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Supply chain management project alibaba

Supply chain management project alibaba

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Supply Chain Management Project: Alibaba

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Supply Chain Management Project: Alibaba

The company selected for this report is Alibaba, arguably the largest e-commerce

business is the world. It owns three major e-commerce platforms, which are Taobao, Tmall and

Alibaba.com. The platforms collectively have over 674 million users and generate US$54 billion

every year (O’Connell, 2019). Alibaba was founded in 1999 by Jack Ma and has grown over the

last two decades to become one of the biggest tech-oriented organizations in the world. The

company started operations at a time when the idea of online shopping was taking shape. Similar

e-commerce websites had just emerged in the West, such as Amazon, eBay, and Netscape.

However, none of these platforms was operating in China and Jack Ma saw an opportunity and

exploited it. China had millions of customers with money to spend as the country’s economy had

been booming for over decade. As the company established itself in the Chinese market, it

received immense protection from the government (O’Connell, 2019). Foreign e-commerce

websites were barred from entering the Chinese market, creating a favorable environment for

Alibaba to thrive. In 2014, the company raised more than US$25 billion in its initial public

offering (IPO). Jack Ma resigned as the company’s chairman in September 2019 and was

replaced by Daniel Zhang. With over 86,000 employees across the globe, Alibaba delivers 57

million packages every year through its Cainiao Network (O’Connell, 2019). Hence, supply

chain management (SCM) has been a critical aspect of Alibaba’s success over the last 20 years.

SCM in an e-commerce environment is different from traditional business setting as

competition is mostly based on the supply chains. An e-commerce company must find innovative

ways of delivering products at the lowest and in the shortest time possible to attract and maintain

customers. It must also invest in establishing and sustaining positive relationship with customers

to increase satisfaction and loyalty. The SCM must have an open communication network for the

customers and the enterprise to engage directly. Effective supply chain management is important

in an e-commerce environment as it facilitates the realization of organized and unified

coordination of business events. It reduces cost, improves efficiency, and shortens demand

response time (Yang, 2012). Alibaba provides a perfect example of an e-commerce environment

in which supply chain management has been implemented successfully.

Alibaba’s Supply Chain Management

Alibaba Group’s logistics are undertaken by a subsidiary called Cainiao. Due to the high

number of packages that need to be moved from one point to another, the company uses

Alibaba’s Cloud’s IaaS platform. Cainiao’s mission is to deliver domestic order within 24 hours

and international orders within 72 hours (Alibaba Cloud, 2020). The company has its own

logistics cloud to track status of every package throughout the supply chain. It has also

developed a knowledge platform for package recipients, shippers, and freight companies that

deliver the items. The key element in Cainiao’s SCM is a platform that is based on technology

and innovation. Social collaboration is also embedded into the company’s SCM to overcome

problems associated with data cooperation. Cainiao has a public cloud portal that acts as a

logistics information system for buyers and sellers to get real-time information (Alibaba Cloud,

2020). The platform is equipped with smart technologies to offer delivery services in an efficient

and effective manner.

Cainiao operates five networks that enable it to provide data-driven services to all the

actors in the supply chain. Shippers and express carriers use the platform to make a wide range

of decisions, such as the best routes to reach particular destinations. Warehouses and local

delivery centers use the platform to monitor demand and supply (Alibaba Cloud, 2020). For

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1 Supply Chain Management Project: Alibaba Student’s Name Institutional Affiliation Course Instructor Due Date 2 Supply Chain Management Project: Alibaba The company selected for this report is Alibaba, arguably the largest e-commerce business is the world. It owns three major e-commerce platforms, which are Taobao, Tmall and Alibaba.com. The platforms collectively have over 674 million users and generate US$54 billion every year (O’Connell, 2019). Alibaba was founded in 1999 by Jack Ma and has grown over the last two decades to become one of the biggest tech-oriented organizations in the world. The company started operations at a time when the idea of online shopping was taking shape. Similar e-commerce websites had just emerged in the West, such as Amazon, eBay, and Netscape. However, none of these platforms was operating in China and Jack Ma saw an opportunity and exploited it. China had millions of customers with money to spend as the country’s economy had been booming for over decade. As the company established itself in the Chinese market, it received immense protection from the government (O’Connell, 2019). Foreign e-commerce websites were barred from entering the Chinese market, creating a favorable environment for Alibaba to thrive. In 2014, the company raised more than US$25 billion in its initial public offering (IPO). Jack Ma resigned as the company’s chairman in September 2019 and was replaced by Daniel Zhang. With over 86,000 employees across the gl ...
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