Curated by Alibaba Business School
Source: Hupan University
Entrepreneurs often face loneliness. They try not to talk about the company’s business with their families because they are afraid that their families will worry about them. What happened at home can’t be brought back to the company, because all the employees who go forward with you also have conflicts between life and work.
During the Spring Festival, family members get together and celebrate, but how to solve the loneliness in a CEO’s heart?
Lucy Peng , Co-Founder and partner of Alibaba, shared with the participants at Hupan University how CEOs often face the “dark moments” and loneliness like few others.
That Moment of Crying on Each Other’s Shoulders**
In 2010, I was asked by Jack Ma to take over Alipay. At that moment, the biggest complaint to Alipay was its bad user experience. How could we translate user experiences to KPIs so that we could solve them?
We could assess the eCommerce business by the number of orders, 2nd time purchase rates and transactions just as the catering business assessed by “table turnover rate”. They are all about user activity. If we viewed from this angle, the user number of Alipay at that moment was already really a big amount, everyone would use Alipay so long as they bought from Taobao. Therefore, I raised two questions to my team:
- If we connect China Union Pay to Taobao, would people still use Alipay? What is our core advantage or unique value?
How do we translate user experience to the words that everyone can understand and can be measured as KPI?
We finally concluded the best metric for measurement would be the success rate of payment. This should be the KPI to solve the problem of whether users can use Alipay and use it well. We also needed to solve the problem of whether people dare to use Alipay. So we put forward the idea of “If you dare to use Alipay, we dare to pay any loss”. Solving these 2 problems then became the 2 strategic targets of Alipay. All the KPIs were set based on these 2 targets. I didn’t care about total transactions volume but only the sense of security and payment success rate. Only after solving these 2 problems, the user activity would become meaningful.
I would prefer 100 users with only 100 RMB transactions per day rather than 1 user with 100 million RMB transaction. This is the fundamental difference between a 2C business and 2B business. It was the problem of direction. So we set 2 KPIs, one is 80% success rate of payment, the other is 200 million users use Alipay at least 3 times per year.
And how should we build the organization to match the strategic target? Although the collocation of HR and CEO was important, CEO should always lead HR’s job. Organization building should always serve the strategic target. CEO should be ‘hermaphrodite’, or the combination of Yin and Yang in Chinese, which means CEO has to think about the business direction as well as how to build team.
After taking over Alipay in 2010, half of the original staff have to transfer their job or leave the company in order to serve the strategic goal. It was a painful process because there were many familiar colleagues and friends among them. But I didn’t have a choice since the strategic goal was set. **As a leader, I had to stay kind but be decisive, to ask them leave with gratitude**. It might not be good to keep him, even more unfair for those capable colleagues. We should let them go since we feel we are not suitable for each other. At that time, after firing each person, we would drink and cry on each other’s shoulder.
Now, it’s very simple to bind any bank card to Alipay. But it was a big trouble at that time. We had to negotiate with every bank. The biggest amount of indemnity we paid was more than 1 million RMB which was caused by fraudulent use of credit card. And we decided to pay. We paid not only in order to build credit to our users, but also to push our risk control team to improve our capability. Today, we are able let our users buy 1 million RMB insurance with the cost of only 1.8 RMB. Our ability today was built from that time.
Three tactics to fight off loneliness**
Being a CEO means loneliness. You can’t fall, because there is either no one behind or too many people behind. The CEO’s every action needs to be accountable for employees, shareholders, customers, the market and even his or her family. However, he or she cannot find anyone to discuss with when facing uncertainty.
Thinking back the KPIs I set for my team 8 years ago - Alipay needed to be easy to use, be secure with high payment success rate and at the same time grow its user base. These KPIs were challenging how far my team and I could go. These challenges created loneliness.
To live with the loneliness is to discover yourself. What am I working on? Why should I be working on this? What value is this going to add to my life and the life of the people around me?
**
These are the questions we need to think about. If there is no clear answer, there is no reason or hope that would light up the darkness, we would be chasing the unknown endlessly in the dark.
I have a few practical tactics that may help entrepreneurs to fight off loneliness.
1- Set Yourself Free. The ones that tend to survive on the battle field are not those with the best techniques but those who are fearless. Overthinking is one’s worst enemy. Therefore, when making business decisions, once you are clear about your goal, you need to charge ahead and realize it.
