Savio Kwan recently attended Alibaba’s 18th annual gala in Hangzhou, eastern China, where Jack Ma started the giant e-commerce company. Only the Yellow Dragon Stadium was big enough for all 50,000 employees, whose singing and dancing, Kwan says, symbolised the company culture and innovative spirit.
Kwan helped turn Alibaba around in its formative years (its market capitalisation has since topped US$450 billion, or £343 billion). He feels humbled and grateful to have played a part in it, even though his time as Chief Operating Officer and President tested his business stamina to the limit.
“It was a really hairy time. Everything I learnt from LBS, my time at General Electric and BTR, all my experiences around the world, came into really sharp focus. I had to deal with things that were thrown at me at 500 mph and hope I got it right 60/70% of the time.”
Kwan arrived in England in 1965 aged 17 after a teacher at his Hong Kong technical college found an apprenticeship for him and a friend at the electronics company Pye. Having worked their 26-day passage on a cargo ship, they arrived at Pye’s factory in Cambridge, where theirs were the only Asian faces.
Thanks to Labour Prime Minister Harold Wilson’s support for the “white heat” of technology, Pye released them to do technical studies one day a week and they topped up their learning at night school. Kwan also took a Masters in telecommunications. Meanwhile, he spent a year in Sierra Leone installing a nationwide telecoms system for the police. Yet Kwan was impatient for more progress. Back in Cambridge, he switched from installations to systems engineering, but still didn’t feel satisfied.
“I was 22 and my boss was in his late 40s and was section leader of the systems engineering section so I thought that must be a prime job, but I worked out that I would have to wait 25 years to have his job. I suddenly woke up and realised that systems engineering wasn’t my passion.”
Heading for business
There was a growing trend for engineers to take up business studies, and Kwan heard about LBS from a Hong Kong friend. He applied to the School, only to receive a rejection letter signed by Charles Handy, who was running the Masters Programme. Kwan jumped into his minivan and drove from Cambridge to London to make a plea for a place.
“I ambushed Charles outside his office and asked him why I had been rejected,” says Kwan. “He told me that my application hadn’t shone. ‘We all know what London Business School can do for you,’ he said, ‘but we don’t know what you can do for London Business School.’ That was the lightning rod that changed my thinking and it’s stayed with me ever since.”
On the spot, Kwan offered up his multicultural approach and academic commitment – but Handy also told him to get a better reference from his employer. Kwan duly did so, along with an offer of sponsorship and a tax-free loan. “It showed me that if you fight for what you believe in passionately, things will happen,” adds Kwan.
At LBS, Kwan found a far more international mix than he was used to at work. There were students from the US, Singapore, Malaysia, Japan, Australia, Argentina and Czechoslovakia. “Looking back, I can see how this international approach helps the students educate each other and creates drive and motivation,” says Kwan. “It was a much higher standard and pace than anything I had experienced and was all very brisk and exciting.”
Our man in Asia
In his last term, Kwan found himself with several job offers – including returning to Pye – but he decided on EMI Medical, which came about after music group EMI had stumbled on the CT (or CAT) scanner. The organisation was assembling a team with a technical background who could market the product. One of their key areas of interest was the Far East, and Kwan was perfectly placed to help.
EMI Medical was taken over by GE and Kwan spent 17 years with the company, ending up as general manager of its joint venture in China producing ultrasound machines. He was then approached by a British industrial conglomerate, BTR, which wanted to expand its operations in China making products such as industrial batteries, tyres, electric motors and glass bottles.
“I met the CEO and he said: ‘You have the technical background but are you international?’” remembers Kwan. “And by that, he meant how many places had I lived in rather than travelled to. I was able to tell him seven different cities in 20 years and he was happy. So he entrusted me as country manager to be the company’s most senior representative in China, reporting directly to him.” But the China focus didn’t survive BTR’s merger with Siebe, which was renamed Invensys, and Kwan was told to wind down the China operations within a year.
In 2001, a headhunter came calling with a role at Alibaba. He had to explain to Kwan that this company was a pioneer of the new economy. “So I remembered Charles Handy and turned his words around saying: ‘What can an old economy guy like me do for a new economy company like Alibaba?’” remembers Kwan. “The headhunter told me that Jack Ma needed old economy people to help him build the company.”
Kwan was hired as Chief Operating Officer, gaining the title of President after a year. But it was a high-risk situation. The company, which had started in 1999, was spending too much, testing the patience of its investors. Kwan’s first task was to fire its employees in the US, Europe, Korea, Hong Kong – in fact everywhere outside Hangzhou, including other mainland China cities – taking the number of employees from 360 to 150.
“We broke even a year later in 2002, and when I met one of the investors, I asked him how much time I would have had,” says Kwan. “He told me to sit down and then held two fingers up. I said: ‘Two months?’ And he said: ‘No, two weeks. If we hadn’t seen you do anything in that time we would have fired you so that we could persuade our second choice to come and take your place.’”
Kwan became Chief People Officer in 2004, instituting management development programmes before stepping down. He sat on Alibaba’s board during its first privatisation and is on the board of its Entrepreneurs Fund. Now aged 69, he has co-founded a consultancy, A&K Consulting, which helps start-up businesses in China, and he is also on the board of British American Tobacco.
Is he surprised at how things have turned out for the Hong Kong teacher’s son who made his way to England at the age of 17? “Luck has a lot to do with it,” he says modestly.
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