Use the strengths of your organization to achieve your goals. It is clear that although very ambitious and action-driven he also cares about the value of being humble. The ethos needs to be summarized in an evocative statement pointing to the behaviors desired in the organizations members. In Europe, we will face some difficulties in the short term, but there will be no impact on our business. The major form of analog control was a proportional-integral-derivative control. And I don't really care about all that. Today, only 30 years later, ultra-broadband has become accessible in most rural areas around the world. The number of Chinese companies investing and engaging in acquisitions in Europe has seen a steep growth curve. Huawei responded to customers 24/7. All he cares about is how to thoroughly solve every problem his company meets and how to improve the efficiency of the whole group. Some top military officers didn't understand it, either. Ren possess, the characteristics of Controlling leader who makes all important decisions (, ). 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. I want to use a case analogy here. Trusted by 2+ million users, 1000+ happy students everyday, You are reading a previewUpload your documents to download or Become a Desklib member to get accesss. You often use military imagery and images of battles in your speeches and communications with the employees at the company. The US government must present evidence to substantiate their charges against Huawei as this lawsuit proceeds. 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. He is continuously focused on the future and hardly ever ruminates about the past. They have great technologies, skilled labor, and economic strength. We also use third-party cookies that help us analyze and understand how you use this website. Arjun Kharpal: Mr. Ren, as we come to the end of the conversation, I want to focus on your future. Chinas Huawei rapidly became one of the worlds most successful telecommunications equipment companies, with revenue exceeding $122 billion in 2019. In particular, we will build the simplest networks, ensure cyber security, and protect user privacy. The leadership of Ren Zhengfei, however, does differ from this rather "controlling only" style in important ways. Therefore, he often uses similar way to manage the company like the military system does. It will never happen. What company can outperform Microsoft in Office and Windows? 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. A great opportunity arose when one senior professor complained that the teaching program staffers acted as if the faculty worked for them, rather than the other way around. Firstly, being practical instead of seeking after useless fame. Arjun Kharpal: You were in the People's Liberation Army. Huawei, one of the biggest company focusing on making communication tools like cellphones, is famous all over the world. In particular, the emergence of AI has accelerated social progress. Huawei, one of the biggest company focusing on making communication tools like cellphones, is famous all over the world. Even with those qualities, many leaders fail at the top job often because they dont know how to get the organization to do what they want. Ren Zhengfei's Media Interview After the Opening Ceremony of the Intelligent Mining Innovation Lab in Taiyuan. 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. A Division of NBCUniversal. Instead, we will use it to fund universities and scientists for their research and explorations into the future. Mr. Ren: I don't know what the US is after and have no idea how they are going to resolve the trade disputes. Arjun Kharpal: Do you feel that your military-style speeches empower the employees here? Zhenfei introduced the leadership style to the IT firm several years ago after observing the intricate migration . Every year we invest more than 20 billion US dollars in it. Publication Date: 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. I was naive and took it for granted that I could earn money playing with this huge industry. This ability derives from his pro-active attitude. By David De Cremer and Tian Tao. The country paid little attention to technology and knowledge, but we were working on a project that required technology and knowledge. But if you were in the room with the US President, what would be your message to him? 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. There's a lot of disagreement, of course, on what the right course of action is in Europe. 2023 CNBC LLC. After I joined the army, I was tasked to establish a chemical fiber factory in Liaoyang, a city in the northeast of China. 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. But if investors are scared that they won't get their money back, they won't dare to invest in the US. This way, we will be able to make world-leading products. Mr. Ren: I think my children have grown up without experiencing much hardship. 3.2 Findings 3.2.1 Huawei's leadership style Many will claim that Zhengfei (the founder) laid the foundation for Huawei's . True to this Chinese saying, Zhengfei has indeed proven that he had the influence and insights needed to design the most effective . We will also increase our sales revenue, which is now more than 100 billion US dollars, to around 250 billion US dollars. 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. We are also collaborating with many vendors in the storage domain, trying to do better, because in edge computing, we will see either CPUs embedded into storage devices or the other way around. We have limited resources and technologies. 