Alibaba, the Chinese ecommerce giant, has announced a significant managerial reshuffle which will see the company decentralise its domestic and foreign ecommerce departments. Jiang Fan, the former head of domestic retail, will lead overseas ecommerce operations. Trudy Dai, widely seen as a protégé of former CEO Jack Ma, will take charge of the China digital commerce team.

The new appointments come at a time when the business has seen slowing growth – and has also been hit by an aggressive crackdown on tech businesses by the Chinese government.

Jiang was head of Alibaba’s domestic ecommerce platforms Taobao and Tmall from December 2017 and March 2019 respectively, running the branches that have consistently been the most profitable for the company.

Despite being only 36, Jiang had long been considered a candidate to eventually lead the entire company. However, he was removed from Alibaba’s “elite partnership” – a group that influences board appointments – after being engulfed in a marital scandal in 2020.

At the time, Jiang was accused of improper behaviour with a Chinese social media influencer. Following the scandal, he was also demoted from senior vice-president to vice-president.

On the surface, Jiang’s appointment to lead the overseas business, which accounts for only 7.5% of Alibaba’s total revenue, is another demotion.

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By GlobalData

However, given the relatively low customer base at Alibaba’s AliExpress, its wholesale trading platform, and Lazada, its Southeast Asian ecommerce platform, Jiang has an opportunity to redeem himself.

Meanwhile Trudy Dai, one of Alibaba’s 18 founding members, will become the new head of the domestic ecommerce platforms. Her appointment drew much attention as all eyes will focus on Alibaba’s domestic digital commerce, the company’s most profitable departments, to further propel the firm’s growth.

Recently, Alibaba has faced headwinds to its ecommerce business, following Beijing’s crackdown and growing competition. For the year ending March 2022, the company is expected to grow at its slowest rate since its inception in 1999. Analysts predict that the growth rate will be between 20% and 23%.

Earlier this year, the company was hit with a record US$2.8bn fine for breaching antitrust regulations. Alibaba was also embroiled in a sexual assault scandal in which a female employee alleged that a senior manager raped her. The case was eventually dismissed as the courts found that the manager in question had committed “forcible indecency”, which was not considered a crime.

The Alibaba management reshuffle, which could weaken CEO Daniel Zhang’s influence, aims to make the company more agile. Previously, under Jack Ma’s leadership, Alibaba’s various departments were more independent and were encouraged to compete with one another. However, “we started seeing different teams undermine each other and other negative consequences,” as the company grew, a source told Nikkei Asia.

Zhang, who took over from Ma in 2019, pursued a more centralised approach to Alibaba’s business model.

Over the weekend of the reshuffle, Alibaba also announced that Maggie Wu would step down as Chief Financial Officer and would be succeeded by Toby Xu. Wu will continue as a partner in the Alibaba Partnership and serve as an executive director on the Alibaba board.

“Maggie has made exceptional contributions that are instrumental to Alibaba’s achievements to date. Since joining Alibaba almost fifteen years ago, Maggie has helped lead three successful company public listings as CFO: on the Hong Kong Stock Exchange in 2007, and Alibaba Group Holding on the New York Stock Exchange in 2014 and on the Hong Kong Stock Exchange in 2019,” said Daniel Zhang in a company statement.

“Going forward, Maggie will leverage her deep experience to support Alibaba in new ways. We will continue to benefit from her guidance and insights in her continued role as an Alibaba board director.”

“The announcement of Alibaba’s CFO transition today is the culmination of extensive preparation over many years and a part of Alibaba’s leadership succession planning,” Wu said. “I trust Toby even more than I trusted myself when I first took up the CFO position years ago.”

Xu joined Alibaba from PwC in 2019 when he was appointed deputy CFO. He also serves as a director of Sun Art Retail Group, Lianhua Supermarket Holdings and Red Star Macalline Group.

Alibaba currently ranks number four on GlobalData’s thematic scorecard, evaluating companies in the ecommerce industry. According to the analysis, the company stands out in terms of artificial intelligence and digital payments. It lacks, however, in areas concerning data privacy, ESG and regulation.