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%). Zhengfei was worried that phase 2 created a kind of decision-making that was less than efficient. Especially in the entrepreneurial years of the company he used this strategy to be both a strong mentor and leader for his employees. 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. At that time, since the number of the employees is limited, the difficulty Ren zhengfei and its group encountered in the human resource management is little. We don't have much influence over China-US trade relations. When designers showed the first iPod prototype to Steve Jobs, he said it was too big. However, Ren zhengfei and Huawei made it in the end. Out of these cookies, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. He is the founder as well as founder of, Huawei Technologies Co.Ltd. Taiyuan, Shanxi. Arjun Kharpal: And part of that R&D budget has gone into 5G, into chips, you've got your own 5G chip. The number of Chinese companies investing and engaging in acquisitions in Europe has seen a steep growth curve. It will greatly increase productivity. Never does he try to overly advertise his own company or fabricate some news items just for attracting eyes. CEO's are the driving force behind any for-profit organisation. What makes Huawei interesting is its rate of growth and . The factory's equipment was from France, and at the time, it was some of the world's most advanced equipment with a high level of automated controls. Mr. Ren: As technology develops, the future world will become "winner-takes-all". Ren has been described as more of a spiritual leader than a hands-on executive. The country paid little attention to technology and knowledge, but we were working on a project that required technology and knowledge. Bringing this emotion-laden message was meant to motivate his own people and eventually to make his R&D people believe that they could one day be better than the researchers at the Bell labs. This can help us address the problem of how we distribute our increasing profit. This is an idea that scares people, but right now, it is not yet anywhere near reality. Arjun Kharpal: You mentioned in our conversation that people ask you about your vision for 20 to 30 years, but you don't even know what's going to happen in the next two to three years. They can transfer to other industries though, and take on new roles. We invest heavily in our focus area. 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. 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. Interestingly, such a strategy suggests that a power of thinking attitude aligns with a shared learning orientation. If a single backdoor was found in even one of the countries where we operate, our sales would shrink in all of them. Make it smaller.[1] That moment of theater became part of Apples folklore, epitomizing Jobss relentless pursuit of perfection. Every night, we took turns fueling the stove, because if it went out, we would have frozen. He said recently that could potentially wipe out humanity. Mr. Ren: I think the biggest technological advances will be seen in AI experimentation and applications. Secondly, hes full of enthusiasm and ambition. There has also been questions about your past as a communist party member and what that means for Huawei. You've often looked up to Apple as a role model. We don't talk about anything else, because we know that our communication is being monitored. So what is her role at this company if she is eventually released? Mr. Ren Zhengfei has been capable of pioneering the development of technology while growing in the world. Mr. Ren: We are open to Apple in this regard. What did you learn at the time that helped you start Huawei and guide your philosophy? Learn how to create a winning business plan. We obviously couldn't control our customers, so we had to get hold of the products. As a result, I went back to where I started and jumped into the market economy. What Industries are the Best Teachers for International Managers? 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. Moments of theater are a potent part of a CEOs toolkit for communicating and reinforcing an ethos. If the Chinese government or any other government ask you to hand over data, how would you react? CNBC is a division of NBCUniversal. (Academic publishing, he believed, was a necessary but not a sufficient condition for RSM to be recognized as a top business school.) Arjun Kharpal: Do you feel that your military-style speeches empower the employees here? According to him, Huawei should be focused on building a company where peoples minds are the main asset and resource to rely on. Harvard Business Publishing is an affiliate of Harvard Business School. At that time, Ren zhengfei often told all kinds of stories to encourage its employees to imagine the splendid future and try to cast them into reality with their own hands. This is because technology is lifeless and can be widely applied. As society moved forward, AI was made possible. In the first decade of the developing of the company, Huawei is needy for all kinds of human resources. High-OQ leaders use action strategy rather than consensus building to pursue strategic goals. Have you thought of retiring any time soon? 