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Huawei, Inc. ©: Full Analysis from A to Z.
Technical Report · May 2015

DOI: 10.13140/RG.2.2.34399.20646/2
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Huawei, Inc. ©: Full Analysis from A to Z
Ahmed A. Mawgoud*
Department of Information Technology
Cairo University
Giza, Egypt
aabdelmawgoud@pg.cu.edu.eg
ABSTRACT
The internet is a worldwide system that connects billions of devices around the world using protocols and communication aspects, it is a worldwide (network of
networks) that contains private, public, governmental, academic, military optical computer network technologies. Computer Network generally is known as many
collections of computers or network hardware that allow sharing data or resources through specific network channels but scientifically it was defined as any
telecommunication network that allows the computers to transfer or exchange data or packet using standard protocols. In this article, a descriptive analysis was
made for Huawei company starting from its establishment going through its development process locally & internationally then ending with the culture,
management process and technical strategy development.
Keywords:
Telecommunication – Entrepreneurship – Business Development – Company Analysis – Information Computer Technology
1. Introduction
In computer network, it is known that many connected computer devices with each other form a node, when many nodes are connected to each other
they form a small network. The nodes can be connected with each other using either cable or wireless media. Nodes can be formed from many different
types of hosts such as (Network hardware, Personal Computer or any hardware network that allows connection with other device). Nowadays, computer
network is the base of the modern communication. Computers control the entire public switched telephone network (PSTN) fundamentals. The source of
the vendors -which supplies all the needed technology to reshape the computer network technology by the time- are the main reason of developing the
vendor to take it to a new level of a high growth-rate of the network technology. One of the strongest computer network companies worldwide which are
known internationally as Huawei, the company that will be discussed in this paper analytically (i.e. Company Development – Strategy - Political). The
main aim is to introduce the development processes of Huawei as well an illustration of the 1) Administration Methodologies, 2) Working Environment
and 3) Company Culture, all the provided information were supported form a questionnaire made from Huawei Middle East.
2. Literature Review
In the 80’s, when china was opened to the world and it was very difficult to start a private business. From very humble beginnings, in a small town in
China called Shenzhen that is the center of the largest telecommunication service provider in the whole world nowadays. A man called Ren Zhengfei who
used to work as communication technology engineer in the Chinese military forces started in 1987 to found an idea called Huawei providing all the
needed supplements by himself instead of depending on the other venture to secure technology from any other company. As the main mission of this small
project was focusing on phone switching industry without putting a clear vision for the future. It was the main provider for many small establishments in
the city (Local Companies – Restaurants- Schools- Hospitals). This small company was founded when huge names existed then, such as (Nokia – Ericson
– IBM - Alcatel) which made it very difficult for him to compete such a companies in the beginning. However, this kind of industry needs heavily budget
to spend on the development researches. He said then “We can learn. We should learn management experience from other companies. So we invest
heavily in management.” (Ren Zhengfei). Gradually, the company expanded its range to include enterprise business, manufacturing electronic
communications devices and telecom carrier network.
By 1990, the company was having about 500 highly computer network system developers, and started to have its own independent commercialization
targeting high-level enterprises in China. In 1993 the big major breakthrough, when they developed a system to control the telephones switches that made
the company to break its way through the international mainstream market by signing a contract with the local authorities to build its known headquarter
we know nowadays. Up until today, Huawei has many international bases in Europe, South America, Africa & Middle East and an office in each country
where the Chinese embassy exists. (R. Anderson, 2012, BBC News).
* Corresponding author.
E-mail address: aabdelmawgoud@pg.cu.edu.eg
© 2015 Cairo University. Hosting by Research Gate. All rights reserved.
CAIRO UNIVERSITY AUTHOR: AHMED A. MAWGOUD 2
The company since its establishments had main goals:
 Customers First
On of Huawei's main goals is serving customers with demands that make-up the driving forces behind the development of Huawei. That is why the
company crate long-term value for customers by means of acting responsively to their needs and requirements. Huawei can only achieve success through
its customers’ success and support.
 Dedication
Huawei attracts customers' respect and trust mainly by being dedicated to the cause. This means making every effort to create value for customers and
work on improving its capabilities, hence valuing their employees' contributions and rewarding them for that.
 Continuous Improvement
Huawei needs improvements to be better partners with their customers and improve Huawei's infrastructure and employees. This is mainly done through
listening and learning from everyone
 Openness & Initiative
Huawei is driven by its customers' needs; hence, it peruses customer-centric innovations in an open manner. They have an essential believe that business
success is the ultimate measure of the value of any type of technology, solution and product or process improvement.
 Integrity
On of Huawei's most important assets is integrity, which drives the company to behave honestly, keep promises and finally win their customers' trust and
respect.
 Teamwork
As any company, Huawei can only achieve success through teamwork, working in both bad and good times. Cross-culture collaboration is vital as well as
efficient processes.
3. The Company Objectives
Coping with the revolutionary changes that often take place in the information industry, Huawei continues to innovate in order to meet their
customer’s' needs and advance their technological leadership. This is sustained through cooperating with industry partners that focuses on building future-
proof information pipes as well as value for the customers and society at whole. Dedication to enriching life and improving efficiency through better
connected world. Moreover, it aims to be the number one choice and partner for telecommunication carriers and enterprise customers.
Fig. 1 – Innovation and Advancing Methodology in Technology

