Curated by Alibaba Business School
From: Hupan University

Those who intend to build a platform from day one would usually fail

The first thing to consider is who your customers are and what value you can bring to them. This is a very important point to consider when defining a new business. The more specific the definition is, the smoother the business strategy landing will be. It will be difficult to discuss the pain points if the customer portrait is not clear. After doing a platform for a long time, it is easy to lose yourself and forget the original intention. Those who intend to build a platform from day one would usually fail.

When discussing business design, there are three aspects that need to be considered first in order to choose a suitable track for the company.

1) We must focus on customer value and assess how universal the customer value is. This is the most critical issue. Once the company has set the track and started charging ahead, it will be difficult to change the track. For at least one cycle, entrepreneurs should focus on one industry or one category at a time, those who make cars focus on cars, and those who provide education service focus on education. All ventures would evolve with time if stay focused. However, the main business must be clear. How big the customer group is depends on how many pain points you are solving, and how much market potential there is behind it.

2) When discussing who the customers are, it is important to go beyond that and cover what services and value can be provided, and whether the coverage of the customers is wide enough. Jack Ma has said many times: the greater the pain point is, the greater the opportunity is. To find a track in business design, we must first dig deep and research the pain points. Is the pain point a real pain? If it is just superficial pain, the barrier for entry will be very low, and no core value can be established for customers. It is also important to think about whether these pain points are universal. Do enough people experience these pains? Can I solve his problem? These are the keys to business design.

3) Apart from looking for different ways to solve customer pain points, either using technological innovation, or commercial innovation, or a combination of the two, we also need to look at the existing players in the market who can address the same pain points. If someone is addressing it, or someone has already addressed part of it, and it has been addressed very well, it doesn’t make much sense to do it again. Does your solution have enough market advantage? If the answer is no, even if your business pitch deck has been distributed all over the world and people have bought into it, you should not do it.

There are two ways to choose the track:

One is vertical integration which is to connect the various roles and businesses along the value chain from the supply chain and production on the upstream side to market on the downstream side;

The other is horizontal extension which is to expand your foot print from one province to the next and one country to the next. These are important decisions, and these decisions can determine the fate of your company.

For example, if Alibaba wants to send employees to Southeast Asia, which is a typical practice of horizontal extension of globalization, the individuals and families’ life path will be changed. The impact on their life, their children’s education and even personal career development will be very significant. These are personal factors which will affect the decision making.

The so-called “no regret” decisions must be the primary responsibility of the top leader. If not me, who? If not now, when? It is impossible for others to do it for you. In the process, it is necessary to maintain strategic focus. The market is dynamic. That’s why we should look not only at ourselves, but also at the existing and emerging players in the market, what everyone is doing and what is evolving. These changes will definitely affect our own judgment, the track we choose and the business designs.

Perhaps due to my personality, I often remind my team to stay strategically focused and not be driven by anxiety. Business track, customer pain points and scale are all dynamic variables that can evolve over time. The entire world is also evolving dynamically. Not only you are playing in this field, others also. How to avoid interference or influence from the market factors? How can you find something unique in your offering? What matters the most in the decision making process is strategic focus.

I often remind my team that when the business cannot find a strategic direction due to various factors such as future breakthrough points or competition related challenges, do not try to solve the problem through co-creation workshops. The co-creation workshops are not for making strategic decisions. It is only good for people to get to know each other and connect with each other.

My original quote was that attempting to create a company strategy through co-creation workshops is a sign of the top leader being incompetent. If the top leader is not sure which track to choose, how to define customer value or how to design a business model, and expect the team to sit down and create it together through discussion, you will often hear people expressing their emotions without coming to an actionable conclusion.

Solving practical problems relies on calm thinking, judgment, and decision making based on the determination and vision of the leaders. You may wonder if there are elements of gambling here? The answer is of course - my experience tells me that to make a big decision, there bound to be some rational elements, but the decision that determines the fate of a company can only be made by the top leader. This is another “no regret” moment, the decision you make determines the fate of the company.

