The news out of China this week about the break up of Alibaba into six separate Companies was startling and exciting for investors and followers of high-tech companies with high valuations. The e-commerce giant said Tuesday that it would split into six Business groups, which will each be managed by their respective CEOs and follow a holding company structure. Each CEO will report to a board of directors and assume full responsibility for company performance.

At Advantexe, we have had the privilege of working with dozens of large companies that have made the decision to break up into smaller companies. Much of our work uses business simulations to help the new leaders and contributors adjust to the new environment by providing the business acumen and business leadership skills needed to thrive. Based on years of experience and working directly with hundreds of executives, senior leaders, and the managers and contributors who do the work, here are five insights into why Breaking up is good for business: