We'll buy them directly." CNBC is the leading global broadcaster of live business and financial news and information, reporting directly from the major financial markets around the globe with regional headquarters Singapore, Abu Dhabi, London, and New York. But even if it did happen, it would be at least 30 years from now. For such a powerful country to be scared of a small company like us, some other countries are saying, "Your products are so good that the US government is scared. They viewed the rat problem as one the company had the responsibility to solve. Dong Mingzhu, Chinas most successful businesswoman and the head of Gree Electric, has a persona that says, Where Sister Dong walks, no grass grows meaning she is really, really tough. Many will say that the blueprint of Huaweis success has been laid out by Zhengfei and even though Huawei nowadays makes use of a rotating leadership system in which every six months another board member is the acting CEO, its founder still has a significant impact on the pace and direction of the company. It was analog technology, analog automatic control. Moments of theater are a potent part of a CEOs toolkit for communicating and reinforcing an ethos. It's not up to me to designate a successor. Mr. Ren: Huawei's future iterative succession system is clearly defined in our Articles of Governance. High-OQ leaders stage moments of theater that will be told and retold throughout the organization. Mr. Ren: We have worked closely with our customers for 30 years. We will also push the Chinese government to sign a cyber security agreement with the German government. He lives with his daughter Cathy Meng who is also the CFO of Huawei. Part of making the dreams of customers to come alive is the idea that providing the best service possible is crucial to the success of the company. In China, leadership has traditionally been grounded in a hierarchical top-down management system. Some US politicians are criticizing Huawei everywhere they go. Huawei was founded by Ren Zhengfei when he was in the mid-age crisis. First, embrace bureaucracy rather than rail against it. This incentive performance system ensures that people are not only motivated to work hard towards collective success, but probably even more importantly it ensures that Huawei really is an employee-owned company. Our relationship with the Chinese government is primarily defined by these two points. Collective decision-making ensured that Huawei made fewer mistakes and absorbed collective wisdom, but it also caused rigidity. This website uses cookies to improve your experience while you navigate through the website. We have reflected on this a lot. Vernon Hill was transformationally successful in leading Commerce Bank in the USA and then Metro Bank in the UK. Cuts and bruises toughen her up, and even since ancient times, heroes were born of hardship. We live in a very connected world. At that time, China was just beginning with its reform and open-up policy, and was paying more attention to technology, talent, and knowledge. CNBC.com is the preeminent financial news source on the web, featuring an unprecedented amount of video, real-time market analysis, web-exclusive live video and analytical financial tools. This revolution was also referred to as the bloodless revolution because the victory of William of Orange was achieved without bloodshed. In the early years of Huawei, Zhengfei was very much aware that their products did not meet the standards of those of its competitors. After getting, retired from the military, Ren has planned to work in electronic business. So the standards the US finds so compelling are actually all built on a single mathematics article. Arjun Kharpal: I want to also address some of other criticisms towards your company. For example, in 2014, the company made a decision on bonuses, which received over 70,000 negative comments, leading to a modification of that decision. All rights reserved. If so, what did she say to you? 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Its success stems in no small part from its ethos, "the wolf spirit of Huawei," created by founder and chairman Ren Zhengfei at the start. At Huawei, we often talk about the term of "Van Fleet Load", which was invented by a general of the US army. Is that the right way forward? Our employees are used to the way I speak. Today, Huawei has developed a decision-making system with limited democracy and appropriate centralisation. You also have the option to opt-out of these cookies. February 9, 2021. 