drawn from the mission and vision of a company. The mission and vision of a company details why it is in business and every action should be towards fulfilling it. The mission and Vision of Alibaba Group of company is E- commerce that will enable business anywhere in the world. Alibaba is now the leading online and mobile marketing platform for both wholesale and retail trade. It also offers services like cloud computing and data management, digital entertainment, mobile applications, internet communications and mobile operating systems. Alibaba’s vision is to construct infrastructure of e-commerce with aim that all the customers will work, meet and live at Alibaba for over one hundred years.
Organizational strategy should raise a business level strategy that aims on competition, with quality products and services at the lowest cost. Over a period of time , Alibaba has established various units that enhances large customer base. The Juhuasuan, an online buying market place, established in March 2010, provides discounted products monthly. In 2014, it was rated the best online market place for monthly customers.( Che, T.et al. 2015). AliExpress targets retailers globally especially from Russia, Brazil and the United States. It was established in 2010 to facilitate consumers to buy goods and services directly from manufacturers and wholesalers from China at lowest cost (Li, D. January 2016,).
The first level business unit established by Jack Ma was Alibaba.com (Yazdanifard, R., & Li, M. T. H. 2014). This website enables small business to sell their good and services to big companies in other countries. These small producers and manufacturers are majorly based in China, Thailand, the United states and Pakistan.
In September 2009, Alibaba developed another unit known as Alibaba cloud computing( Zhang, G., & Ravishankar, M. N. 2019). It deals with data storing and management in the clouds where one can retrieve data or share across private or public. Alibaba cloud computing platform is one of the global largest E -commerce company that is fairly cheap to individuals, education institutions, financial institutions, small and large businesses and the government.
Organizational strategy in E-commerce should include market level strategy. Market level strategy checks the life span in business community, the growth and development of business and diversity in product and service delivery. The success of Alibaba group of companies can be traced mainly on diversification. In May 2003, Alibaba launched Taobao Marketplace that gave customers a wide range quality products and services, offered conveniently and at fair prices. By 2015, iReserch rated the mobile Taobao App as the best E- commerce application in China (Jung, J. C., & Liow, A. K. 2015). In 2014 again Tmall.com was rated the largest third party E-commerce offering top-quality products.
In November 2007, Alibaba Group of company come up Alimama website to market and sell computer and mobile devices. Alibaba not only focused on selling but also financing individual customers, micro and small businesses who has been royal to the Alibaba group of companies (Ding, D 2018). Cianiao logistics was developed by Alibaba group of company to provide real time information to both service provider and customers. It endeavors to remain relevant in E-commerce through the mobile applications.
Organizational design is the methodology employed to check work flow, institution structures, systems employed in line with the vision and mission of the institution. The systems put in place for E-commerce should be able to adopt current affairs and the new changes in the market. A well established design significantly improves the results. This therefore calls for team work in all levels of management and junior employees in the E-commerce institution. Acceptable behaviors should be set in regard to time management, shift pattern and operation, effective and smooth communication, and decision making.
Organizational design of E-commerce should ensure perfect customer services, lower the cost of operation subsequently increase returns, improve efficiency, cultivate a culture of committed employees who are motivated in their line of duty, and indicators of how to deal with the changing technology. E commerce organizations should periodically review their organizational designs for three main reasons. First, it helps to identify any change inside and outside E-commerce business. In E-commerce, there are pop ups of new technologies, identify rivals and competitors or even change of business law. Secondly, once new goals and strategies have changed, there is need to review organizational design and finally is when the existing design doesn’t work. Below is a checklist of how Alibaba group of companies is able to employ the above aspects in E- commerce.
Jack Ma was only developing as simple platform where the buyers and the sellers would interact online. As technology advanced, he started advertising and marketing those products. He later moved to logistics and financing the enterprises. This has significantly expanded into making Alibaba the most popular E-Commerce. He first used artificial intelligence to date center cooling, machine learning to now know as block chain technology. Alibaba gains customer’s loyalty for it is able to real time update them the location of items by use GPRS.Alibaba has recently paid a very stiff competition to Amazon.com, a united state E-commerce after its pledge to help small business to sell world wide. Amozon has lost about 20 % loyalty due to claims of counterfeit goods (Jung, J. C& Liow, A. K. 2015).
Organizational design in E-commerce has two primary levels; hierarchical and organic. Hierarchal design is further divided into functional structures and divisional structure. Functional structures like marketing, accounting and human resource have distinct roles where senior executive reports to the chief executive officer. Division structure on the other hand, has units that are independent, headed by manager each accountable to the C.E.O.
Organic organization design in E- commerce are the simple structure, matrix organization and network structures. The simple structure ensures the is little no management between employees and the executive. Matrix structure has several levels of department one has to pass to before reaching the executive. Network structure is very flexible in terms of coordination and internal and external affairs of E-commerce business.
Effective organization structure in E- commerce should ensure vision and the mission of the business is achieved. This is done so when the structure defines the role of each employee at all levels that makes it easier to delegate responsibility. Jack Ma had a succession plan of Alibaba from onset. On September 2018 announced to delegate chairmanship to Daniel Zhang (Gilchrist, K. 2019). He recognized the importance of continuity with his absence and so developed a structure that is sustainable.
An effective organization structure helps the E-commerce companies to unify their marketing message. This enables E-commerce to review its ultimate marketing goals and mode of attaining them. Alibaba identified untapped potential in advertising, marketing and logistics electronically. Through unified marketing message, Jack Ma communicated this to his employees and together they have made Alibaba most popular E-commerce company. The structure in Alibaba prepared its employees for any position, upward or downward through trainings.
Organizational Culture
Organizational Culture is the acceptable conduct in the company. E- commerce companies should develop beliefs and values that earns them confidence in customers and loyalty. The E-commerce should not be perceived as a prank where counterfeit products are delivered. The E- commerce institutions should cultivate a culture of proper way of response to any situation and top management should lead through examples.
Cameron, K., & Quinn, R. E. (2016), categorized organizational culture into clan culture, adhocracy culture, the market culture and hierarchy culture. Clan culture advocates collaboration among persons who has a common goal over E-commerce. Each member is a team player who are bounded by norms and tradition that are refreshed through mentorship. Alibaba group of companies established a very good relationship with environment, manufacturers suppliers and customers. The adhocracy culture promotes innovation and creativity. Team players in Alibaba are funded for research in line to come up websites that cope current challenges. The market culture deals with the dynamics of competition and the demands. Jack Ma exploited market culture by putting the objectives clearly to beat all E-commerce companies where all people we buy and live in Alibaba (Cameron, K., & Quinn, R. E. 2016). The hierarchy culture deals with the rules of the organization, processes, structure with the maintenance hierarchy of power.
Strategies of improving E-commerce
E- commerce has shunned all the retail globally by offering wide range of products where customers can review products and services any time of the day. Alibaba group of companies projected that leading E-company where all customer will meet and live in Alibaba.Nevertheless the E-commerce has faced many challenges. The major challenges is the mistrust between customers and the online shopping. Following countless scams, many people question the online business security due to theft, and stealing of credit cards. In other cases, counterfeit products have been delivered or delays in terms of delivery thus dissatisfying the customers. Due to constant improvement of technology and innovation, many websites have been lead obsolete, raising the risk of failure of E-commerce industry. However, these challenges may be addressed in the following ways.
The E-commerce should have the objectives, mission and vision well know. The design and the structure of E-commerce company’s culture should motivate each employee feeling like they own the company. This can be achieved when they are involved in decision making process. The feeling of the ownership of the company reduces mistrust among workers. Workers are motivated to offer the best services and response to customers thus winning customers loyalty, coordination in all levels of E-business.
The E-commerce industry should set grants for any person who brings innovation and creativity in the marketing and advertising, quality and quantity products and services. At any single order, the E-commerce should ensure convenient and legit products. The E-commerce company should hire the best soft and hand wear engineer who ensures the website is up to date. The E-commerce should endeavor to expand the product and services.
References
Cameron, K., & Quinn, R. E. (2016). Organizational culture assessment instrument.
Ceruzzi, P. E. (2012). Computing: a concise history. MIT Press.
Che, T., Peng, Z., Lim, K. H., & Hua, Z. (2015). Antecedents of consumers’ intention to revisit an online group-buying website: A transaction cost perspective. Information & Management, 52(5), 588-598.
