Huawei's weapon for market development
Huawei's rapid growth has its fortuitousness and inevitability. Chance is that it can combine all kinds of weapons. The inevitability is that with these weapons, Huawei will be able to overcome the difficulties and become the leader of China's private enterprises.
According to the news on July 9, 2007, Yu Chengdong, president of Huawei wireless products, said in an interview with Reuters recently that Huawei is striving to win 30% of the global GSM network equipment market within 1 to 2 years. At present, Ericsson is the leader in the global GSM network equipment market, with a market share of 30% last year. Nokia and Siemens followed closely, with a market share of 15%. If Huawei can win 30% of the market, it will threaten the sales of Ericsson and other giants.
The announcement made by Huawei executives has a solid foundation. In June 2007, Huawei successfully defeated many major international groups and became the biggest black horse winner of China Mobile's 35 billion yuan GSM bidding. The large order of China Mobile reflects the formation of a new competitive pattern in the global GSM industry. China's emerging equipment enterprises, represented by Huawei, are rising rapidly, while Motorola, Nokia, Ericsson, Siemens, and Shanghai Bell Alcatel are shrinking in succession, and some old telecom giants such as Nortel Network are beginning to fade away.
Huawei has grown rapidly from a small company starting from a simple house to a world-class communication company. Why did Huawei succeed? Its weapons deserve special attention.
Local R&D to seize the strategic highland
One characteristic of the communication industry is that whoever has mastered the core technology will master the strategic highland of market competition. Only by standing on the core technology can we be unstoppable. When the annual revenue was 20000 yuan, Huawei invested a large amount of money in research and development without hesitation. For 20 years, Huawei has finally become the pride of Chinese technology.
Generally, companies consider China, while Huawei considers the world. Generally, companies will consider expanding the market with products, while Huawei will drive the market with research and development.
Huawei has established many research institutes at home and abroad: the American Silicon Valley Institute, the American Dallas Institute, the Swedish Institute, the Indian Institute, the Russian Institute and other overseas institutions; Huawei Technologies (headquartered in Shenzhen), the Beijing Institute, the Shanghai Institute, the Xi'an Institute, the Chengdu Institute, the Hangzhou Institute, the Nanjing Institute and other domestic institutions.
Developing Huawei's global layout with the localization of technology research and development is Huawei's strategic feature, and also reflects the essence of the industry. A technical design that is not suitable for the aesthetic, thinking and working habits of local people is difficult to win customers. A product and technology that has not been fully localized is more difficult to gain the feelings and loyalty of customers. Based on its deep understanding of the nature of the industry, Huawei has formed a global strategy led by localized research and development.
The indirect strategy of going to sea by boat wins the world
The focus on strategic industries is a powerful force. Huawei sticks to the supply of communication equipment, laying the foundation for forming more strategic alliances.
Commercial competition is sometimes strange. In order to eliminate potential competitors, it doesn't matter how much money you spend. In the monopoly industry of communication operation, enterprises may gain a small part of profits in one region, but in more places, operators will close the channels that can be accessed. Ren Zhengfei understands the weakness of human nature and adheres to Huawei's long-term strategic interests.
Few customers in developed countries know Huawei, but no one doesn't know Nokia, Ericsson, Siemens, GE, Microsoft, IBM, Sony, Alcatel, 3COM, etc. Huawei's strategic alliance with these giants is undoubtedly an indirect strategy of sailing by boat. Customers also have a certain understanding of Huawei's brand through these giants.
The general creed of Chinese enterprises is to strive to create the most perfect products, create brands and conquer the world. Huawei further recognized the value of indirect strategy and achieved extensive cooperation with multinational companies. By virtue of its own products and technologies, and by means of equity participation or holding, Huawei is technology-oriented, relying on well-known brands and channels to achieve the expansion of Huawei's global technology landscape, which is the essence of its indirect strategy.
Strengthen the process and system
In the practice of globalization, Ren Zhengfei deeply understood the significance of the replicability and predictability of enterprise organizations, which is reflected in the standardization of a series of internal processes and internal and external environments of enterprises, and has become the basis of modern scale management.
In the process of introducing western management, Huawei has experienced the painful process of cutting the feet to fit the shoes. In 1998, Huawei paid a large price to invite IBM to guide the internal optimization of the enterprise. The customer-centered market growth gene was transplanted to Huawei's terminal R&D by IBM using the integrated management model, and solidified through the process, resulting in direct economic benefits. Ren Zhengfei made a decisive decision to reengineer the whole process of Huawei and put forward the slogans of "ossification, optimization, and solidification" and "to wear American shoes, you must cut your feet to fit your shoes", which expressed Ren Zhengfei's will and determination.
