'Just as we broke even, SARS hit'

“Six hours after one of our colleagues was taken to hospital with suspected SARS, our whole company – all 600 employees – were on lock down,” recalls Savio Kwan MSc09 (1976), former COO of Chinese e-commerce giant Alibaba.

This was 17 years ago, in 2003, when SARS (severe acute respiratory syndrome) – a type of coronavirus – first appeared in China before rapidly spreading to other parts of Asia and around the world. According to the World Health Organization (WHO), SARS affected more than two dozen countries and killed almost 800 people before it was contained.

For some businesses, particularly those in Asia, the COVID-19 pandemic is not the first time they’ve had to quickly reshape business models, change traditional working practices and rethink how they deliver value propositions.

Watch: Savio Kwan shares his experience of running Alibaba during the SARS pandemic

In conversation with Luisa Alemany, Associate Professor of Management Practice in Strategy and Entrepreneurship and Academic Director of the Institute of Innovation and Entrepreneurship (IIE), Kwan explains how SARS led to Chinese customers changing their online purchasing habits – and so proved a huge boost to Alibaba and its businesses. In particular, the outbreak allowed Taobao, the platform that connects businesses to consumers as well as consumers to consumers, to thrive.  

Only two years before, the business had been struggling, with no defined business model and burning through its cash reserves.  

In the wake of the SARS outbreak, Kwan says he made personal phone calls to all of Alibaba’s then 600 employees to check on their wellbeing and make sure they had the equipment necessary to work remotely. And his overriding memory is of employees’ family members picking up the phone as they supported Alibaba in responding to spikes in customer demand.

“The first time I realised this I broke down and cried,” says Kwan, who is still a non-executive director at Alibaba.

This is the third in a series of videos produced by London Business School’s Institute of Innovation and Entrepreneurship (IIE) profiling entrepreneurs who have overcome significant challenge. To watch the previous films and find out when the next ones will be released follow @LBSEntrepreneur or click on #LBSResilientFounders.

Savio Kwan MSc09 (1976) was President and COO of Alibaba from 2001 to 2003. He took on the Chief People Officer role in 2004 and has been a non-executive director since December 2008. He worked for General Electric in their medical systems division for 17 years and co-founded A&K Consulting, where he serves as CEO and founding partner, advising entrepreneurs on start-up businesses in China. The views in this video are his own and are not representative of the IIE or London Business School.