Digital Finance, and Inclusion, Volume 1 (pp. 19-35). Academic Press.
Ding, D., Chong, G., Chuen, D. L. K., & Cheng, T. L. (2018). From ant financial to Alibaba’s rural Taobao strategy–how Fintech is transforming social inclusion. In Handbook of Blockchain,
Fessenden, M. (2015, November 30). What was the first thing sold on the internet? Smithsonian Magazine. https://www.smithsonianmag.com/smart-news/what-was-first-thing-sold-internet-180957414/
Gilchrist, K. (2019, October 18). Alibaba’s Jack Ma spent 10 years preparing for his retirement. Retrieved from https://www.cnbc.com/2019/10/18/alibabas-jack-ma-spent-10-years-preparing-for-his-retirement.html
Jung, J. C., Ugboma, M. A., & Liow, A. K. (2015). Does Alibaba’s magic work outside China?. Thunderbird International Business Review, 57(6), 505-518.
Li, D. (2016, January). A Comparative Analysis of B2C Cross-border E-commerce Platforms: the AliExpress and the DHgate. In International Conference on Education, Management, Computer and Society. Atlantis Press.
Weick, K. E. (1995). Sensemaking in organizations (Vol. 3). Sage.
Writer, S. (2018, September 10). Alibaba’s Jack Ma reveals succession plan in letter — full text. Retrieved from https://asia.nikkei.com/Business/Companies/Alibaba-s-Jack-Ma-reveals-succession-plan-in-letter-full-text
Yazdanifard, R., & Li, M. T. H. (2014). The review of Alibaba’ s online business marketing strategies which navigate them to present success. Global Journal of Management and Business Research.
Zhang, D. J., Dai, H., Dong, L., Wu, Q., Guo, L., & Liu, X. (2019). The value of pop-up stores on retailing platforms: Evidence from a field experiment with alibaba. Management Science, 65(11), 5142-5151.
Zhang, G., & Ravishankar, M. N. (2019). Exploring vendor capabilities in the cloud environment: A case study of Alibaba Cloud Computing. Information & Management, 56(3), 343-355. E-COMMERCE ORGANIZATION
Introduction
E-commerce organization is an electronic mean of buying and selling of goods and services electronically using internet base. The transaction of funds and payments for goods and services is cashless for it is done electronically. The E- commerce platforms are restrained to buying and selling if goods and services for social networking is not allowed. E- commerce has benefited all sectors from individuals to mega cooperation, from small and medium enterprises to companies in a manner of identifying goods and service provider easily.
According to Ceruzzi, P. E. (2012). Marijuana was the first item sold electronically in 1972. The Stanford university student in California used the Arpenet platform to sell weed. Twenty two years later, a what is considered a successful and legit E-commerce was done by Dan Kohn (Fessenden, 2015) when he sold Ten Summoner’s Tales disc using a Netmarket website.
There are four types of E-commerce models, namely, business to business, business to customer, customer to customer, and customer to business. Business to business deals company to company with no consumer involved. Business to consumer is where the company electronically sells goods and services to the consumer. The company displays their offers to a website where consumer browses products that includes their real photos, brief description as well as reviews. Thirdly, consumer to consumer is a platform where consumer has a direct with another, trading personal items like in OLX. Finally, there is consumer to business where consumer renders goods and services to the company such as developing and selling a software to the company. Examples o the world wide known E- Commerce networks are Amazon, OLX, eBay, Quikr , upwork and Alibaba. This paper discuses choses to discuss Alibaba company as an example of an Electronic commerce, biased on it history and background, organizational strategy, organizational design and its effectiveness and changes that would improve its operations.
Historical Background
Alibaba is one of the biggest E-commerce in the world, established on 4th April 1999 in China by Jack Ma , Joseph C. Tsai , Cathy Zhang , Trudy Dai et al.Its headquarters are based at Hangzhou, China with over one hundred thousands employees under Daniel Zhang as the chief executive officer. Alibaba is the most popular E-commerce market in the world through Taobao, Tmall and Alibaba.com sites.
E-commerce has a wide range of advantages. E- commerce overcomes the geographical barrier for the transaction platform is virtual without hindrance of location. At any continent, one needs to browse the Alibaba site, search for any goods from their store, make an order by adding item to the cart, and wait for delivery within the agreed time. This ensures conveniences for goods are delivered quickly hence making Alibaba very popular and fast growing industry. The platform for consumers to raise and settle complains at Alibaba, saves a lot of time and energy for both company and consumer.
The absence of literary building as shops that employs dozens of services provider as security guards, cleaners, shop attendants, cashiers, accountants makes Alibaba and other E- commerce companies enjoy a big margin of profit. The cost of maintain the buildings, land rates and accruing insurance substantially withdraws hidden costs, making the transaction cost significantly low. The E- commerce business, unlike the shop offers costumers opportunity to shop 24/7since are functional all times.
Most of business collapse due to lack of proper and speedy communication and transactions. This has mostly been enhanced by the intermediaries who earns more than product owner. The E – commerce has provided a direct interface between the business and the customers. This has not only reduced the cost but also provided a personal touch.
Organizational Strategy
Organizational strategy is the plan set by the organization with the intention of achieving long term goals which is also known as strategic plan. The board of directors and managements creates the strategic plan as they monitor its implementation by middle and lower carder step by step. Henry Mintzberg refers to organizational strategy as a five “p” strategy (Weick, K. E. 1995). plan, pattern, position perspective and ploy.
A good plan leads to a possibility of achieving set goals. The management, therefore, should give with clarity the objectives of the company and the role for each team player. When Jack Ma found Alibaba in 1999, his goal was to put him and China in the world map for the next one hundred and two years. However, he knew can’t live for that long and therefore he planned to sell some shares as well as train Daniel Zhang for period of twelve months (Writer, S. 2018)A good study and evaluation should be conducted on how previous results were achieved so as to come up with a pattern to achieve future results. Successful pattern should be upheld while weak behaviors be excluded in the strategy. The position of Alibaba Group of companies was to be the global leading electronic trading market which was sired at the onset. Jack Ma has been engaging the board of director in order to examine and drive this position. Perspective is the art of evaluating feedback from the targeted customers in order to find how they perceive E-commerce, find out how employees treat its customers as well as how employees regard their boss.
Organizational strategy is drawn from the mission and vision of a company. The mission and vision of a company details why it is in business and every action should be towards fulfilling it. The mission and Vision of Alibaba Group of company is E- commerce that will enable business anywhere in the world. Alibaba is now the leading online and mobile marketing platform for both wholesale and retail trade. It also offers services like cloud computing and data management, digital entertainment, mobile applications, internet communications and mobile operating systems. Alibaba’s vision is to construct infrastructure of e-commerce with aim that all the customers will work, meet and live at Alibaba for over one hundred years.
Organizational strategy should raise a business level strategy that aims on competition, with quality products and services at the lowest cost. Over a period of time , Alibaba has established various units that enhances large customer base. The Juhuasuan, an online buying market place, established in March 2010, provides discounted products monthly. In 2014, it was rated the best online market place for monthly customers.( Che, T.et al. 2015). AliExpress targets retailers globally especially from Russia, Brazil and the United States. It was established in 2010 to facilitate consumers to buy goods and services directly from manufacturers and wholesalers from China at lowest cost (Li, D. January 2016,).
The first level business unit established by Jack Ma was Alibaba.com (Yazdanifard, R., & Li, M. T. H. 2014). This website enables small business to sell their good and services to big companies in other countries. These small producers and manufacturers are majorly based in China, Thailand, the United states and Pakistan.
In September 2009, Alibaba developed another unit known as Alibaba cloud computing( Zhang, G., & Ravishankar, M. N. 2019). It deals with data storing and management in the clouds where one can retrieve data or share across private or public. Alibaba cloud computing platform is one of the global largest E -commerce company that is fairly cheap to individuals, education institutions, financial institutions, small and large businesses and the government.