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. You also have the option to opt-out of these cookies. In the past, no one spoke up for us. Ren: First of all, we want to delegate the decision-making power to our experts. At the start of his tenure, only 1% of the 300 faculty publications a year were in managerial journals, and those were not the top journals. Arjun Kharpal: Have you tried to reach out to the president to speak to him about it? Arjun Kharpal: You mentioned the Ericsson CEO at the time said it was a bold move to jump into this space. KPMG wouldn't hide anything for us. What have been the driving forces behind that? His tax cuts are helping revitalize enterprises. Its fighting spirit, however, made it resistant to many negative influences and today Huawei can be called the only true global Chinese company. Mr. Ren: In a long run, I can tell you clearly that I will retire as I won't be alive forever but in a short term, it depends on my mental agility as I get older. I want to use a case analogy here. He also. Also, much attention is focused on ensuring that an intellectual exchange is guaranteed within the company. Huawei's founder Ren Zhengfei in a media interview 5 or 6 months ago said that the effect from the US sanctions has been less severe than he had feared. Obviously this has required a strict control of information, which attaches a flavor of secrecy and even mystery to the behavior of Mr. Ren Zhengfei. In the fiscal year of 2014 Huawei reached an all-time high sales revenue of CNY288.197 billion (US$46.515 billion) and CNY27.866 billion (US$4.49 billion) in net profit. Strategies are implemented not by CEOs and other top executives but by the many people who choose on a daily basis whether to take actions that support or undermine what top management wants to achieve. That requires two skills. As of February 2019, he had an estimated net worth of US$3.3 billion. As a matter of fact, one of the strengths that people usually refer to when talking about Huaweis founder is that he is always thinking about the kind of company he wants Huawei to be in the next 10 years. In a way Zhengfei works hard to always keep clear to himself a kind of meta-view that enables him to make informed strategy decisions. An interesting consequence was that because of this purpose-driven strategy they acquired much experience in developing robust equipments and materials, which helped them later on to win several big business accounts in the Middle-East. In a similar vein, since the beginning of Huawei, it is a known fact that Zhengfei is not a technical expert, but he never saw that as a weakness. They also need to follow local laws and regulations and pay local taxes. Another strategic objective was better cooperation between faculty and staff. I also participated in a large project that brought equipment in from France. Arjun Kharpal: I want to go back a little bit to talk about the US-China trade war because Meng Wanzhou was arrested in Canada on behalf of the US authorities. Arjun Kharpal: You were in the People's Liberation Army. China Europe International Business School. Since China has become the second largest economy in the world, this relationship has taken new forms in the shape of several business initiatives. In phase 2, running from 1997 to 2007, Huawei became more structured by hiring IBM to implement management structures as these were completely lacking at that time. Or do you feel sometimes they are intimidated by that style of leadership? After we were discharged, we were assigned to different places across China. Everyone at GE knew what to expect from Neutron Jack Welch. The best illustration of how rewards are shared is the fact that Zhengfei only holds 1.4% of the companys total share capital whereas 82,471 employees hold the rest of the shares (stated in Huaweis 2014 Annual report, as of December 31, 2014). Over the past century, which countries and companies have made the US scared? document.getElementById( "ak_js_1" ).setAttribute( "value", ( new Date() ).getTime() ); Your email address will not be published. Most of us also didn't understand that move. Get your Culture in Good Shape, Not Lost in Translation: Making the Data Make Sense. We will also increase our sales revenue, which is now more than 100 billion US dollars, to around 250 billion US dollars. So he emphasized action. This way, we will be able to make world-leading products. Our scientists spotted it and spent 10 years turning his theories into the 5G standards of today. Before I was able to settle into this new position though, China disbanded many of its military forces and everyone had to go find another job. Difficult as Huawei is, its founder Ren zhengfei still have faith about Huaweis future and its great success in few years later. In particular, the emergence of AI has accelerated social progress. Again, he ties this in part back to their ownership structure:. Huawei responded to customers 24/7. Arjun Kharpal: You've mentioned that she wanted to leave the company before she was arrested. 5G made progress. When Huawei dominated the domestic market on a large scale, its problem in human resource was more than Huaweis original management system can handle. So we've decided that our. We will put more money into research in new frontiers. Instead of issuing an EQ response to mollify the professor, George sent an OQ response: We all work for RSM.. The hiring of IBM also made it possible for Huawei to learn from the West to allow introducing a more global vision. Everything is limited. 5G technology was not invented by Huawei. Arjun Kharpal: Mr. Ren, you talk a lot about the distance between Huawei and the Chinese government. Huawei has indeed invested considerably in creating a learning driven culture where the power of the mind is visible. We will not be affected by increased tariffs, either. And he was on a four-year contract and had limited time. First, as our technology advanced rapidly, we managed to bring down the costs of our products. By taking a set of coordinated actions that add up to a strategic change, a leader can kickstart the process without creating organized opposition. In 1994, Huawei is still a company that has been working for no more than seven years. For example, in the desert and rural areas in China, rats were a plague for the telecom connections to customers. What Crisis? Arjun Kharpal: So that's a metaphor for your daughter? That creates a kind of balance. Mr. Ren: I don't know about technology, management, or finance. Second, ultra-broadband connections, and ultra-large storage systems, as well as micro-computing storage and edge computing. Mr. Ren: When I was a kid, I didn't have many hobbies mainly because my family was poor. Investor and consumer confidence will increase, and the US economy may take a turn for the better. These experiences taught me to endure hardships. The US has highly developed technology, but it also has a shortage in labor. Ren innovation skills and technical knowledge. Mr. Ren: Regarding the allegations against Meng Wanzhou and Huawei, the US Department of Justice has sued Huawei, and Huawei has pleaded not guilty in the court. 