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[ACC 2018] Alibaba Computing Conference 2018 Main Forum – Jack Ma’s Keynote Speech

  • Monday, November 5, 2018, 10:46 pm
  • ACROFAN=Yong-Man Kwon
Alibaba Group held 'The Computing Conference 2018' from September 19 to 22 at Cloud Town located in Hangzhou, China. The Computing Conference 2018, now in its ninth year, is the annual flagship event of Alibaba Group, and cutting-edge technologies and applications of the group under the theme of ‘Empower Digital China’ were presented.

This Computing Conference was held in Cloud Town, a special industrial zone in Hangzhou, China, with more than 60,000 people attending from China and abroad. This year, Alibaba Group's latest technological capabilities in cloud computing, big data, AI, IoT, etc., which have recently attracted a great deal of attention, were introduced. At the same time, Alibaba Group made clear its commitment to contribute to the transformation of society into a digital society by releasing various partnerships.

At the keynote of this event, Jack Ma, who is chairman of Alibaba Group, Simon Hu, who is president of Alibaba Cloud, Dr. Wang Jian, who is president of Technology Steering Committee at Alibaba Group, and Jeff Zhang, who is CTO of Alibaba Group, introduced about the latest technologies and the development direction of the company. The keynote highlighted that technologies of Alibaba Cloud are having a positive impact on the real world. Also, various partnerships for global change beyond changes in Hangzhou as well as examples of changes in Hangzhou and China were released through this keynote.

▲ Keynote speech of Jack Ma, chairman of Alibaba Group, was the last order of the main forum.

The last order of the main forum of "Computing Conference 2018" was Jack Ma, Chairman of Alibaba Group, who introduced the change from "new retail" to "new manufacturing". First of all, he explained about the value of foundation studies, such as mathematics, that pursing only the immediate results cannot obtain the future. He also commented about the “Computing Conference”, which is turning nine this year. It has grown rapidly and become the largest in scale ever with more than 60,000 participants this year. In addition, the conference became a place where the latest technologies from domestic and foreign countries come together to showcase our thoughts and share, not just to sell technologies and products.

Jack Ma introduced five "new" future growth engines in retail, manufacturing, technology, finance and energy in 2016. And so far, the word “new” has not been used for quite some time. But in the retail segment, the word “new” now has a dictionary meaning of “new”, and also “new retail” is now newly defining retail business. Moreover, he mentioned a new-loop manufacturing, “new manufacturing”, by saying that the “new manufacturing” will create a great crisis and opportunity for manufacturing in China and the whole world, and manufacturing will be in trouble beyond all imagination for the next 10 to 15 years, so all preparation will be needed.

According to the speech, “manufacturing” will not disappear, but its appearance will change drastically. It is expected that the underdeveloped manufacturing industry will eventually disappear due to the rapid change. In addition, technological innovation will last for about 50 years, and over the next 30 years, changes will be reflected not only in technology but also in ideology. If IT moves the future, DT will create the future, and if IT changes people into machines, then DT will want to turn the machine into a person. In the IT era, people trusted "knowledge," but in the DT era, the intelligence of people will be strengthened. He stated, “The IT era challenged me, but the DT era challenges altruism.”

Moreover, the characteristic of the DT era is “platform”, and this “platform” has an altruistic feature, revitalizing the surroundings and making the surroundings perform better. Hereupon, some people would say that his business is getting bigger, but Jack Ma emphasized that he is trying to make this kind of ‘platform’. In IT, standardization and scalability are required, and in DT, uniqueness, personalization and flexibility are required. And he mentioned that “new manufacturing” is a type of manufacturing in the DT era. At the same time, over the next 10 to 15 years, traditional manufacturing is expected to have a tough time, and in the trend of the current technological changes, traditional resource-consuming companies are expected to become more difficult and more challenging. Therefore, he added that entering “new manufacturing” without knowing customers and demands is like driving with eyes closed.

Next, he stressed that all manufacturing industries, with a high level of cool-headness, should not be satisfied with the current situation. For example, that a company now expands its marketing and sales to the Internet does not mean to have an ability to go to the future. In addition, the way to become “manufacturing of the future” beyond the integration of the internet should be considered, and a successful future manufacturing will certainly require internet, IoT, cloud computing and big data. And companies that do not take advantage of these technologies will fail, and they will not be able to manufacture properly.

▲ Keynote speech of Jack Ma was one of the most interesting sections of the event.