Organizational strategy in E-commerce should include market level strategy. Market level strategy checks the life span in business community, the growth and development of business and diversity in product and service delivery. The success of Alibaba group of companies can be traced mainly on diversification. In May 2003, Alibaba launched Taobao Marketplace that gave customers a wide range quality products and services, offered conveniently and at fair prices. By 2015, iReserch rated the mobile Taobao App as the best E- commerce application in China (Jung, J. C., & Liow, A. K. 2015). In 2014 again Tmall.com was rated the largest third party E-commerce offering top-quality products.
In November 2007, Alibaba Group of company come up Alimama website to market and sell computer and mobile devices. Alibaba not only focused on selling but also financing individual customers, micro and small businesses who has been royal to the Alibaba group of companies (Ding, D 2018). Cianiao logistics was developed by Alibaba group of company to provide real time information to both service provider and customers. It endeavors to remain relevant in E-commerce through the mobile applications.
Organizational design is the methodology employed to check work flow, institution structures, systems employed in line with the vision and mission of the institution. The systems put in place for E-commerce should be able to adopt current affairs and the new changes in the market. A well established design significantly improves the results. This therefore calls for team work in all levels of management and junior employees in the E-commerce institution. Acceptable behaviors should be set in regard to time management, shift pattern and operation, effective and smooth communication, and decision making.
Organizational design of E-commerce should ensure perfect customer services, lower the cost of operation subsequently increase returns, improve efficiency, cultivate a culture of committed employees who are motivated in their line of duty, and indicators of how to deal with the changing technology. E commerce organizations should periodically review their organizational designs for three main reasons. First, it helps to identify any change inside and outside E-commerce business. In E-commerce, there are pop ups of new technologies, identify rivals and competitors or even change of business law. Secondly, once new goals and strategies have changed, there is need to review organizational design and finally is when the existing design doesn’t work. Below is a checklist of how Alibaba group of companies is able to employ the above aspects in E- commerce.
Jack Ma was only developing as simple platform where the buyers and the sellers would interact online. As technology advanced, he started advertising and marketing those products. He later moved to logistics and financing the enterprises. This has significantly expanded into making Alibaba the most popular E-Commerce. He first used artificial intelligence to date center cooling, machine learning to now know as block chain technology. Alibaba gains customer’s loyalty for it is able to real time update them the location of items by use GPRS.Alibaba has recently paid a very stiff competition to Amazon.com, a united state E-commerce after its pledge to help small business to sell world wide. Amozon has lost about 20 % loyalty due to claims of counterfeit goods (Jung, J. C& Liow, A. K. 2015).
Organizational design in E-commerce has two primary levels; hierarchical and organic. Hierarchal design is further divided into functional structures and divisional structure. Functional structures like marketing, accounting and human resource have distinct roles where senior executive reports to the chief executive officer. Division structure on the other hand, has units that are independent, headed by manager each accountable to the C.E.O.
Organic organization design in E- commerce are the simple structure, matrix organization and network structures. The simple structure ensures the is little no management between employees and the executive. Matrix structure has several levels of department one has to pass to before reaching the executive. Network structure is very flexible in terms of coordination and internal and external affairs of E-commerce business.
Effective organization structure in E- commerce should ensure vision and the mission of the business is achieved. This is done so when the structure defines the role of each employee at all levels that makes it easier to delegate responsibility. Jack Ma had a succession plan of Alibaba from onset. On September 2018 announced to delegate chairmanship to Daniel Zhang (Gilchrist, K. 2019). He recognized the importance of continuity with his absence and so developed a structure that is sustainable.
An effective organization structure helps the E-commerce companies to unify their marketing message. This enables E-commerce to review its ultimate marketing goals and mode of attaining them. Alibaba identified untapped potential in advertising, marketing and logistics electronically. Through unified marketing message, Jack Ma communicated this to his employees and together they have made Alibaba most popular E-commerce company. The structure in Alibaba prepared its employees for any position, upward or downward through trainings.
Organizational Culture
Organizational Culture is the acceptable conduct in the company. E- commerce companies should develop beliefs and values that earns them confidence in customers and loyalty. The E-commerce should not be perceived as a prank where counterfeit products are delivered. The E- commerce institutions should cultivate a culture of proper way of response to any situation and top management should lead through examples.
Cameron, K., & Quinn, R. E. (2016), categorized organizational culture into clan culture, adhocracy culture, the market culture and hierarchy culture. Clan culture advocates collaboration among persons who has a common goal over E-commerce. Each member is a team player who are bounded by norms and tradition that are refreshed through mentorship. Alibaba group of companies established a very good relationship with environment, manufacturers suppliers and customers. The adhocracy culture promotes innovation and creativity. Team players in Alibaba are funded for research in line to come up websites that cope current challenges. The market culture deals with the dynamics of competition and the demands. Jack Ma exploited market culture by putting the objectives clearly to beat all E-commerce companies where all people we buy and live in Alibaba (Cameron, K., & Quinn, R. E. 2016). The hierarchy culture deals with the rules of the organization, processes, structure with the maintenance hierarchy of power.
Strategies of improving E-commerce
E- commerce has shunned all the retail globally by offering wide range of products where customers can review products and services any time of the day. Alibaba group of companies projected that leading E-company where all customer will meet and live in Alibaba.Nevertheless the E-commerce has faced many challenges. The major challenges is the mistrust between customers and the online shopping. Following countless scams, many people question the online business security due to theft, and stealing of credit cards. In other cases, counterfeit products have been delivered or delays in terms of delivery thus dissatisfying the customers. Due to constant improvement of technology and innovation, many websites have been lead obsolete, raising the risk of failure of E-commerce industry. However, these challenges may be addressed in the following ways.
The E-commerce should have the objectives, mission and vision well know. The design and the structure of E-commerce company’s culture should motivate each employee feeling like they own the company. This can be achieved when they are involved in decision making process. The feeling of the ownership of the company reduces mistrust among workers. Workers are motivated to offer the best services and response to customers thus winning customers loyalty, coordination in all levels of E-business.
The E-commerce industry should set grants for any person who brings innovation and creativity in the marketing and advertising, quality and quantity products and services. At any single order, the E-commerce should ensure convenient and legit products. The E-commerce company should hire the best soft and hand wear engineer who ensures the website is up to date. The E-commerce should endeavor to expand the product and services.
References
Cameron, K., & Quinn, R. E. (2016). Organizational culture assessment instrument.
Ceruzzi, P. E. (2012). Computing: a concise history. MIT Press.
Che, T., Peng, Z., Lim, K. H., & Hua, Z. (2015). Antecedents of consumers’ intention to revisit an online group-buying website: A transaction cost perspective. Information & Management, 52(5), 588-598.
Digital Finance, and Inclusion, Volume 1 (pp. 19-35). Academic Press.
Ding, D., Chong, G., Chuen, D. L. K., & Cheng, T. L. (2018). From ant financial to Alibaba’s rural Taobao strategy–how Fintech is transforming social inclusion. In Handbook of Blockchain,
Fessenden, M. (2015, November 30). What was the first thing sold on the internet? Smithsonian Magazine. https://www.smithsonianmag.com/smart-news/what-was-first-thing-sold-internet-180957414/
Gilchrist, K. (2019, October 18). Alibaba’s Jack Ma spent 10 years preparing for his retirement. Retrieved from https://www.cnbc.com/2019/10/18/alibabas-jack-ma-spent-10-years-preparing-for-his-retirement.html
Jung, J. C., Ugboma, M. A., & Liow, A. K. (2015). Does Alibaba’s magic work outside China?. Thunderbird International Business Review, 57(6), 505-518.
Li, D. (2016, January). A Comparative Analysis of B2C Cross-border E-commerce Platforms: the AliExpress and the DHgate. In International Conference on Education, Management, Computer and Society. Atlantis Press.
Weick, K. E. (1995). Sensemaking in organizations (Vol. 3). Sage.
Writer, S. (2018, September 10). Alibaba’s Jack Ma reveals succession plan in letter — full text. Retrieved from https://asia.nikkei.com/Business/Companies/Alibaba-s-Jack-Ma-reveals-succession-plan-in-letter-full-text
Yazdanifard, R., & Li, M. T. H. (2014). The review of Alibaba’ s online business marketing strategies which navigate them to present success. Global Journal of Management and Business Research.
Zhang, D. J., Dai, H., Dong, L., Wu, Q., Guo, L., & Liu, X. (2019). The value of pop-up stores on retailing platforms: Evidence from a field experiment with alibaba. Management Science, 65(11), 5142-5151.
