Deconstruction Huawei 2 ? High input by external force ? After the entrants as Huawei, to his position at the technical level is the pragmatism of the road, which has been stressed for the market, R &amp; D, develop new technologies, complemented by low prices and good service, grab global market share. Gu Hui China Business Technical inputs up to Huawei eyes, there are three departments of the company&#39;s largest contribution to: market research, development and human resources. Although the company&#39;s president Ren Zhengfei now focus only on the determination of grand strategy, but the company three large sectors of the R &amp; D still Zhengfei head. Huawei introduced an insider from the company&#39;s inception, Ren Zhengfei have invested in technology companies have requested. Huawei was founded early, Ren Zhengfei would require companies to sales agents of foreign products the profits are invested in the technology development on a small switch. With the expansion of profit margins. Profits to invest in the company again upgraded product research and development, the cycle, gradually expanding. According to data provided by Huawei brand center, Huawei R &amp; D costs per year not less than 10% of sales, and insisted on 10% of R &amp; D for the pre-research, new technology, new areas of continuous research and tracking. This statistical data with third parties the same. In the recently announced near 23rd list of top hundred electronic enterprises, Huawei R &a mp;amp; D investment in China, the amount of ranking first. 2008 Love for the R &amp; D reached 10 billion yuan, the proportion of its revenue more than 8%. So far, Huawei has won 6 consecutive years, the number of patent applications, the first Chinese companies, account for 3 consecutive years, the number of China&#39;s invention patent applications first. While rival Huawei ZTE R &amp; D investment revenue as high as 9.8%, but still lower than the total amount of Huawei. Huawei attaches great importance to IPR protection technical innovation. According to Huawei official data, as of the end of 2008, Huawei has accumulated 35,773 patents, including patent applications, 26,005 Chinese, 5,446 international patent applications, foreign patent applications for 4322. In the LTE in the field, Huawei fundamental core patents accounted for 10% of the total, ranking third. 1 Shenzhen communications manufacturers believe that Huawei&#39;s generous early R &amp; D investment is rising out of Zhengfei their inherent requirement of the company. Since then, the Cisco IP Huawei Ren Zhengfei more convinced the prosecution to put on the need for technology research and development. 43% of Huawei staff adhere to research and development investment. Huawei has been for several years at an annual rate of recruitment of 34 thousand graduates of famous universities, are still thousands of people each year rate of recruitment of excellent technical personnel at home and abroad. Huawei R &amp; D personnel in recent years to reach 4 million. Leveraging append Compared with other communications giant, Huawei is not a long-term technology accumulation. But Huawei is found in the technical research and development for its own way. Huawei has chosen to do non-core ASIC development and board- level development of two applied technology development. Huawei&#39;s R &amp; D is done based ASIC development. ASIC technical difficulty of small and large quantities. ASIC technology development useful role in the company reduce costs. The main development model is designed by Huawei own several chips, and then look for China Taiwan, Hong Kong, China or the United States chip maker professional processing. After processing, the chip can be used instead to buy ready-made chips, saving a lot of cost. In 2004, Huawei&#39;s ASIC design department, independent from Huawei, set up the &quot;Hisilicon&quot; the new company. Hisilicon is a professional design company, to include outside companies, including Huawei Technologies to provide chip design. Huawei&#39;s R &amp; D in the board- level development idea is to use cheap labor of domestic R &amp; D, spend a lot of manpower to reduce the cost of entire board. For example, Huawei has spent more than a dozen individuals to study the lower the cost of the switch the user board. Huawei is technically not the same one with domestic enterprises where technology development is to do with external forces. The early stage of development in Huawei Ren Zhengfei once that independent development is the only R &amp; D should take the path. The transformation process after the introduction of IBM, IBM&#39;s consultants have found a problem, Huawei R &amp; D to do everything on their own, this result is inefficient companies, Huawei is therefore proposed to shorten their product time to market. Ren Zhengfei competitors in summing up the experience, so that Huawei Technologies R &amp; D to go down this