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. Again, he ties this in part back to their ownership structure:. In the early years of Huawei, Zhengfei was very much aware that their products did not meet the standards of those of its competitors. What they lack and what successful leaders embody, down to their marrow is organizational intelligence. High-OQ leaders use action strategy rather than consensus building to pursue strategic goals. He said, Those are air bubbles. Mr. Ren: I often talk about staying focused. Do you still feel Europe is open to Huawei, or could one country blocking Huawei mean that the whole union stops Huawei from participating in 5G? We want to sign such an agreement because we think it's the right thing to do. It has grown the market, enabling many other companies to survive. Despite this controversy, Huawei received support from both Ericsson and Nokia, stating that in their view Huawei was not dumping its products. The collaboration between these two countries would create two "trains" that can tow the global economy out of trouble. For example, if AI is applied to tractors, they will be able to work 24 hours a day. Apple is also a great company. When he reduces taxes, he must be hoping to attract more investment. 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. Huawei is to a large extent no stranger to this system. But opting out of some of these cookies may have an effect on your browsing experience. 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. Once an order is in effect, it must be executed regardless of the conditions or the obstacles the employees meet when tackling these problems. 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. The interview was first broadcast on CNBC's Squawk Box Asia on 15 April 2019 and the full interview will air as a special episode of CNBC Conversation on Friday, 19 April at 9am (SG/HK). Back home in Shenzhen, Zhengfei told everyone that the passion that he felt for that lab was equal to love. Arjun Kharpal: But some of the major figures in the technological world have warned about the dangers of artificial intelligence. 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. Arjun Kharpal: Do you have a succession plan in place when you eventually do retire? He also. Directive Style. I'm not the one responsible for these achievements, and I shouldn't be the one receiving honors. Of course, we can still be concerned about this, but we believe we will have the ability to harness AI and create benefit. Huawei is now the world's largest telecoms equipment maker. I think that is how this story is likely to end. 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. People will be afraid of getting trapped there. 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. Arjun Kharpal: Would you support similar ideas about no-spy agreements in other countries, including the US? After I was discharged from the army, I ran into a big trouble at work. 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. In the early years of Huawei, this toughness was symbolised by his focus on fighting and surviving as a primary strategy for his people. You dont want to be like John DeLorean, who battled nearly everything on his way up in and then out of General Motors. The country wanted to reform and open its doors. I could not keep up with the times. Bill Gates changed his mind though during his later speeches, suggesting that AI could greatly boost social progress. Mr. Ren: I think technology will advance even faster than we could ever imagine. We cannot deny the role that enthusiasm plays in the procedure. Amazon, Google, and many others all have their own focus areas. AI will benefit our society. 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. But what we've seen publicly is senior officials in the government talking at times on Huawei's behalf. Is only slower computing good for us? These experiences taught me to endure hardships. Register as a Premium Educator at hbsp.harvard.edu, plan a course, and save your students up to 50% with your academic discount. 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. In fact, the company only seems to be growing stronger. Is that useful to the company, or do you find that a distraction? Ren Zhengfei, founder and CEO of Huawei, speaking at the company's headquarters in Shenzhen on May 24, 2019. and pay only $8.50 each, Buy 50 - 499 If they do, they will buy some of our products. If they attack a country, that country will fight back. You have entered an incorrect email address! 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. Huaweis competitors assumed that they only had to provide the technology to the customer. This switch was used by hotels and small organizations. In 1963, he studied at the Chongqing Institute of Civil Engineering and Architecture. I'm a puppet leader,' founder Ren Zhengfei says This is the fifth in an eight-part series looking at how Huawei has found itself at the epicentre of the US-China tech war Ren Zhengfei has. Huawei's achievements were not created by me alone, but by our 180,000 employees. Arjun Kharpal: Mr. Ren, you talk a lot about the distance between Huawei and the Chinese government. In fact, we have too many. Steve Jobs and Tim Cook have managed to turn Apple to an iconic brand. This is beyond what anyone had imagined. This is fundamental to solving problems. Where does this idea of competing in a cooperative way come from? Huawei was founded by Ren Zhengfei when he was in the mid-age crisis. Nothing we've achieved would give us the right to neglect any laws or overlook the technologies of any country. Early life. Arjun Kharpal: So that's a metaphor for your daughter? But this year, once the slate is wiped clean, the financial statements they will release in July will be much healthier. We will wait for the court to make its judgment. They wouldn't need to rest, just to refuel. I would have to repay tens of billions of dollars in debts. 