Zhang, G., & Ravishankar, M. N. (2019). Exploring vendor capabilities in the cloud environment: A case study of Alibaba Cloud Computing. Information & Management, 56(3), 343-355. E-COMMERCE ORGANIZATION
Introduction
E-commerce organization is an electronic mean of buying and selling of goods and services electronically using internet base. The transaction of funds and payments for goods and services is cashless for it is done electronically. The E- commerce platforms are restrained to buying and selling if goods and services for social networking is not allowed. E- commerce has benefited all sectors from individuals to mega cooperation, from small and medium enterprises to companies in a manner of identifying goods and service provider easily.
According to Ceruzzi, P. E. (2012). Marijuana was the first item sold electronically in 1972. The Stanford university student in California used the Arpenet platform to sell weed. Twenty two years later, a what is considered a successful and legit E-commerce was done by Dan Kohn (Fessenden, 2015) when he sold Ten Summoner’s Tales disc using a Netmarket website.
There are four types of E-commerce models, namely, business to business, business to customer, customer to customer, and customer to business. Business to business deals company to company with no consumer involved. Business to consumer is where the company electronically sells goods and services to the consumer. The company displays their offers to a website where consumer browses products that includes their real photos, brief description as well as reviews. Thirdly, consumer to consumer is a platform where consumer has a direct with another, trading personal items like in OLX. Finally, there is consumer to business where consumer renders goods and services to the company such as developing and selling a software to the company. Examples o the world wide known E- Commerce networks are Amazon, OLX, eBay, Quikr , upwork and Alibaba. This paper discuses choses to discuss Alibaba company as an example of an Electronic commerce, biased on it history and background, organizational strategy, organizational design and its effectiveness and changes that would improve its operations.
Historical Background
Alibaba is one of the biggest E-commerce in the world, established on 4th April 1999 in China by Jack Ma , Joseph C. Tsai , Cathy Zhang , Trudy Dai et al.Its headquarters are based at Hangzhou, China with over one hundred thousands employees under Daniel Zhang as the chief executive officer. Alibaba is the most popular E-commerce market in the world through Taobao, Tmall and Alibaba.com sites.
E-commerce has a wide range of advantages. E- commerce overcomes the geographical barrier for the transaction platform is virtual without hindrance of location. At any continent, one needs to browse the Alibaba site, search for any goods from their store, make an order by adding item to the cart, and wait for delivery within the agreed time. This ensures conveniences for goods are delivered quickly hence making Alibaba very popular and fast growing industry. The platform for consumers to raise and settle complains at Alibaba, saves a lot of time and energy for both company and consumer.
The absence of literary building as shops that employs dozens of services provider as security guards, cleaners, shop attendants, cashiers, accountants makes Alibaba and other E- commerce companies enjoy a big margin of profit. The cost of maintain the buildings, land rates and accruing insurance substantially withdraws hidden costs, making the transaction cost significantly low. The E- commerce business, unlike the shop offers costumers opportunity to shop 24/7since are functional all times.
Most of business collapse due to lack of proper and speedy communication and transactions. This has mostly been enhanced by the intermediaries who earns more than product owner. The E – commerce has provided a direct interface between the business and the customers. This has not only reduced the cost but also provided a personal touch.
Organizational Strategy
Organizational strategy is the plan set by the organization with the intention of achieving long term goals which is also known as strategic plan. The board of directors and managements creates the strategic plan as they monitor its implementation by middle and lower carder step by step. Henry Mintzberg refers to organizational strategy as a five “p” strategy (Weick, K. E. 1995). plan, pattern, position perspective and ploy.
A good plan leads to a possibility of achieving set goals. The management, therefore, should give with clarity the objectives of the company and the role for each team player. When Jack Ma found Alibaba in 1999, his goal was to put him and China in the world map for the next one hundred and two years. However, he knew can’t live for that long and therefore he planned to sell some shares as well as train Daniel Zhang for period of twelve months (Writer, S. 2018)A good study and evaluation should be conducted on how previous results were achieved so as to come up with a pattern to achieve future results. Successful pattern should be upheld while weak behaviors be excluded in the strategy. The position of Alibaba Group of companies was to be the global leading electronic trading market which was sired at the onset. Jack Ma has been engaging the board of director in order to examine and drive this position. Perspective is the art of evaluating feedback from the targeted customers in order to find how they perceive E-commerce, find out how employees treat its customers as well as how employees regard their boss.
Organizational strategy is drawn from the mission and vision of a company. The mission and vision of a company details why it is in business and every action should be towards fulfilling it. The mission and Vision of Alibaba Group of company is E- commerce that will enable business anywhere in the world. Alibaba is now the leading online and mobile marketing platform for both wholesale and retail trade. It also offers services like cloud computing and data management, digital entertainment, mobile applications, internet communications and mobile operating systems. Alibaba’s vision is to construct infrastructure of e-commerce with aim that all the customers will work, meet and live at Alibaba for over one hundred years.
Organizational strategy should raise a business level strategy that aims on competition, with quality products and services at the lowest cost. Over a period of time , Alibaba has established various units that enhances large customer base. The Juhuasuan, an online buying market place, established in March 2010, provides discounted products monthly. In 2014, it was rated the best online market place for monthly customers.( Che, T.et al. 2015). AliExpress targets retailers globally especially from Russia, Brazil and the United States. It was established in 2010 to facilitate consumers to buy goods and services directly from manufacturers and wholesalers from China at lowest cost (Li, D. January 2016,).
The first level business unit established by Jack Ma was Alibaba.com (Yazdanifard, R., & Li, M. T. H. 2014). This website enables small business to sell their good and services to big companies in other countries. These small producers and manufacturers are majorly based in China, Thailand, the United states and Pakistan.
In September 2009, Alibaba developed another unit known as Alibaba cloud computing( Zhang, G., & Ravishankar, M. N. 2019). It deals with data storing and management in the clouds where one can retrieve data or share across private or public. Alibaba cloud computing platform is one of the global largest E -commerce company that is fairly cheap to individuals, education institutions, financial institutions, small and large businesses and the government.
Organizational strategy in E-commerce should include market level strategy. Market level strategy checks the life span in business community, the growth and development of business and diversity in product and service delivery. The success of Alibaba group of companies can be traced mainly on diversification. In May 2003, Alibaba launched Taobao Marketplace that gave customers a wide range quality products and services, offered conveniently and at fair prices. By 2015, iReserch rated the mobile Taobao App as the best E- commerce application in China (Jung, J. C., & Liow, A. K. 2015). In 2014 again Tmall.com was rated the largest third party E-commerce offering top-quality products.
In November 2007, Alibaba Group of company come up Alimama website to market and sell computer and mobile devices. Alibaba not only focused on selling but also financing individual customers, micro and small businesses who has been royal to the Alibaba group of companies (Ding, D 2018). Cianiao logistics was developed by Alibaba group of company to provide real time information to both service provider and customers. It endeavors to remain relevant in E-commerce through the mobile applications.
Organizational design is the methodology employed to check work flow, institution structures, systems employed in line with the vision and mission of the institution. The systems put in place for E-commerce should be able to adopt current affairs and the new changes in the market. A well established design significantly improves the results. This therefore calls for team work in all levels of management and junior employees in the E-commerce institution. Acceptable behaviors should be set in regard to time management, shift pattern and operation, effective and smooth communication, and decision making.
Organizational design of E-commerce should ensure perfect customer services, lower the cost of operation subsequently increase returns, improve efficiency, cultivate a culture of committed employees who are motivated in their line of duty, and indicators of how to deal with the changing technology. E commerce organizations should periodically review their organizational designs for three main reasons. First, it helps to identify any change inside and outside E-commerce business. In E-commerce, there are pop ups of new technologies, identify rivals and competitors or even change of business law. Secondly, once new goals and strategies have changed, there is need to review organizational design and finally is when the existing design doesn’t work. Below is a checklist of how Alibaba group of companies is able to employ the above aspects in E- commerce.
