SHAJI STUDIO 2019: An immersive summer school in the heart of China’s dynamic manufacturing ecosystem: https://blog.fab.city/shaji-studio-2019-an-immersive-summer-school-in-the-heart-of-chinas-dynamic-manufacturing-a289e6bc7f5b

Shaji Model

Inspired by what they see in Shaji, Alibaba Researcher worked with CASS (Chinese Academy of Social Science) on Shaji model that summarized critical drivers of their success.

  • Bottom-up model: unlike the typical model of bringing e-commerce to the rural area in the top-down fashion, e-commerce was started from the bottom up by the rural residents themselves.
  • Copy to scale: the low barriers of entry enabled others to copy the existing business and start their own. The paper called this a cell division copying with exponential growth.
  • E-commerce market drove industrialization: unlike the traditional model of industrialization by offering a considerable amount of cheap labors to manufacture goods for others, the industrialization is driven by the market reality to decide what kind of tools, equipment, and technologies to adopt.
  • The clear core group who compete and collaborate: the core group of Shaji e-commerce is the new entrepreneurs who are mostly related to each other through family ties. The multiple layers of relationship create a system of competing and collaboration that further expand the complexity of the business ecosystem that contributes to the growth of diversification and specialization.
  • “presence and not interfering” governing: the government did not try to lead the development policy or direction and focus on building infrastructures such as roads, electricity, and telecommunication. Also, the government is responsible for solving problem arise from the community such as securing land usage for the factory. (e.g., Farmlands to industrial lands change is extremely hard in rural China).
  • Proper vertical markets. The furniture markets with vast segmentations of the markets enable the cell division model of scaling to specialize in different segments. Thus, proper vertical market facilitates the cell division model of scaling of the Shaji model.

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