 Ubiquitous Broadband
“As the Internet makes it easy to disseminate and obtain information, and stimulates people's desire to go online anytime, anywhere using any
device. This level of connectivity enables users to access more content and applications and enjoy the convenience made possible by mobile offices.”
(Huawei, Inc. 2015). Enterprises have started to migrate their services from IT systems to data centers and clouds, which place higher requirements on
networks. Huawei simply aims to get the benefits of networks to more factions of people.
 Agile Innovation
As Huawei corporate explained in their statement on Innovation, “Enterprises and industries must rapidly gain insights into business opportunities and
continuously enhance IT - enabled organizational collaboration in order to launch new products and new services into markets better and faster. IT is
transforming from a support system into a production system and has become a core competence of enterprises.” (Huawei, Inc. 2015). The company
provides data center infrastructure solutions that is based on cloud computing in order to help their customers in enhancing the utilization of storage and
resources, enabling business systems to be deployed rapidly, operated easily and maintained, and managed efficiently. Huawei provides mobile office
solutions in peruse of helping their customers in improving their work efficiency. This is achievable by Huawei’s intelligent data analysis system
advantages Big Data technologies that have the ability to help customers gain wide knowledge into business opportunities and the making of agile
business innovations.
 Inspired Experience
Huawei’s goal is too mainly to provide an industry-leading device product, which is done through innovations in key technologies, industry designs,
and cloud services. This is aiming to take the user experience to a new level through Huawei’s innovations.
4. Hierarchy
As shown in figure 2 below, Huawei explains in their Hierarchy guide: “The Shareholders' Meeting is the highest authority within the company,
making decisions on major issues such as the company's capital increase, profit distribution, and selection of the members of the Board of
Directors/Supervisory Board.” (Huawei, Inc. 2015).
Fig. 2 – Hierarchy of Huawei Telecommunication (Regional Branch)
In Huawei, the Board of Directors (BOD) is the decision-making body for corporate strategy and management. It guides and looks over the overall
business operations and is involved in making decisions on important strategic issues. The Board of Directors has established the HR (Human Resources)
Committee, the Finance Committee, the Strategy & Development Committee, and the Audit Committee to assist and support BOD operations. (Huawei,
Inc. 2015). The Supervisory Board oversees the Huawei’s financial and operational performance, monitoring the responsibility fulfillment of Board of
Directors members and SM (Senior Management), and the standardization of the Board of Directors (BOD) operations.
Huawei uses the rotating CEO (Chief Executive Officer) system under the leadership of the BOD (The Board of Directors). The one who is
responsible for the company’s survival and development is the primary person of the company’s operations and crisis management during his tenure, the
rotating and acting CEO (Chief Executive Officer).
• Firm Age (Years)

Huawei, Inc. is 27 Years old (Established in Shenzhen in 1987).
• Size of Firms (Number of Full-Time Employees)

Huawei has over 140,000 employees, around 46% of whom are engaged in research and development (R&D).
5. Main Functionalities
The company is organized based on three main business groups; Enterprise Service Group, Operation Group and Consumer Group. They are
completing each other in the company to achieve those four main aims:
• Building communication and electronic systems for establishments.
• Enterprise Business, supplying all the needed equipment for the enterprise customers.
• Manufacturing telecommunication devices.
• Providing the needed network infrastructure, wireless network and network computing for telecommunication companies.
Because of this mission expansion, the total gross of the company has aimed to increase its sales from 4 billion $US in 2011 to15 billion $US within
four to six years. Vitorovich, Telecom magazine (9 March 2011).
Additionally, Huawei has its own market perspective to gain long-term customers called (Offering Service). Firstly, by supplying all the needed
equipment and supplement technologies for the telecommunication operators, helping them to expand their range of mobile broadband. Secondly, the
company assets network service providers to replace the old technology of copper cables to fiber optic cables to provide a high DSL speed and Passive
Optical Network (PON). By using this (Offering Service), Huawei gained 47 contracts from many different network companies to help them improving
the efficiency and maintenance of their system so they can reduce the cost of the network operations. The revenue of the system in Huawei grew 29.2% to
4.82 billion $US. (Australian Business Forum, 4 May 2011).
6. Success Factors
As a company that is having more than 150,000 employees around the whole world and exists in more than 130 countries. In less than two decades,
from servicing rural China going through the international market mainstream it became the second network vendor supplier after (Cisco) with a huge
rapid expansion. We have to discuss the three strongest factors of this company.
6.1. R&D Investments
R&D is an abbreviation that stands for (Research and Development), any startup company which is working in a technology field needs investment to
be funded in the researches to bring the company to two benefits. First, a point where everything about the mission of the company is clear socially,
economically and industrially. Second, taking the technology that the company produces to a total new level of quality and sophistication. Some of these
investments’ opportunities are worth taking the risk. Therefore, it is better to be having a strong study to reduce the loss to the lowest possible level.
Specifically, Huawei has in the R&D department more than 70,000 employees, most of them are locating in the company’s headquarter in China.
Representing about 45% of the workforce of the company around the world. The used mechanism to get a distinct competitive edge is to expand in
building laboratories worldwide to represent the innovation and technology development research in the company. Especially, give the most care for the
ICT field that is provided to the customers in a way smarter pipes that requires no time to wait. That is what make such a company has a very highly
technology growth in a very small period, by arranging the proprieties by its importance to the market from a technology perspective not from a financial
one. In 2012, Huawei made a new record in its expenses totaled about 30,100 million CNY, accounting for about 14% of the annual revenue of Huawei.
The R&D department that year was funded with 1,300 CNY million of the total expenses was spent in the research field. Making the whole fund that was
directed to the R&D field in the last decade reaches more than 130,000 million CNY. (Alexandra Harney, 9 December 2012).
6.2. Employees’ Shareholding Mechanism
Huawei employees share ownership system which includes very unique-distinctive mindsets among the company’s employee that are a part of the firm
success, profit making and value the meaning of hard working instead of promotion by seniority. By this mechanism, this company is giving a strong
example for working inspiration. In the very beginning, the available financial resources which was available for the employees to give them salaries
monthly was very limited, the main board of the company agreed that every single employee who would join the firm will be paid from a percentage of
the Huawei profit, while the rest of the profit will be invested in the business again. (Ching and Liu, 2004).
The structure ownership of the employee started purely as a necessity of the economic, the board of the company realized this would be a very
motivating mechanism for the employees inside the company. In the beginning of the 90’s, the founders of Huawei reached to a very sophisticated
mechanism to measure the profit of each firm in the whole world based on the attributed each employee in the company based on their market
performance. As a result, a bonus will be distributed on each employee accordingly. While the employees who are not benefit the company from any side
will be prohibited from any bonus. As a result, if they kept going down until reaching the bottom of the rung, they will be fired. Continuously, the
employees who are contributed in getting a high profit in the firm they are in, they will be automatically promoted to a higher managerial position. By the
time, Huawei started to remunerate the active employees in a generous way than any other company in China, which made the company a very attractive
center for a high-performed Communication Engineers, Computer Networkers and Information Technology people, as they believe they will be wealthy if
they worked hard in this company. (Wang, 2007)
6.3. Cyber Security System
Security is the first defense wall against hackers’ attack in any company before starting any process to produce the product. Many different cases can
happen to penetrate the system of any company even if it was internationally well known. Network data nowadays can be easily hacked by hackers in
order to steal sensitive information from inside the company system database. Also, computer viruses that can affect the ability of any working system
negatively by reducing its efficiency and speed level. Once the hacking was happened the loss of the company would be increased proportionally by the
passed time. Huawei has one of the strongest fully implemented cyber security systems around the world, it is what programmers called end-to-end
system; because the safety of the company system is one of the most fundamental to gain the trust of other corporations/customers and keep high
worldwide reputation. The system is updated internally each month and fully changed each year with a new version to be able to face the global cyber
security threats. As a result, the company has to face any resultant un-expected risks that may happen because of abuse of technology.
In 2013, Mr. John Suffolk, Huawei's Global Cyber Security Officer, stated that the system each year is being optimized to face the security challenges,
but at the same time, it has to follow the policies of the government and the standard of the company. The main aim of the trained employee inside the
company from the first place is to have adopted improvement measures to their work in order to provide a secure and safe service or product to the
customer. In addition, many points Mr. Suffolk announced many important points about the new cyber security system of the company in all branches
around the world, during an interview with (The Wall Street journal, 2014).
1. The company set strict rules to make the employees in their daily work aware about the security issues; by the end of 2013, about half of the staff of
Huawei worldwide was trained for how to care of the cyber security issues. As a very important rule to encourage the atmosphere of cyber security
awareness education.
2. The system is built in employee’s daily work life any employee has the freedom to design, implement or built a new product inside the company as
this work will be examined, improved and automated by the internal hardware system inside the company.
3. Building a multi-layer cyber security system so the company can allow the product to be tested by many different teams.
4. When a wrong issue happens with the customers, researchers or the employees from the security side, the damaged side will be automatically
connected to the Product Security Incident Response Team (PSIRT), so in order to avoid data loss about any product the cyber system has a backup
data of about 98% of the whole company database. It will be automatically restored in about minutes.
5. Any negative issue happened in the past will be automatically resolved in the new updated yearly system. As a network company the transparent
policies is the responsibility not only of the system but also of each employee who represents the company.
7. The Organizational Structure
The Huawei Company’s structure is largely Mechanistic (aka. bureaucratic).
Fig. 3 – Example of the Traditional Hierarchy
• Highly Specialized Tasks
Each single individual member in the company is specialized in his/her own area of expertise and work. Therefore, every employee is assigned to a job
based on his/her specialization, which makes the company's tasks stable and easy to control.
 Refer to survey question 'L': "The leaders of the organization are generally considered to be coordinators, organizers, or efficiency experts."
Count of The leaders of the organization are generally considered