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. Second, thanks to the Western management approaches we brought in, our operational costs were also kept low. Thirdly, its his sense of management that helps him to become an excellent leader. High-OQ leaders send messages that reinforce the strategy and minimize other messaging. Harvard Business Publishing is an affiliate of Harvard Business School. Arjun Kharpal: Have you tried to reach out to the president to speak to him about it? He brought in editors from the target journals to help train the faculty on how to write more effectively for them. But we will not distribute this extra money to our employees or shareholders. The last thing we want is to have bureaucrats or managers lead our way in technology. 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. Mr. Ren: First, it's understandable that government leaders would take pride in the great companies of their country. Arjun Kharpal: Have you spoken to her recently? This message has been reiterated by many senior officials of the Chinese government, including Yang Jiechi, who stated his position at the Munich Security Conference, and Premier Li Keqiang, who made similar statement at a press conference shortly after a recent session of the National People's Congress. Do you think that companies like yours are too powerful and need to be regulated? By taking a set of coordinated actions that add up to a strategic change, a leader can kickstart the process without creating organized opposition. We obviously couldn't control our customers, so we had to get hold of the products. They are buying our products in large quantities as the US government is advertising for us. But I don't think Huawei can help solve the disputes between the US and China. Do people know what type of leader you are and what to expect when they interact with you? 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. And then, once we had established some market presence, we began to build up capital. Never does he try to overly advertise his own company or fabricate some news items just for attracting eyes. Let's look at an example. When two nations or companies meet, they must collaborate to achieve shared success. David De Cremer is the KPMG Professor of Management Studies at the Judge Business School, University of Cambridge, UK, an honorary professor at Wenzhou University, China, and a research fellow at the Ruihua Innovative Management Research Institute at Zehjiang University, China. 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. Secondly, we need to pay taxes to the Chinese government. Accelerate your career with Harvard ManageMentor. 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. Leadership styles. We did not know that these small things were designed to connect the whole city or even the whole world. Mr. Ren: Because I don't actually know technology that well, and I didn't invent anything. Mr. Ren: I can't speak for other companies; I have no authority over them, but Huawei will be the first company to comply with this agreement. You also have the option to opt-out of these cookies. We want to hear from you. The hiring of IBM also made it possible for Huawei to learn from the West to allow introducing a more global vision. Second, we don't really sell in the US market, so we will not be affected by a sales ban. October 01, 2018, Source: Western companies are no different. The US government is actually advertising for us in a good way. Arjun Kharpal: One of the concerns is that these powerful technologies like artificial intelligence are being developed by a small group of very, very big technology companies. Arjun Kharpal: But what was the personal effect of her arrest on you as a father? 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. Small projects like this ignited my passion for scientific research. 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. With Huawei becoming the largest telecommunications equipment manufacturer in the world, Ren zhengfei has already become a paradigm On one hand he possesses the characteristics of a controlling leader who makes all the decisions. For more information, visit www.cnbc.com. 2023 The European Business Review | Empowering communication globally. As mentioned earlier, the first two decades of Huaweis existence were dominated by the force of attack in order to survive and gradually become a better service provider. What do you make of his views? At the time, the market economy was beginning to take shape in China, at least in coastal cities. When we were negotiating with the German government about signing such an agreement, we didn't know top officials from the Chinese government were also discussing the same thing. The first is the ability to accurately estimate the level of conflict a particular course of action will elicit. I raised a total of over 20,000 RMB to pay the variety of fees needed to start a company. We chose a tough road. Do you see that Huawei is a pawn in the broader US-China trade war that's going on at the moment? What Crisis? She will be a hero if she makes it back to us. 