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Huawei aims to be more resilient in 2019 amid challenges

Huawei’s rotating chairman Guo Ping outlines the firm’s priorities to optimise its product portfolio, empower employees and build a more resilient business structure

Huawei has laid out its priorities in 2019 amid the uncertainty of international politics that could hamper its growth in key western markets.

In his New Year message, Huawei’s rotating chairman Guo Ping said the Chinese supplier of telecoms equipment and mobile devices will focus on strategic business opportunities and build a more resilient business structure.

That includes optimising its product portfolio and cutting back on development of products that have not been competitive, Guo said.

“If we can develop the simplest possible network architecture, make our transaction models as simple as possible, ensure the highest level of cyber security and privacy protection, produce the best products and provide the best services, no market can keep us away,” he added.

In December 2018, Huawei’s chief financial officer Meng Wanzhou was detained by the Canadian government over allegations that Huawei had used a shell company to do business with Iran, against US sanctions.

The US, Australia, New Zealand and Japan are also looking to ban or have banned the use of Huawei’s telecoms equipment on upcoming 5G networks over national security concerns arising from Huawei’s alleged ties to the Chinese government.

Huawei has publicly dismissed those allegations, claiming that the Chinese government has no ownership stake in or control of the company. In his message, Guo reiterated the company’s “very strong track record” in cyber security.

“Huawei has never and will never present a security threat,” Guo said, adding that company will systematically enhance its software engineering capabilities over the next five years to build more trust and quality into its offerings.

New operating model

Empowering employees appeared to be a key focus for Huawei in 2019, with Guo dedicating a large portion of his message to organisational changes.

In a new operating model, Huawei will delegate more authority to field offices that are closest to customers, with the head office focusing more on budget management, Guo said.

Setbacks will only make us more courageous, and incredibly unfair treatment will drive us to become the world's number one
Guo Ping, Huawei

Guo added that this will help to optimise the relationship between Huawei’s Shenzhen headquarters and field offices, increase productivity and inspire teams to make greater contributions. Huawei will also automate large amounts of repetitive work to improve business efficiency.

Taking a leaf from tech giant Google, Guo said Huawei will de-emphasise output as a factor of productivity while maintaining a focus on results and responsibilities. “We need to look at how much value our people create for customers, how they help others maximise their contribution, and how they use the output of others to improve their own,” said Guo.

Still on the human resources (HR) front, Guo said Huawei will explore incentive structures that better match the characteristics of different businesses while keeping HR policies consistent.

“We need to combine different kinds of incentives to reflect different responsibilities and contributions, both for teams and individual employees. This will give people the extra motivation they need to push themselves and achieve more,” said Guo.

“Naturally, those who contribute more will earn more. Bonuses should serve as an incentive for short-term contributions, and also as a guide for future investment. We should reward those who work to grow the harvest, as well as those who work to increase the fertility of our soil for future growth.”

Remaining calm amid adversity

Underscoring the need to remain calm and composed in the face of current political undertones, Guo said Huawei will use the certainty of legal compliance to deal with the uncertainty of international politics.

“We must continue to incorporate compliance requirements into all business activities through carefully aligned policy, systems, organisations, processes, culture, training and communications. These requirements must be ingrained in the awareness and behaviour of each and every Huawei employee.

“We must not be discouraged by malicious incidents or temporary setbacks, and must remain determined to achieve global leadership. Setbacks will only make us more courageous, and incredibly unfair treatment will drive us to become the world's number one,” Guo said.

Despite its challenges, Huawei closed the year with 26 commercial 5G contracts inked with global telcos. It shipped over 10,000 5G base stations and more than 200 million smartphones, with sales revenue tipped to reach $108.5bn in 2018, up 21% year-on-year.

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