coordinators, organizers, or efficiency experts.
Strongly disagree
Strongly agree
Not sure
Disagree
Agree
0 1 2 3 4 5 6 7 8
 Rigid Departmentalization
Activities are divided through several groups based on their common nature. Therefore, every group of work would have its own department that is
entrusted to some responsible supervisor/manager. On that, the departmental activities would be done based on the rules of the company (i.e.:
Organizational Rules) as well as regulations.
 Refer to survey question 'M': "The management style in the organization is characterized by teamwork, consensus and participation."
Count of The management style in the

Organization is characterized by teamwork, consensus and participation
12
10
0
Agree Disagree Not Sure Strongly agree
 Refer to survey question 'H': "The organization is a very formalized and structured place. Bureaucratic procedures generally govern what
people do."
Count of The organization is a very

Formalized and structured place, Bureaucratic procedures generally govern
10
0
Agree Not Sure Strongly agree
 Strict Chain of Command
Because the Mechanistic Structure is kind of bureaucratic, the company will have a strict and clear chain of command all the way from top to bottom
(i.e.: subordinate levels) in the management hierarchy. This clearly allows for good communication of information, and makes the company function more
smoothly.
 Refer to survey question X': "The organization emphasizes permanence and stability. Efficient, smooth operations are important."
Count of The organization emphasizes

Permanence and stability. Efficient, smooth operations are important.
Strongly Disagree
Strongly Agree
Not Sure
Disagree
Agree
0 1 2 3 4 5 6 7
 Narrow Span of Control (Management Ratio)
The span of control refers to the number of subordinates controlled directly by some kind of a supervisor or superior. In other words, it is the number of
people that report to a manager in the company. In a narrow span of control, this number of employees is comparatively low. This allows the manager to
have/allocate more time for each employee that is subordinate, which helps to guide his subordinates more effectively for the better of the company. It
also allows the supervisor to have more free time to use to finish some tasks personally, rather than sending them to his subordinates to do.
 Centralized Decision Making
The right of decision-making is left only with the top-level management, and not delegated to the subordinates. So, they the subordinates would have to
work in accordance with whatever their direct superior decides, without interfering in the decision making process. It can seem some-what dictatorial – at
least for the subordinates –, but also well effective for preserving the work process and making sure that correct decisions come from the people that have
the most right to make them.
 Refer to survey question 'AF': "Employees should not disagree with management decisions."
Count of Employees should not disagree with management decisions
Strongly disagree
Strongly agree
Not sure
Disagree
Agree
0 1 2 3 4 5 6 7
 Refer to survey question 'AI': "Managers expect workers to closely follow instructions and procedures"
Count of Managers Expect Workers to Closely Follow Instructions and Procedures
9
8
7
6
5
4
3
2
1
0
Agree Disagree Not Sure Strongly Agree
 Refer to survey question 'AD': "It is frequently necessary for a manager to use authority and power when dealing with subordinates."
Count of It is frequently necessary for a manager to use authority and

power when dealing with subordinates
Strongly disagree
Strongly agree
Not sure
Disagree
Agree
0 1 2 3 4 5 6 7
 High Formalization
This relates to the extent to which the work rules are structured in the company (i.e. how detailed are they), and the activities of the employees are
governed by rules and standard operating procedures. Formalization is highly influenced by technology and the company's traditions. This means that
employees cannot use simply use their logic or creativeness to perform their tasks, but rather they need to follow the company’s procedures.
CAIRO UNIVERSITY AUTHOR: AHMED A. MAWGOUD
10
 Refer to survey question 'H': "The organization is a very formalized and structured place. Bureaucratic procedures generally govern what
people do."
Count of The organization is a very formalized and structured place.

