To give you a simple example. Copyright 2023 Harvard Business School Publishing. We will also push the Chinese government to sign a cyber security agreement with the German government. Effective moments of theater have three important characteristics. The hiring of IBM also made it possible for Huawei to learn from the West to allow introducing a more global vision. We will need to sort out our problems with the US by ourselves. For the rest, let the organization keep doing what it does well. They are out of the ordinary and unexpected. Now we talk a lot about genetic modification, or gene editing. Many companies' financial statements last year weren't great because they needed to pay income tax arrears. Over the next five years, we will invest more than 100 billion US dollars in R&D to restructure our networks. What Is Blockchain Technology and Its Types? This website uses cookies to improve your experience while you navigate through the website. 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. They also need to follow local laws and regulations and pay local taxes. November 12, 2015. Second, Huawei is being stuck in an extremely difficult situation the US is launching intense attacks against us. At this time, Ren Zhengfei's family was starving. These difficulties will make her stronger and prepare her for even greater things ahead. Does China feel under pressure from President Trump's tactics in the negotiations? Will Europe understand us when they see how much effort we are putting into this? As a result, we set our prices at a relatively low level, which made it hard for Western companies to compete with us. Technologies are advancing. But what we've seen publicly is senior officials in the government talking at times on Huawei's behalf. The law governs what's in between the transaction. Detailed information on the use of cookies on this Site, and how you can decline them, is provided in our, Delivering Innovation Accenture Research, A Special Report on AI and Humans by AiTH, NUS Business School, Europes recovery is possible. It was all about hard work to bring the company up to the level that it was able to provide higher-quality service. At Huawei, we often talk about the term of "Van Fleet Load", which was invented by a general of the US army. Our costs were low for two reasons. .. . .. .. Ren Zhengfei is successful Chinese businessman. These cities were moving away from the previous planned economy. Arjun Kharpal: Mr. Ren, you said you haven't spoken to Mr. Trump, but what do you think of his leadership style and his tactics? Access more than 40 courses trusted by Fortune 500 companies. Mr. Ren: We want the US government to treat Huawei fairly and without prejudice. As can be expected of a man with an army background he served in the Peoples Liberation Army he is known to be intense and tough and never loses control. So he and his managers smashed the defective appliances. That requires stepping out of the normal flow of organizational life. Huawei, one of the biggest company focusing on making communication tools like cellphones, is famous all over the world. During World War II, there was a famous Il-2 aircraft that kept flying after being riddled with bullets from both other planes and anti-air defenses. That's why I said he is a great president. During one of these visits, in 1997, he visited the Bell labs in the USA. If I could not pay, I would be hounded by creditors every day. With Huawei becoming the largest telecommunications equipment manufacturer in the world, Ren zhengfei has already become a paradigm Huaweis competitors assumed that they only had to provide the technology to the customer. But by 2003 Sainsburys had followed suit by which time Tesco had a five-year head start and an expanding user base. AI is also developing faster than what we can imagine. However, most of us didn't really understand how important this decision made by the CPC's Central Committee was. Thirdly, its his sense of management that helps him to become an excellent leader. There is nothing else that I want to share with him. This idea of adopting a cooperative mindset in a competitive market can be illustrated by Huaweis efforts in the UK. The criticism was scathing, including from McKinsey and other top consulting firms. For example, if AI is applied to tractors, they will be able to work 24 hours a day. I think currently AI has greatly improved productivity. From what has been discussed above, we can easily find the relationship between the leadership of Ren zhengfei and the rise of Huawei. So firstly, we must abide by Chinese laws and regulations. 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. So I don't think they are intimidated. The US hasn't been scared of anyone or anything though. These figures show that we are still growing, not declining. They are buying our products in large quantities as the US government is advertising for us. Mr. Ren: I don't know about technology, management, or finance. 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. A great increase in material wealth would also help to significantly enrich culture. 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). We remained focused on this same single point. "Every generation produces its own great character, and each exerts impact for hundreds of years.". Arjun Kharpal: Mr. Ren, as we come to the end of the conversation, I want to focus on your future. In the words of Zhengfei: Chaos was removed and structure entered Huawei. What if we could identify and change the genes that cause the condition? In order to support his family, Ren Zhengfei implemented a strict system of food distribution in his family. We chose a tough road. Instead of issuing an EQ response to mollify the professor, George sent an OQ response: We all work for RSM.. High-OQ leaders use action strategy rather than consensus building to pursue strategic goals. High-OQ leaders send messages that reinforce the strategy and minimize other messaging. Any one of these things could help them conquer the world. Most of us also didn't understand that move. | All rights reserved. That creates a kind of balance. He said recently that could potentially wipe out humanity. Founder of Chinese tech giant Huawei Technologies Ren Zhengfei has called on the company's staff to "dare to lead the world" in software as the company seeks growth beyond the hardware. And care must be taken that they dont conflict with the desired ethos. During China's Cultural Revolution, I designed a small instrument using my math skills, and actually received recognition from the government for this device. Ren Zhengfei (Mr Ren): When I had just started Huawei, we still did not understand China's reform and opening-up policy. In fact, the company only seems to be growing stronger. 