Question

company: Huawei

1What strategies the company is using?

2What are the cultural issues that they have had to confront in terms of individual, institutional

and product adaptations?

3In which parts of the world are they focused? And why?  

4What forms of foreign involvement are they using?

Answer 1

Ans 1) Consistent and heavy investment in advertising and communications has been the mainstay of Huawei's brand strategy. This will continue as the company tries to strengthen visibility and awareness of its products globally and remain competitive (in terms of marketing investments) with the likes of Apple and Samsung.

Ans 2)Cultural issues that Huawei had to confront in terms of individual are the lack of transparency, the chaotic management and exploitation culture. Only the Chinese colleagues enjoy the trust of the upper management and are given opportunities. The rest are not seen as part of the company.” Among the most frequent complaints include issues of diversity, cultural sensitivity, ethics, and discrimination, particularly in developed markets.Despite such issues, many current and former Huawei employees dismiss such concerns. One Chinese manager who worked on a number of overseas projects explained that Huawei’s success despite its seeming indifference to issues of diversity proved that the importance of diverse work teams was “nothing more than a Western myth.

Cultural issues that Huawei had to confront in terms of institution some core issue with Huawei has been concerns about its coziness with the Chinese government and fears that its equipment could be used to spy on other countries and companies.

Ans 3)Beyond China and the U.S., the company’s smartphone brands have found potentially lucrative opportunities in India, Indonesia, Taiwan and many African countries.

These new found opportunities have linked nicely with Huawei’s status as an entry-level challenger in most markets and enabled it to design and implement a global marketing strategy rather than grapple with the complexities of different maturity levels in different markets

And 4) exporting, joint ventures, foreign direct investment, franchising, licensing forms of foreign involvement has been used by Huawei.A significant part of Huawei’s leap from regional player to global leader has to do with its astute strategy of brand partnerships throughout its development. In 2003, Huawei established a joint venture with 3Com, a world leader in networking solutions at the time. The venture was called H3C – a conjunction of both companies’ brand names. Under the agreement terms, 3Com would simply sell and rebrand products under H3C while reaping the benefits of Huawei’s distribution networks and local knowledge. This venture would be extremely profitable for 3Com, but possibly even more valuable for Huawei in the long-run who, after their years learning from the American giant, eventually moved to purchase their global operations in 2007. Unfortunately, U.S. government regulators stepped in over concerns that the Chinese military would gain access to 3Com’s cyber security unit which sells software to the U.S. military. Eventually, 3Com was acquired by HP in 2010.

However, Huawei succeeded with Symantec. In 2008, it signed a joint venture with Symantec to boost their capabilities in network, security, and storage technologies. More than 50 percent of Huawei Symantec employees would be engaged in research and development activities with labs in Beijing, Shenzhen, Hangzhou and India. Three years later, Huawei acquired all of Symantec’s shares in the joint venture. For a company who had only begun R&D in security technology in 2000 and storage in 2004, Huawei was now a global powerhouse in both fields.

Huawei continues to be mentioned as suitors in potential game-changing acquisitions as it seeks to deploy its capital. In 2010, Huawei purchased products and services from American companies totaling USD 6.1 billion. In 2012, rumours began to swirl that Google – who had bought Motorola – was in talks to sell the entire Motorola handset business to Huawei.

To continue to add expertise, Huawei will face a challenge to stay away from the type of mergers or acquisitions that are predicated on cost efficiency and economies of scale. The most meaningful mergers and acquisitions for brand-building are those that truly add to a company’s competitive advantage, not just their bottom-line.