In the early days of Taobao, eBay charged the sellers based on the number of items uploaded onto the platform. The sellers uploaded a product, and they didn’t know if they could sell it or not. They had to pay a few cents per item per day, and everyone was reluctant. At that time, Jack Ma made a decision, as a general rule, if eBay thinks it is right, we will be against it, and if eBay thinks it is wrong, we will support it.

It may sound funny. I think this is a very good approach when facing a strong competitor in the market. Maybe the truth is in the hands of a few people, but this is only true if you can find a way to survive. If you couldn’t find a way, it is not true. If you want to compete in the market, and your competitors are so strong, you have to go the opposite way to your competitor to create new opportunities,

Doing business design under fierce market competition needs to follow the theory of relativity. What differentiation do you have compared to your competitors? If there is no differentiation, no matter how hard you work, it is useless. You can’t assume that others are running slower than you and lazier than you. You have to assume that others are smarter, more diligent, stronger in execution, and further ahead than you. What should you do in this circumstance? The only way to survive is to differentiate.

Two Sustainability During The Business Design: The sustainability of customer value and cost efficiency

From the perspective of historical cycle, when an enterprise has been operating for a while, as the society and technology develop with time, we should consider whether the customer value will become weaken，which is very likely to happen.

We must avoid falling into the trap of repeating what worked in the past. I always remind the Alibaba teams: if a business was created to address issues around information asymmetry, it will disappear in the future. Today we are in an era of information abundance rather than scarcity. If a business model that only solves information asymmetry issue, it will eventually disappear. Before that happens, we’ll need to find an opportunity to redefine the customer values, and consider whether to take extreme measure to re-start the business or continue to do what you have been doing just to survive.

During the business evolution, you have to continuously explore the customer value. The most dangerous thing is that you believe the customer value will stay the same as what it was when you started the business. In other words, we do the business in this way because we have always been doing it. I am personally strongly against this idea. Businesses are created by entrepreneurs to solve pain points. As customers’ pain points evolve, businesses should evolve as well. Businesses have to constantly innovate and reinvent to stay relevant and alive. As leaders, we have to continuously pay close attention to the business and to make decisions, rather than only care about whether my business is growing fast and doing good enough, which may hide crisis.

The second sustainability is about burning money, which is the sustainability of cost efficiency. The sustainability of customer value is to find out customers’ pain points and create long-term values for them. However, if you want to realize the solution and provide relevant service, it relies on the sustainability of spending money and gaining efficiency. This is the common problem which most people care about.

I like reading war stories, especially about the Second World War history. Was the Invasion of Sicily just a randomly planned event? No, it was full of contingencies. This is where the fun is. The uncertainty brings a variety of possible changes.

If you want to gain market shares by only burning money and raising money, it is not sustainable. There are lots of business models like this in different industries in South East Asia as well as in China. I cannot fully understand them when I read their figures, and I’ll need to learn to understand. But most times, you can predict their future from day one.

My point is that we need to try the best and then the fortune will favor you. We cannot calculate and plan out all business results, but if you do not plan and just wait for the favor from the fortune, it won’t work either. ‘Do one’s best and leave the rest to God’s will’, this is something one must consider when designing their business.

Leaders are not gods, leaders are destined to be lonely

Leaders are not omnipotent. Leaders are destined to be lonely. When you run a business, certain things you can discuss with others, while other decisions you have to make on your own. The most painful moment for a leader is when he/she cannot discuss with others on certain issues. This is when the people you may want to discuss with are all stakeholders. You are the only one can take a step back to make objective decisions.

To be honest, Jack Ma has a great influence on me personally. I learned and observed from him - a true leader should always be looking forward into the future.

Looking forward is not only looking at future opportunities, but also looking at future problems. In fact, the customer pain points and customer value we can see may not solve today’s problems. The more accurate you are in judging future problems, and the earlier you prepare, the greater your achievements may be. There is no shortage of smart people in this world, and many people can see the future. How do you judge the future evolution? What problems will arise? What opportunities will it bring?