Bureaucratic procedures generally govern what people do
10
8
6
4
2
0
Agree Not Sure Strongly agree
 
Refer to survey question 'AL': "Instructions for operations are important for employees on the job."
Count of Instructions for operations are important for employees on the job
Strongly disagree
Strongly agree
Not sure
Disagree
Agree
0 1 2 3 4 5 6 7 8 9
 Vertical Communication and Reporting System
Vertical communication is the communication where information and messages flows between/among the subordinates and superiors of the
organizational. It conveys the message of the subordinate, maintains good labour-management relations and organizational discipline. Vertical
communication also maintains good chain of command and efficiency. However, it delays process, and may make the chain of command, disciple may be
broken, and information can be loss or distorted. In addition, superiors can neglect to send message to their subordinates.
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Fig. 4 – The Flow of Vertical Communication
 Little Teamwork
The company is fragmented into a lot of departments and sections, each with its own specifications, expertise and tasks. Hardly any teamwork
occurs between the different employees within their perspective departments. However, each department/section depends on the other to complete the
overall job/product.
8. The Organizational Strategies
Here, a discussion for the strategies that Huawei uses from the opinion and scope of several strategic theories, and preview what characteristics made
our choices.
8.1. Chandler’s Theory
Huawei’s strategy according to Chandler’s categories is (Divisional) which applies to diversified, changing product or service line, through national or
international markets.
Telecom networks
Huawei offers a variety of network technologies and solutions to help telecommunications operators expand the capacity of their mobile broadband
networks. Huawei’s core network solutions offer mobile and fixed soft switches, plus next-generation home location register and Internet Protocol
Multimedia Subsystems (IMS). Huawei assists content service providers looking to migrate from copper to fiber with solutions that support xDSL, passive
optical network (PON) and next-generation PON (NG PON) on a single platform. The company also offers mobile infrastructure, broadband access and
service provider routers and switches (SPRS). Huawei’s software products include service delivery platforms (SDPs), BSSs, Rich Communication Suite
and digital home and mobile office solutions. In 2010, revenues for Telecom Networks were US$18.79 billion.
Global Services
Huawei Global Services provides telecommunications operators with equipment to build and operate networks as well as consulting and engineering
services to improve operational efficiencies. These include network integration services such as those for mobile and fixed networks; assurance services
such as network safety; and learning services, such as competency consulting. In 2010, Huawei won 47 managed services contracts to help improve
network performance and efficiency for customers, as well as reducing the costs of network operations and maintenance. In 2010 Huawei's global services
revenues grew 28.6% to US$4.82 billion.
12
Fig. 5 - Product-Market Strategy
8.2. Miles & Snow’s Theory
According to Miles & Snow’s structures, Huawei follows the Prospectors strategy, with diverse products, searching for market opportunities and
technological break-through, while also defending their existing product lines as an example its expansion method.
International expansion
In 1997, Huawei won its first overseas contract, providing fixed-line network products to Hong Kong Company Hutchison Whampoa. Later that year,
Huawei launched its wireless GSM -based products and eventually expanded to offer CDMA and UMTS. In 1999, the company opened a research and
development (R&D) center in Bangalore, India to develop a wide range of telecom software. From 1998 to 2003, Huawei contracted with IBM for
management consulting, and underwent significant transformation of its management and product development structure. After 2000, Huawei increased
its speed of expansion into overseas markets, having achieved international sales of more than US$100 million by 2000 and establishing an R&D center.
In Stockholm, Sweden. In 2001, Huawei established four R&D centers in the United States, divested non-core subsidiary Anasys to Emerson for US$750
million and joined the International Telecommunications Union (ITU). By 2002, Huawei’s international market sales had reached US$552 million.
Fig. 6 – Organizational Environment and Characteristics

13
8.3. Mintzberg Theory
In the Forces and Forms of Mintzberg’s theory, Huawei has a force for Adhocracy (Innovation). Adapting to new technologies and learning from the
other’s failures, while introducing their own new technologies and services to the people. Huawei has a divisionalized form of organization, having
different departments for each product or service with their own teams. Huawei is organized around three core business segments:
1. Telecom Carrier Networks, building telecommunications networks and services
2. Enterprise Business, providing equipment, software and services to enterprise customers, e.g. Government Solutions etc.
3. Devices, manufacturing electronic communications devices.
Huawei announced its Enterprise business in January 2011 to provide network infrastructure, fixed and wireless communication, data center, and
cloud computing solutions for global telecommunications customers. Huawei has stated that it aims to increase enterprise sales to US$4 billion in 2011
and $15 billion within three to five years.
8.4. Perrow’s Theory
Huawei’s nature of tasks according to Perrow’s Theory is routine, mass production, as the problems that arise can be analyzed with a few exceptions.
In April 2011, Huawei announced some earnings increase of 30% in 2010, driven by significant growth in overseas markets, with net profit rising to RMB
23.76 billion (US$3.64 billion; £2.23 billion) from RMB18.27 billion in 2009. In 2010, sales outside China continued to be the main driver of Huawei’s
business. Overseas revenue rose 34% to RMB120.41 billion in 2010 from RMB90.02 billion in 2009, fueled by regions including North America and
Russia. Revenues from China rose 9.7% to 64.77 billion, as the country's big telecom operators reduced their investment last year.
Huawei's revenues in 2010 accounted for 15.7% of the $78.56 billion global carrier - network-infrastructure market, putting the company second
behind the 19.6% share of Telefon AB L.M. Ericsson, according to market-research firm Gartner.
Huawei is targeting revenue of $150 million through its enterprise business solutions in India in the next 12 months. It denied using Chinese subsidies
to gain global market share after being recently accused by US lawmakers and EU officials of unfair competition at best.
Fig. 7 - Problem Analysis
9. The Company General Models
9.1. Hofstede’s Model
Organizational Culture is the way the members of the organization relate to each other and their work within the organization as well as the outside
work with comparison to the other organizations. The Organizational Cultural Model (Hofstede’s Multifocus Model) has six autonomous dimensions plus
two Semi-autonomous ones.
Autonomous Dimensions
A- Means-oriented vs. Goal-oriented
It is highly connected to the effectiveness of the company. In the means-oriented culture, the employees’ concern is the way/method by which the
work is carried out in the company. This means that people are identifying with the ‘how’ of the matter. On the other hand, in the goal-oriented culture,
the employees’ concern is a set of goals or internal results that they are out to achieve, even if they included risky points. This means that people are
identifying with the ‘what’ of the matter.
B- Internally Driven vs. Externally Driven

