The Self-Tuning Enterprise: How Alibaba uses Algorithmic Thinking to Constantly Reinvent Itself
Information service company Alibaba.com Ltd. is used to illustrate the self-tuning strategy for modulating a firm's rate of experimentation depending on circumstances. When Alibaba was founded, Internet penetration growth was uncertain. At each stage of the company's evolution, Alibaba generated new business models and allowed them to run as separate units. The emphasis was on identifying and molding strategic opportunities rather than executing plans. With systems that support feedback and fluidity, the firm is able to adapt to change; the separate business units launch co-creation sessions the moment a relevant market stimulus is perceived. In this manner, Alibaba is able to succeed in unpredictable environments.