It is sometimes easy for us to value the current opportunity. I have a theory called “the first bus and the last bus”. People talk about catching up with the trend; it used to be the wireless Internet, now it is the Internet of Things, the trend of autonomous driving is coming in a big way as well. Many of these trends, we are not leading it but going with it.
When a company does not seize a big opportunity in a certain field, it will fall into anxiety collectively worrying about others may win the competition. However, when you are able to jump out from the anxiety, you will find that this world is always reincarnate. When you miss this trip, and there will always be the next trip. Survival is the most important.

This is not being arrogant. In fact, we have to think about survival everyday, no matter how big your company is. New business models, innovations, or social issues, can all affect the company’s survival..

Only by surviving, we can have the opportunity to catch the next trend and be prepared to get on the first bus. This is the theory of “the first bus and the last bus”.

We usually say that when 4G comes, short videos will replace long videos, and we must seize the opportunity. Not many people were convinced at the time that this will happen. The adoption process needs to be closely observed.

In despair, it lies opportunities and in impulse, it lies traps. History keeps repeating itself.

How to keep you finger on the pulse of the market? How to look at the trend and the future opportunities? I will share some personal experiences and practices. I like chatting very much. In fact, I don’t talk much. I tend to listen. I receive a lot of input when listening to other people’s talking. I remind myself that to do things, we must keep our fingers on the pulse of the market. This pulse comes from experience and instinct, which cannot be solved by any kind of artificial intelligence data analysis or wonderful PPTs. The input given by the team and our customers can never replace our own instinct to the market.

The duck knows first when the river becomes warm in the spring. The source of all business design comes from market acumen. Agility is very important for an organization, and it is also important for leaders. Do you have the acumen, agility, and insight to sense market changes, even if these are subtle changes?

This is the unique source of a company’s vitality.

Nowadays, Alibaba has become so big, and I’m the person in charge. I want to maintain a unique way to listen and understand the market. It’s not to pick faults, but to get a feeling of the market. I will also listen to the input from my team.

I recently said that PPT is already outdated in the digital age. It takes more time to create the PPT than writing it down, no matter how well you have mastered PPT. I have a habit. The team always sends me the slides via DingTalk before the meeting, and when they start presenting the slides. I will go through the slides in the reverse order starting from the last slide and see what’s been written on the last page. Generally, it is the help they need, and the achievements are all in front. You don’t see your boss often, and you have to seize this opportunity to let your boss see how hard you work and how successful you are. Thus, the team certainly has some expectation.

This is the human nature. I don’t mean to cut them off. We need to respect human nature. Your team think that I have a chance to meet with you. I have to let you remember me. It’s the human nature. He will remember what problem you helped him to solve. Basically, the team started talking for five minutes and ten minutes, and I’ve finished the slides.

Different people have different approaches and there is no right or wrong way. My approach is to be patient and listen them out, unless it is necessary to interrupt. Why would I go through the slides quickly first? In fact, you are looking at what they didn’t tell you, even didn’t write in the PPT. After having a general understanding, the most important thing is to catch what he didn’t tell you.

I am not saying that this is a colleague with bad intention. This is often the case in the world. A group of good people only talk about what they want you to hear, and in the end you feel bad. They only describe a world they want you to know, and the real world is more rich and colorful. What they didn’t talk about was the most important thing, and even what he didn’t talk about combined with what he said was the most important thing. The most amazing thing about language is that a sentence can be expressed in different ways and contexts, which will produce different effects.

Some people say, Daniel, you’re a man who always thinks carefully and meticulously. In fact, the hardest thing is to make a rigorous person into a non-rigorous one. This is where I struggle the most. You are obviously very logical, but you have to give up some logic. In other words, sometimes you can clearly foresee that certain action will lead to tragedies, but you still let it happen.

There are many reasons you might do it. One is to train people. Just like a child, the fire is hot, and the child still wants to touch it. If you let him touch it once, he won’t touch it a second time. Second, in the face of many different opinions, sometimes you have to pay some cost to make uncertainty into certainty and turn disagreement into consensus. It is a bit of tongue twister. You can understand that when there is uncertainty, there will be a lot of points of view in the company, up and down, back and forth, and you also have your opinion. No matter how confident you are and how much you want to, you can’t convince others.

