Alibaba's middle office
Centralized in 2015, reversed from 2020, split into six in 2023. All three were correct.
Alibaba Group, 1+6+N restructuring announcement
28 March 2023
Contemporaneous reporting on the middle office and its unwinding
2015 to 2023
Alibaba built a large shared capability layer, the zhongtai or middle office, from 2015, under a large-middle-platform, small-front-office design. From 2020 it began unwinding it, and in the March 2023 restructuring it split into six independently governed business groups while the group level retained little beyond listed-company compliance functions.
It is the Strategy cell's teaching case precisely because it is not a failure. Centralizing was right while the shared capability still differentiated, and wrong once it had become a utility slowing the front line down. Position on the evolution curve changed and the correct answer changed with it.
Where on the evolution curve does each capability sit, and does that dictate build, buy, or let go?
What is the smallest unit that can own a customer outcome end to end?
What is owned, what is rented, and what is summoned only when needed?