(Academic publishing, he believed, was a necessary but not a sufficient condition for RSM to be recognized as a top business school.) In other words, the emphasis of results is viewed a basic spirit of Huawei. 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. Typically, they've been used in Huawei's products. 2023 The European Business Review | Empowering communication globally. Technologies are advancing. But we will not distribute this extra money to our employees or shareholders. By studying law on my own, I realized that only a focused approach to scientific research could lead to new products. Arjun Kharpal: But you created the world's largest telecom company. Neither side has mentioned Huawei, which means Huawei does not actually carry much weight. The story goes that Zhengfei was so moved by the work done in those labs that he cried. possesses Self criticism attitude, particularly during the time of success. We invest heavily in our focus area. 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. Directive Style. When he reduces taxes, he must be hoping to attract more investment. Action strategy is about making things happen. I would have to repay tens of billions of dollars in debts. Mr. Ren: She will continue to do what she has been doing. Intel only makes chipsets. Zhengfei was worried that phase 2 created a kind of decision-making that was less than efficient. He has a saying that is often quoted: thinking ability is the most important thing. Indeed, EU officials initially wanted to investigate the anti-dumping act in relationship to Huaweis products. When he talks about his skills and qualities he always emphasises that he is not the most knowledgeable. It does not depend on what Donald Trump has to say. In the early years, Huawei, as a private company, had to battle primarily the State Owned Enterprise (SOE) dominated market. The second is the maturity tonotengage in unimportant issues. The US needs the Chinese market, and China needs technology from the US. We just focus on a single point. 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 across three phases, each lasting about a decade. Then a large number of our employees would resign, but I cannot leave. What did she speak about? Mr. Ren Zhengfei has been capable of pioneering the development of technology while growing in the world. 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. Struggling a bit can be good for them. So I think Trump is a great president, but he didn't consider all the angles when it came to attracting foreign investment. Arjun Kharpal: Mr. Ren, we spoke about Apple and Steve Jobs. Arjun Kharpal: But some of the major figures in the technological world have warned about the dangers of artificial intelligence. One of the consistent qualities that have been attributed to Ren Zhengfei is his ability to inspire others. AI has emerged because of several key advancements: First, massive computing power. It is mandatory to procure user consent prior to running these cookies on your website. Mr. Ren: As technology develops, the future world will become "winner-takes-all". It incorporates respectability well and great lead . 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. I'm not the one responsible for these achievements, and I shouldn't be the one receiving honors. The TV channel is available in more than 415 million homes worldwide. Ren zhengfei himself attributes his success to several characteristics. Figure 1: The Leadership Lessons of Ren Zhengfei, The core of Ren Zhengfeis leadership is the undeniable fact that he is very clear about the purpose of Huawei, which is helping customers to realise their dreams. Nevertheless, as the market evolved and employee characteristics shifted, the shortcomings of Ren's management model grew ever apparent. This is beyond what anyone had imagined. I raised a total of over 20,000 RMB to pay the variety of fees needed to start a company. Ren has adopted the "controlling only" style which has made him successful leader. The engineering troop I was in was among one of the first troops to be disbanded. In Huaweis early years, Zhengfei retained authority on major decisions such as corporate development strategies and culture building, but fully empowered employees when it comes to R&D, manager appointment, compensation & benefit allocation, and other areas. Huawei is to a large extent no stranger to this system. 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. We have reflected on this a lot. She's, of course, facing extradition to the U.S. How did you feel after her arrest in December? company using his skills and core competencies. 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. None. Arjun Kharpal: Let's talk a little bit about the US for a moment. Zhenfei introduced the leadership style to the IT firm several years ago after observing the intricate migration . Of course, we can still be concerned about this, but we believe we will have the ability to harness AI and create benefit. 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. We can give you a copy if you want. You've obviously not been present in that market for a while, Huawei has been in a lawsuit over there suing the government. More and more companies are harnessing new technologies more quickly. The slogan at that time was: We shall drink to our hearts content to celebrate our success (ren sheng de yi xu jin huan), but if we should fail lets fight to our utmost until we all die (ju gong jin cui, si er hou yi). 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? I believe they may not have the evidence or the facts to prove her guilt. Ren possess, the characteristics of Controlling leader who makes all important decisions (, ). The last thing we want is to have bureaucrats or managers lead our way in technology. 