Alibaba Group Holding Ltd.: Challenges and Strategies

ALIBABA GROUP HOLDING LTD
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Alibaba Group Holding Ltd is a Chinese multinational conglomerate involved in e-commerce, technology, the internet, and retail. Established in 1999 by Jack Ma, Alibaba operates an extensive set of businesses in different sectors, such as media and entertainment, cloud computing, retail, and finance. The firm's businesses are organised into four main segments comprising core commerce, digital media, cloud computing, entertainment, and innovation initiatives (Nazir et al., 2020). The core commerce business includes Taobao Marketplace, Tmall, and Alibaba.com, all leading online marketplaces in China. Alibaba's cloud computing business provides a suite of cloud-based products and facilities, including data storage, computing, and analytics (Kratz et al., 2020). Alibaba's innovation initiatives comprise AliExpress, an online marketplace for international trade, and Cainiao, a logistics and delivery platform (Sciaudone, 2018). This discussion conducts a detailed analysis of the company to detect multiple challenges facing its leadership to suggest viable remedies to the strain
Despite its impressive growth, Alibaba Group faces multiple challenges. Among the strains are counterfeits. The entity has been criticised for selling counterfeit goods on its platforms. In 2017, the U.S. Trade Representative added Alibaba Group to its "Notorious Markets" list. These products are often of inferior quality and can be dangerous. The business world criticises the entity for not putting adequate models in place to stop the sale of counterfeit products on its platforms. In 2015, Alibaba launched a programme to fight counterfeit goods called the "Good Faith Programme." The model requires sellers to submit proof that their products are genuine (Chen, 2016). Alibaba also works with brands to help them identify and take down listings for counterfeit goods. Also, the firm invests in technology to better identify and remove counterfeit listings and works with brands to remove infringing content.
The issue of counterfeits at Alibaba Group Holding Ltd impacts the company's leadership in a few ways. This strain erodes consumer trust in the company and its products (Chow, 2019). The instance can lead to decreased sales and revenue and damage the company's reputation. Besides, the situation leads to legal issues and penalties, as selling counterfeit goods is often illegal. Finally, the strain creates tension and conflict within the company, as the leadership may disagree on how to deal with the issue or may be accused of participating in the sale of counterfeit goods.
The other core problem is piracy. A significant example of this strain is the organisational sale of pirated content (Costa, 2020). The firm is accused of selling pirated movies, music, and software on its platform. In 2015, the US government reported that Alibaba's websites "facilitated and promoted" the sale of pirated content. Alibaba has also been accused of selling pirated books. Alibaba has also been accused of trademark infringement. In 2016, Alibaba was sued by Gucci for selling counterfeit products on its platform. Alibaba has also been accused of selling products that infringe on other brands' trademarks. The above issue threatens business models by undermining the trust between the company, small businesses, and individual sellers.
Regulatory scrutiny refers to a critical matter for the international entity. Alibaba Group is subject to increasing regulatory scrutiny in China and other markets. The company has recently faced increased regulatory scrutiny (Oxford Analytica, 2021). In 2016, Alibaba was fined $2.75 billion by the State Administration for Industry and Commerce (SAIC) for violating anti-monopoly laws. The SAIC found that Alibaba had been preventing merchants from using other e-commerce platforms and using its market dominance to pressure them into exclusive deals. Alibaba has also been criticised for its lax attitude toward counterfeit goods. In 2015, the US Office of the Trade Representative (USTR) placed Alibaba on its "Notorious Markets" list, citing the company's "widespread availability of pirated and counterfeit goods." The USTR estimated that up to 90% of the goods sold on Alibaba's Taobao platform were counterfeit.
The issue of regulatory scrutiny at Alibaba Group Holding Ltd impacts the leadership in several ways. First, the increased scrutiny may make it difficult for the company to continue to grow at the same pace as it has in the past. This situation could limit the ability of Alibaba to invest in new businesses and expand its reach into new markets (Laband, 2021). Additionally, the increased scrutiny could lead to more stringent regulation of the company's business practices, which could hamper its ability to compete effectively (Fried and Kamar, 2021). Finally, the increased scrutiny could damage the company's reputation, making it harder for Alibaba to attract and retain top talent.
Max Weber's Bureaucratic Management theory can be used to understand the issue of counterfeits at Alibaba Group Holding Ltd. This perspective supports the idea of a clear hierarchy and division of labour in business (Drechsler, 2020). Besides, everyone must follow an outline of set rules and regulations. This idea can be used to understand how Alibaba deals with counterfeits. Alibaba has a clear hierarchy. The system comprises the Alibaba Group, its parent company, and various subsidiaries, such as Taobao. Also, each subsidiary has its own set of rules and regulations. For example, Taobao does not allow counterfeit goods to be sold on its platform. Tmall has multiple rules and is more lenient regarding counterfeit goods. Alibaba also has a clear division of labour. There are different teams responsible for different aspects of the business. For example, there is a team responsible for monitoring the sale of counterfeit goods. This team is responsible for investigating complaints and taking action against sellers who are selling counterfeit goods.
Elton Mayo's human relations theory on business states that businesses should focus on the human element in the workplace to improve productivity and motivation (Omolawal, 2021). This perspective further supposes that workers were more productive when they felt their work was valued and they had a good relationship with their supervisors (Bendix and Fisher, 2017). The idea can be used to understand the piracy issue at Alibaba Group Holding Ltd. by looking at how the company's employees interact with each other and with customers. By understanding how these relationships work, it is possible to identify areas where there may be potential for conflict or where there may be opportunities for improvement.
Frederick Taylor's Scientific Management idea on business posits that there is an optimal way to complete any task. A major principle of the perspective is that work should be divided into small, simple tasks (Turan, 2015). The idea supports that by analysing and understanding the task at hand, organisations ca...