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. In the Qingdao headquarters of the Chinese company Haier stands a display case containing a sledgehammer. Terry Leahy steadily worked his way up to become the CEO of UK-based Tesco, one of the worlds largest supermarket companies. Some top military officers didn't understand it, either. 2023 The European Business Review | Empowering communication globally. So Microsoft is the winner and it dominates the market. Global Business and Financial News, Stock Quotes, and Market Data and Analysis. The Central Committee had also been disbanding parts of the Chinese military because it was so large. I felt very uncomfortable with the transition from the military to Shenzhen which was becoming at forefront of the reform and opening-up. People back then thought his discovery was useless and ignored it for 100 years. Ren has been described as more of a spiritual leader than a hands-on executive. In this article David De Cremer and Tian Tao discuss the seven important leadership lessons that have made Huawei the company it is today. 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. Our relationship with the Chinese government is primarily defined by these two points. For example, in the desert and rural areas in China, rats were a plague for the telecom connections to customers. Mr. Ren: We have worked closely with our customers for 30 years. Where does this idea of competing in a cooperative way come from? 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. We don't talk about anything else, because we know that our communication is being monitored. We will put more money into research in new frontiers. He belongs to rural family and spent his middle and primary school years in remote mountains, where started his career as civil engineer when China faced turmoil because of cultural, revolution. Mr. Ren: When Ericsson was already really big, Huawei was still a "caterpillar". Join us in Amsterdam for the 2023 European Compliance & Ethics Institute! Arjun Kharpal: I want to talk a bit about your management style. In his view this could only be achieved by providing excellent services. We will expand it, and dive deeper into it. If a single backdoor was found in even one of the countries where we operate, our sales would shrink in all of them. We earned a bit of money this way. It makes that he is characterised by his employees as someone who leads with his heart and moves with his mind. So I think Trump is a great president, but he didn't consider all the angles when it came to attracting foreign investment. This does mean though that many translators and stock analysts and the like will lose their jobs. By then, we will have probably found solutions to the potential problems surrounding the creation of "new people". He relentlessly convinces his employees through stories and actions. 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. We also had to understand the law. Unlike many Chinese companies that set up many businesses but most cannot be called successful, US companies know how to narrow their focus and then charge forward. On April 12, at the "16+1 Summit" in Croatia, Premier Li repeatedly told all our employees not to install backdoors on networks. Arjun Kharpal: But what was the personal effect of her arrest on you as a father? Ren zhengfei invested much money and other resources on learning and putting this management system into effect. So you said she doesn't want to leave anymore. In the early years, Huawei, as a private company, had to battle primarily the State Owned Enterprise (SOE) dominated market. What do you make of his views? Because we want to grow our harvest and produce actual results. So I'll let her face what she is facing. I said I couldn't even imagine what it would look in two or three years. Ren is an active supporter of Communist Party of China. Zhengfei was very clear about this ambition and demanded that all Huawei employees would adopt the US-based way of looking at business as introduced by IBM. If a technology is just five kilometers away, we will invest heavily (a business version of a Van Fleet Load). We have raised our prices and now many people think Huawei is expensive. and pay only $8.75 each, Buy 11 - 49 Its founder, Ren Zhengfei, has recently even referred to Europe as a market where they feel at home as a telecom company. No backdoors. President Trump hasn't shared his thoughts with me. The major form of analog control was a proportional-integral-derivative control. Nothing but life. With the accounting error, Hill broke a big rule but we suspect that had he followed the smaller rules around issues like showing favoritism to family members, he would have had a better chance of survival. Everything is limited. When we first entered the telecom industry, we started by reselling products from another company. If we couldn't make ends meet, we wouldn't be able to survive. We have become what we are today with our own strength. In particular, the emergence of AI has accelerated social progress. As can be expected of a man with an army background he served in the Peoples Liberation Army he is known to be intense and tough and never loses control. 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. Especially in the entrepreneurial years of the company he used this strategy to be both a strong mentor and leader for his employees. Mr. Ren: I think technology will advance even faster than we could ever imagine. And he initiated an annual conference whose panels combined executives and faculty members. We cannot deny the role that enthusiasm plays in the procedure. Mr. Ren: I don't know. Living in such extremely harsh conditions and working on such a highly modernized project was really a good experience for me. In a way obsessed by doing good for the customer, Zhengfei is relentless in communicating this purpose by means of stories to his employees and convincing them that they all should be dedicated to pursue the mission of the company: To connect people via communication.. and pay only $8.00 each. Even if AI poses other threats, we can manage them with laws and rules. Leading Huawei: Seven Leadership Lessons of Ren Zhengfei, The relationship between China and the European continent carries much history with it. The ethos needs to be summarized in an evocative statement pointing to the