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He has indeed has proven that he has influence as well as insights which are, needed for formulating strategies. President Trump hasn't shared his thoughts with me. Mr. Ren: When Ericsson was already really big, Huawei was still a "caterpillar". And then, once we had established some market presence, we began to build up capital. That's the shortcoming of Trump's approach. So George revamped the universitys advisory board meetings. When we first entered the telecom industry, we started by reselling products from another company. High-OQ leaders send messages that reinforce the strategy and minimize other messaging. To give you a simple example. Any cookies that may not be particularly necessary for the website to function and is used specifically to collect user personal data via analytics, ads, other embedded contents are termed as non-necessary cookies. When I was young, I had no ideals. Earn badges to share on LinkedIn and your resume. We also sued the US government in Dallas. 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. I lived through the great famine that hit China, and the economic recovery that followed. At Huawei, we have two major areas that we are focusing on for the future. Many Chinese believe the blueprint for Huawei's success was created by its founder and long-time CEO, Ren Zhengfei. Networks belong to our customers, not us. The relationship between China and the European continent carries much history with it. What else can we talk about? We want to sign such an agreement because we think it's the right thing to do. Due to his technical skills, He was appointed as a delegate from, PLA for attending the National Science Conference in 1978 (, ).It was a golden opportunity for Rein to lean and gain knowledge, about the field. Ren Zhengfei (Mr Ren): When I had just started Huawei, we still did not understand China's reform and opening-up policy. If no one dares to invest in the US, then how can they make up for lost tax revenue? Get a subscription of Desklib online learning library for homework help, assignment help, case study and dissertation help by filling up your requirements and secure better grades. Otherwise, they will become overweight and won't be able to move fast. Therefore, we will count on the law to address these issues. First, embrace bureaucracy rather than rail against it. What did she speak about? Along the way he introduced one important innovation: the Clubcard, the UKs first supermarket loyalty card, which allowed Tesco to leapfrog Sainsburys into the number-one retail spot. We can scale down a little bit. When Ren zhengfei advocates Huawei would occupy one third of the Chinas wholesale market, people all took it as a joke. He made this persuasively clear by literally saying that it is necessary To cut off your feet to wear the shoe, In China, leadership has traditionally been grounded in a hierarchical top-down management system. Divested mid-price range Honor brand in Nov 2020. Huawei is to a large extent no stranger to this system. With Huawei becoming the largest telecommunications equipment manufacturer in the world, Ren zhengfei has already become a paradigm for businessmen to study and learn from. This case focuses on the distinctive "paternalistic" leadership and management style of Ren Zhengfei, founder of Huawei Technologies Co., Ltd. (hereinafter "Huawei") and considers whether he needed to adapt his style in light of new challenges at the company. She has understood the difficulties that the company is facing and wants to help us see this through. We can give you a copy if you want. This case is undergoing legal procedures, and we believe it will be solved in court. The industry had high requirements. At that time, Zhengfei clearly used a competitive mindset as the driving force to grow as a company. 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. Saying that he was great is an understatement. This represents Chinese state leaders' position on backdoors, so we will never install backdoors on our equipment. At that time, China was just beginning with its reform and open-up policy, and was paying more attention to technology, talent, and knowledge. This is fundamental to solving problems. This shows that the little rabbit or mouse must have something great to offer. By the time I left the military, 186, 286, and 386 had dominated the computer world. So I don't think there will be a significant impact on Huawei's business. .. . .. .. Ren Zhengfei is successful Chinese businessman. But we will not distribute this extra money to our employees or shareholders. Tanks can cross a swamp, but needles can pierce hard things through. Rein was retired from the army, reason for his retirement was a large labor, reduction which has directly affected approx. Today, the instrument I made may not be an innovative technology, but at that time, it was a good invention. This statement was understood as underlining that his global ambitions were there to stay and grow. While pursuing this vision, he continuously has proven his ability to design strategies that enabled him to adapt his vision to the challenges that the company faces. After, completing his school, He attended the university named Chongqing and then Ren Zhengfei, joined Peoples Liberation Army research institute as, he wishes to work as a military technologist, reportedly in the PLA's Information Technology research unit. In the Qingdao headquarters of the Chinese company Haier stands a display case containing a sledgehammer. As we noted earlier, often references to past historic events are used to shape actions and beliefs towards the future. The story goes that Zhengfei was so moved by the work done in those labs that he cried. As a result, I read a lot of books on law and learned that the market was about two things: the product and the customer. 