Jack Ma was only developing as simple platform where the buyers and the sellers would interact online. As technology advanced, he started advertising and marketing those products. He later moved to logistics and financing the enterprises. This has significantly expanded into making Alibaba the most popular E-Commerce. He first used artificial intelligence to date center cooling, machine learning to now know as block chain technology. Alibaba gains customer’s loyalty for it is able to real time update them the location of items by use GPRS.Alibaba has recently paid a very stiff competition to Amazon.com, a united state E-commerce after its pledge to help small business to sell world wide. Amozon has lost about 20 % loyalty due to claims of counterfeit goods (Jung, J. C& Liow, A. K. 2015).
Organizational design in E-commerce has two primary levels; hierarchical and organic. Hierarchal design is further divided into functional structures and divisional structure. Functional structures like marketing, accounting and human resource have distinct roles where senior executive reports to the chief executive officer. Division structure on the other hand, has units that are independent, headed by manager each accountable to the C.E.O.
Organic organization design in E- commerce are the simple structure, matrix organization and network structures. The simple structure ensures the is little no management between employees and the executive. Matrix structure has several levels of department one has to pass to before reaching the executive. Network structure is very flexible in terms of coordination and internal and external affairs of E-commerce business.
Effective organization structure in E- commerce should ensure vision and the mission of the business is achieved. This is done so when the structure defines the role of each employee at all levels that makes it easier to delegate responsibility. Jack Ma had a succession plan of Alibaba from onset. On September 2018 announced to delegate chairmanship to Daniel Zhang (Gilchrist, K. 2019). He recognized the importance of continuity with his absence and so developed a structure that is sustainable.
An effective organization structure helps the E-commerce companies to unify their marketing message. This enables E-commerce to review its ultimate marketing goals and mode of attaining them. Alibaba identified untapped potential in advertising, marketing and logistics electronically. Through unified marketing message, Jack Ma communicated this to his employees and together they have made Alibaba most popular E-commerce company. The structure in Alibaba prepared its employees for any position, upward or downward through trainings.
Organizational Culture
Organizational Culture is the acceptable conduct in the company. E- commerce companies should develop beliefs and values that earns them confidence in customers and loyalty. The E-commerce should not be perceived as a prank where counterfeit products are delivered. The E- commerce institutions should cultivate a culture of proper way of response to any situation and top management should lead through examples.
Cameron, K., & Quinn, R. E. (2016), categorized organizational culture into clan culture, adhocracy culture, the market culture and hierarchy culture. Clan culture advocates collaboration among persons who has a common goal over E-commerce. Each member is a team player who are bounded by norms and tradition that are refreshed through mentorship. Alibaba group of companies established a very good relationship with environment, manufacturers suppliers and customers. The adhocracy culture promotes innovation and creativity. Team players in Alibaba are funded for research in line to come up websites that cope current challenges. The market culture deals with the dynamics of competition and the demands. Jack Ma exploited market culture by putting the objectives clearly to beat all E-commerce companies where all people we buy and live in Alibaba (Cameron, K., & Quinn, R. E. 2016). The hierarchy culture deals with the rules of the organization, processes, structure with the maintenance hierarchy of power.
Strategies of improving E-commerce
E- commerce has shunned all the retail globally by offering wide range of products where customers can review products and services any time of the day. Alibaba group of companies projected that leading E-company where all customer will meet and live in Alibaba.Nevertheless the E-commerce has faced many challenges. The major challenges is the mistrust between customers and the online shopping. Following countless scams, many people question the online business security due to theft, and stealing of credit cards. In other cases, counterfeit products have been delivered or delays in terms of delivery thus dissatisfying the customers. Due to constant improvement of technology and innovation, many websites have been lead obsolete, raising the risk of failure of E-commerce industry. However, these challenges may be addressed in the following ways.
The E-commerce should have the objectives, mission and vision well know. The design and the structure of E-commerce company’s culture should motivate each employee feeling like they own the company. This can be achieved when they are involved in decision making process. The feeling of the ownership of the company reduces mistrust among workers. Workers are motivated to offer the best services and response to customers thus winning customers loyalty, coordination in all levels of E-business.
The E-commerce industry should set grants for any person who brings innovation and creativity in the marketing and advertising, quality and quantity products and services. At any single order, the E-commerce should ensure convenient and legit products. The E-commerce company should hire the best soft and hand wear engineer who ensures the website is up to date. The E-commerce should endeavor to expand the product and services.
References
Cameron, K., & Quinn, R. E. (2016). Organizational culture assessment instrument.
Ceruzzi, P. E. (2012). Computing: a concise history. MIT Press.
Che, T., Peng, Z., Lim, K. H., & Hua, Z. (2015). Antecedents of consumers’ intention to revisit an online group-buying website: A transaction cost perspective. Information & Management, 52(5), 588-598.
Digital Finance, and Inclusion, Volume 1 (pp. 19-35). Academic Press.
Ding, D., Chong, G., Chuen, D. L. K., & Cheng, T. L. (2018). From ant financial to Alibaba’s rural Taobao strategy–how Fintech is transforming social inclusion. In Handbook of Blockchain,
Fessenden, M. (2015, November 30). What was the first thing sold on the internet? Smithsonian Magazine. https://www.smithsonianmag.com/smart-news/what-was-first-thing-sold-internet-180957414/
Gilchrist, K. (2019, October 18). Alibaba’s Jack Ma spent 10 years preparing for his retirement. Retrieved from https://www.cnbc.com/2019/10/18/alibabas-jack-ma-spent-10-years-preparing-for-his-retirement.html
Jung, J. C., Ugboma, M. A., & Liow, A. K. (2015). Does Alibaba’s magic work outside China?. Thunderbird International Business Review, 57(6), 505-518.
Li, D. (2016, January). A Comparative Analysis of B2C Cross-border E-commerce Platforms: the AliExpress and the DHgate. In International Conference on Education, Management, Computer and Society. Atlantis Press.
Weick, K. E. (1995). Sensemaking in organizations (Vol. 3). Sage.
Writer, S. (2018, September 10). Alibaba’s Jack Ma reveals succession plan in letter — full text. Retrieved from https://asia.nikkei.com/Business/Companies/Alibaba-s-Jack-Ma-reveals-succession-plan-in-letter-full-text
Yazdanifard, R., & Li, M. T. H. (2014). The review of Alibaba’ s online business marketing strategies which navigate them to present success. Global Journal of Management and Business Research.
Zhang, D. J., Dai, H., Dong, L., Wu, Q., Guo, L., & Liu, X. (2019). The value of pop-up stores on retailing platforms: Evidence from a field experiment with alibaba. Management Science, 65(11), 5142-5151.
Zhang, G., & Ravishankar, M. N. (2019). Exploring vendor capabilities in the cloud environment: A case study of Alibaba Cloud Computing. Information & Management, 56(3), 343-355. E-COMMERCE ORGANIZATION
Introduction
E-commerce organization is an electronic mean of buying and selling of goods and services electronically using internet base. The transaction of funds and payments for goods and services is cashless for it is done electronically. The E- commerce platforms are restrained to buying and selling if goods and services for social networking is not allowed. E- commerce has benefited all sectors from individuals to mega cooperation, from small and medium enterprises to companies in a manner of identifying goods and service provider easily.
According to Ceruzzi, P. E. (2012). Marijuana was the first item sold electronically in 1972. The Stanford university student in California used the Arpenet platform to sell weed. Twenty two years later, a what is considered a successful and legit E-commerce was done by Dan Kohn (Fessenden, 2015) when he sold Ten Summoner’s Tales disc using a Netmarket website.
There are four types of E-commerce models, namely, business to business, business to customer, customer to customer, and customer to business. Business to business deals company to company with no consumer involved. Business to consumer is where the company electronically sells goods and services to the consumer. The company displays their offers to a website where consumer browses products that includes their real photos, brief description as well as reviews. Thirdly, consumer to consumer is a platform where consumer has a direct with another, trading personal items like in OLX. Finally, there is consumer to business where consumer renders goods and services to the company such as developing and selling a software to the company. Examples o the world wide known E- Commerce networks are Amazon, OLX, eBay, Quikr , upwork and Alibaba. This paper discuses choses to discuss Alibaba company as an example of an Electronic commerce, biased on it history and background, organizational strategy, organizational design and its effectiveness and changes that would improve its operations.
