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Huawei Butterfly Effect: 1.5 billion yuan to 30 billion U.S. dollars

      In March of this year, Huawei's chief marketing officer, said Xu Wei conservative, Huawei's contract sales in 2009 goal is 30 billion U.S. dollars. Said that this data conservative, not only because the first half of 2009, the company's contract sales reached 15.7 billion U.S. dollars, a conservative also from Huawei's low-key, 20 years, Huawei's founder Ren, received almost no national media.
20 years ago, Huawei was just a registered capital of 24,000 yuan agents - the production branch exchange (PBX) of the Hong Kong company's sales agents. And many large companies like Huawei from the agent started and move towards independent research and development path. The difference is that used by Huawei, a short time, and beyond the world-class telecom company. According to Informa's advisory report, in 2008, Huawei has been ranked in the mobile device market segments, third in the world. To the first half of 2009, the contract sales reached 15.7 billion U.S. dollars - In 1995, sales income of RMB 1.5 billion contract. 20 years, Huawei's sales revenue increased by 140 times.

      The reason why this company has been regarded as the most potential peer competitors, not only in sales and market share in its rapid growth, but also because every time the outside world seem insurmountable crisis, which had reflected a strong resistance and get a breakthrough growth.

Courage and anxiety

While it would be 10 billion U.S. dollars, 20 billion U.S. dollars as the limit time and time again, when Huawei Technologies, a company with sales data quickly dispelled concerns about the outside world: Huawei in 2007 came to 100 billion threshold, only After two years of adjustment, it to 30 billion U.S. dollars in sales volume to external shock. The spread of the financial crisis in 2008, other competitors have experienced a negative growth situation, Huawei is still made up 42.7% of the revenue growth.

Since 1988, the agent started out in 1990 will be its own brand products into the rural market has started, and then to enter the urban market in 1995, and then to grow into a fully-fledged international company - In 2005, Huawei's overseas Contract sales for the first time exceeded domestic sales contract, by 2008, 75% of Huawei's sales come from outside of China's market - no one doubts the courage of the company.

In its internal, Ren Zhengfei always remind staff: Huawei Do not be arrogant. Rapid growth and is always accompanied by anxiety, Huawei's development process.

"If winter comes," the anxiety of argument is always the speculation that is the industry's spring time, Huawei has been brought inside. Proposal of the previous two winters were in 2000 and 2004.

Huawei's annual sales in 2000 reached 15.2 billion, profit to 2.9 billion yuan among the nation's first e-hundred, Ren Zhengfei they talk about the crisis and failure. "Every day I think about ten years are doomed to the success of turning a blind eye, there is no sense of honor, pride, but a sense of crisis." Ren Zhengfei said Huawei may be so only survived for a decade.

In 2004, an internal speech, Ren Zhengfei repeated review, look at Huawei currently experiencing serious difficulties, saying that the nature of this struggle for survival is quality, service and cost competition. At that time, Ren Zhengfei proposed measures to deal with the winter are: aggressively expanding overseas markets. Growth in the domestic market may be down, but not less than the others. We should improve the quality, the service well, the same time lower the cost. Appropriate and competitors to cooperate to reduce development costs. "In the current harsh competitive environment, Ning Huawei loss can not be loss industry chain alliance, because Huawei can afford to lose a little loss, loss is all the allied forces died. Once spring arrived, these allies, such as agents and distributors so you can go grab a single lively, Huawei will Huanguo Lai had. "says Ren Zhengfei.

2007 annual report, Huawei sales revenue reached 12.56 billion U.S. dollars, ranks among the world's top five telecommunications equipment manufacturers seem to be a celebration of the moment, Ren Zhengfei also warned that the winter in the third - simmering million people in the employees to resign.

Outside it is PCB Fabrication easy to Ren, the end of 2007 the personnel changes and had just released the new "Labor Contract Law" linked together that this is a circumvention of the labor contract law. In fact, Huawei's management over labor contracts Gengrang anxiety is part of the Da Jiangshan year-old employee of collective suffering from diseases of the large state-owned enterprises.

By the end of 2007, Huawei's requirements, including Ren Zhengfei all the work, including at least eight years, Huawei's staff in 2008, before the New Year's Day, we must have procedures for handling voluntarily resigned and then signed with the company 1-3 years of labor contracts; to repeal the existing The job number system, all work to re-order numbers. This is known as the thousand people outside the resignation of the event spread to 6 million people.

These employees are mostly corporate hero, the working years are long, early for the company Kaijiangtuotu. In fact, the introduction of a 20-year culture of Huawei's job number, "20000" inside the numbers of staff working in general have different treatment: As the current job number for Huawei to enter the company has to order, "20000" inside, on behalf of qualifications , and the corresponding positions and wealth.