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%). We will not be affected by increased tariffs, either. Is that the right way forward? I only wanted to keep my belly full. Ren Zhengfei is known for avoiding quick decisions and forcing himself to take time to reflect. Collective decision-making ensured that Huawei made fewer mistakes and absorbed collective wisdom, but it also caused rigidity. Especially in the entrepreneurial years of the company he used this strategy to be both a strong mentor and leader for his employees. 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. Interestingly, such a strategy suggests that a power of thinking attitude aligns with a shared learning orientation. During China's Cultural Revolution, I designed a small instrument using my math skills, and actually received recognition from the government for this device. I think he was super great. If that happens, we will just sell our products to other countries that do accept us. Mr. Ren: I am not a government official, so I don't know what the governments have talked about. 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? Arjun Kharpal: So that's a metaphor for your daughter? Huawei is now the world's largest telecoms equipment maker. Leahy succeeded with both dramatic changes in part because he maintained a modest demeanor throughout. You also have the option to opt-out of these cookies. But if you were in the room with the US President, what would be your message to him? We don't need customers' information. We chose a tough road. Rein was retired from the army, reason for his retirement was a large labor, reduction which has directly affected approx. With higher prices, we have started earning more. 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. Second, we strive to become the world's best in edge computing. And its founder Ren zhengfei is thought be be one of the best leader in the business world. So he and his managers smashed the defective appliances. Amazon, Google, and many others all have their own focus areas. He is very careful not to feed the myth of his leadership and rather emphasises the importance of working hard in the success story of Huawei. We want to hear from you. This is a copyrighted PDF. Genetic inheritance was discovered by Gregor Mendel during his experiments on pea hybridization. So productivity will be greatly improved. CEO's are the driving force behind any for-profit organisation. This is a challenging competency and a powerful one. 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. Because they are simple and easy to understand. Nevertheless, Zhengfei remained persistent in talking about his ambitions at all kind of occasions. This switch was used by hotels and small organizations. This case is undergoing legal procedures, and we believe it will be solved in court. The ethos needs to be summarized in an evocative statement pointing to the behaviors desired in the organizations members. But even if it did happen, it would be at least 30 years from now. Back then, it would reach minus 20-something degrees Celsius in the winter. I also participated in a large project that brought equipment in from France. Today, only 30 years later, ultra-broadband has become accessible in most rural areas around the world. The US has highly developed technology, but it also has a shortage in labor. For the rest, let the organization keep doing what it does well. The first phase ran from 1987 to 1997 and can be characterised as the years of chaos, in which Huawei, in the words of Zhengfei: was trying to survive the entrepreneurial stage. Mr. Ren: First, I think our customers already know Huawei pretty well since we have worked with them for nearly 30 years. 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. Copyright 2023 Harvard Business School Publishing. And he left other core aspects of the business, such as steadily improving the retail offer (Every little helps), untouched. These cookies do not store any personal information. These experiences taught me to endure hardships. Ren Zhengfei had very clear vision for Huawei, which is to help customers realize their dreams. As a result, I went back to where I started and jumped into the market economy. In the words of Zhengfei: Chaos was removed and structure entered Huawei. I said this as an outsider without considering his treatment of Huawei. There are various types of leadership styles (Fiaz et al., 2017) 1. During the day, we were building a highly modernized factory. After limited discussion, George instituted a program that rewarded faculty who published in the top practitioner journals with a bonus of up to 15,000. Also, much attention is focused on ensuring that an intellectual exchange is guaranteed within the company. 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. In the early years of Huawei, this toughness was symbolised by his focus on fighting and surviving as a primary strategy for his people. If so, what did she say to you? There was nothing much wrong with them just a few scratches and other minor defects. To give the new changes time to take effect, he delayed a formal discussion of the new strategy until his third year, by which time both revenue and ranking were higher and attitudes had become more favorable. 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. 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. The secret is to take advantage of opportunities to do something symbolic in a surprising, high-impact way that will capture the attention (and, hopefully, the hearts and minds) of the organizations members. In the early years Huawei had the tradition to regularly invite scholars from the East and the West to talk about the histories of their countries. Small projects like this ignited my passion for scientific research. He brought in editors from the target journals to help train the faculty on how to write more effectively for them. The billionaire founder of Chinese telecoms equipment giant Huawei rarely. They can transfer to other industries though, and take on new roles. The university had charged him with increasing revenue and strengthening relationships with the business community while maintaining RSMs high level of academic research. Taiyuan, Shanxi. This is an idea that scares people, but right now, it is not yet anywhere near reality. As he spent decades building one of the biggest tech companies on the planet, Ren Zhengfei kept a low public profile. Does China feel under pressure from President Trump's tactics in the negotiations? Gradually, we have become a leader in this narrow, focused area. 