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Amitava Chattopadhyay


Amitava Chattopadhyay
Emerging Market Multinationals - Amitava Chattopadhyay


Alibaba prioritizing shareholders last among key stakeholders is likely to come back to haunt them!

The Financial Times this morning (September 8, 2013) reports that the Alibaba board is wrestling over its listed future. It quotes Jack Ma as having noted in a March speech that “Customers are number one, employees number two and shareholders are number three…investors support you when times are good.” This raises cause for concern for the long term health and success of Alibaba.

Customers, employees, and shareholders are all stakeholders and the bedrock of any business. To build a strong and lasting branded business, all three need to be considered equally and aligned. Being openly and officially relegated to the number three position only makes the shareholders more likely to behave in the way Mr. Ma predicts, that is, support Alibaba when times are good but abandon it at the first sign of trouble. In such an ecosystem, when resources are most needed, you are likely to be constrained due to a lack of investor confidence. To build a strong and lasting branded business the challenge is indeed to figure out how one can align the interests of all three of these key stakeholders. It is not easy, but really great companies do this well. Downgrading one or the other stakeholder simply weakens the very foundation on which any business is built and does not auger well for its long term health.

  Sep 8, 2013 | Musings




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