Technology

Huawei CEO: ‘Must make high-end products from third-class components’


Huawei founder Nham Chinh Phi also set a goal to strongly develop software along with hardware for the company.

Huawei is well known in the Chinese business world for its “wolf culture”: fearlessness and aggression.

Founder and CEO Ren Zhengfei often tells stories about the courage of Huawei employees in the face of hardship and harsh adversity. Demonstrating stoicism has become a part of the corporate identity.

At a recent internal meeting, Mr. Nham said the company must try to “use third-class ingredients to produce first-class products”, in the context of US sanctions imposed.

Huawei prepares My Anh's commitment 1
Attendees walked across the Huawei sign at the opening of the MWC trade show, Shanghai on February 23, 2021. Image: SCMP.

“1 + 8 + N”

“In the past, we had enough supply for premium products. But now, the US has completely blocked Huawei’s access to us. Even ordinary commercial products, we can hardly have it,” he said. Acknowledging.

He also forces employees to “work hard to sell more products and services, while maintaining positions in core business areas. In terms of strategy in the future, we must. abandon some countries, customers and product launch plans.

This speech is similar to the talk last June. At that time, he said that Huawei had to decentralize its operations, simplify product lines and focus on making profits in order to survive.

Additionally, the company had to tweak the in-product algorithm to deal with the sanctions increase move from Washington.

Huawei prepares My Anh's commitment 2

Ren spoke in an interview in Shanxi, northern China, on February 9. Image: Xinhua.

According to the meeting memorandum, Huawei’s consumer business team, the company’s biggest profit contributor, must maintain a “1 + 8 + N” strategy.

Number 1 represents smartphones, while number 8 refers to consumer devices including laptops, TVs, tablets, smartwatches and headphones. “N” includes smart home, audio-visual entertainment and mobile offices.

Nham wants Huawei to sell more products in the 8 category, due to the limited access to smartphone components. He also called for increased cooperation with partners producing products in category N.

Winning by the user

Users will be the decisive factor in Huawei’s success or failure, said Nicole Peng, vice president of Mobile Research at Canalys. “Consumers are very difficult to please. There is no way for them to accept products that are not made with quality ingredients, whether it be from a local or international supplier, ”she said.

Fighting to survive is challenging for Huawei, but it is difficult for a company to develop a technology supply chain for China. “I believe that is where Huawei wants to position itself, become one of the core pillars, become independent in the technology supply chain,” she said.

Huawei supports My Anh's commitment 3

Huawei workers hold a Mate X2 in their hands at the production facility in Dongguan, south of Guangdong province. Photo: Bloomberg.

Not stopping at the supply chain, Huawei also plans to develop software capabilities. “It would be very difficult if you only rely on hardware to lead the world in the long run. We have to assert the position of software, “said Mr. Nham.

According to him, this will require stronger collaboration between the company’s devices, cloud storage, and Internet segments.

The development goals set for Huawei gradually stepped up last month. Nham’s trust is placed on Richard Yu Chengdong, CEO of the company’s consumer business. Mr. Yu is also the head of Huawei’s AI and cloud services division.

Follow Zing / Caixin, SCMP

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