The only way is to let this happen, and after it happens, everyone agrees. We are not playing god here. We need to be in awe. Not everything can be calculated clearly. What I want to say is to leave a blank space for the evolution of business design and to give some space for the market evolution and for team creation. You have to believe in your team and believe in this market. We are not omnipotent. It is impossible to think of all problems, so it is important to leave a little space for the market for it to take its own course.

The development of the world does not depend on planning. In the end, operation and management will always be a balance act between science and art. Blank space is an art, we must leave some space for the objective world.

About ten years ago, when I just moved to business(Daniel use to be a CFO), it didn’t take long for people to ask me what is the biggest difference between doing finance and doing business. I think the biggest difference is that you need to make imperfect decisions in business.

Doing business means you must dare to make imperfect decisions. What is behind the imperfect decisions? It is the judgement. This is the most difficult thing in business design. There is no way for the team to make the judgement. It is ok for a company to be wanting-it-all from the strategic point of view. It is always wrong when it comes to the implementation of the organization strategy and strategic arrangement.

The most important thing for a leader is to be able to give very simple directions and decisions, and to align the different directions and decisions taken by your teams in order to reach your strategic goals ultimately.

Without appropriate production relations, any good business design will become a castle in the air

In the previous section, we talked about business design like how to create and stimulate productivity and how to leave space for its future development, from which we may benefit someday unexpectedly.

Back to the fundamentals of business, productivity cannot be created without production relations. Appropriate production relations can stimulate and create productivity; conversely, if the production relations is inappropriate, any good strategic approach, business tactics or competitive action will turn out to be castles in the air eventually, and lead to internal discord with the top leader calling for coordinated collaboration every day.

In Alibaba group, we unequivocally call upon all to coordinate with each other as well. In my opinion, however, most of the issues about coordinated collaboration are actually caused by inappropriate production relations, instead of negative attitude or unwillingness of teams. Under the twisted production relations, collaboration is essentially against human nature.

Speaking of which, production relations in enterprise is about organization design. At the point of designing organization with clear strategic direction and track selection, it’s necessary for an enterprise to identify the stage it is in, the major issues and principal contradiction it has to resolve. So in a broad sense, is the major contradiction to resolve by organization design, the issue of gaining breakthrough or of improving overall efficiency? They are very different.

Just as water retains no constant shape, so in warfare there are no constant conditions. How to organize and how to design organization essentially, reflect the specific problem the enterprise needs to solve in the specific stage, and how to lay a solid foundation as paving stone when moving to the next step. Why is it defined as “the next step” here instead of “future” as in a broader sense? Because the organization can be adjusted step by step. For instance, when you achieve the strategic goals and realize the original design becomes the bottleneck of the next step into the future, it’s time to re-calibrate your organizational structure.

In recent years, especially since I started to serve as CEO of Alibaba group in 2015, the organization has been kept re-calibrated each year right after double 11. Our annual organizational structure re-calibration of this year is taking place to ensure that Alibaba digital economy is guided by “One picture, One heart, One battle” in order to realize a more perfectly unified strategy.

The core of business operation is gaining breakthrough, the core of management is improving efficiency

“Business operation” and “management” are two different things. The core of running business is gaining breakthrough. Using Hema as an example, it not only meets the basic needs of customer, but also continuously innovate products and services, bringing unexpected surprises to consumers? This is an issue of business operation.

While management is a matter of efficiency, saying whether the organization is efficient, or whether every staff is fully engaged. Many Alibaba’s teams have national offices, regional offices, and city offices. How can we manage different level offices efficiently? This is an issue of management.

Issues of business operation and management are always changing according to different stages and are in line with the barrels principle that the shortest board decides the final outcome. Even if you have the best idea, the best products, if your management is poor, the enterprise will still be in a mess. But at a certain stage, as the top leader, you have to think from the big map. When designing the organization, you have to consider what to focus, what is the current primary contradiction, and what are the specific problems need to be solved in business operation and management. Besides, how to dynamically and delicately keep the balance between management and operation. is another issue to consider.