road: The core technology is their own development, but a number of relevant and forward-looking technology to do domestic universities or laboratories. This is to ensure the master core technologies of Huawei, but also to protect its R &amp; D efficiency. Huawei Technologies and Tsinghua University Department of Radio Engineering, China University of Technology, University of Electronic Science and Technology, Southeast University and other universities have established long-term technology partnership. This large-scale cooperation with domestic universities, not only solved the front-end technology of Huawei in the problems, but also trained a large number of high-end Huawei technical personnel. In overseas, Huawei has also established a cross-border integration of employees through the establishment of the laboratory. Overseas research is of great significance to Huawei, Huawei&#39;s overseas operations not only to provide support and services but also means that Huawei can with other international IT giants, like 24 hours to establish a globa l research system. Huawei, one third of the world I In 1997, Huawei CEO Ren Zhengfei visit, when Lucent Technologies said that the first sentence is: &quot;I worship a young age is Bell Labs, feelings of admiration than love.&quot; In 2008, Huawei beyond the Alcatel- Lucent, the world&#39;s third large telecommunications equipment suppliers. China Business section of cast &quot;Every economic crisis will have a great company, hope that this time Huawei will seize the opportunities.&quot; In 2008 coincided with the global financial crisis, an information within Huawei says. It is also in 2008, Huawei beyond the Alcatel- Lucent, the world&#39;s third- largest telecommunications equipment suppliers. &quot;In 2008, Ericsson sharp drop in performance, Motorola, Nokia Siemens loss, Huawei 40 percent of the growth can be said to stand out. Current operator equipment market, has become Ericsson, Nokia Siemens, Huawei tripod pattern.&quot; One of the telecommunications industry of Guangzhou researchers reviewed the case. Stand out 2008 In 1997, Huawei CEO Ren Zhengfei visit, when Lucent Technologies said that the first sentence is: &quot;I worship a young age is Bell Labs, feelings of admiration than love.&quot; At the same time, Ren Zhengfei release rhetoric in other occasions: &quot;In the future one-third of the world telecommunications market, there must be a seat of Huawei.&quot; In 2008, the global financial crisis led to decline in profitability of almost all enterprises, Huawei completed annual sales income of 23.3 billion U.S. dollars contract, in accordance with domestic accounting standards, operating income of 18,330,000,000 U.S. dollars, net profit of 1.15 billion. Operating profit margin of 10% in 2007 to 13% in 2008, sales revenue growth than cost growth by 3.4 percentage points higher than the cost rate of 28.47% from 2007 down to 26.7%. That same year, the world&#39;s largest telecommunications equipment supplier Ericsson net income decreased 46.3%, loss of 301 million euros of Nokia Siemens, Motorola loss of 4.163 billion U.S. dollars, sales fell 36%. Huawei Technologies Annual Report 2008 revealed that 75% of their income has been from the international market, sales of terminal operatio ns to reach 4 billion U.S. dollars, up more than 80%. Terminal business more than 80% of its revenue from international markets. Including Europe and the Middle East, and Africa&#39;s emerging markets, Huawei is still the main source of foreign income, while the Asia-Pacific (excluding China), Latin America and North America also improved significantly. This year, rival Alcatel- Lucent Ren Zhengfei worship are not doing well, the 6th consecutive quarter of losses makes the Alcatel-Lucent lost the throne of the third global communications equipment, Huawei is replaced. Informa advisory body known in the recent &quot;Global Mobile&quot; feature article published, said the global mobile device market is increasingly becoming Ericsson, Nokia Siemens, Huawei-strong battle, the three companies to further consolidate the market leadership. With the gradual recovery of Nokia Siemens, Huawei in the global market continue to win major contract carriers, declining North American manufacturers are expected to share the three major vendors will eventually be more than 70% market position is unassailable. Another well-known consulting firm Ovum is released by Huawei as the research object of special study, said that Huawei has grown from a &quot;Chinese Vendor&quot; (Chinese supplier) growth for the &quot;Global Giant&quot; (global giants). The next opponents Huawei&#39;s continuous challenge in the outside world 40% of the time the sustainability of high growth, Huawei to produce a first half of 2009 year over 2008 respondents, with 17% market share ranked third, while Huawei&#39;s market share than almost doubled over the same period in 