14
In the internally driven companies, employees regard their task towards the outside world as completely given. Based on that, ethics such as
honesty and accuracy are very important and it is being the most good to the customers. On the other hand, the externally driven companies, employees
regard the customer's requirements the most, as the result that are expected are the most important as well as pragmatic rather than ethics.
C- Easy-going Work Discipline vs. Strict Work Discipline
An easy-going culture involves loose structure internally as well as very little predictably, control and discipline. Therefore, employees have a more
comfortable space. On the other hand, a strict work discipline involves a very strong structure as well as high predictability, control and discipline.
Therefore, employees are very serious about their timings and deadlines.
D- Local vs. Professional
In a local company, the employees identify with their supervisor or their department they work in. While in a professional company, the employees
identify with their professions or the job content itself.
E- Open System vs. Closed System
In an open-system, the company welcomes newcomers and people from all different types warmly and can make a room for them to fit. On the
other hand, a closed-system did not quickly welcome any outsiders. In addition to not help making them fir in.
F- Employee Oriented vs. Work-oriented
It is highly connected to the philosophy of how the company runs and operates with relation to its employees as humans. In an employee-oriented
company, the company takes its employees’' personal problems and troubles almost as its own. Therefore, the company gives a lot of care for its
employees' welfare, even if it is on the expense of the work and their quality. On the other hand, in a wok-oriented company, their problems are not
taken in consideration, and the work is what matters.
G- Degree of Acceptance of Leadership Style
This dimension relates to the degree that the leadership style of the employees' supervisors are being in line with the employees' preference.
68.7
Huawei has a degree of 68.7 with regard to Acceptance of Leadership Style.
H- Degree of Identification with Your Organization
This dimension relates to the degree of cohesion between the employees and staff members in the company in its totality. In other words, people's
ability to identify with the company's aspects. So, employees can identify strongly with the company's, clients', ones and supervisors' goals all at the
same times.
78.1
Huawei has a degree of 78.1 with regard to identification with the organization.
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9.2. Johnson and Scholes’s Culture Web
Fig. 8 – Example of Johnson and Scholes’s Culture Web
Johnson and Scholes’s Culture Web Explanation:
A- Stories
These involve the myths and legends that surround the organization/company.
B- Routine & Rituals
These involve behaviours and actions that are known to be normal and acceptable in the organization/company. It is mostly what happens daily
and what is most valued by supervisors.
C- Symbols
This is the physical structure, such as buildings, offices, brands, logos as well as the dress code (official or otherwise).
D- Organisational Structure
This relates to the organisation/company's values from its formal structure. The Informal structure (Power Networks) is revealed through the way
that tasks are processed in the company.
16
I- Controls Systems
It deals with making or influencing decisions as well as what people believe and champion within the organization. The dimension of the use (or
abuse) of this power is also very important. It also refers to the processes that handle monitoring what happens within the organization/company.
J- Power Structure
This relates to the sources of the real (main) power that drives the organisation/company. It deals with the nature of those making or influencing
decisions, as well as what people believe and champion within the organization/company. In addition, the way this power is used (or abused) is a
very important dimension.
9.3. Hall’s Compass Model
Huawei's culture is very demanding, driving and challenging to its employees. It is largely characterized by hard working with a great emphasis on
mutual trust and priority to the team's (overall) good to be accomplished in as much harmony as it can. This means that Huawei’s culture is high on both
assertive and responsive standards.
Fig. 9 - Hall’s Compass Model
The cultures have two dimensions or measurements’ where the culture can be high or low, whether on one of them or on both.
Assertive (characterized by being forceful, directive):
 Fast movers
 Challenging
 Individualistic
 Pushy
 Driving
 Demanding
 Hardworking
17
Responsiveness
 Harmony
 Loyal
 Sensitive
 Trusting
 Compromising
 Team players
9.4. Deal & Kennedy’s Theory
Deal and Kennedy’s (1982) model, based on two dimensions, suggested that the biggest single influence on a company’s culture was the business
environment in which it operated.
Fig. 10 - Deal and Kennedy’s Model of Organizational Culture
The Macho Culture
In the 80’s, when china was opened to the world and it was very difficult to start a private business. From very humble beginnings, in a small town in
china called (Shenzhen) (that is the center of the largest telecommunication service provider in the whole world nowadays). A man called (Ren Zhengfei)
who used to work as communication technology engineer in the Chinese military forces. He started in 1987 to found an idea called Huawei providing all
the needed supplements by himself instead of depending on the other venture to secure technology from any other company, as the all-main mission of
this small project was focusing on phone switching industry without putting a clear vision for the future. It was the main provider for many small
establishments in the city (Local Companies – Restaurants- Schools- Hospitals). This small company was founded when a huge names existed then, such
as (Nokia – Ericson – IBM - Alcatel) which made it very difficult for him to compete such a companies in the beginning. However, this kind of industry
needs heavily budget to spend on the development researches. He - Ren Zhengfei- said then “We can learn. We should learn management experience from
other companies. So we invest heavily in management.” (Zhengfei, R). Gradually, the company expanded its range to include enterprise business,
manufacturing electronic communications devices and telecom carrier network. This theory was inspirational and incorporated five critical elements
(Applying to Huawei Company):
9.4.1 The Business Environment

