The Huawei Way: Grow Up or Die!

Related entries: Corporate News, General, Strategy

I recently reported about the woes of TCL and their European adventure with Thompson , as well as the latest losses from Lenovo. However, on the upside of China’s global business plan were Haier and Huawei. A bit more on Huawei here.

Speaking at the Chatham House China Communications conference recently was Edward Chen, Chief Representative in the UK. He had some interesting things to report. In terms of scale the company boasts impressive figures, and is already bigger outside China than in:

    • Total sales: US$8.2 billion
    • International sales: 58%

Chen noted that Huawei has made the transformation from being an infrastructure and systems provider to being an “end-to-end solutions provider” that is sensitive to differing consumer demands in different markets. It has also moved away from being just another Chinese supplier, to being a brand that can be seen advertised (as well as reported) in the Economist and elsewhere.

So what is the philosophy behind this Chinese success story? Two comments shed some light on the company’s drivers:

    • “Grow Up, or Die!”
    • “The customer is Number 1!”

Of course, there must be more to it than that. In Huawei’s case, these beliefs are supported by equally strong commitment to technology, and 10% of revenues are invested in developing IPR. As of June this year the company was reported to have seen a return on these investments in the form of:

    • 14,000 patent applications
    • 2,000 patents approved
    • Over 90% of patents are “invention” patents (rather than process ones)

When I spoke with one of the UK managers the other day, he painted a very positive picture of the market, and the attractiveness of their balance of good technology and great price.

I suspect they will have a good Christmas party! And that there will be plenty of other Chinese success stories in the international market in the next 5 years. No doubt there will also be failures. So, can the Chinese book world expect a “Mr. China” clone? “Mr. Europe”, perhaps?!

One Response to “The Huawei Way: Grow Up or Die!”

  1. Archive » Innovation Nation?| China Business Blog Says:

    […] senger jets. While few Chinese companies have had international success with technology (Huawei being one), today’s technologies leaders would be wise to keep an eye on emerging Chine […]

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