2008 doubled compared to the first quarter of 2009, also high by 2 percentage points, the highest growth for the industry. The most important areas of wireless communications, first half of 2009 Huawei UMTS market in shipping more than 400,000 carrier frequencies, and the year 2008 shipments to 300,000 of its carrier frequencies; in 2009 in the first half, Huawei CDMA shipments close to 280 000 carrier frequency, the 2008 full year shipments of its carrier frequency to 220 000. U.S. market research firm Dell Oro latest data show that, after the first quarter of 2009, ranked third in the world after the second quarter of Huawei in the global mobile network equipment market continue to third, with 32% of Ericsson&#39;s market share continued to rank first Nokia Siemens with 20% market share in second place, down 1 percentage point to 17% of Huawei& ;#39;s market share ranked third, while Huawei&#39;s market share more than doubled over the same period in 2008 almost doubled compared to the first quarter of 2009 also higher by 2 percentage points, the highest growth for the industry. &quot;Huawei&#39;s the truth,&quot; the author, Dong-Sheng Cheng, senior media people think that before 2005, Huawei Africa copying the experience of the Chinese market, and these practices in Europe are mature markets such as the lack of core competitiveness. In 1998, &quot;Huawei Basic Law&quot;, IPD (integrated product development), ISC (integrated supply chain) for three events at the same time began to be stationed in Europe, said the three major events over the role of a low-cost advantages, Huawei has become a real sense of the international company. In 2005, Hanover, Germany, Deutsche Telekom Huawei awarded the exclusive operator QSC&#39;s NGN project, covering Germany and QSC to build more than 200 cities throughout the NGN network. This is a Huawei successfully entered the European market standards. August 15, 2006, Huawei has won Leap Wireless in the United States, Idaho Boise, Reno, Nevada and Washington SPOKANE the 3G network contract. Huawei officially entered the North American market. &quot;The next rival is the Nokia Siemens, and will soon surpass, Huawei 2008 annual growth rate of 43%, first half of 2009 to complete the equivalent of 2008 full year sales contracts, the latest data show that only the ratio of Nokia Siemens, Huawei 3% less market share. According to the current growth rate, the end of 2009, Huawei Nokia Siemens will replace as the world&#39;s second- largest telecommunications equipment supplier. &quot;telecommunications industry of Guangzhou, a researcher said. &quot;Coyotes&quot; are faced with learning How effective financial management and reduce costs? It can be said that Huawei was founded 20 years the second bottleneck. This IBM 1993 is almost exactly the same problems: the high revenues can not be changed in line with the net profit. China Business section of cast &quot;We do get a lot of big overseas orders, but I was not clear whether the money list.&quot; 2007, Ren Zhengfei at an internal meeting said. As in 2000, once again trapped in a &quot;ceiling&quot; phenomenon Huawei again coach IBM. This time, the &quot;coyotes&quot; Huawei to learn is &quot;to reckon his own account.&quot; IBM where he studied under the second How effective financial management and reduce costs? It can be said that Huawei was founded 20 years the second bottleneck. This IBM 1993 is almost exactly the same problems: not into the high revenues with consistent profit. 1993 Gerstner took over IBM, immediately start the integration, including financial management, including a number of reforms in 1997, IBM re-emergence, it is also at this time, Ren Zhengfei IBM first came to visit. In 2007, Huawei Ren Zhengfei has been aware of the &quot;coyote-style&quot; assault to be coming to the extreme, human sea tactics alone more and more difficult to capture market share in Europe and the United States and other mature expansion of overseas markets have to rely on more detailed management Among these, the most important financial cost control. In early 2007, Ren Zhengfei personally wrote a letter to IBM CEO, Sam Palmisano, IBM hopes to emulate the financial management make the transformation. Huawei needs is not the general financial advisory consultants, IBM&#39;s own financial officers must personally involved. The reason finds IBM, because IBM helped Huawei to implement early IPD and other projects, bringing Huawei &quot;brand new type of change.