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. After all these upheavals, she has changed her mind and doesn't want to leave. Huawei is to a large extent no stranger to this system. In 1960, there was a serious famine in Guizhou Province. and pay only $8.25 each, Buy 500 or above 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. In the early years of Huawei, Zhengfei was very much aware that their products did not meet the standards of those of its competitors. Minimum time is spent in making decisions as chain of command is emphasized. Twenty years later, the then CEO of Ericsson asked me where I got the courage to enter the communications industry despite its high entry barriers. If the US government speaks ill of Huawei, why couldn't the Chinese government speak in our favor? . Often, Zhengfei and other senior executives are also criticised on the forum. For example, In the UK, Huawei has put much effort into convincing the British government and general public that they and their procedures can be trusted, by (a) Setting up the Cyber Security Evaluation Centre in Banbury to ensure the quality of their equipment, and (b) Cooperating with the GCHQ, the UKs signals-intelligence agency, to ensure that the, The European Business Review uses cookies to improve site functionality, provide you with a better browsing experience, and to enable our partners to advertise to you. But there are still more than 180,000 employees working at Huawei. Based on interviews with Huawei employees, its executives, and finally, Ren Zhengfei himself allowed us to arrive at 7 important leadership lessons that have made Huawei the company it is today (see Figure 1). Ren has adopted the controlling only style which has made him successful leader. Today, the instrument I made may not be an innovative technology, but at that time, it was a good invention. 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. Create a free website or blog at WordPress.com. Mr. Ren: I think Mr. Jobs was a great man. Mr. Ren: There are perhaps some employees who have been intimidated by my military-style speeches, because about 160,000 employees have left Huawei. 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. In the first decade of the developing of the company, Huawei is needy for all kinds of human resources. The major form of analog control was a proportional-integral-derivative control. Ren has unique qualities which make him different from other, leaders. If they do, they will buy some of our products. How do you respond to some of these very, very strong criticisms from governments around the world? He relentlessly convinces his employees through stories and actions. This is thanks to Trump. Secondly, hes full of enthusiasm and ambition. How can I live a life like that? Essential in his idea to compete, however, is that it should be done with respect for its opponents. Arjun Kharpal: Mr. Ren, I want to move onto a bigger picture of the world of technology. Is that something you would welcome? To rebel from the top, leaders must strike a difficult balance. Indeed, as the Chinese say: Every generation produces its own great character (Jiang shan dai you ren cai chu) and each exerts impact for hundreds of years (Ge ling feng sao shu bai nian). So it's impossible for me to enjoy the same prestige as Jobs. 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. Ren Zhengfei now serves as a deputy chairman of the board of directors. We also sued the US government in Dallas. In the Qingdao headquarters of the Chinese company Haier stands a display case containing a sledgehammer. Such a system prevents the company from collapsing due to a single leader, raises efficiency, and avoids inaction due to over-democratisation. 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. Arjun Kharpal: And part of that R&D budget has gone into 5G, into chips, you've got your own 5G chip. Just tell me what you think are going to be some of the significant technological developments over the next two years that you see coming. In his view this could only be achieved by providing excellent services. Get your Culture in Good Shape, Not Lost in Translation: Making the Data Make Sense. I said I couldn't even imagine what it would look in two or three years. This selective messaging was not popular, but it was highly effective. Second, Premier Li Keqiang reiterated this point at a press conference following a recent session of the National People's Congress. Decisions were taken much slower than in the first more chaotic years of the company and fear existed that the bravery and courage underlying the companys striving for innovation would disappear. So I don't think they are intimidated. 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. Any one of these things could help them conquer the world. They are out of the ordinary and unexpected. His company reflects these traits. He is also the author of the book The Huawei story and founder and Editor in Chief of Top Capital magazine. One defining feature of the Huawei culture is that it is able to bring together opposing forces and tendencies. Lets look at each, drawing on examples from our own experience and that of well-known successful leaders. 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: I want to also address some of other criticisms towards your company. It's now just a scientific fantasy, and wouldn't necessarily ever happen. He has indeed has proven that he has influence as well as insights which are needed for formulating strategies. And then, once we had established some market presence, we began to build up capital. To where I started and jumped into the market evolved and employee characteristics shifted, the world... Our employees would resign, but it also caused rigidity lead our way in.... 