Manage the Organizational Change to Build the Smart Car in China A Study of SAIC-Alibaba Joint Venture

Type de publication:

Conference Paper

Source:

Gerpisa colloquium, Paris (2019)

Mots-clés:

automobile, Organizational agility, Organizational Change, smart car

Résumé:

The paper focus on the case of Banma, a newly established joint venture between two Chinese giants: Alibaba (the internet leader) and Shanghai Automobile Industry Corporation (SAIC). The joint venture was created in Nov. 2015. In less than three years, a series of “internet cars” were built, covering three car brands of SAIC. The company became an RMB 8 billion capital value unicorn 2.8 years after its establishment. Some Chinese and sino-foreign joint venture cars (Dongfeng Citroën, Chang’an Ford etc.) are using Banma’s open operation system, named AliOS . Thanks to its commercial success, Banma raised RMB1.6 billion as pre-A round and its capital value reached USD1.2 billion in Sept. 2018. Further, the company has the ambition to install its operation system to 10 million cars in China in next 5 years via industrial partnership. If succeed, this will become a direct competitor of Google Android in the global automobile industry.

How two companies with significant corporate culture, can work together in an efficient way, and generate new product and commercial success in a very short time period? Through the in-depth case study, in particular driven by one of the authors, acting as one of the founding members of Banma, the paper illustrates the organizational cultural change and organizational agility of two Chinese leading companies.

Our main findings are the followings: despite those are two Chinese companies, their corporate culture differs significantly, one is the culture of State-Owned company, and another one is that of private company. From the new product perspective, it is not the simple two-party cooperation, but the interaction with the new ecosystem of automobile industries. Thus, the culture diversity is exhibited to another level. Facing cultural conflicts, choosing the right trajectory of organizational transformation, making two categories of leaders and teams working together in an efficient way, creating mechanism to resolve cultural conflicts are important measures that lead to success.

This case will have important theoretical and practical implications for both OEMs managing the transformation, and new entrants who want to access to the automobile industry.

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