The “new manufacturing” is expected to redefine everything from existing manufacturing to the customer's market, supply chain, all production, commercial activities, and services. And this will be an overall technological innovation, not just for Internet companies or traditional companies. In the combination of new manufacturing, it is emphasized that simply combining chips into the product does not mean to be a “new manufacturing”, and the standard of the definition of new manufacturing is “personalization” rather than “customization according to demand”. Thus, in the traditional industry, people have created assembly lines with standardization and extensibility, but in the data era in the future, the assembly line should be configured to enable 'personalized' production.

Testing of the traditional industrial era has become uniform, but this also needs to change in future data eras. In the past, the ability to check 2,000 pieces of the same clothes in 5 minutes, but in the future, the ability to check 2,000 different clothes in 5 minutes will be required. Decades ago, we could see people dressed in the same clothes everywhere, but not now. And the core of this customized production is data. The previous manufacturing industries believed in electricity, but data will be important for the future manufacturing. Furthermore, he emphasized that technologies such as big data, cloud, IoT, chip and AI will change every level of the manufacturing industry.

IoT is at the beginning point, and many IoTs are still selling hardware and software and looking for reasons for better sales. But before that, "smart network" has to be considered important in IoT since IoT cannot perform properly without the network. In addition, even if there are a number of cameras and they are connected, without the computing power and AI technology to take advantage of the generated data, the cameras would be used just as a camera and waste data. Chip technology is also important. In other areas, there is a big gap with advanced companies, but the situation will be different in IoT. Also, considering locational advantages, direct development of chips can create an opportunity to jump the gap at once.

In Big Data and Cloud Computing technologies that will lead the future of manufacturing, they cannot be separated from each other. Also, manufacturing and Internet companies have not been able to coexist in the past, but now they indeed have to be together. Moreover, "new manufacturing" is also a "service manufacturing", and it is emphasized that no pure manufacturing or service industries will be found in the future. However, this change will not always be seen as an enemy to the existing manufacturing workers because the future manufacturing industry is expected to utilize AI and robotics to create jobs in the future.

“New retail” is a mixture of online and offline, and manufacturing is going to be a combination of physical and virtual as well as manufacturing and services. It is expected that “New manufacturing” will be a perfect combination of manufacturing and service industries. Therefore, the competitiveness of new manufacturing will depend on creativity, experience, feeling and service ability rather than the manufacturing industry itself, and the jobs created here will not like a traditional manufacturing. In addition, he stated that the existing uniformed and standardized manufacturing jobs have already been replaced by standardized machines, but the parts that require experience and innovative creation cannot be replaced.

▲ With the rise of “new manufacturing” based on digitalization, Jack Ma pointed out that the trade war is also a struggle with “old manufacturing”.

Moreover, he pointed out that the trade war is also a struggle with “old manufacturing”. That is, “new retail” is something that can be done by not only themselves but also anyone, and in case of “new manufacturing”, Alibaba is not trying to enter manufacturing, but wants to help innovation in manufacturing. New manufacturing is the overturning of the fundamental value production model, and it also transforms a producer-centered structure into a consumer-centered structure. And, he added that while large firms benefit from the producer-centered structure, opportunities for technologically innovative SMEs can be created from the consumer-centered structure.

Currently, nearly 90% of China's production machinery and equipment are unconnected, and if all of them are connected and integrated intelligently, it will be possible to transform the industry and the economy as a whole. And trade disputes are inevitable in technological innovation, and it is said that there should be a dispute considering the growth of trade between China and the United States for 30 to 40 years. However, even large corporations cannot avoid the difficulties caused by the trade dispute, and it will be impossible to overcome the situation by considering it a natural disaster or periodic difficulty and waiting. He stressed that we have to find a way to the future through new ideas and technologies.

He also explained that the difficulty needs to be prepared against extended period for decades, not a short term. In the meantime, future manufacturing will be 'made in Internet', trade will be reorganized into packages rather than containers, and the power of trade will be reorganized into a number of customers rather than factories or companies. The traditional 'trade war' will no longer be meaningful when all the order is rearranged.

On the other hand, it should be kept in mind that the biggest obstacle in corporation’s innovations might be a resistance to failure and change, and that the existing profit groups are making various attempts to eliminate new productivity in order to restrain the innovation and to rest on the reality. And, he added that the manufacturing industry will change, and the creativity and innovation of young people shown at “Taobao Creation Festival” is much better than our imagination, and it is not possible with conventional manufacturing. In addition, he said that the change has already begun, and if we do not accelerate our business, adapt to future changes and change ourselves, everyone will be crying in the next 15 years.