Amazing company, great book, incredible simplicity: points, lines and plane; network coordination; data intelligence.

SMART BUSINESS

There’s a distinct refrain in Ming Zeng’s Smart Business: What Alibaba’s Success Reveals About the Future of Strategy that many an Internet company has preached equally many times before:

Embrace technology. Make data-driven decisions. Trust the algorithm.

Zeng offers several nuggets of wisdom in driving home the point. He writes, for instance, that “[w]hen strategy is no longer predicated on competition but centers on coordination, the ways of creating value are completely transformed.” He stresses that the Internet makes possible a “customer-to-business (C2B)” model whereby a business is organized around direct interaction with its customers on an unprecedented scale. He notes that for organizations to thrive in this environment, “strategy formulation is dynamic; it is about planning, not about static plans.” Most importantly, he provides a compelling paradigm for what he calls Smart Business–the intersection between network coordination and data intelligence.

Yet to the extent that all this is to expound on the refrain–Embrace technology! Make data-driven decisions! Trust the algorithm!–the message comes across as a little mundane.

That said, the message does take on entirely new dimensions when framed in the context of how such an approach allowed Alibaba to grow and evolve into the Internet giant it is today.

In that regard, Smart Business shines where it allows readers who are unfamiliar with Alibaba to figure out what the company is (or, more precisely, the many things the company is) and what it does. And who else other than founder Jack Ma can explain than Zeng, the company’s de facto chief strategy officer?

Zeng submits that it is inaccurate to state that Alibaba is the Amazon of China, as often assumed. Rather, Alibaba is better conceived as a true Internet conglomerate, arguably single-handedly creating China’s e-commerce market by developing end-to-end solutions for both buyers and sellers. In that sense, it is akin to China’s Amazon, eBay, Etsy, and Salesforce rolled into one, assuming each also had to create its own payment solutions, supplier management platform, and logistics network from the ground up.

Interestingly, Zeng makes the argument that Alibaba’s e-commerce success owes largely to China’s poor brick and mortar infrastructure. Because realities on the ground made commerce challenging, both businesses and consumers were ripe to consider any alternative that would be better. So when Jack Ma saw the Internet’s potential and decided to build a business around it in China, he was certainly on to something. And it was by practicing the principles at the core of what Zeng describes as Smart Business–Embrace technology! Make data-driven decisions! Trust the algorithm!–that allowed Alibaba to become a genuine marketplace.

As a book about strategy, Smart Business doesn’t necessarily tread new ground. As mentioned, there are similar books that preach the same gospel, and it’s a huge leap to expect that what would work for a company like Alibaba would work for others (or should). But it does bring Alibaba’s story to life, and provides a powerful framework for deconstructing the strategic intent of Internet giants.

SMART BUSINESS by Ming Zeng focuses, as the subtitle notes, on "What Alibaba's Success Reveals about the Future of Strategy." Jack Ma provides the foreword and says that "by 2036, Alibaba hopes to serve 2 billion customers, create a 100 million jobs, empower 10 million firms to create profitable businesses ..." That is a staggering change from the 18 people who met and founded Alibaba in 1999. Ming Zeng, former (2006-2017) Chief of Staff and strategy adviser to Jack Ma at Alibaba Group, has divided this text into three part: the emergence of a smart business; how smart businesses compete; and how smart businesses run.

He notes how difficult it is to compete with a smart business with a strong head start due to its data intelligence and ever-improving algorithms. He says, "all companies, even entirely offline businesses, are now playing in a world defined by networks, data, machine learning and algorithms." He stresses the importance of analyzing the ecosystem and one's position and leverage within it, looking, for example, at a "new strategy of mobilizing resources on the network, instead of owning them." In several chapters he stresses the value of creativity and the individual. As a business school graduate, I certainly have background in this area, but SMART BUSINESS reminds readers of the importance of taking the long view and updates examples in a helpful manner. I especially liked his Appendix C which describes a unifying theory of strategy, citing past contributions by Porter, Drucker, Christensen, Kim and Mauborgne, while stressing that change is happening faster and communities are aggregating and disaggregating more quickly with the result that "the traditional strategy toolkit will become irrelevant." Appendices, notes and an index comprise roughly a quarter of the book.

The book tries to explain how, owing to recent technology advances, a new theory of value creation can be defined, developed and implemented. This new strategic view diverge from traditional strategic approach.
The key concept presented in this book is the effective interconnection and coordination of players (buyer, sellers, and service providers) through real- time data mediated by technology (machine learning).
To better clarify the theory, the author provide several examples: the story of Alibaba (througout the whole book), web celeb, ...

For someone like me who is just only starting getting familiar to the nuances of the business world, this book provides a lot of information on how the Chinese behemoth Alibaba works. You will really learn a great deal in terms of the strategies employed by this company to make it successful today.

I learned about web celebs who espoused entrepreneurship in modern China and fuel the success of of Taobao.

There are so many things to learn in this book that I would certainly buy a copy of this one someday and put it on my online bookshelves.

Thanks to Netgalley and Harvard Business Review Press for letting me read and post my views on this book.

I have ready many books regarding Google, Facebook and Apple, but Smart Business is the first regarding the Chinese behemoth, Alibaba.

Smart Business embraces the innovative power of Chinese business which has a distinctly different approach to the West.

Much like Google and Amazon, there are similar cutting-edge technologies that are applied within Alibaba's business framework, from highly sophisticated machine-learning algorithms to mobile internet and cloud computing, but Alibaba ethos has a distinctive Eastern mindset.

The peculiar incorporation of Chinese web celebs, the creation of Ant Financial and the flexibility and fortitude to continually engage in risky experimentation in order to remain on the forefront of a rapidly evolving e-commerce market. Imagine Amazon deciding one day to split its entire business into into three independent business units that literally compete against each other. Unimaginable, but that is exactly what Alibaba did in 2011 as an experiment to clarify which model served as the best way forward for e-commerce in China.

As interesting as Smart Business was at times, there was a great deal of repetition and certain chapters were much weaker than others. I also felt that Smart Business was divorced from the human element as the focus was primarily on the innerworkings of Alibaba as opposed to exploring the people themselves, their personal struggles and their triumphs as they built a small, modest startup into the global powerhouse that it is today.