Give yourself a break every now and then. For example, you are allowed to get angry in front of your team. It is also ok to do something unusual with the team to help yourself and the team to relax.
2- Be optimistic and always believe in the future. I have always been inspired by the last paragraph in Gone with the Wind - Tomorrow is another day. You need to believe in the direction you set for your company, organisation and team despite and hiccups you may be experiencing.
Keep telling yourself things will be better tomorrow, next week or next month.
3- Enjoy your hobby and life. Entrepreneurs often think about their startups 24/7 and find it difficult to stop and enjoy the beauty of life.
Do try to lose yourself in doing things you enjoy other than work. Jack finds his passion and distraction in singing, painting, acting and playing magic.
The core management team needs to be open and trustworthy**
Many startup entrepreneurs and company leaders are concerned about whether they can make friends with their subordinates. In fact, CEO is destined to be lonely. The bigger the company is, the lonelier it is. It’s hard to be friends with subordinates, with whom you can share everything. When CEO interacts with team, the sense of friendship and distance need to be balanced.
People also asked me, isn’t Jack Ma like a friend to you? In fact, for us, Jack Ma is not only the leader, but also the big brother, and part of it is friend. Many roles are intertwined. We can drink, play cards and fight together, but as the soul of the company, Jack Ma expects more of subordinates than friends.
So, first of all, there is an important precondition for building a core team: we don’t join Alibaba to make friends, but because we share the same mission, vision and values. I don’t agree that you join someone only because of your appreciation but not because the thing ongoing is reliable and exactly what you want.
Secondly, a feeling of trust between the core team members is very important.** **For example, when you appoint someone to do something, it’s the greatest trust. Drinking together and team building can bring each other closer, but more importantly, we need to develop our team by leading and fighting together. Trust can’t be forced.
Thirdly, there should be no barriers between you and the core team. If you feel that someone has a negative influence on the team, you must find out why and how to solve it.
For example, once a Hupan University entrepreneur spoke of one person when talked about the team. He said that this person was very good, but just could not get along with others, which made him overcautious when making decisions because of this person’s presence. He even blamed himself for not giving full play to that person’s ability. I appreciate his ability of introspection, but it will become self-defeating over time.
A CEO must be prepared to restructure the team at any time, so that the team members can keep up with your strategy, and to ensure that the team has high morale. It’s a process which is quite exhausting and never stops.
Finally, you need to understand what is your own bottom line, assess what is irritating, what is stumbling block, and to what extend you can barely accept. Only when you work it out and you won’t be so prone to the anxiety of getting along with the team.
Keep the bottom line, stay kind but decisive**
Over these years, people in Alibaba have come and gone, and every story bears blood and tears behind.
Looking back, Jack has also experienced such time before. In the early days of Alibaba, branch offices were set up in both Silicon Valley and Hong Kong, China. However around 2002, the Internet bubble burst. At that time, we were not even profitable yet. So when we were about to run out of money, we had to stop burning.
The rents and cost of human capital in Silicon Valley and Hong Kong were the most expensive, so the branches in these two places must be shut down, and we had to fire many good talent, which was quite sad. I still remember on the New Year Eve that year, Jack asked a colleague on the phone that, “Do you think I am a bad person?” Even people with such a strong heart would ask questions like that. The entrepreneur is lonely during the darkest moments. But they have to face the moment by themselves.
It is because of the dream of innovating technology that makes everyone gather together. However they happened to encounter the issue of a broken cash flow of the company. When the CEO made the decision of dissolving the company, he faced so many tortures toward his soul that he started to question himself from the bottom of his heart.
That’s why I’m asking, what is the bottom line you have to keep? When facing complicated and difficult situations, will you able to come across these obstacles? These are very important tasks and practices for CEOs.
Sometimes, maybe there are people who can help you, but most of the time, you can only grit your teeth to find the answer in the dark, and keep telling yourself like repeating a mantra, this is the best decision I can make now. Even after ten or twenty years, looking back at that moment, you can still say, under that situation, with my capability, vision and resources, I have tried my best.
Alibaba Business School’s vision is to empower entrepreneurs, women and youth globally through the education and training programs on the digital economy and the benefits it brings to larger society.
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