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 you'd like to share this PDF, you can purchase copyright permissions by increasing the quantity. Fostering an ethos requires taking two important steps. That's why some deep-pocketed countries with rich oil reserves are buying from us. We have given up on supercomputing and intermediate computing. Learn how to create a winning business plan. Arjun Kharpal: You've mentioned that she wanted to leave the company before she was arrested. Today, Huawei has developed a decision-making system with limited democracy and appropriate centralisation. If no one dares to invest in the US, then how can they make up for lost tax revenue? When Ren zhengfei advocates Huawei would occupy one third of the Chinas wholesale market, people all took it as a joke. Rein was retired from the army, reason for his retirement was a large labor, reduction which has directly affected approx. They need to recognize what aspects of the status quo need to be challenged and they need the discipline to avoid wasting time rebelling in ways that are not strategic and wont move the organization forward. The leadership of Ren Zhengfei, however, does differ from this rather controlling only style in important ways. Huawei is to a large extent no stranger to this system. We don't need customers' information. Some governments have criticized the relationship between Huawei and the Chinese government. The US and Canadian legal systems are open, transparent, just, and fair. Terry Leahy steadily worked his way up to become the CEO of UK-based Tesco, one of the worlds largest supermarket companies. Another strategic objective was better cooperation between faculty and staff. Ren zhengfei himself attributes his success to several characteristics. He began by abandoning the tradition that the dean chaired all defenses of doctoral dissertations; he made it clear that his priority was engaging with external stakeholders, particularly corporate executives. although employees even management employees were not used to it, since it need a thorough change. Why cannot we edit human genes? So productivity will be greatly improved. 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. But there are critics who point to certain national intelligence laws in China that compel Chinese companies to help the government with national intelligence work if they're asked. This practice differed from the ones used by Western companies, which had advanced technologies and equipment, but ignored their services sector. In other words, the emphasis of results is viewed a basic spirit of Huawei. 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. I don't think we need to worry too much about the adverse impact of this technology. Arjun Kharpal: Mr. Ren, you've said in the past that the US government hasn't seen Huawei's technology and source code. By studying law on my own, I realized that only a focused approach to scientific research could lead to new products. Second, Huawei is being stuck in an extremely difficult situation the US is launching intense attacks against us. If we get caught in the middle, we will be crushed like a watermelon when these two powers clash. Although he is a billionaire, Zhengfei prefers a low profile lifestyle and even travels on the public transport. I had a vague feeling at the time though, that the communications industry was about to explode and so I started looking for opportunities in this market with tremendous potential. Mr. Ren: I think the most essential factors to judge guilt are facts and evidence. To rebel from the top, leaders must strike a difficult balance. I think currently AI has greatly improved productivity. 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. She has understood the difficulties that the company is facing and wants to help us see this through. This does mean though that many translators and stock analysts and the like will lose their jobs. When Huawei was just founded, the world of communications was extremely under-developed. Over the next five years, we will invest more than 100 billion US dollars in R&D to restructure our networks. I had thought that this was an Internet rumor initially, so I said that without much thought. The US doesn't need to conquer the world through violence. 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. Arjun Kharpal: Mr. Ren, we spoke about Apple and Steve Jobs. By the time I got my business license, I didn't have a single penny left. 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 he was on a four-year contract and had limited time. So what is her role at this company if she is eventually released? In many ways the second skill is the more difficult one to develop; most top managers are competitive, and their natural reaction to a challenge is to take it head-on. His message resonated throughout the Chinese corporate world; one of the sledgehammers now sits in the National Museum of China. That's how we started out. Media Contact:Clarence ChenCommunications Manager APAC, CNBC InternationalD: +65 6326 1123M: +65 9852 8630clarence.chen@cnbc.com. So there is no need to worry too much about some comments posted on the Internet. We only focus on edge computing. This company philosophy was inspired by the heroic tales of the Glorious Revolution that took place in England in 1688. 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. Taiyuan, Shanxi. Huawei, in contrast, decided to provide these services to their customers. Executives may want to develop these OQ competencies on the way up the ladder and theyll certainly need them if they are to succeed at the most senior levels. All rights reserved. Leadership Style Assignment : Ren Zhengfei. First, embrace bureaucracy rather than rail against it. AI is also developing faster than what we can imagine. Tian Tao is codirector of Ruihua Innovative Management Research Institute at Zehjiang University. 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. Required fields are marked *. The US is a strong economy and offers many high-quality products. Its fighting spirit, however, made it resistant to many negative influences and today Huawei can be called the only true global Chinese company. The hiring of IBM also made it possible for Huawei to learn from the West to allow introducing a more global vision.