Historical Background
Alibaba is one of the biggest E-commerce in the world, established on 4th April 1999 in China by Jack Ma , Joseph C. Tsai , Cathy Zhang , Trudy Dai et al.Its headquarters are based at Hangzhou, China with over one hundred thousands employees under Daniel Zhang as the chief executive officer. Alibaba is the most popular E-commerce market in the world through Taobao, Tmall and Alibaba.com sites.
E-commerce has a wide range of advantages. E- commerce overcomes the geographical barrier for the transaction platform is virtual without hindrance of location. At any continent, one needs to browse the Alibaba site, search for any goods from their store, make an order by adding item to the cart, and wait for delivery within the agreed time. This ensures conveniences for goods are delivered quickly hence making Alibaba very popular and fast growing industry. The platform for consumers to raise and settle complains at Alibaba, saves a lot of time and energy for both company and consumer.
The absence of literary building as shops that employs dozens of services provider as security guards, cleaners, shop attendants, cashiers, accountants makes Alibaba and other E- commerce companies enjoy a big margin of profit. The cost of maintain the buildings, land rates and accruing insurance substantially withdraws hidden costs, making the transaction cost significantly low. The E- commerce business, unlike the shop offers costumers opportunity to shop 24/7since are functional all times.
Most of business collapse due to lack of proper and speedy communication and transactions. This has mostly been enhanced by the intermediaries who earns more than product owner. The E – commerce has provided a direct interface between the business and the customers. This has not only reduced the cost but also provided a personal touch.
Organizational Strategy
Organizational strategy is the plan set by the organization with the intention of achieving long term goals which is also known as strategic plan. The board of directors and managements creates the strategic plan as they monitor its implementation by middle and lower carder step by step. Henry Mintzberg refers to organizational strategy as a five “p” strategy (Weick, K. E. 1995). plan, pattern, position perspective and ploy.
A good plan leads to a possibility of achieving set goals. The management, therefore, should give with clarity the objectives of the company and the role for each team player. When Jack Ma found Alibaba in 1999, his goal was to put him and China in the world map for the next one hundred and two years. However, he knew can’t live for that long and therefore he planned to sell some shares as well as train Daniel Zhang for period of twelve months (Writer, S. 2018)A good study and evaluation should be conducted on how previous results were achieved so as to come up with a pattern to achieve future results. Successful pattern should be upheld while weak behaviors be excluded in the strategy. The position of Alibaba Group of companies was to be the global leading electronic trading market which was sired at the onset. Jack Ma has been engaging the board of director in order to examine and drive this position. Perspective is the art of evaluating feedback from the targeted customers in order to find how they perceive E-commerce, find out how employees treat its customers as well as how employees regard their boss.
Organizational strategy is drawn from the mission and vision of a company. The mission and vision of a company details why it is in business and every action should be towards fulfilling it. The mission and Vision of Alibaba Group of company is E- commerce that will enable business anywhere in the world. Alibaba is now the leading online and mobile marketing platform for both wholesale and retail trade. It also offers services like cloud computing and data management, digital entertainment, mobile applications, internet communications and mobile operating systems. Alibaba’s vision is to construct infrastructure of e-commerce with aim that all the customers will work, meet and live at Alibaba for over one hundred years.
Organizational strategy should raise a business level strategy that aims on competition, with quality products and services at the lowest cost. Over a period of time , Alibaba has established various units that enhances large customer base. The Juhuasuan, an online buying market place, established in March 2010, provides discounted products monthly. In 2014, it was rated the best online market place for monthly customers.( Che, T.et al. 2015). AliExpress targets retailers globally especially from Russia, Brazil and the United States. It was established in 2010 to facilitate consumers to buy goods and services directly from manufacturers and wholesalers from China at lowest cost (Li, D. January 2016,).
The first level business unit established by Jack Ma was Alibaba.com (Yazdanifard, R., & Li, M. T. H. 2014). This website enables small business to sell their good and services to big companies in other countries. These small producers and manufacturers are majorly based in China, Thailand, the United states and Pakistan.
In September 2009, Alibaba developed another unit known as Alibaba cloud computing( Zhang, G., & Ravishankar, M. N. 2019). It deals with data storing and management in the clouds where one can retrieve data or share across private or public. Alibaba cloud computing platform is one of the global largest E -commerce company that is fairly cheap to individuals, education institutions, financial institutions, small and large businesses and the government.
Organizational strategy in E-commerce should include market level strategy. Market level strategy checks the life span in business community, the growth and development of business and diversity in product and service delivery. The success of Alibaba group of companies can be traced mainly on diversification. In May 2003, Alibaba launched Taobao Marketplace that gave customers a wide range quality products and services, offered conveniently and at fair prices. By 2015, iReserch rated the mobile Taobao App as the best E- commerce application in China (Jung, J. C., & Liow, A. K. 2015). In 2014 again Tmall.com was rated the largest third party E-commerce offering top-quality products.
In November 2007, Alibaba Group of company come up Alimama website to market and sell computer and mobile devices. Alibaba not only focused on selling but also financing individual customers, micro and small businesses who has been royal to the Alibaba group of companies (Ding, D 2018). Cianiao logistics was developed by Alibaba group of company to provide real time information to both service provider and customers. It endeavors to remain relevant in E-commerce through the mobile applications.
Organizational design is the methodology employed to check work flow, institution structures, systems employed in line with the vision and mission of the institution. The systems put in place for E-commerce should be able to adopt current affairs and the new changes in the market. A well established design significantly improves the results. This therefore calls for team work in all levels of management and junior employees in the E-commerce institution. Acceptable behaviors should be set in regard to time management, shift pattern and operation, effective and smooth communication, and decision making.
Organizational design of E-commerce should ensure perfect customer services, lower the cost of operation subsequently increase returns, improve efficiency, cultivate a culture of committed employees who are motivated in their line of duty, and indicators of how to deal with the changing technology. E commerce organizations should periodically review their organizational designs for three main reasons. First, it helps to identify any change inside and outside E-commerce business. In E-commerce, there are pop ups of new technologies, identify rivals and competitors or even change of business law. Secondly, once new goals and strategies have changed, there is need to review organizational design and finally is when the existing design doesn’t work. Below is a checklist of how Alibaba group of companies is able to employ the above aspects in E- commerce.
Jack Ma was only developing as simple platform where the buyers and the sellers would interact online. As technology advanced, he started advertising and marketing those products. He later moved to logistics and financing the enterprises. This has significantly expanded into making Alibaba the most popular E-Commerce. He first used artificial intelligence to date center cooling, machine learning to now know as block chain technology. Alibaba gains customer’s loyalty for it is able to real time update them the location of items by use GPRS.Alibaba has recently paid a very stiff competition to Amazon.com, a united state E-commerce after its pledge to help small business to sell world wide. Amozon has lost about 20 % loyalty due to claims of counterfeit goods (Jung, J. C& Liow, A. K. 2015).
Organizational design in E-commerce has two primary levels; hierarchical and organic. Hierarchal design is further divided into functional structures and divisional structure. Functional structures like marketing, accounting and human resource have distinct roles where senior executive reports to the chief executive officer. Division structure on the other hand, has units that are independent, headed by manager each accountable to the C.E.O.
Organic organization design in E- commerce are the simple structure, matrix organization and network structures. The simple structure ensures the is little no management between employees and the executive. Matrix structure has several levels of department one has to pass to before reaching the executive. Network structure is very flexible in terms of coordination and internal and external affairs of E-commerce business.
Effective organization structure in E- commerce should ensure vision and the mission of the business is achieved. This is done so when the structure defines the role of each employee at all levels that makes it easier to delegate responsibility. Jack Ma had a succession plan of Alibaba from onset. On September 2018 announced to delegate chairmanship to Daniel Zhang (Gilchrist, K. 2019). He recognized the importance of continuity with his absence and so developed a structure that is sustainable.
An effective organization structure helps the E-commerce companies to unify their marketing message. This enables E-commerce to review its ultimate marketing goals and mode of attaining them. Alibaba identified untapped potential in advertising, marketing and logistics electronically. Through unified marketing message, Jack Ma communicated this to his employees and together they have made Alibaba most popular E-commerce company. The structure in Alibaba prepared its employees for any position, upward or downward through trainings.
