Jack Ma Encourages Alibaba Employees to “Correct Course” Following Years of Government Punishment and Decline
China’s tech industry was once dominated by Alibaba Group Holding Ltd., but the company has fallen behind in recent years, facing government scrutiny and strategic missteps. Alibaba’s co-founder Jack Ma, who has kept a low profile after clashing with Beijing, has now broken his silence, urging employees to “correct their course” and praising rival PDD Holdings Inc. for its market share gains.
In a message posted on an internal platform, Ma expressed confidence in Alibaba’s 220,000-plus staff to return the company to its past success through determination and hard work. He emphasized the importance of reform and sacrifice for organizations to be respected, saying, “Every great company is born in a winter.”
Alibaba, which was once the most valuable company in China, has fallen behind competitors like Tencent Holdings Ltd. and PDD Holdings Inc. On Thursday, Alibaba’s market value dropped to about $187 billion, putting it below PDD’s value.
Ma’s intervention is particularly significant, given his long absence from addressing anything related to the company for over three years. This absence, coupled with government scrutiny, has led to suspicions and apprehensions among entrepreneurs and investors regarding Beijing’s treatment of the private sector in the country.
The troubles for Ma and Alibaba began three years ago when the entrepreneur publicly criticized Chinese regulators, leading to the cancellation of the initial public offering of Ant Group Co., an Alibaba affiliate. Since then, Ma largely disappeared from the public eye, in what appeared to be a response to Beijing’s crackdown on his businesses.
Beijing’s broad crackdown on powerful tech companies has left Alibaba distracted and struggling to respond to competitive threats. The company has faced setbacks, including a failed plan to split into six different business units and despite being a dominant force in e-commerce within China, it has been unsuccessful in expanding its business outside the country.
Ma’s recent comments and his move to delay reducing his stake in Alibaba indicate his willingness to become more active in the public spotlight after years of staying low-profile due to government scrutiny. His comments also came following PDD reporting strong financial results, indicating the company’s success in gaining market share at Alibaba’s expense.
Alibaba’s struggle to expand its business and competition from rivals like PDD has indicated the need for reform and strategic changes within the organization. With Ma breaking his silence and urging employees to work towards returning the company to its past success, it remains to be seen whether Alibaba can overcome its challenges and regain its position in the market.