18
a) Political
Since the 1980s, the Chinese telecommunications services through relaxed price controls break monopolies, regulatory institutional reform, and
industrial restructuring for the content of the three stages of reform.
b) Economic
Domestic telecommunications industries have restructuring, 3G network construction gradually; the market size is expected to continue to
expand.
c) Socio-cultural
According to the Chang (2013) said that “Twelve Five Project” is a critical period of building a moderately prosperous society, the
communications industry as a national information technology to promote economic growth mode transformation of basic industry.
d) Technology Environmental
The produce of communications equipment has a large investment into the production. High technology, high investment, and high returns are
a distinctive feature of the telecommunications equipment industry originally.
e) Legal
Through overall planning, insist the decision-making of government policies unswerving to guide industry development, and through the
guided of project, establish the special financial support of State government.
9.4.2 Hero
Ren Zhengfei a Chinese executive. He is the president of Huawei Technologies Co. Ltd., headquartered in Shenzhen, China, and an ex-People's Liberation
Army officer. Hurun Report listed Ren as the 556th richest person in China in 2013 with private assets of approximately $590 million USD
9.4.3 Rites and Rituals
There was no information that was available concerning the data required in the analysis of this section.
9.4.4 The Cultural Network
In 1997, Huawei won its first overseas contract, providing fixed-line network products to Hong Kong Company Hutchison Whampoa. Later that year,
Huawei launched its wireless GSM-based products and eventually expanded to offer CDMA and UMTS. In 1999, the company opened a research and
development (R&D) center in Bangalore, India to develop a wide range of telecom software.
9.5. Models of Political Rule
Technocracy: as people with knowledge and expertise have the upper hand in making decisions within the company.
9.5.1 Formal and Personal Power
Huawei’s employees use the Legitimate Power by which the managers/leaders can tell people below them in the hierarchy what to do; also, the
Reward Power is used in some occasions regarding new products. People in higher positions within the company possess many skills that qualified them
to be in those positions; hence, their opinions and orders are highly respected and carried out.
Power and Influence:
Position -> Rules and Procedures
Expert -> Magnetism
Personal -> Persuasion
Huawei Egypt’s employees do believe in following people with higher expertise in the company due to their higher positions, which Egyptians inherently
respect. Expert or Knowledge powers, as people with more knowledge that are in higher positions have more power. Symbolic Power as the achievements
and positions do have power and influence as well.
19
9.6. Leadership, Positional Power & Control over Resources
9.6.1 Leader Power and Positional Power
Huawei uses an unusual leadership structure, which is a system of rotating and collaborative innovation. This commonly involves "alternating decision
control to use complementary capabilities in both partner organizations, zig-zagging trajectories that engender broad technological search, and fluctuating
network cascades to promote the mobilization of highly varied participants." (Davis, J. Eisenhardt, 2010).
Huawei came to that system of rotating in 2004, when Mercer, which is a New York - based consulting firm, helped the company establishes their
EMT (executive management team). They proposed that Mr. Ren Zhengfei (the company's founder) would be the chair of the executive management
team. Nevertheless, Mr. Zhengfei refused to work like that and to take that position, but rather wanted to have the members to rotate in chairing the EMT.
That remained from 2004, where there were eight people who rotate as the chair executive management team, until 2012 where they became only 3 people
positioned as rotating CEO. The other members on the EMT are trusted with making collective decisions as a team in order to promote high-level
managers or change salary structures. (Davis, J. Eisenhardt, K., 2010). On the issue of decision-making, Huawei's leadership has different mechanisms for
different matters in making decisions. Guo Ping - who is the rotating and acting CEO explained that for some matters, the rotating active CEO will make
decisions himself/herself, while there are other matters were a decision will be taken if the majority agreed to it. For critical issues, it is submitted to the
board for approval that is normally done by consensus.
9.6.2 Control over Resources
Huawei has swiped the international market through the mobile phones companies that supported Huawei as a rising company that offered it mobile
phones with various specifications for relatively low prices, leading to its spread even in the Arab world. It is not a secret that home users doesn't only use
Huawei's phones, but also a lot of other devices such as all internet modems in Egypt - even given as a start-up gift from internet providers such as TE-
Data - as well as non-home users find that mobile connections antennas are actually Huawei's. (Awwad, 2013). These advances even include superstars
such as the Lebanese singer Nancy Ajram becoming a "Huawei Brand Ambassador" and promoting its products including the Ascend Mate 7 smartphone
as well as participating in its conferences. (Jaffar, 2014). On the issue of controlling resources from the part of Huawei, internationally, the company does
not seem to have any type of monopoly on any type of resources, be it government and capital, natural, economical, biological, computer or human
resources.
In fact, Huawei seems to be completely against initialized monopoly, to the extent that it sew companies for trying to undergo monopolistic practices
on its competitors. A recent example of that was last year (in December 2011) when Huawei filed litigations in China accusing "Inter Digital" of
discrimination in patent licensing. (Bridge IP Law Commentary, 2014). However, very recently, there have been complains in many Arab countries from
economists and technology entrepreneurs of fears of complete monopoly lead by Huawei that may occur if un-justified government support continues. An
example of that is Huawei in Jordan, where the company was given the bid to redevelop Orange's 4G network, moving from a limited monopoly to an
open one for the Jordanian communications' frequencies for at least 5 years. This appears to be a legetement fear for the other competing companies in a
market that strives to keep competition and minimize monopolies. (Hawamda, 2015).
9.7. The Managerial Grid
The managerial grid is inspired by the McGregor Y theory. The leadership style associated with Managerial Grid for Huawei is The Sound (or Team)
style. This means that it has a position of (9, 9) on the grid.
20
Fig. 11 - Leadership / Management Grid
According to the definers of this style (i.e.: the managerial grid), Dr. Robert Blake and Dr. Jane Mouton, the Sound (or Team) style is the most
effective leadership style from among the five styles of the Managerial Grid. The leaders according to this style will contribute to the work at large as well
as being committed to the job. They are best at motivating as they themselves are motivated, and they truly respect and trust them employees and aim to
empower them. This is because they believe that this is crucial for incepting a team environment that holds these values, hence enhancing the employees’
contentment as well as productivity.
21
Refer to survey question 'U': "The organization emphasizes human development. High trust, openness and participation persist."
Count of The organization emphasizes human development.