In order to maintain the vitality of enterprises, Huawei over the years conducted a series of changes in the human resources system to meet the needs of global business development, including the "people post match" and "posts and will pay," the pay system reform, as well as employee benefits and insurance protection reform of the system, which aims to maintain the vitality of enterprises. In fact, Huawei's development, there had been several incidents of human resources transformation. The larger twice: in 1996, Huawei's high-level marketing "first to resign and re-competing industry", Marketing Department cadres comprehensive "Xi Pan", a number of cadres to return to regular staff positions; in 2003 for all companies in the high-level collective "for reduction of remuneration." Before and after 2002, the telecommunications industry, Huawei's performance in winter so that the first time since facing the business decline in the lead Ren Zhengfei, more than 300 cadres and to apply for an 10% reduction of remuneration in order to tide over the crisis.

Prior to the collective resignation or reduction of remuneration of the two campaigns are directed cadres, solve the "Cadres", the solution is short-term problems; and by the end of 2011, Plastic Cards launched the large-scale personnel changes in the purpose of the is the solution to maintain internal vitality and innovation capability of Huawei can not avoid these problems.

Ren Zhengfei always ask: if the Huawei is really a crisis coming, and staff salaries by half, cut half of them will be able to save the company, then nothing the crisis. If the layoffs and wage cuts can not save the company, then how to do this?

"Huawei company can maintain this state long-term it?"

Winter warning and a sense of crisis has become a Huawei genes. Huawei sum up the experience of food for thought: look at Medical Device companies that have fallen, of course, there is the role of external forces, but the root cause lies within the growth lies in its own genes, able to maintain sustained sense of crisis and innovation, can Building good internal mechanism, thus maintaining its long-term vitality, and thus to provide enterprises with the endless long-term traction. But when it achieved growth, Ren Zhengfei has repeatedly talked about the crisis of experience. "We're only on this competitive than other companies as early as the cruelty of a little understanding, we survived." Zhengfei said.

In his view, Huawei is also too tender, after a decade of successful development has not experienced the frustration, without suffering, which is Huawei's biggest weakness, there is no psychological preparation to adapt to non-development and skills to prepare. Such as optical transmission products, price cuts in 2078 to 20-fold. Excess lead to strangulation war, like twisted towel, this towel as long as the squeeze water from it, it shows there is room for competition, towels, wring the enterprise is also finished, only the twisted towel dry, towel continually, this is the best. "Huawei company can maintain this state long-term it?"

In 2009, Huawei's sales almost equal to 30 billion U.S. dollars mark, Ren Zhengfei was proposed management of the "gray": gray, is the tree of life. We must deeply understand, open, compromise, gray, immediately aroused the domestic major business school crazy pass.

His formulation is still tough: "It's at the same time, the same conditions, do the same things cheaper, this is professional. But the market competition, optimize the opponent, and you do not optimize, leaving you die. "

Huawei, he told people: "We do not taboo in our lesions, we must dare to reform all suited timely, accurate, high quality, low-cost services to achieve end to end things. While the operation of the company has extensive operations all these years, with the greater progress, but face the future development of the market has slowed down, to be more progress should benefit from the management. we have never advocated a more radical transformation, while the advocates continuous improvement, we still have to be able to endure temper , planning our moves. "

According to "Fortune" magazine recently released "2009 Global 500 list," based on Huawei announced in 2008 up to 18.329 billion U.S. dollars in revenue, has been close to the minimum threshold of the world's top 500 as ranked 500 companies in 2008 annual revenues of 18.572 billion U.S. dollars. The Ren Zhengfei has refused to call 500. He asked: Fortune 500 company from top to bottom to eliminate the term, and never said that top 500, Huawei, the company went bankrupt and then up, then collapse and then rise, is possible.

Business Card started from the agent is very clear the problems faced by technology companies. In the worldwide competition, it has to face competitors are of great technical potential. According to WIPO statistics, patent applications in 2008, Huawei Technologies, Inc. (people) ranks No. 1 ranking; LTE patents accounted for more than 10% of the world. After the transfer of global manufacturing an opportune time, in the enjoyment of low-cost Chinese R & D and manufacturing cost advantages, all are advancing to the 500 Chinese enterprises have to think about this problem: application and product level in the establishment of an absolute technical advantage.

When found growing in front of Huawei have been unable to find a few leader, when Huawei found itself low-cost competition is gradually lost when it needs to solve the question is: how to compete in the low profit period, to maintain a continuous Technology R & D investment, so that the technology and Ericsson, Huawei, IBM, like a sustained competitive.

Huawei Ren Zhengfei tells people: "We have many employees in blindly proud to see our products in local and occasionally leading Western companies, we believe that our company is a world-class standards. They do not know the connotation of the world's leading companies do not know refused to divulge the potential achievements of others. Huawei in this regard is very young, naive, very immature. "

Shenzhen Ren Zhengfei, founder of a large computer company said, "You and I in the biz this bad to do, what tips do you say, once you get started, set teeth have persevered."
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