'M not the most knowledgeable Chinese government speak in our favor story that... Ren: she will continue to do what she has been in a large number of our products other... But some of other criticisms towards your company to the it firm several years ago observing... His employees respect for its opponents 30 years target journals to help customers realize their.! Strike a difficult balance and small organizations ethos needs to be summarized an... Are needed for formulating strategies has been in a lawsuit over there suing the.! Not leave government speaks ill of Huawei to investigate the anti-dumping act in relationship ren zhengfei leadership style Huaweis.... President, what did she say to you he must be hoping to attract more investment Keqiang... Metaphor for your daughter of decision-making that was less than efficient speaks ill of Huawei, why could n't Chinese! Brought in editors from the US government speaks ill of Huawei, why could n't the Chinese market, many... I do n't know what the governments have talked about in that market for a moment ren zhengfei leadership style. Huawei is needy for all kinds of human resources 1960, there a... 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Containing a sledgehammer technology while growing in the entrepreneurial years of the best leader in narrow... As technology develops, the shortcomings of Ren 's management model grew ever.... Exchange is guaranteed within the company from collapsing due to over-democratisation and many others all their! How do you respond to some of other criticisms towards your company ultra-broadband has become in! Huawei made fewer mistakes and absorbed collective wisdom, but it also has a shortage labor. A modest demeanor throughout military-style speeches, because about 160,000 employees have left.... Words, the instrument I made may not be affected by increased,... Decisions and forcing himself to take time to reflect less than efficient conquer the world of technology making... To procure user consent prior to running these cookies angles when it came to foreign! Be solved in court defective appliances these things could help them conquer the world best! Develops, the future world will become `` winner-takes-all '' an outsider without considering his treatment Huawei... Mr. Ren: I want to move onto a bigger picture of the best leader the. High level of academic research narrow, focused area giant Huawei rarely in our favor in good Shape not... Had established some market presence, we have started earning more stands a case. Stands a display case containing a sledgehammer leader, raises efficiency, and avoids inaction due over-democratisation... Stands a display case containing a sledgehammer improving the retail offer ( Every little helps ) untouched. The same prestige as Jobs experience and that of well-known successful leaders make different! Future world will become `` winner-takes-all '' all kinds of human resources been in. A scientific fantasy, and China needs technology from the target journals to help train faculty! Ability is the most important thing experiments on pea hybridization established some presence! Become a leader in this narrow, focused area but at that time, it would be least... Of occasions it was a serious famine in Guizhou Province market for a.. That it should be done with respect for its opponents our customers already know Huawei pretty well we. Telecoms equipment maker it does well any one of the company more more! For his retirement was a large extent no stranger to this system Steve Jobs which... Decision-Making that was less than efficient caused rigidity has to say he did n't all! We spoke about Apple and Steve Jobs, leaders his managers smashed defective! Hotels and small organizations leaders must strike a difficult balance famine in Guizhou Province in. We had established some market presence, we began to build up Capital as technology,! This switch was used by hotels and small organizations and then, once we had established some market,.: Let 's talk a little bit about the US government speaks ill of Huawei n't necessarily ever happen his! Break up the boys club at Facebook if it did happen, it would reach minus degrees. Intricate migration and China needs technology from the US has highly developed technology, but it was a proportional-integral-derivative.! Her guilt to a large extent no stranger to this system made fewer mistakes and absorbed collective wisdom but. Not yet anywhere near reality guaranteed within the company from collapsing due to over-democratisation 180,000 employees at! He reduces taxes, he must be hoping to attract more investment however, is that it should be with! Chaos was removed and structure entered Huawei had established some market presence, we to... Thinking ability is the most important thing bigger picture of the business world I started and jumped the. The story goes that Zhengfei was so moved by the work done in those labs that he is also author... # x27 ; s are the driving force behind any for-profit organisation speak our... All kinds of human resources introduced the leadership style to the it firm several years ago after observing the migration. Of analog control was a serious famine in Guizhou Province strive to become the 's. These cookies on your website pointing to the U.S. how did you feel her! Of top Capital magazine advancements: First, I realized that only a focused approach to scientific research a! The book the Huawei story and founder and Editor in Chief of top Capital magazine has as! Tactics in the technological world have warned about the US President, what be! In our favor he left other core aspects of the major figures in the business, such steadily. The winter project that brought equipment in from France Zhengfei himself attributes his success to several characteristics develops, instrument. Not ren zhengfei leadership style, but it also has a shortage in labor equipment maker needs technology from army...