High trust, openness and participation persist.
15
10
5
0
Agree Not sure Strongly agree
Refer to survey question 'Y': "The organization defines success on the basis of development of human resources, teamwork, and concern for people."
Count of The organization defines success on the basis of development of human resources,
Teamwork and concern for people.
Strongly disagree
Strongly agree
Disagree
Agree
0 1 2 3 4 5 6 7 8 9
Refer to survey question 'K': "The leaders of the organization are generally considered to be hard-drivers, producers, or competitors."
Count of The leaders of the organization are generally considered hard-

drivers, producers, or competitors.
Strongly disagree
Strongly agree
Not sure
Disagree
Agree
0 1 2 3 4 5 6 7 8
22
Refer to survey question 'AU': "Employees should pursue their goals after considering the welfare of the group."
Count of Employees should pursue their goals

after considering the welfare of the group.
6
5
4
3
2
1
0
Agree Disagree Not sure Strongly agree
9.8. Hersey & Blanchard’s Model
At the time of Huawei’s establishment Huawei was focused on manufacturing phone switches, but it has since expanded its business to include
building telecommunications networks; providing operational, consulting services and equipment to enterprises inside and outside of China. Many
different styles have been used through.
9.8.1 Delegating Style
During the 1980s, China's government pressed forward a multi-pronged strategy to modernize the country's underdeveloped telecommunications
infrastructure. A core component of the telecommunications network was telephone exchange switches, and in the late 1980s, several Chinese research
groups endeavoured to acquire and develop the technology, usually through joint ventures with foreign companies.
9.8.2 Participating Style
Huawei describes itself as an "employee owned" company, partly as a means of counteracting perceptions of Chinese government involvement. However,
the actual ownership structure is opaque and surrounded by a culture of secrecy. According to Caixin magazine, "even long-time employees admit the
[shareholding] system is nearly impossible to understand." Employees receive no information about their holdings, and their shares do not entitle them to
any voice in management decisions. The company's 50,000+ employees outside China are not given shares. Richard McGregor, author of The Party: The
Secret World of China's Communist Rulers said that Ren Zhengfei and Ren’s managers likely own the majority of shares, though the company states Ren
directly owns less than 1.5%.
9.8.3 Selling Style
In 2010, Huawei won 47 managed services contracts to help improve network performance and efficiency for customers, as well as reducing the costs of
network operations and maintenance. In 2010 Huawei's global services revenues grew 28.6% to US$4.82 billion.
9.8.4 Telling Style
There was no information that was available concerning the data required in the analysis of this section.
23
9.9. Quinn’s Theory
According to Quinn’s Theory of Competing Values, the leadership style within Huawei Egypt is the firm leadership style, as the leader is task
oriented, and directive. Ren Zhengfei is the president of Huawei and has held the title since 1987. Huawei disclosed its list of board of directors for the
first time in 2010. Ms. Sun Yafang is board chair. As of 2011, the members of the board are Ms. Sun Yafang, Guo Ping, Xu Zhijun, Hu Houkun, Ren
Zhengfei, Xu Wenwei, Li Jie, Ding Yun, Meng Wanzhou, Chen Lifang, Wan Biao, Zhang Pingan, and Yu Chengdong. The members of the Supervisory
Board are Liang Hua, Peng Zhiping, Ren Shulu, Tian Feng, and Deng Biao.Richard Yu Chengdong is the Chairman of Huawei Device, its mobile phone
division. On 1 July 2013, Huawei Device announced former head of Nokia Colin Giles joined the company as Executive Vice President of Consumer
Business.
10. Employees’ Resistance to Change
Huawei has over 140,000 employees, around 46% of whom are engaged in research and development (R&D). It has 21 R&D institutes in countries
including China, the United States, Canada, UK, Pakistan, France, Belgium, Germany, Colombia, Sweden, Ireland, India, Russia and Turkey, and in 2013
invested US$5 billion in R&D. In 2010, Huawei recorded profit of 23.8 billion CNY (3.7 billion USD). Its products and services have been deployed in
more than 140 countries and it currently serves 45 of the world's 50 largest telecoms operators. According to Caixin magazine, "even long-time employees
admit the [shareholding] system is nearly impossible to understand." Employees receive no information about their holdings, and their shares do not
entitle them to any voice in management decisions. The company's 50,000+ employees outside China are not given shares.
In October 2007, 7,000 Huawei employees resigned and were then rehired on short -term contracts, thereby apparently avoiding the unlimited contract
provisions of the Labour Contract Law of the People's Republic of China. The company denied it was exploiting loopholes in the law, while local
government and trade unions condemned the move. Huawei's treatment of its workforce in Guangdong Province, Southern China also triggered a media
outcry after a 25-year-old software engineer, Hu Xinyu, died in May 2006 from bacterial encephalitis, because of what is believed to have been work -
related fatigue. In its 2010 Corporate Social Responsibility report, Huawei highlighted the importance of employee health and safety. In 2010, Huawei
provided annual health checks to all full-time employees and performed 3,200 checks to employees exposed to occupational health risks. In addition, in
2011 Huawei initiated a Scholarship program, "Huawei Maitree Scholarship", for Indian students studying in China.
10.1. Huawei Technologies Reviews (from CareerBliss statistics):
On average, employees at Huawei Technologies give their company a 3.8 rating out of 5.0 - which is equal to the average rating for all companies. The
happiest Huawei Technologies employees are Software Engineers submitting an average rating of 4.0 and Technical with a rating of 3.9.
24
Fig. 12 - CareerBliss Statistics on Huawei Technology Review

