Growing a company requires hiring the right people. For Jack Ma, the man behind Chinese tech giant Alibaba, that's a process that took him some time to master.
Jack Ma, speaking in the Indonesian resort island of Bali in October, recalled a hiring mistake he made in the early days of Alibaba.
He said on CNBC: “When I raised my first round of funds, it was $5 million. I hired a lot of vice presidents from multinational companies. One of the VPs of marketing came to me, he gave me a proposal, he said: 'Sir, this is our next year's business marketing plan’. As it turned out, that plan was designed to cost $12 million — way over the spending budget that the company could afford back then, Ma explained. But that employee admitted that he had never done a business plan below $10 million.”
"So I said: 'Alright, it's not his fault, it's my fault,'" Ma said, adding that he realized his decision to hire those people then was akin to placing a Boeing 747 engine into a tractor.
Since then, Alibaba has grown into an e-commerce giant with more than 80,000 employees worldwide and is one of the most attractive employers in China, according to a ranking by consultancy firm Universum.
Underpinning that success is one of Ma's first rules in hiring: Avoid the "best" people and the "experts."
"I hate to hire people who come as experts because there's no experts of future, they're always experts of yesterday," Ma said. "There are no best people. The best people are always in your company, you train them to become best."
And that starts with getting in people who are ready to learn and are not afraid to make mistakes, he added.
Topping the class is not a requirement to get hired by Jack Ma. In fact, Ma is known for shunning top performers.
In the book "Alibaba: The House That Jack Ma built," writer Duncan Clark said Ma preferred hiring people who are not top performers of their schools, according to an excerpt carried by Tech in Asia. Ma explained that the "college elites" would get frustrated easily when they face difficulties in the real world, according to Clark.
Even so, candidates must still have some smarts to navigate the ever-changing business environment, Ma revealed last week.
Ma said he tends to prefer people with a good emotional quotient because he finds that they make better leaders and team players. But without some intelligence, they wouldn't go far either, he added.
"You should have the EQ (to) work with others, you should have IQ so you know what you're doing," he said.
Ma places a lot of emphasis on being optimistic, a trait that he said helped him build Alibaba into the tech juggernaut that it is today.
Being optimistic can help people turn a challenging situation into a favorable one, he said.
"As entrepreneurs, if you're not optimistic, you're in trouble," Ma said. "So the people I choose, they have to be optimistic."