&quot; July 2007, IBM invited Huawei nearly 10 finance-related personnel to the U.S. headquarters of a three-day visit to understand the situation of financial systems. Soon, Huawei formally launched the IFS (integrated financial restructuring) project. At the same time, IBM officially upgraded to a Division Huawei customers - in dozens of division of its global customers, Huawei is the only Chinese enterprise. This division of the customer, IBM will not only set up a global team from the backbone, will provide a full range of customized services. The team structure that will report directly to U.S. headquarters. Few people know that this investment geometry Huawei, Huawei, IBM is willing to upgrade to business unit customers, the importance of this transformation is evident. It can be concluded that the cost of this project is certainly big enough order of magnitude. Moreover, this can also participate in financial restructuring as evidenced by the level of IBM staff - most of them in all areas of the CFO-level people. John F Bould is one of them, it is Huawei IFS (Integrated Financial System) project&#39;s main person in charge, he and his team stationed in Huawei&#39;s sole purpose is to enhance the capacity of Huawei&#39;s financial team. According to Huawei Technologies Annual Report 2008: the global financial crisis, almost all declining profitability in 2008, Huawei completed annual sales income of 23.3 billion U.S. dollars contract, according to domestic accounting standards, operating income of 18.33 billion U.S. dollars, net profit of 1.15 billion. Operating profit margin of 10% in 2007 to 13% in 2008, and revenue growth than cost growth by 3.4 percentage points higher than the cost rate of 28.47% from 2007 down to 26.7%. Meanwhile, beginning in 2007 and achieved initial results IFS projects, application of international financial management standards, strict control of financial risks, make it grow faster than sales growth in accounts receivable-trade, to ensure the good condition of payment,. Huawei&#39;s 2008 annual report: 2008 Huawei-trade receivables growth rate of 35.7%, with sales growth of 42.7% compared to 7 percentage points lower;-trade receivables to total assets ratio fell 5.6 percentage points. As of the end of December 2008, Huawei&#39;s cash flow has reached 3.08 billion U.S. dollars. Finance-led decentralization With the gradual integration of the business processes of financial, Huawei&#39;s management style, &quot;hit single&quot; mode and the training of personnel and so began to follow the new process. Now, t he Huawei effective increase in stress, improve per capita benefits, &quot;profit&quot; and &quot;cash flow&quot; as the &quot;income&quot; is also important markers. Huawei company encourages employees to go forward, but do not encourage style regardless of the costs to occupy the market, but more emphasis on profitability, and this reflected in the assessment indicators. For example, Huawei&#39;s number one on all levels in order to achieve effective growth, profits, cash flow, increase per capita effective stringent assessment as a starting point: who can not achieve an improvement in efficiency improvement of average per capita above, the need for accountability. Huawei after the financial restructuring the financial sector in the entire business process system, the examination of these financial targets easier to achieve. In the new system of financial management processes under the protection of Huawei in early 2009 on the organizational structure was a major adjustment. Prior to the organizational structure is similar to IBM&#39;s business integration across all sales model, is highly centralized organizational structure. It emphasizes the sharing of resources - all the products on behalf of a client manager faced with a client, the advantage of a unified customer interface. However, Huawei&#39;s products span too complex internal communication, which for internal collaboration and collaboration with partners a challenge. According to Huawei line pre-sales service personnel revealed that a number of business support services on the line not in place, the responsibility is not clear, often the phenomenon of internal wrangling with each other. Not long before, Ren Zhengfei, entitled &quot;Let the line direct call for fire&quot; internal speech, the militarization of language with the usual Huawei ongoing organizational restructuring of the reasons were clearly stated: &quot;Our situation now is that the front combat units, less than 1 / 3 of the time is spent looking for objective, look for opportunities and the opportunities into results, while a lot of time is frequently used in communication with the coordination between the rear platform. and back problems to be solved to coordinate to the front, dragging the hind legs fighting forces ... ... &quot; Huawei has been practiced from the establishment of a highly centralized management, however, With the growing size of the rapid expansion, this centralized management framework of our inefficiencies Jigou bloated become increasingly prominent. Thus, Huawei ensure the new financial system, the determination to achieve some decentralization. &quot;If there is no complete financial management system support, Huawei is not easily give up their powers.