Organizational Culture
Organizational Culture is the acceptable conduct in the company. E- commerce companies should develop beliefs and values that earns them confidence in customers and loyalty. The E-commerce should not be perceived as a prank where counterfeit products are delivered. The E- commerce institutions should cultivate a culture of proper way of response to any situation and top management should lead through examples.
Cameron, K., & Quinn, R. E. (2016), categorized organizational culture into clan culture, adhocracy culture, the market culture and hierarchy culture. Clan culture advocates collaboration among persons who has a common goal over E-commerce. Each member is a team player who are bounded by norms and tradition that are refreshed through mentorship. Alibaba group of companies established a very good relationship with environment, manufacturers suppliers and customers. The adhocracy culture promotes innovation and creativity. Team players in Alibaba are funded for research in line to come up websites that cope current challenges. The market culture deals with the dynamics of competition and the demands. Jack Ma exploited market culture by putting the objectives clearly to beat all E-commerce companies where all people we buy and live in Alibaba (Cameron, K., & Quinn, R. E. 2016). The hierarchy culture deals with the rules of the organization, processes, structure with the maintenance hierarchy of power.
Strategies of improving E-commerce
E- commerce has shunned all the retail globally by offering wide range of products where customers can review products and services any time of the day. Alibaba group of companies projected that leading E-company where all customer will meet and live in Alibaba.Nevertheless the E-commerce has faced many challenges. The major challenges is the mistrust between customers and the online shopping. Following countless scams, many people question the online business security due to theft, and stealing of credit cards. In other cases, counterfeit products have been delivered or delays in terms of delivery thus dissatisfying the customers. Due to constant improvement of technology and innovation, many websites have been lead obsolete, raising the risk of failure of E-commerce industry. However, these challenges may be addressed in the following ways.
The E-commerce should have the objectives, mission and vision well know. The design and the structure of E-commerce company’s culture should motivate each employee feeling like they own the company. This can be achieved when they are involved in decision making process. The feeling of the ownership of the company reduces mistrust among workers. Workers are motivated to offer the best services and response to customers thus winning customers loyalty, coordination in all levels of E-business.
The E-commerce industry should set grants for any person who brings innovation and creativity in the marketing and advertising, quality and quantity products and services. At any single order, the E-commerce should ensure convenient and legit products. The E-commerce company should hire the best soft and hand wear engineer who ensures the website is up to date. The E-commerce should endeavor to expand the product and services.
References
Cameron, K., & Quinn, R. E. (2016). Organizational culture assessment instrument.
Ceruzzi, P. E. (2012). Computing: a concise history. MIT Press.
Che, T., Peng, Z., Lim, K. H., & Hua, Z. (2015). Antecedents of consumers’ intention to revisit an online group-buying website: A transaction cost perspective. Information & Management, 52(5), 588-598.
Digital Finance, and Inclusion, Volume 1 (pp. 19-35). Academic Press.
Ding, D., Chong, G., Chuen, D. L. K., & Cheng, T. L. (2018). From ant financial to Alibaba’s rural Taobao strategy–how Fintech is transforming social inclusion. In Handbook of Blockchain,
Fessenden, M. (2015, November 30). What was the first thing sold on the internet? Smithsonian Magazine. https://www.smithsonianmag.com/smart-news/what-was-first-thing-sold-internet-180957414/
Gilchrist, K. (2019, October 18). Alibaba’s Jack Ma spent 10 years preparing for his retirement. Retrieved from https://www.cnbc.com/2019/10/18/alibabas-jack-ma-spent-10-years-preparing-for-his-retirement.html
Jung, J. C., Ugboma, M. A., & Liow, A. K. (2015). Does Alibaba’s magic work outside China?. Thunderbird International Business Review, 57(6), 505-518.
Li, D. (2016, January). A Comparative Analysis of B2C Cross-border E-commerce Platforms: the AliExpress and the DHgate. In International Conference on Education, Management, Computer and Society. Atlantis Press.
Weick, K. E. (1995). Sensemaking in organizations (Vol. 3). Sage.
Writer, S. (2018, September 10). Alibaba’s Jack Ma reveals succession plan in letter — full text. Retrieved from https://asia.nikkei.com/Business/Companies/Alibaba-s-Jack-Ma-reveals-succession-plan-in-letter-full-text
Yazdanifard, R., & Li, M. T. H. (2014). The review of Alibaba’ s online business marketing strategies which navigate them to present success. Global Journal of Management and Business Research.
Zhang, D. J., Dai,bbb H., Dong, L., Wu, Q., Guo, L., & Liu, X. (2019). The value of pop-up stores on retailing platforms: Evidence from a field experiment with alibaba. Management Science, 65(11), 5142-5151.
Zhang, G., & Ravishankar, M. N. (2019). Exploring vendor capabilities in the cloud environment: A case study of Alibaba Cloud Computing. Information & Management, 56(3), 343-355.vv According to Ceruzzi, P. E. (2012). Marijuana was the first item sold electronically in 1972. The Stanford university student in California used the Arpenet platform to sell weed. Twenty two years later, a what is considered a successful and legit E-commerce was done by Dan Kohn (Fessenden, 2015) when he sold Ten Summoner’s Tales disc using a Netmarket website.
There are four types of E-commerce models, namely, business to business, business to customer, customer to customer, and customer to business. Business to business deals company to company with no consumer involved. Business to consumer is where the company electronically sells goods and services to the consumer. The company displays their offers to a website where consumer browses products that includes their real photos, brief description as well as reviews. Thirdly, consumer to consumer is a platform where consumer has a direct with another, trading personal items like in OLX. Finally, there is consumer to business where consumer renders goods and services to the company such as developing and selling a software to the company. Examples o the world wide known E- Commerce networks are Amazon, OLX, eBay, Quikr , upwork and Alibaba. This paper discuses choses to discuss Alibaba company as an example of an Electronic commerce, biased on it history and background, organizational strategy, organizational design and its effectiveness and changes that would improve its operations.
Historical Background
Alibaba is one of the biggest E-commerce in the world, established on 4th April 1999 in China by Jack Ma , Joseph C. Tsai , Cathy Zhang , Trudy Dai et al.Its headquarters are based at Hangzhou, China with over one hundred thousands employees under Daniel Zhang as the chief executive officer. Alibaba is the most popular E-commerce market in the world through Taobao, Tmall and Alibaba.com sites.
E-commerce has a wide range of advantages. E- commerce overcomes the geographical barrier for the transaction platform is virtual without hindrance of location. At any continent, one needs to browse the Alibaba site, search for any goods from their store, make an order by adding item to the cart, and wait for delivery within the agreed time. This ensures conveniences for goods are delivered quickly hence making Alibaba very popular and fast growing industry. The platform for consumers to raise and settle complains at Alibaba, saves a lot of time and energy for both company and consumer.
The absence of literary building as shops that employs dozens of services provider as security guards, cleaners, shop attendants, cashiers, accountants makes Alibaba and other E- commerce companies enjoy a big margin of profit. The cost of maintain the buildings, land rates and accruing insurance substantially withdraws hidden costs, making the transaction cost significantly low. The E- commerce business, unlike the shop offers costumers opportunity to shop 24/7since are functional all times.
Most of business collapse due to lack of proper and speedy communication and transactions. This has mostly been enhanced by the intermediaries who earns more than product owner. The E – commerce has provided a direct interface between the business and the customers. This has not only reduced the cost but also provided a personal touch.
Organizational Strategy
Organizational strategy is the plan set by the organization with the intention of achieving long term goals which is also known as strategic plan. The board of directors and managements creates the strategic plan as they monitor its implementation by middle and lower carder step by step. Henry Mintzberg refers to organizational strategy as a five “p” strategy (Weick, K. E. 1995). plan, pattern, position perspective and ploy.
A good plan leads to a possibility of achieving set goals. The management, therefore, should give with clarity the objectives of the company and the role for each team player. When Jack Ma found Alibaba in 1999, his goal was to put him and China in the world map for the next one hundred and two years. However, he knew can’t live for that long and therefore he planned to sell some shares as well as train Daniel Zhang for period of twelve months (Writer, S. 2018)A good study and evaluation should be conducted on how previous results were achieved so as to come up with a pattern to achieve future results. Successful pattern should be upheld while weak behaviors be excluded in the strategy. The position of Alibaba Group of companies was to be the global leading electronic trading market which was sired at the onset. Jack Ma has been engaging the board of director in order to examine and drive this position. Perspective is the art of evaluating feedback from the targeted customers in order to find how they perceive E-commerce, find out how employees treat its customers as well as how employees regard their boss.