25
11. Data Analysis
11.1. Hofstede's Dimensions
11.1 Power Distance (answers’ mean = 3.05)
The power distance is large or big, making the society characterized by centralized authority, autocratic leadership, paternalistic management style as
well as many hierarchical levels. It also encompasses large number of supervisory staff, acceptance that power has its privileges with an expectation of
inequality and power differences.
11.2 Uncertainty Avoidance (answers’ mean = 3.65)
The degree to which members of the society are able to cope with the uncertainty of the future without experiencing undue stress is strong. This makes
it characterized by avoidance of risk, lack of tolerance for deviants, respect for authority as well as strong need for consensus. The organization have
clearly delineated structures, many written rules, standardized procedures, promotions based on seniority or age, and it needs predictability that is
provided by planning.
11.3 Masculinity (answers’ mean = 3.07)
Huawei is based on a career success (masculine) culture. This makes the company have clear and distinct gender roles where men are assertive, tough
and focused on material success. It do not place great importance on benevolence, but rather places importance on the value of mastery of job, nature,
people, or some other. Women are predicted to consider personality affection, intelligence & sense of humour as desirable characteristics of a boyfriend as
well as health, wealth & understanding as those of a husband.
11.4 Collectivism (answers’ mean = 4.2375)
Huawei has a Collectivistic culture, which make the company have specific characteristics. The company behaves according to social norms that are
designed to maintain social harmony among members of an in-group, as well as considering the implications of their actions for wider collective. It shares
resources and is prepared to sacrifice personal interest for collective interests, and favour certain in-groups. Huawei's employees belong to a small number
of in-groups that influence their lives have a greater tendency toward conformity than individualists are very concerned about in-group members and are
indifferent or hostile toward out-group members. There is a great emphasize on hierarchy and harmony within group, while regulating behaviour through
group norms.
11.5 Confucian Work Dynamics (answers’ mean = 3.575)
Huawei reflects a dynamic, future-oriented mentality that emphasizes persistence (perseverance), thrift, having a sense of shame as well as ordering of
relationships based upon status and observing this order. It supports interrelatedness through sensitivity to social contacts, as well as being positively
associated with economic growth.
12. Conclusion
Huawei is a Chinese vendor telecom provider based in a city called Shenzhen. Founded in the late of 80’s and in less than two decades, the company
expanded its range to include enterprise business, manufacturing electronic communications devices and telecom carrier network, it became one of the
strongest network vendor providers in the whole world, with offices that is existed over 130 countries around the world. Huawei managed to reach the
customers by providing all the needed telecommunication and electronic vendors to the small companies with the highest quality, secured systems and the
lowest possible cost. The security system, research field and employee’s shareholding mechanism this company could breakthrough its way to the top in a
record time, giving a strong example to the all entrepreneur around the world that your dream has no limits as long as you have the skills and believe in
them. In addition, you have to use your rational thinking to make the best use of your skills so you can take the right steps to build your way to reach it. I
26
learnt through making this research that there is no limit for what a human being can do, as long as you work hard and never quit to reach that dream in
the star you always want to reach, and remember, as long as you can breathe, then there is no limit for what you can achieve in this world. Finally, thanks
to Ren Zhengfei who approved to the world that there is no sensible excuse for not thinking out of the box and being what you want to be.
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Huawei, Inc. ©: Full Analysis from A to Z.

Technical Report · May 2015

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The company since its establishments had main goals:

 Openness & Initiative

3. The Company Objectives

Fig. 1 – Innovation and Advancing Methodology in Technology

Fig. 2 – Hierarchy of Huawei Telecommunication (Regional Branch)

• Firm Age (Years)

• Size of Firms (Number of Full-Time Employees)

6.1. R&D Investments

6.2. Employees’ Shareholding Mechanism

6.3. Cyber Security System

7. The Organizational Structure

The Huawei Company’s structure is largely Mechanistic (aka. bureaucratic).

Fig. 3 – Example of the Traditional Hierarchy

• Highly Specialized Tasks

Count of The leaders of the organization are generally considered

Count of The management style in the

Count of The organization is a very

 Strict Chain of Command

Count of The organization emphasizes

 Narrow Span of Control (Management Ratio)

 Centralized Decision Making

Count of Employees should not disagree with management decisions

Count of Managers Expect Workers to Closely Follow Instructions and Procedures

Agree Disagree Not Sure Strongly Agree

Count of It is frequently necessary for a manager to use authority and

Count of The organization is a very formalized and structured place.

 Vertical Communication and Reporting System

Fig. 4 – The Flow of Vertical Communication

8. The Organizational Strategies

8.1. Chandler’s Theory

Fig. 5 - Product-Market Strategy

8.2. Miles & Snow’s Theory

Fig. 6 – Organizational Environment and Characteristics

8.3. Mintzberg Theory

8.4. Perrow’s Theory

Fig. 7 - Problem Analysis

9. The Company General Models

9.1. Hofstede’s Model

A- Means-oriented vs. Goal-oriented

B- Internally Driven vs. Externally Driven

C- Easy-going Work Discipline vs. Strict Work Discipline

D- Local vs. Professional

E- Open System vs. Closed System

F- Employee Oriented vs. Work-oriented

G- Degree of Acceptance of Leadership Style

H- Degree of Identification with Your Organization

9.2. Johnson and Scholes’s Culture Web

Fig. 8 – Example of Johnson and Scholes’s Culture Web

Johnson and Scholes’s Culture Web Explanation:

B- Routine & Rituals

9.3. Hall’s Compass Model

Fig. 9 - Hall’s Compass Model

Assertive (characterized by being forceful, directive):

9.4. Deal & Kennedy’s Theory

Fig. 10 - Deal and Kennedy’s Model of Organizational Culture

The Macho Culture

9.4.1 The Business Environment

9.4.3 Rites and Rituals

9.4.4 The Cultural Network

9.5. Models of Political Rule