&q uot; Huawei said a financial consultant. Abandoned extensive demand intensive Like other domestic firms, Huawei has also gone through a period of extensive growth, at present, although more and more standardized management of Huawei, but there are still many areas to waste. It is a work in Huawei&#39;s North Institute of test engineer, Huawei&#39;s R &amp; D areas in the test is not strict because of other reasons, a lot of waste generated, he thinks most of these waste is avoided. In fact, in recent years, as the business rapidly, Huawei&#39;s margins have been declining. According to Huawei&#39;s 2007 annual report, Huawei operating margin from 19% in 2003 fell to 7% in 2007, net profit margin dropped from 14% to 5%. Although since 2000, Huawei&#39;s financial sector has been involved in cost accounting, but the company is still a lack of forward- looking budget management - the vast majority of business very difficult to do, but it is good for multinational corporations. For example, each product pricing and cost accounting, etc., have a complete system and operation of the process to ensure that each one can have a clear out of bidding to calculate costs and profits. Previously, Chinese companies Huawei and, like most of the fina ncial sector has not participated in every product pricing and cost accounting, primarily still stay in the traditional accounting roles. When small, the company can control the risk. However, the Huawei, when the increasing scale of the company, business has globalized, increasingly long supply chains, customer differentiation, when more and more, without a global financial management, financial risk will be difficult to control. Despite the strong pace of expansion of Huawei, but how to maintain a high growth, further improve profitability, as Huawei must be addressed. Zhengfei is aware of this problem, so in early 2007 to personally write to the IBM &quot;help.&quot; Implantation of the standard financial processes to Huawei the operational processes, to achieve the balanced development of revenue and profits, bid farewell to all costs of &quot;coyote-style&quot; assault, to support more effective global operations and growth. Huawei: the success of a balanced development model Huawei proposed macro-and micro business model business model is built on the basis of rational thinking, and its essence is the dynamic balance management into a practical meaning of &quot;Huawei model.&quot; China Business bo Recently, Huawei has once again aroused the concern of the industry in China, many enterprises have Huawei as a benchmark study, and some even proposed to be certain areas of Huawei. Cause the background of this phenomenon is that the financial crisis, Huawei not only has maintained a good momentum of growth, and its pace of internationalization has been a firm go far, in 2008 international revenues account for 75% of its sales revenue; and the current international patent The number of applications beyond Toyota and Philips, the world&#39;s top business first; in the &quot;Business Week&quot; magazine out of the top ten most influential companies, Huawei is the only Ranking enterprise. The author believes that Huawei as a Chinese, non- listed, private, high technology enterprise, is a &quot;phenomenon&quot;, for Chinese enterprises, their imitation and reference value is not great, but hidden behind the success of the phenomenon in Huawei operation and management of the philosophy and concept, is worth thinking of Chinese enterprises and entrepreneurs. Huawei Ren Zhengfei, president of management can be attributed to the ideological balance. Since 2001 in the sum of Huawei Ren Zhengfei the &quot;Ten management points&quot;, regardless of how the external environment change, of &quot;adhering to balance development&quot; has been placed first. Can speak, Ren Zhengfei core of the idea of management is to balance, balance is the highest management philosophy. Zhengfei claimed to be a &quot;gray&quot; who, in his view, between the gray between black and white, is very difficult to grasp, that is, the level of leadership and mentor. &quot;Equilibrium is the most effective form of productive forces,&quot; &quot;continue to adhere to a balanced development of ideas and promote reform and improvement of the work. Equalizer is the most effective form of productive forces. Through the consistent improvement, and continuously enhance organizational vitality, and improving the overall competitiveness, and continue to improve average efficiency &quot;, which is a long stick to the core values of Huawei. Huawei has 20 years of growth and development path is built dynamically to achieve success and benefits, operation and management based on the balance, through continuous improvement, improvement and improvement, Huawei continued to strengthen and enhance the management capacity, and then enable enterprises to embark on a positive development. Huawei&#39;s success, once again the case of Chinese-style shows, balanced management is really the core competitiveness of enterprises. 