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The Startup: Who is Huawei? BBC Future
To the layperson, Huawei is best known as one of the world’s top three smartphone makers. But Huawei is firstly a world leader in telecommunications – its industry-leading equipment, connecting developed and developing countries, is present in 170 countries.
The company’s origins, however, are far humbler.
The story of Huawei and its founding father, Ren Zhengfei, is one born out of need and circumstance. It’s a 30-year journey, marked with many setbacks and culminating in the company’s transformation into the behemoth it is today.
Ren Zhengfei himself embodies that journey to success, born into a time where Chinese people were enduring mass hardships, including famine and the fallout from the Cultural Revolution. Hard work and suffering were commonplace, and basic items such as cooking oil and salt were considered a luxury.
“We survived on cheap cereal crops throughout the year. We were slightly better off than our neighbours, because my parents were teachers. By better off, I mean we could add salt when we cooked,” remarks Ren.
He was the only member of his family lucky enough to receive higher education,
for which he attended Chongqing Institute of Civil Engineering and Architecture. This distinction led him to a position in the army as a lab technician in 1974, under harsh conditions in a factory in rural Liaoyang.
“Our unit was part of the tens of thousands of troops that took up a construction task in the northern wilderness. We built our simple houses on our own. They were built during the winter, and the walls sank and cracked, so cold winds would blow through,” remembers Ren.
While the conditions were harsh, it gave him the opportunity to develop his fascination with mechanical innovation at a time when China was not highly focused on education, earning him the nickname ‘Ren–Tech’.
“Despite these difficult living conditions, our engineering work was actually pretty advanced and highly automated, and we had a rare opportunity to learn. So despite the difficult living conditions, we were very happy. The factory was like an oasis in the desert,” recalls Ren.
The time in the factory saw Ren constantly experimenting with available machinery.
He used his knowledge of mathematics to develop schematics for equipment that made headlines in the Chinese press. It was the beginning of a lifetime of innovation.
In the 1980s, China downsized its army. As with many ex-army personnel, Ren found it hard to integrate into normal working life after his dismissal from the army, and did not do well – he was soon fired. This struggle to survive in a new, commercial world gave him the motivation he needed to start Huawei at the age of 44. He had no real experience working in a company, let alone running one.
In its first iteration, Huawei wasn’t the global innovator we know today. It was a simple reseller of the technology created by a company in Hong Kong, and it was operated out of a small apartment in Shenzhen. They resold affordable telecoms switches to small city hotels.
Founding a startup at that time was no easy feat, even without the complications of product development and innovation. People at that time in China trusted only state-run organisations, so trying to break through customer mistrust of new and unknown companies was an uphill battle. Huawei tackled this through a radically customer-centric approach, putting in extra effort, time and dedication to their client servicing.
“History has determined the existence of Huawei. If China didn’t open up, Huawei would not exist; if private companies would not be allowed, Huawei would not exist. It fit perfectly the bill what was needed at that time for China’s entrepreneur to give the push towards what would become one of the biggest telecom companies in the world,” remarks Professor De Cremer from National University of Singapore Business School.
Just as Huawei started to break through to achieve small success in this niche in China, the company for which they were a reseller revoked their license, leaving Huawei in a precarious position. They had no choice but to innovate or close their doors.
“At that time, we had no other options. We didn’t think about what would happen if we failed; we were quite confident that we could succeed,” Ren says.
And succeed they did, by careful iteration and experimentation, and a lot of hard work. They also prioritised innovation, pouring all of their earnings back into product development. It was an ethos that became foundational to Huawei’s operations and later success.
“We started out by making small analogue switches for small hotels, gradually working to make larger analogue switches. We didn’t begin to make digital switches until we already had many years of experience,” comments Ren. “We didn’t spend the money ourselves; we invested it in our services and systems to create even more value for our customers,” he adds.
In addition to Huawei’s early business strategy, there was an element of being in the right place at the right time that helped Huawei survive the many complications of its infancy, and set the scene for it to blossom into the global company we know today.
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Who is Huawei?
Founded in 1987, Huawei is a leading global provider of information and communications technology (ICT) infrastructure and smart devices. We are committed to bringing digital to every person, home and organization for a fully connected, intelligent world. We have nearly 188,000 employees, and we operate in more than 170 countries and regions, serving more than three billion people around the world. Huawei’s end-to-end portfolio of products, solutions and services are both competitive and secure.
Who is Huawei?
Founded in 1987, Huawei is a leading global provider of information and communications technology (ICT) infrastructure and smart devices. We are committed to bringing digital to every person, home and organization for a fully connected, intelligent world. We have nearly 194,000 employees, and we operate in more than 170 countries and regions, serving more than three billion people around the world.
