What can Alibaba's Jack Ma teach us about succession planning?

The tech boss has already done the hard work of letting go, says Simon Hayward.

by Simon Hayward
Last Updated: 17 Sep 2018
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Down to business

For many organisations, the departure of a high-profile leader can leave a void which is difficult to fill. On Monday last week, Jack Ma, the executive chairman of Chinese e-commerce giant Alibaba, announced that he plans to step down in a year’s time and hand over to current Group CEO Daniel Zhang. For the next 12 months, he intends to work closely with Zhang to ensure a smooth transition. After that, he aims to remain on the board until 2020.

When the departure of a high-profile corporate leader makes the news, that news is not always positive. Sometimes the departure is sudden and unexpected, or there is an unclear succession plan in place. However, Ma’s resignation letter to customers and shareholders demonstrates careful planning.  He is keen that the story is about the organisation and not about him.  In his letter, he states that Alibaba is no longer a company that relies on individuals. Rather he describes how it has ‘stepped up to the next level of corporate governance’ to become a business ‘built on systems of organisational excellence and a culture of talent development’.

When it comes to leadership succession planning in our own organisations, there are some valuable lessons we can learn from Jack Ma.

Learn to let go

In my experience, many CEOs and senior leaders find it difficult to let go so others can take responsibility. To secure sustainable, long-term success leaders need to devolve decision-making across the organisation while they’re still ‘in charge’. This prevents an over-reliance on people at the top. Think about the decisions only you can make, and delegate the rest.

Jack Ma co-founded Alibaba in 1999 and handed over the CEO reins in 2013.  Alibaba’s sprawling businesses are now managed by a network of senior leaders. The spirit of partnership and collaboration has always been strong across the organisation, and Ma has long been renowned for his inclusive style of leadership. In his resignation letter, Ma states that he has ‘complete confidence in our next generation of leaders.’

Develop others

Some leaders cite colleagues’ lack of capability as a reason not to empower them. As a leader, it is your responsibility to develop the leadership capability of others – to nurture talent across the business and encourage others to step up and drive growth and performance improvement. 

Although most organisations understand the importance of developing a rich leadership pipeline, many could do more to offer the sort of challenging experiences that take future leaders out of their comfort zones so that they develop new, more innovative ways of working.

Speaking at the World Economic Forum in Davos earlier this year, former teacher Ma talked about the importance of developing human creativity in a digital age. ‘Education is a big challenge,’ he said, ‘If we don’t change the way we teach, we will be in big trouble in 30 years from now.’

Be transparent

Perhaps most importantly, Jack Ma has been completely open about his succession plan. This is reassuring for colleagues, customers and stakeholders. It builds confidence and removes uncertainty, which ultimately can help avert dips in share price, lapses in loyalty, and bad press.

Dr Simon Hayward is CEO of Cirrus and author of The Agile Leader

Image credit: JD Lasica/Flickr  (creative commons)

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