Organizational strategy is drawn from the mission and vision of a company. The mission and vision of a company details why it is in business and every action should be towards fulfilling it. The mission and Vision of Alibaba Group of company is E- commerce that will enable business anywhere in the world. Alibaba is now the leading online and mobile marketing platform for both wholesale and retail trade. It also offers services like cloud computing and data management, digital entertainment, mobile applications, internet communications and mobile operating systems. Alibaba’s vision is to construct infrastructure of e-commerce with aim that all the customers will work, meet and live at Alibaba for over one hundred years.
Organizational strategy should raise a business level strategy that aims on competition, with quality products and services at the lowest cost. Over a period of time , Alibaba has established various units that enhances large customer base. The Juhuasuan, an online buying market place, established in March 2010, provides discounted products monthly. In 2014, it was rated the best online market place for monthly customers.( Che, T.et al. 2015). AliExpress targets retailers globally especially from Russia, Brazil and the United States. It was established in 2010 to facilitate consumers to buy goods and services directly from manufacturers and wholesalers from China at lowest cost (Li, D. January 2016,).
The first level business unit established by Jack Ma was Alibaba.com (Yazdanifard, R., & Li, M. T. H. 2014). This website enables small business to sell their good and services to big companies in other countries. These small producers and manufacturers are majorly based in China, Thailand, the United states and Pakistan.
In September 2009, Alibaba developed another unit known as Alibaba cloud computing( Zhang, G., & Ravishankar, M. N. 2019). It deals with data storing and management in the clouds where one can retrieve data or share across private or public. Alibaba cloud computing platform is one of the global largest E -commerce company that is fairly cheap to individuals, education institutions, financial institutions, small and large businesses and the government.
Organizational strategy in E-commerce should include market level strategy. Market level strategy checks the life span in business community, the growth and development of business and diversity in product and service delivery. The success of Alibaba group of companies can be traced mainly on diversification. In May 2003, Alibaba launched Taobao Marketplace that gave customers a wide range quality products and services, offered conveniently and at fair prices. By 2015, iReserch rated the mobile Taobao App as the best E- commerce application in China (Jung, J. C., & Liow, A. K. 2015). In 2014 again Tmall.com was rated the largest third party E-commerce offering top-quality products.
In November 2007, Alibaba Group of company come up Alimama website to market and sell computer and mobile devices. Alibaba not only focused on selling but also financing individual customers, micro and small businesses who has been royal to the Alibaba group of companies (Ding, D 2018). Cianiao logistics was developed by Alibaba group of company to provide real time information to both service provider and customers. It endeavors to remain relevant in E-commerce through the mobile applications.
Organizational design is the methodology employed to check work flow, institution structures, systems employed in line with the vision and mission of the institution. The systems put in place for E-commerce should be able to adopt current affairs and the new changes in the market. A well established design significantly improves the results. This therefore calls for team work in all levels of management and junior employees in the E-commerce institution. Acceptable behaviors should be set in regard to time management, shift pattern and operation, effective and smooth communication, and decision making.
Organizational design of E-commerce should ensure perfect customer services, lower the cost of operation subsequently increase returns, improve efficiency, cultivate a culture of committed employees who are motivated in their line of duty, and indicators of how to deal with the changing technology. E commerce organizations should periodically review their organizational designs for three main reasons. First, it helps to identify any change inside and outside E-commerce business. In E-commerce, there are pop ups of new technologies, identify rivals and competitors or even change of business law. Secondly, once new goals and strategies have changed, there is need to review organizational design and finally is when the existing design doesn’t work. Below is a checklist of how Alibaba group of companies is able to employ the above aspects in E- commerce.
Jack Ma was only developing as simple platform where the buyers and the sellers would interact online. As technology advanced, he started advertising and marketing those products. He later moved to logistics and financing the enterprises. This has significantly expanded into making Alibaba the most popular E-Commerce. He first used artificial intelligence to date center cooling, machine learning to now know as block chain technology. Alibaba gains customer’s loyalty for it is able to real time update them the location of items by use GPRS.Alibaba has recently paid a very stiff competition to Amazon.com, a united state E-commerce after its pledge to help small business to sell world wide. Amozon has lost about 20 % loyalty due to claims of counterfeit goods (Jung, J. C& Liow, A. K. 2015).
Organizational design in E-commerce has two primary levels; hierarchical and organic. Hierarchal design is further divided into functional structures and divisional structure. Functional structures like marketing, accounting and human resource have distinct roles where senior executive reports to the chief executive officer. Division structure on the other hand, has units that are independent, headed by manager each accountable to the C.E.O.
Organic organization design in E- commerce are the simple structure, matrix organization and network structures. The simple structure ensures the is little no management between employees and the executive. Matrix structure has several levels of department one has to pass to before reaching the executive. Network structure is very flexible in terms of coordination and internal and external affairs of E-commerce business.
Effective organization structure in E- commerce should ensure vision and the mission of the business is achieved. This is done so when the structure defines the role of each employee at all levels that makes it easier to delegate responsibility. Jack Ma had a succession plan of Alibaba from onset. On September 2018 announced to delegate chairmanship to Daniel Zhang (Gilchrist, K. 2019). He recognized the importance of continuity with his absence and so developed a structure that is sustainable.
An effective organization structure helps the E-commerce companies to unify their marketing message. This enables E-commerce to review its ultimate marketing goals and mode of attaining them. Alibaba identified untapped potential in advertising, marketing and logistics electronically. Through unified marketing message, Jack Ma communicated this to his employees and together they have made Alibaba most popular E-commerce company. The structure in Alibaba prepared its employees for any position, upward or downward through trainings.
Organizational Culture
Organizational Culture is the acceptable conduct in the company. E- commerce companies should develop beliefs and values that earns them confidence in customers and loyalty. The E-commerce should not be perceived as a prank where counterfeit products are delivered. The E- commerce institutions should cultivate a culture of proper way of response to any situation and top management should lead through examples.
Cameron, K., & Quinn, R. E. (2016), categorized organizational culture into clan culture, adhocracy culture, the market culture and hierarchy culture. Clan culture advocates collaboration among persons who has a common goal over E-commerce. Each member is a team player who are bounded by norms and tradition that are refreshed through mentorship. Alibaba group of companies established a very good relationship with environment, manufacturers suppliers and customers. The adhocracy culture promotes innovation and creativity. Team players in Alibaba are funded for research in line to come up websites that cope current challenges. The market culture deals with the dynamics of competition and the demands. Jack Ma exploited market culture by putting the objectives clearly to beat all E-commerce companies where all people we buy and live in Alibaba (Cameron, K., & Quinn, R. E. 2016). The hierarchy culture deals with the rules of the organization, processes, structure with the maintenance hierarchy of power.
Strategies of improving E-commerce
E- commerce has shunned all the retail globally by offering wide range of products where customers can review products and services any time of the day. Alibaba group of companies projected that leading E-company where all customer will meet and live in Alibaba.Nevertheless the E-commerce has faced many challenges. The major challenges is the mistrust between customers and the online shopping. Following countless scams, many people question the online business security due to theft, and stealing of credit cards. In other cases, counterfeit products have been delivered or delays in terms of delivery thus dissatisfying the customers. Due to constant improvement of technology and innovation, many websites have been lead obsolete, raising the risk of failure of E-commerce industry. However, these challenges may be addressed in the following ways.
The E-commerce should have the objectives, mission and vision well know. The design and the structure of E-commerce company’s culture should motivate each employee feeling like they own the company. This can be achieved when they are involved in decision making process. The feeling of the ownership of the company reduces mistrust among workers. Workers are motivated to offer the best services and response to customers thus winning customers loyalty, coordination in all levels of E-business.
The E-commerce industry should set grants for any person who brings innovation and creativity in the marketing and advertising, quality and quantity products and services. At any single order, the E-commerce should ensure convenient and legit products. The E-commerce company should hire the best soft and hand wear engineer who ensures the website is up to date. The E-commerce should endeavor to expand the product and services.
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