behaviors desired in the organizations members. Huawei is now China's most prominent multinational company and a leader in 5G mobile telephone technology, which will be rolled out across the world in the next few years. Ren has unique qualities which make him different from other, leaders. But he also has shortcomings. This is because technology is lifeless and can be widely applied. We believe US laws are open, transparent, fair, and just. In the third phase, after 2007, the strategy was to simplify management and be creative with top talents to turn Huawei into an efficient and creative creator of customers dreams. document.getElementById( "ak_js_1" ).setAttribute( "value", ( new Date() ).getTime() ); Mark your calendar for these stimulating events and prepare to be inspired. Ren Zhengfei leads Huawei Technologies, one of the world's largest manufacturer of telecommunication hardware and mobile phones. You dont want to be like John DeLorean, who battled nearly everything on his way up in and then out of General Motors. Collective decision-making ensured that Huawei made fewer mistakes and absorbed collective wisdom, but it also caused rigidity. Arjun Kharpal: You said you've not had any communication with Donald Trump. However, it kills employees creativity and . The billionaire founder of Chinese telecoms equipment giant Huawei rarely. 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. The negotiations between China and the US have nothing to do with Huawei. 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. In his pursuit of the Huawei dream, Ren Zhengfei seems to know his own limitations and does not portray himself as the ultimate know-all leader. If the US opens its telecom industry and its operators say they are going to purchase tens of billions of dollars in equipment from us, I wouldn't believe it and wouldn't be willing to make billions of investments. It takes a lot to get to the top of an organization: a high IQ, emotional intelligence, technical competence, and a variety of personal characteristics, such as fortitude and resilience. Arjun Kharpal: You've mentioned that she wanted to leave the company before she was arrested. But even if it did happen, it would be at least 30 years from now. Chinas Huawei rapidly became one of the worlds most successful telecommunications equipment companies, with revenue exceeding $122 billion in 2019. He is also the author of the book The Huawei story and founder and Editor in Chief of Top Capital magazine. Sheryl Sandberg is well-known for combining social skills and intelligence in a way that allowed her to break up the boys club at Facebook. Lets look at each, drawing on examples from our own experience and that of well-known successful leaders. So productivity will be greatly improved. Ren Zhengfei has lead Huawei to become a global brand making the top global 100 by 2017 (Huawei 2017). When I look back on how Huawei developed in the telecom market, we actually made some missteps. My younger daughter is a fan of Mr. Jobs, so she proposed that we stop for a moment of silence to mourn him, and we did. Vernon Hill was transformationally successful in leading Commerce Bank in the USA and then Metro Bank in the UK. 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 can scale down a little bit. 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. It was all about hard work to bring the company up to the level that it was able to provide higher-quality service. I told him that I didn't actually know that the barriers were so high, and once we had entered the industry, there was no turning back. Ren: First of all, we want to delegate the decision-making power to our experts. There was no chance for us to step back and start another business. Mr. Ren Zhengfei has been capable of pioneering the development of technology while growing in the world. On the other hand, Zhengfei is also known to give much freedom when it comes down to how decisions are executed. At the time, the market economy was beginning to take shape in China, at least in coastal cities. All Rights Reserved. If a technology is 20,000 kilometers away, we can invest a little more, like an apple. Huawei is to a large extent no stranger to this system. China also didn't have its own testing instruments, so I invented one. This can help us address the problem of how we distribute our increasing profit. This statement was understood as underlining that his global ambitions were there to stay and grow. These cookies will be stored in your browser only with your consent. Huawei was founded by Ren Zhengfei when he was in the mid-age crisis. According to him, Huawei should be focused on building a company where peoples minds are the main asset and resource to rely on. He is frequently quoted as saying that the most important thing to value is the power to think. Such a system prevents the company from collapsing due to a single leader, raises efficiency, and avoids inaction due to over-democratisation. For that reason, phase 3 focused on simplifying management and creating conditions that more creative chaos could be brought back into the structured management models. For example, as the products of Huawei in their pioneering years were not yet well developed he visited many R&D offices abroad. With higher prices, we have started earning more. His company reflects these traits. If we didn't pay taxes or follow the laws and regulations in the over 170 countries where we operate, we wouldn't have survived in those countries. Around 2008, Professor Arikan published a mathematics paper. Figure 1: The Leadership Lessons of Ren Zhengfei 1. To stay one step ahead of your competition, sign up today to our exclusive newsletters to receive exciting insights and vital know-how that you can apply today to drastically accelerate your performance. Get your Culture in Good Shape, Not Lost in Translation: Making the Data Make Sense. They don't need a warship to conquer the world. Because the board members were top executives, he brought one or two senior academics to each meeting to present their research, emphasizing that they needed to make it relevant to the audience. Second, Huawei should be focused on building a company where peoples are! And Stock analysts and the rise of Huawei China, at least 30 from... Situation the US have nothing to do with Huawei evocative statement pointing to the ren zhengfei leadership style that it was all hard...: when Ericsson was already really big, Huawei should be focused on building a company peoples. 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