Huawei’s end-to-end portfolio of products, solutions and services are both competitive and secure. Through open collaboration with ecosystem partners, we create lasting value for our customers, working to empower people, enrich home life, and inspire innovation in organizations of all shapes and sizes. At Huawei, innovation focuses on customer needs. We invest heavily in basic research, concentrating on technological breakthroughs that drive the world forward.
Who owns Huawei?
Huawei is a private company wholly owned by its employees. Through the Union of Huawei Investment & Holding Co., Ltd., we implement an Employee Shareholding Scheme that involves 96,768 employee shareholders. This scheme is limited to employees. No government agency or outside organization holds shares in Huawei.
Who controls and manages Huawei?
Huawei has a sound and effective corporate governance system. Shareholding employees elect 115 representatives to form the Representatives’ Commission. This Representatives’ Commission elects the Chairman of the Board and the remaining 16 board directors. The Board of Directors elects four deputy chairs and three executive directors. Three deputy chairs take turns serving as the company’s rotating chairman.
The rotating chairman leads the Board of Directors and its Executive Committee while in office. The board exercises decision-making authority for corporate strategy and operations management, and is the highest body responsible for corporate strategy, operations management, and customer satisfaction.
Meanwhile, the Chairman of the Board chairs the Representatives’ Commission. As Huawei’s highest decision-making body, the Representatives’ Commission makes decisions on important company matters, like profit distribution, capital increases, and the elections of members of the Board of Directors and the Supervisory Board.
Who does Huawei work with?
Externally, we rely on our customers. They are at the center of everything we do, and we create value for them with innovative products. Internally, we rely on our dedicated employees. Dedication is a core part of our work ethic. At Huawei, those who contribute more get more.
We work with stakeholders including suppliers, partners, industry organizations, open source communities, standards organizations, universities, and research institutes all over the world to cultivate a broader ecosystem that thrives on shared success. In this way we can help drive advancements in technology and grow the industry as a whole.
We create local employment opportunities, pay our taxes, and comply with all applicable laws and regulations in the countries where we operate. We help local industries go digital, and we openly engage with governments and the media.
What do we offer the world?
We create value for our customers. Together with our partners, we provide innovative and secure network equipment to telecom carriers. We provide our industry customers with open, flexible, and secure ICT infrastructure products. In addition, we provide customers with stable, secure, and trustworthy cloud services that evolve with their needs. With our smartphones and other smart devices, we are improving people’s digital experiences in work, life, and entertainment.
We ensure secure and stable network operations. We have made cyber security and privacy protection our top priorities since 2018. Over the past three decades, we have worked closely with our carrier customers to build over 1,500 networks in more than 170 countries and regions. Together, we have connected more than three billion people around the world, and we have maintained a solid track record in security throughout.
We promote industry development. Huawei advocates openness, collaboration, and shared success. Through joint innovation with our customers and partners, we are expanding the value of ICT to develop a more robust and symbiotic industry ecosystem. Huawei is an active member of more than 400 standards organizations, industry alliances, and open source communities, where we work with our peers to develop mainstream standards and lay the foundation for shared success. Together, we are driving the industry forward. We enable sustainable development.
Huawei has contributed significantly to bridging the digital divide and promoting digital inclusion, helping to connect places as remote as Mount Everest and the Arctic Circle. We are keenly aware of the importance of telecommunications in emergency situations. Having faced Ebola in West Africa, nuclear contamination triggered by the tsunami in Japan, and the massive earthquake that struck Sichuan, China, our people hold fast in disaster zones to restore communications networks and ensure the reliable operation of essential telecoms equipment. To further promote sustainability, we prioritize a low-carbon footprint and environmental protection. We are also supporting the development of the next generation of local ICT talent to boost the digital economy.
We provide dedicated people with a strong growth platform. Inspiring dedication is one of Huawei’s core values, and it manifests itself in many ways. We assess employees and select managers based on their contribution, as well as the extent of their responsibilities. We provide our teams with a global development platform, giving young team members the opportunity to shoulder greater responsibilities and accelerate their careers. In this way, we have enabled over 100,000 Huawei people to yield ample returns and gain memorable life experience.
What do we stand for?
For the past 30 years we have maintained an unwavering focus, rejecting shortcuts and easy opportunities that don’t align with our core business. With a practical approach to everything we do, we concentrate our efforts and invest patiently to drive technological breakthroughs. This strategic focus is a reflection of our core values: staying customer-centric, inspiring dedication, persevering, and growing by reflection.
The digital era has been generous. We will make the most of this historic opportunity, and boldly forge ahead to build a fully connected, intelligent world.
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