5G made progress. This focus on unlimited delivery of services helped Huawei to gain the reputation that they sincerely cared about the needs of their customers, and as a result gave them a competitive advantage. This represents Chinese state leaders' position on backdoors, so we will never install backdoors on our equipment. Iterative succession must take place in an orderly fashion. Mr. Ren: When I was a kid, I didn't have many hobbies mainly because my family was poor. However, monopolies in these kinds of technologies will benefit the world, rather than harm it. If a technology is 20,000 kilometers away, we can invest a little more, like an apple. It was all about hard work to bring the company up to the level that it was able to provide higher-quality service. Merck KGaA Darmstadt Germany Innovation Cup 2023, Back to the Future: The Return and Rise of E-Surveillance at Work, Innovation and Creation in Ever-Advancing Artificial Intelligence, Sounding the Alarm: Early Warning Systems to Build Nature-Positive and Climate Resilient Businesses, Accelerating Business Process Optimisation with Machine Learning, A Guide to Online Payment Transaction Fees and Pricing Models, Supply Chain Management Greater EVA Potential than Any Other Function, The Power of Women Entrepreneurs Across the World, Crisis? Like a judo master, you must practice getting the maximum effect from your large organization with a minimum effort on your part: the judicious email, the sharp moment of theater. But he also has shortcomings. The Laissez-Fair Leadership Style 1085 Words | 5 Pages They are engaging elements of transformational leadership in which leaders get great illustrations who increased in value, respected, replicated and trusted by subordinates ; . 500000 employees in military field. Because they are simple and easy to understand. For example, in the early years of Huawei (Phase 1), he regularly told stories to employees that he believed that in 20 years Huawei would have 1/3 of the market share in the world, despite the fact that at that time Huawei only employed about 200 employees. Western companies are no different. This is beyond what anyone had imagined. When two nations or companies meet, they must collaborate to achieve shared success. Many Chinese believe the blueprint for Huawei's success was created by its founder and long-time CEO, Ren Zhengfei. His ability to critically reflect on past successes and at the same time to identify the future challenges in the next decade makes Zhengfei an impactful business leader in the eyes of many Chinese. Many scientists also proposed that genetic technology should be gradually integrated with electronic technology to create "new people". Turning to personnel, George replaced the people likely to generate the most opposition and appointed a new, supportive vice dean from among the existing department chairs. So our products needed to be standardized. Mr. Ren: I am not a government official, so I don't know what the governments have talked about. He also. Ren Zhengfei, a founder of Huawei, conducts the personal communication style inspiring employees to achieve high results. Huawei has indeed invested considerably in creating a learning driven culture where the power of the mind is visible. High-OQ leaders rebel from the top. First, as our technology advanced rapidly, we managed to bring down the costs of our products. Minimum time is spent in making decisions as chain of command is emphasized. We won't test your products. We are actually learning from US companies. Although he has introduced a strong focus within Huawei on continuously learning and reflecting, he leads his company with the passion of a true founder. Neither side has mentioned Huawei, which means Huawei does not actually carry much weight. If we spread things too thin, there is no way we will be successful. Huawei responded to customers 24/7. As Ren was dissatisfied with his job, he planned to, Despite of his low profile, Ren has managed to transform small business into a successful. You've grown the company over 30 years to the size of it now. Combining storage and computing will enable devices to run faster. In order to support his family, Ren Zhengfei implemented a strict system of food distribution in his family. Do these seven lessons primarily make Zhengfei a cerebral type of leader as the power of the mind is placed so central to his philosophy? Arjun Kharpal: But the US has put intense pressure on some of its allies in Europe, for example, Germany and the UK, to block Huawei from 5G networks. Of course, large equipment still relies on an architecture of no other elements but computing, storing and connecting, so we will also work hard to contribute to a cloud world. As CEO, he introduced Tescos distinctive online model, based not on the classic centralized warehouse but on existing stores, where Tesco.com employees picked and packed online orders during off-peak periods. Save my name, email, and website in this browser for the next time I comment. Technologies are advancing. These difficulties will make her stronger and prepare her for even greater things ahead. So Microsoft is the winner and it dominates the market. Indeed, looking at the Fortune Global 500 list, Huawei is the only mainland Chinese company (out of 91 Chinese companies listed) earning more revenue abroad (67%). So you said she doesn't want to leave anymore. This selective messaging was not popular, but it was highly effective. Mr. Ren: She will continue to do what she has been doing. Do you think that companies like yours are too powerful and need to be regulated? We also use third-party cookies that help us analyze and understand how you use this website. CEO's are the driving force behind any for-profit organisation. Our costs were low for two reasons. The leadership of Ren Zhengfei, however, does differ from this rather "controlling only" style in important ways. For more information, visit www.cnbc.com. We chose a tough road. Every year we invest more than 20 billion US dollars in