To keep a dynamic balance is the most important thing. For any enterprise, any change from the top leader, no matter how small it is, even if it’s only five degrees different from the direction, when the change passed to the front line, it may be bring 180 degree difference to the business. Hence no matter what we talk, when we make a statement, though casually, people will garble your quote very easily.

The key frame of designing organization are：vertical or horizontal, divided or combined. Generally speaking, the vertical and divided are corresponding. When should we design organization vertically? When we need a single team to march fast to open a new market, the organization needs to be agile enough to advance, even at the cost of mistakes and losses. Some managers take loss of efficiency as a huge problem, which is what I keep reminding myself to avoid, since my background is CFO. I have been thinking, why Jack used to say that CFOs cannot be CEOs? Until now, he still insists on this view, but he takes me as an exception. He must have reasons, but nothing can be absolute.

Management is a foundation factor; there shall be management, efficiency staff’s engagement and clear design of positions. But management is not an incentive factor, when an enterprise needs to create future, it can’t only rely on management, on setting the restrict attendance rate. Factory management can easily turn people into machines and components. This is not the case for Internet companies, nor is it for digital operation organizations. The philosophy of management is about inspiring people’s self-motivation rather than turning people into machines.

How to manage different organization design strategies of vertical and horizontal as well as dividing and combining? Business needs to seek breakthrough and speed vertically and stability horizontally. Enterprises will eventually have a lot of functional positions. The question to consider is whether to place these positions in a team or on a shared platform, i.e. middle platform.

Small teams still have a variety of functions and stay nimble at the same time. There is no right or wrong way. The key is to distinguish the main contradiction. No one can make the decision for me, so I’ll think about them over and over again. Those problems, finally you realize, have to be changed based on daily and constantly observing a variety of phenomena, situations.

For a large organization, a lot of things are not happening in chronicle order. Some people say that I will book your time with your secretary. My secretary can only take notes of who wishes to meet me but he/she cannot decide who I will meet. I am used to manage my own calendar. Time management is key to any leaders. If you cannot manage your time, you won’t be able to manage anything else either.

I will record on my mobile phone. Who is looking for me but I have not responded him. It is a long list. I know some people are anxious. I don’t look for him just because I have more important things to do. This does not mean that his business is not important. Important or not important, urgent or not urgent, is always relative.
Let’s get back to the topic of dividing business. To be frank, when Alibaba created new businesses, including Dingtalk, Hema, LST and Tmall Genie, they would be created independently, otherwise they would fail without doubt. If we just mix a group of people together, no one would take the responsibility, and you don’t know to whom the credits should go neither. It’s definitely not going to work. You have to set up an independent team to conquer the market, instead of looking for coordination.

The same goes for two teams doing the same thing, you should provide resources to both of them, so as to make up their minds to win. You should not stop them even though their missions are overlapped. You should let each team do their best to win. That’s why we need to design the organization vertically and divide them. The worst situation is that you let these teams coordinate on new business and new battle field. It’s too complicated, everyone has their own opinion, the finance team, the legal team, the investment, the technology, the logistics and even the outsource teams, will make comments on the situation. However none of them are willing to take the responsibility.

Why do we even need a leader if coordination can create solutions? Everyone just raises questions without providing solutions. Do you really want to win? Do you fully trust this person? If so, people would not complain even if they lose. I would prefer to be responsible for my own decision rather than complaining. It is against human nature to let people be responsible for others’ decisions.

The process of decision making is the process of building and consuming trust

We quite often talk about the middle platform strategy. Middle platform is Alibaba’s very unique strategy. In the business development and breakthrough phase, the work must be done by independent regiments, independent divisions, and independent teams. However, when business development reached to certain maturity, having too many independent divisions and independent teams creates silos. When silos emerge, the independent divisions and teams should be unified; many divisions may be shut down, transferred, or merged. From the management perspective, we are looking for efficiency and avoiding repetitive investment.

Those who intend to build platform from day one would usually fail. Similarly, if a company builds a middle platform for the sake of it, they would not survive. All platforms were grown out of real business battles. Without the experience and data consolidated from real business battles, you would not understand what the customer needs are. It is impossible to meet the customer needs without the insight.