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. The multinationals that were present in China at that time did not consider this to be their problem, but rather that of the customer. Thirdly, its his sense of management that helps him to become an excellent leader. . Ren Zhengfei, a founder of Huawei, conducts the personal communication style inspiring employees to achieve high results. Google is now helping blind people see the world with nerve sensors, although they are not as good as human eyes. Its this kind of spirit in Ren zhengfei that propels his company to become one of the best in China even the world. Not really, we think. Nevertheless, as the market evolved and employee characteristics shifted, the shortcomings of Ren's management model grew ever apparent. Arjun Kharpal: But what was the personal effect of her arrest on you as a father? It makes that he is characterised by his employees as someone who leads with his heart and moves with his mind. Even if we were ordered to, Huawei would still not install backdoors. So he and his managers smashed the defective appliances. That's why we told the German government that we are willing to accept their regulation. The US government is actually advertising for us in a good way. We have become what we are today with our own strength. During one of these visits, in 1997, he visited the Bell labs in the USA. Technology has moved on so rapidly in the past few years that a lot of people are talking about the impact of technology on society. The qualities that help managers rise in the organization emotional intelligence, high IQ, technical competence, and so forth dont necessarily make them effective once theyre in a leadership position. His management of the company is heavily influenced by the childhood hardship he endured during the Cultural Revolution and the military values instilled in him during his 6 years in the PLA. This selective messaging was not popular, but it was highly effective. Effective moments of theater have three important characteristics. In China, leadership has traditionally been grounded in a hierarchical top-down management system. When he passed away, I was on a vacation in the mountains with my family. Apple is also a great company. OQ, as well call it, consists of five competencies: sending messages that reinforce strategy, fostering an ethos, using action strategy, rebelling from the top, and staging moments of theater. By studying law on my own, I realized that only a focused approach to scientific research could lead to new products. It was all about hard work to bring the company up to the level that it was able to provide higher-quality service. Zhengfei made this very clear when he said: I do not know anything about technology, but I can bring people together to work for the collective. He is praised for his desire to hire better people in the areas he is weak in, with the ultimate goal to improve the quality of Huawei products and services. Mr. Ren: We want the US government to treat Huawei fairly and without prejudice. So I think Trump is a great president, but he didn't consider all the angles when it came to attracting foreign investment. I majored in architecture back in school, but I studied electronics technology myself. I said this as an outsider without considering his treatment of Huawei. Why do you think that is? As far as I know, Huawei has never been mentioned in any of the China-US talks or in any official news releases. From what has been discussed above, we can easily find the relationship between the leadership of Ren zhengfei and the rise of Huawei. Technologies are advancing. Huawei has kept a low profile, ever since it was founded. Mr. Ren: Huawei is based in China. Instead, we will use it to fund universities and scientists for their research and explorations into the future. For example, as the products of Huawei in their pioneering years were not yet well developed he visited many R&D offices abroad. 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 ; . 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. We believe US laws are open, transparent, fair, and just. 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%). The simpler and clearer, the better; organizational members at all levels suffer from information overload, so leaders need to be selective about what messages to send. Vernon Hill was transformationally successful in leading Commerce Bank in the USA and then Metro Bank in the UK. Let's look at an example. We live in a very connected world. Mr. Ren: I don't know. One story that stayed with Zhengfei was the overthrow of King James II of England by a union led by William of Orange in 1688, which was called the Glorious Revolution. Our network equipment sales dropped 1.5% last year, but enjoyed a 15% increase in Q1 of this year. In his view this could only be achieved by providing excellent services. As the dean of Rotterdam School of Management (RSM), one of us, George, set the strategic objective of persuading faculty members to publish in practitioner journals like HBR and MIT Sloan Management Reviewin addition to academic journals. Ren Zhengfei now serves as a deputy chairman of the board of directors. One defining feature of the Huawei culture is that it is able to bring together opposing forces and tendencies. 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