2005, along with the quickening pace of internationalization of Huawei, Huawei to re-sort their mission vision and development strategy. Its strategic position on: 1. For customer service only reason Huawei exists, the development of customer demand is the driving force of Huawei; 2. Quality, good service, low operating costs, the priority to meet customer needs, enhance customer competitiveness and profitab ility ; 3. continued management transformation to realize efficient process operation to ensure quality delivery of end to end; 4. jointly with the Friends of the development of both competitors and partners together to create good living space, shared the interest of the value chain. Not difficult to see from the above strategy, Huawei&#39;s strategy is both concerned with management (the first), but also concerned about the management (second); both concerned with the business outside (the first and fourth), but also concerned about the internal (second and third) . Can be said that the management philosophy based on its strategy of Huawei, a full and balanced strategy. In the business model, the Huawei&#39;s macro-oriented business model is customized, product development roadmap is customer driven, to provide comprehensive and timely customer service as the company&#39;s value and the only reason for existence; in management mode, Huawei micro-business model is process-oriented organizations, the completion of various elements from end to end enterprise, high quality, efficient and effective management; in the internal core values, corresponding to build a high performance culture characterized. As Ren Zhengfei said: &quot;In 20 years of painful ordeal, we finally established a &#39;customer-centered, striver-based&#39; corporate culture, which the company slowly out of the dilemma.&quot; Also not difficult to see, Huawei core values advocated by the same internal value orientation (hard) and the external value orientation (customers) an organic and balanced together. Overall, this model will be customer value, business efficiency and management efficiency and high performance together organically in order to achieve an effective harmony, a dynamic equilibrium. It can be said, Huawei proposed macro-and micro business model business model is built on the basis of rational thought, and its essence is the dynamic balance management into a practical meaning of &quot;Huawei mode l.&quot; Huawei in the early stage of development, the focus of the enterprise located in the business, is also very weak for a company concerned, is undoubtedly a wise choice, because &quot;to live, is the company&#39;s last word,&quot; the company want to live, and to a high- tech enterprises, to grow and the need to give priority to the efficiency of enterprises. After 1997, the company based on changes in the status and external environment, transform the strategic focus, strengthen internal management, by introducing world-class enterprise management system in the management of enterprise-class integration and, through management efficiency to promote the business benefits increase. For Huawei, the strengthened management, the implementation of IPD, ISC as the core of the management changes that make up the management of the short length of wood, because the management is really the core competitiveness. For each department, project team and the director speaking, with the personal commitment to implementation of the system performance, it has not simply functions of the departments or functions of the manager, the company strengthened its management body functions, the department has actually transformed the cadres To set management functions and business functions as one of the managers. Therefore, managers face an urgent role and the role of the conversion, and then realize their operational capacity and management capacity in the balance. Thus forming a virtuous circle: the individual level, the personal ability and responsibility of the dynamic equilibrium; at the organizational level, to achieve departmental business objectives and the management efficiency of the dynamic equilibrium; at the corporate level, to achieve power and profit, business and management, organizational strategic objectives and organizational capacity of dynamic equilibrium. Truly realize the dynamic equilibrium of the enterprise, the winner must be business, not growth, not development, is not successful is difficult. Duiyu Huawei&#39;s future development, we have reason full of confidence, support this confidence reason is this: in Mr. Ren Zhengfei&#39;s leadership, Huawei to balancing its management philosophy, and the Practice after 20 years, Huawei Chenggongdazao Le the balance of world-class enterprise soft power. This is a terrible balance of power! ?
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