A dysfunctional middle platform can become a bottleneck for business. All well-developed middle platforms are integrated with the business. As we develop business, middle platform will emerge. Middle platform is consolidated from business, cannot grown out of nowhere.

I highly recommend that you take a look at your organization. The biggest challenge faced by top leaders is that a leader needs to be both a business architect and a technical architect. This is a very demanding role. I’m definitely not a technical architect. I might become a product architect, but a company ultimately needs a good business architect and a technical architect to complement each other, which has nothing to do with the position and reporting relationship. If you are not doing a purely technical business, you still have to become a business architect in the end, otherwise it will be difficult to become the top leader in the company.

When multiple businesses are developing at the same time, more and more overlaps emerging, you need to extract and consolidate the common ground to form the middle platform in order to support the development of new businesses. This is the process of dividing and combining, horizontally vs vertically.
A famous quote from Romance of The Three Kingdoms is the empire, long divided, must unite; long united, must divide. The same is true for a company. I heard it from Jack Ma. It did not resonate with me at first. In the end, it’s like building blocks. Businesses need to be reorganized from time to time.

People is still the key to any formation

I am a big football fan myself. My favorite teams or coaches are the type that can change the formation according to local conditions. Some coaches prefer to play 352 wherever they are, or the popular formation 4231 with two midfielders and one forward. The front waist is the organization, the two back defenders can move independently to cover the two sides as well as back and front. While some coaches would first line up the team to see what is available. For example, the formation of 352 needs two strong side defenders. When attacking, they need to be like left and right forwards. When defending, they become two defenders.
Enterprise management and organization design are the same. I don’t think the ideal organization chart exists. We are constantly looking for suitable people for the business. It is always difficult to find someone who is 100% suitable for the business. It always depends on what you have, particularly the key leaders and talents you have.

I always prefer the top leader per se, rather than looking at how many people reporting to him. Sometimes I would chat with the presidents asking who your right-hand man is. He/she is not necessarily the one who directly report to you, maybe indirect reporter. It is the basic rule that a company or a leader has to have a core team, otherwise you will be a lone wolf. And how to choose the primary right-hand man? You need to consider different problems in different stages.

The real top business leader should be the one who can seek certainty from a highly uncertain situation. The uncertainty is the only thing that is certain. How to judge whether the one who has potential characteristics of being a general? The most basic requirement is this guy must have a point of view. It’s very common that in a team discussion, the ones with higher position make the final decision.

This is the humanity. In a fast-growing innovative business, the biggest problem is that people have no point of views, and they cannot insist on and defend their own points. Such people can definitely not be a general, he is just a manager. Running a business is totally different from managing a company. He might be a good house keeper. Of course house keepers are needed for a company. But you must have generals if you want breakthroughs in business. It’s very important to figure out how to seek out those people and get to know how they perceive the company.

Finally, to all the top leaders, you have to spend most of your time on selecting people. Your key job should always be making strategy, forming organization, and selecting generals. These are the things decide your company’s destiny. I have spent a lot of time chatting with my colleagues, formally and informally. By the way, I believe meeting is the most ineffective way for communication. Of course sometimes we still need meeting. Maybe the team would think meeting is important to get acknowledge from me. Sometimes the team can get more resources by meeting with the CEO, it’s understandable.

You need to listen to his/her thoughts. The most important thing is to assess if he/she has integrity. If not, the smarter he/she is, the more disaster it would be to bring him to the company. Everyone has their own selfish desire. The bigger trust and responsibility you give him, he will be more and more selfless. This is a process. And at the same time, he should have his own unique point of view. He must express his clear stance in facing uncertainty. Giving points is making choice. A general of an organization cannot do business well without making choice. You have to make key choices under the great pressure and challenges according to the strategy. The process of making choices is also the process of building trust and consuming trust. If you make the right choice you can gain the trust, otherwise nobody will trust you.

