Alibaba: Changing the Way Business Is Conducted in the Information Economy

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ALIBABA: CHANGING THE WAY BUSINESS IS CONDUCTED IN THE INFORMATION ECONOMY

Casimir Barczyk, Purdue University Calumet Gideon Falk, Purdue University Calumet Lori Feldman, Purdue University Calumet Charles Rarick, Purdue University Calumet

CASE DESCRIPTION The primary subject matter of this case concerns the changing nature of international business. Secondary issues examined include unique business strategies and issues of corporate governance. The case is written at a difficulty level of three, appropriate for junior level courses. The case is designed to be taught in one class hour and is expected to require six hours of outside preparation by students. CASE SYNOPSIS The Chinese company, Alibaba, is changing the way global business is conducted. This fast growing B2B company has benefited from the explosion in information technology and has developed a unique business model. This case examines Alibaba’s success and how the company is unique from most Western companies. With the explosive growth of Alibaba in China, the company is now ready to expand to the rest of the world. INTRODUCTION Jack Ma is a man on a mission. The Chinese entrepreneur who founded Alibaba and other companies, wants to change the way business-to-business (B2B) is conducted. He wants to develop a platform to support small and medium sized enterprises (SMEs). Alibaba, Taobao, and other Ma creations have already begun to make some wonder how this former English teacher, with an unassuming demeanor, has been so successful, and what the future holds for his companies and the future of B2B activity. HUMBLE BEGINNINGS The founder of Alibaba, Jack Ma grew up in the Chinese city of Hangzhou, a city known for its beauty. Hangzhou has been consistently rated the most livable city in China for a number of years. Ma began his work life as a child, acting as a tour guide in order to improve his proficiency in English. Ma’s academic skills in math and science were poor; however, he possessed...