it. Divested mid-price range Honor brand in Nov 2020. I would be afraid that they would pull out suddenly and stop doing business with us. These cities were moving away from the previous planned economy. We were living in an adobe house that only provided us a little shelter from the wind. One defining feature of the Huawei culture is that it is able to bring together opposing forces and tendencies. We also had to understand the law. In the words of Zhengfei: Chaos was removed and structure entered Huawei. AI is also developing faster than what we can imagine. Register as a Premium Educator at hbsp.harvard.edu, plan a course, and save your students up to 50% with your academic discount. These cookies do not store any personal information. Saying that he was great is an understatement. In his view, it was necessary in the second phase to wear the shoes of the Americans, and if your feet would not fit then we have to cut it. Underlying his focus on story telling is his strategy to energise people and introduce a sense of vitality to the projects that need to be undertaken. Secondly, we need to pay taxes to the Chinese government. Our network equipment sales dropped 1.5% last year, but enjoyed a 15% increase in Q1 of this year. We will wait for the court to make its judgment. Although this multinational company surpassed Ericsson in 2012 as the world leader in terms of sales revenue and net profit, the company is still relatively unknown to the European business audience. It is clear that although very ambitious and action-driven he also cares about the value of being humble. He made this persuasively clear by literally saying that it is necessary To cut off your feet to wear the shoe (xue zue shi lu). But unfortuetely he fails to, achieve military rank, due to which he was not allowed to join communist party of China for, continuing his career in Military field as, Ren Zhengfei family belongs to social background and, Ren Zhengfei was accountable for many, technological achievements. Otherwise, they will become overweight and won't be able to move fast. So I don't think they are intimidated. Purpose-driven Ambition The core of Ren Zhengfei's leadership is the undeniable fact that he is very clear about the purpose of Huawei, which is helping customers to realise their dreams. Mr. Jobs was great not because he created Apple, but because he created an era, the mobile Internet era. Back then, China was still going through the Cultural Revolution. We will expand it, and dive deeper into it. Every generation produces its own great character, and each exerts impact for hundreds of years. True to this Chinese saying, Zhengfei has indeed proven that he had the influence and insights needed to design the most effective strategies to ensure that Huawei has grown into a world leading company. Interesting in this journey so far is that each phase is characterised by a specific focus and strategy. Ren has unique qualities which make him different from other, leaders. Important in this whole management process is that his use of an adaptive vision never compromises the purpose and values of the company. In total, 300,000 to 400,000 people have joined Huawei, but only around 180,000 people decided to stay. Specifically, in this section the leadership style of Huawei will be analysed, as well as its impact on the employee engagement and overall organisational performance, and findings and discussions will be presented. Every night, we took turns fueling the stove, because if it went out, we would have frozen. You have entered an incorrect email address! Wearing nice clothes or seeking further education was not what I wanted. For the rest, let the organization keep doing what it does well. Director, CEO Born on October 25, 1944 into a rural family where both parents were school teachers, Mr. Ren Zhengfei spent his primary and middle school years in a remote mountainous town in Guizhou Province. I liked reading books, doing homework, and solving math equations on scrap newspaper. In 1994, Huawei is still a company that has been working for no more than seven years. The university had charged him with increasing revenue and strengthening relationships with the business community while maintaining RSMs high level of academic research. Since China has become the second largest economy in the world, this relationship has taken new forms in the shape of several business initiatives. On October 25, 1944,Ren Zhengfei was born in Zhenning County, Guizhou Province.He spent his primary and junior high school in the mountain village near his home. Let's look at an example. Arjun Kharpal: If you say that Meng Wanzhou is maybe a hostage in this US-China trade battle, does that mean some of the allegations, from a legal point of view, you don't believe in? 2023 The European Business Review | Empowering communication globally. In particular, the emergence of AI has accelerated social progress. The European Business Review is not responsible for any financial losses sustained by acting on information provided on this website by its authors or clients. Leadership styles. An organization offers telephone exchange equipment. Arjun Kharpal: Do you have a succession plan in place when you eventually do retire? 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