Another point is that you have to fight. Nothing is perfect. Someone must press the button when the deadline comes. I have been challenging myself in the past years. Usually if I have to make the decision, it means no one else can make the decision.
Secondly, once the decision is made, you have to insist. The earth is round. Even you go to east, if you can survive till the last, you can still reach west. The worst thing is tossing back and forth, which will waste lots of resources and lead to no result. Your team would collapse as well. The end of the industry must not be a direct route. My job is to find a way between the end of the industry and the present. I have constantly adjust the steer. Sometimes I have to jump over a pot hole, while other times I need to take a detour.

Top leader needs to have decisiveness, influence and charisma

The formation of the organization is decided by human beings.

As the top leader, his point of view, decisiveness, influence and charisma are very crucial. Some things are naturally born, and they need to be inspired. Many times, Jack Ma and Lucy (Peng Lei) joked me that I look different now, because they did not expect me to be such a person before. I think I was inspired. In such a special position, you will be naturally inspired to mobilize all your potential to do one thing.

It is very important for a top leader to be decisive and responsible, as we face high uncertainty. A good leader must not only be a manager. The qualities of being a good leader can be summarized in three sentences and are all related to responsibility.

1) Dare to make decisions that others can’t;
2) Take the responsibility that the team shall not and cannot take;
3) Gain resources that the team can’t.
The third point particularly reflects my function. It ‘s easy for everyone to think about the first two, you must make a decision, you must take responsibility, but if you only have these two qualities, it ‘ll be useless if you can’t help the team solve real issues. You have made a good decision, we have to do this and take the responsibility. But how do we do it? You’ll need to have resources, including technical resources, human resources and capital resources. You’ll have to get these done, and this is a must for leaders since the resources are always limited. There are always more opportunities than resources.

In turn, if you have gone through the same battle and shared same experience with your team, you can tell whether they see you as a “boss”, or a “leader”. In my opinion, “leader” is a positive calling because if there is no leader in a team, it will not have true unity. You can appoint the boss, but you can’t appoint a leader, a leader is recognized from the bottom of people’s heart.

And this can only be gained through battles, that the team shall share honor and disgrace together, and take responsibility for each other and the team. I often ask myself, do people recognize me as who I am, or just as my official title? Of course I want people to recognize me as who I am. But I also understand that people will only recognize me as my official title, if we have no close contact nor been through same battle together. If an organization wants to develop healthily, team members must need to share honor and disgrace together and fight together to become comrade.

I used to tell the team that if you haven’t fought together, you guys could only be called colleagues, instead of comrade. Only when you all experience the feeling of desperation and try to pull each other out of it but may fail to do so, the feeling of life and desperation, can the team become different. The success of a company is when you are brave enough to give your hands to your colleagues and trust each other unconditionally. It is a relationship more than just colleagues.

Adding the icing on the cake is easy, however to send people firewood in cold weather is hard. When it’s time to make a decision, can we really help each other? Only when the company is in danger, can we know what is true friendship and what is true support. People often applaud, smile, and greet, but when situations are hard, can I still help others, encourage others, and even do something for them? This is to test true friendship, and at the same time it builds trust.

Alibaba believes in “trust makes everything simple.” Trust is something very high level. First of all, people must know each other and interact with each other a lot. Only after experiencing something, that people will start to slowly trust each other. You can’t expect two persons who don’t know each other to trust.

First of all, you must move yourself, then you can move others, and make the team, your delegates, and other employees to become better selves. This is the theme of Ali’s culture. You have to use your full heart. This is the same as doing business. In the end, being a business leader is all about his/her IQ, EQ, and finally Love Quotient. This is what we firmly believe in. I summarize the core of Alibaba’s culture, is to believe in the beauty of people and society. Although there are many ugly things in the world, you are still willing to believe in beauty and to trust others.
When you encounter a problem, do you dare to believe in others first, even if sometimes you will be deceived, or things are not going well, are you still willing to do it? The answer reflects the DNA of the company and it is the DNA of Alibaba.

Regarding Ali’s new six values, my point of view is that, it is not inheritance, not about passing them to people, but to find sympathy and fellows. Everyone has such a part in his or her heart. You need to inspire them, and in the end, you’ll realize that everyone believes in it, and they all think that the world can be better. Then why not we work together? That’s what really brings culture and business together, and only then can we move towards to make the organization healthier.

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.