Huawei once hired IBM experts to give management scores (TPM) to its various departments. Based on the full score of 5, Huawei's average score in 2003 was only 1.8 and reached 2.3 in 2004, while the target for that year was 2.7. According to IBM experts, a truly efficient and standardized multinational company should have a TPM score of 3.5. According to the evaluation of IBM experts, Huawei's per capita work efficiency is only 1/2.5 of that of world-class companies. Before Huawei reorganized its supply chain, its management level was far behind that of other companies in the industry. Huawei's order timely delivery rate is only 50%, while the average level of other telecom equipment manufacturers in the world is 94%; Huawei's inventory turnover rate is only 3.6 times per year, compared with the international average of 9.4 times per year; Huawei's order fulfillment cycle is 20 to 25 days, and the average level of international telecom equipment manufacturers is about 10 days. The purpose of Huawei's restructuring of the supply chain is to design and establish a customer-centric, low-cost integrated supply chain, and lay a good foundation for becoming a world-class enterprise at an early date.
Interestingly, Huawei once hired Mercer Management Consulting twice to integrate the highly centralized IBM matrix management model. For the first time, Mercer developed a centralized plan to comprehensively learn from IBM, but it was not adopted by Huawei. Because the "centralized mode" has very high requirements for senior managers, Ren Zhengfei may be worried that Huawei's managers can not meet the requirements, so he decided to hold still temporarily. In 2004, Huawei hired Mercer again for the second organizational restructuring of enterprise management. There are two purposes: one is to change the organizational structure of the enterprise from the linear functional organization established by departments to the process organization; The second is to establish a marketing system (including company-level, regional, product and key customer subsystems) that is in line with international standards to meet the increasingly obvious consulting marketing needs of customers in the local and international markets.
Establish the overall solution aggregator meticulously
Huawei sticks to the field of equipment suppliers, but its philosophy is to continue to create long-term value and potential growth for customers. Therefore, Huawei's products and services have deeply penetrated into all nerve endings of operators, including the system construction, maintenance and management of all operators, including base station systems, process operations, and information management, as well as all spare parts and associated products, and various software and chips.
This deep extension of the supply chain makes Huawei know all the problems and links in the operator's system. In the overall solution, the operator becomes a shell, while Huawei becomes a content provider. Any extension and expansion of operators has actually created a new market for Huawei. In some cases, Huawei is more able to provide operators with new ways to add value and take the initiative to create new value for them.
Huawei's integrated solution aggregator, while creating value for customers and themselves, also forms a strong competitive barrier. Huawei's meticulous care has cultivated the habit of customers, so that once they enter Huawei's aggregator, they will never leave again.
At the same time, the personalized needs of customers are endless, and the integrated overall solution is bound to be broken through by the actual needs. Ren Zhengfei is very clear about this, so he has always emphasized the alliance, and all participants are allies. Once the alliance reaches its scale, an agile supply chain alliance will take shape, and Huawei will go a step further.
Only by managing with heart and not vulgar can we achieve first-class
Huawei has been aiming to create long-term value and potential growth for customers for more than ten years. For Ren Zhengfei, being a company is not for grandstanding, nor is it for shining rankings; Not to be a social spiritual leader, let alone a government bureaucrat.
Being an enterprise is not only a survival state, but also a kind of obedience. He must faithfully obey every call from customers, markets and employees. There will always be countless crises and the critical point of falling down. To be an enterprise requires constant humility, remember the role of time, and always be alert to the nature of things that are ephemeral.
Many entrepreneurs' behavior and thinking come from fear, while Ren Zhengfei comes from love. The return of Li Yinan was Ren Zhengfei's happiest thing in 2006. The Chinese sometimes tolerate the enemy, but hate the "traitor" to the bone. Ren Zhengfei can tolerate it. Li Yinan took a detour and started his own business from Huawei, and took Huawei as his rival everywhere. But in Ren Zhengfei's eyes, Li Yinan who has experienced this experience is more precious. Because Ren Zhengfei knows that Li Yinan is Huawei's wealth.
When Chinese companies pass on the pressure of multinational companies to every employee, the creativity of all employees is stimulated, and the depression of employees begins to occur frequently. Ren Zhengfei, who praises the management with his heart, has put forth a series of policies and written articles in person to care for and comfort the employees' body and mind from the spiritual level.
Ren Zhengfei must have heard a mysterious voice: leave the mercenary business of businessmen, dare to think and do, dare to go lonely, not vulgar, not mediocre, and become a world-class enterprise. Only the strong can declare his happiness as a model. Huawei's model is too soft to speak, only to the clearest soul.
(This article is an original article by Zhuge Changqing, and the pictures are selected from the Internet. Welcome to forward it, and please indicate the source for forwarding)
Introduction to Zhuge Changqing: Zhuge Changqing, the inheritor and promoter of traditional Chinese culture, is willing to "learn from sages, promote virtue, revitalize China and benefit the world" together with people with the same ideals in the world.
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