Chapter 6

Ancient Art of War Style Management

at Huawei Technologies Co., Ltd.

6.1 About Huawei Technologies Co., Ltd.

6.1.1 Sense of Crisis at Huawei
Now is the spring, but winter lurks on the horizon: : : Finished with the work at
hand, Mr. Ren Zhengfei rose from his desk and paused by his office window. Gazing
at the sunshine, budding trees and blossoming flowers outside, he mused: we have
become too soft, too complacent. The company has survived 10 years of successful
development with few frustrations. Without having overcome major challenges, we
do not have the experience to navigate the correct path. Struggle is valuable, and
a lack of experience of struggle is our greatest weakness. We are not mentally or
technically prepared for market downturns. Crises are imminent, death is eternal,
and may well come soon. Philosophically speaking, from the perspective of natural
law, we cannot prevent it [1] (Fig. 6.1).
Since its inception in 1988, Huawei has experienced 18 years of turbulent
development. Accustomed to the rise and fall of business cycles, Mr. Ren Z.F.
intuitively sensed the arrival of the current crisis. Too far east is west. The IT
industry is experiencing a long winter an unbelievably bitter and unforgiving cold,
as relentless as the summer heat. Without foresight and prevention, we will freeze
to death; even with a coat, can we survive? [1]. Mr. Ren Z.F. gazed out the window,
pondering Huaweis dilemma: how could Huawei find a coat to protect it against the
intensifying competition and the arrival of winter?

6.1.2 The Past and Present Spring

Riding the crest of the IT industry boom, Huawei carved out an impressive
competitive record, creating its own spring through sheer force of will.

Y. Su and L.J. Chen, Modern Oriental Corporate Culture: A Case Collection,

DOI 10.1007/978-3-642-35214-0 6, Springer-Verlag Berlin Heidelberg 2014

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6 Ancient Art of War Style Management at Huawei Technologies Co., Ltd.

Fig. 6.1 Sun Tzu

In 1992, Huawei began producing its own switchboards. For the first time, the
fledgling companys sales exceeded CNY 1 million (USD 0.156 million).
In 1993, Huawei created a breakthrough in the domestic telecommunications
market by exploiting the hidden demand in Chinas rural areas, riding a wave of
high-speed development, and effectively neutralizing multinational mega brands,
such as Alcatel-Lucent, Motorola, and Siemens, who had traditionally dominated
the China market.
In 1997, Huawei introduced and implemented a top-down systematic practice of
world-class management consulting firms and established international standardsbased IT management systems for Integrated Product Development (IPD), Integrated Supply Chain (ISC) Management, Human Resources Management, Financial
Management, Quality Control, and a myriad of other operational functions. Huawei
initiated a strategy of cooperative partnerships with multinational heavy hitters, such
as the Hay Group, PWC, FhG, and others. After 5 years of improvement and change
management, customer demand driven development, and implementation of supply
chain processes, Huawei achieved a significant competitive advantage, consistent
with customer interests, and further consolidated its core competitiveness in the
industry.
In 1999, Huawei achieved sales of CNY 12 billion (USD 1.88 billion), and by
2000, sales had almost doubled to CNY 22 billion (USD 3.44 billion).
In 2003, Huawei implemented the Going Out strategy. Including its overseas
investments, Huawei now employs over 35,000 people, of whom 85 % have college
degrees or higher. About 48 % of Huaweis employees are engaged in R&D. 10 % of
annual sales are re-invested in scientific research with world-class enterprises such

6.2 Value Knowledge, Work Hard, and Insist on Leading Technology

69

as TI, Motorola, Intel, AT&T, ALTERA, SUN, Microsoft, and many others, making
Huawei an industry leader with broad involvement in technical and marketing
cooperation. By the end of 2005, Huawei had accumulated more than 11,000 patent
applications and become the single largest holder of domestic Chinese patents.
Huaweis independent R&D products cover switching, access, transmission, mobile communication, intelligent networks, support networks, ATM, access servers,
routers, Ethernet switches, televideo conferencing, among others. Major telecommunication equipment and services form the core self-developed technology systems, providing fixed networks, mobile networks, and the full spectrum of data
communications network solutions, especially in emerging optical networking,
mobile communications and the broadband industry. Huawei has seized a leadership
position in the communications markets. Key components of Huawei products use
in-house designed integrated circuit chips.
Currently, Huawei has established more than 100 worldwide branches, with
international research institutes in Dallas, Bangalore, Stockholm, Moscow, as
well as domestic locations in Beijing, Shanghai and elsewhere throughout China.
Huaweis products and solutions are in use in Germany, Spain, Brazil, Russia,
Egypt, Thailand, Singapore, and South Korea. Altogether, Huawei products are sold
in more than 100 countries and used by 28 of the worlds top 50 operators, globally
servicing more than 1 billion users.
The chronology outlined above shows that Huawei has become and remains a
major industry player despite intensifying industry competition, thus creating its
own spring. However, IT is a cutthroat industry without development, enterprises die. Huawei thus cannot rest on its achievements, and must continuously
innovate and develop to survive. Huawei has developed an enviable and sustainable
development program that has been operating successfully for over a decade. The
key management philosophies of Huawei are presented below.

6.2 Value Knowledge, Work Hard, and Insist

on Leading Technology
The first rule of Huawei is knowledge is capital. In its early days, Huawei suffered
a perpetual shortage of funds, but Mr. Ren Z.F. still insisted on investing CNY
80 million (USD 15.53 million) annually, and in some years up to CNY 100 million
(USD 15.53 million), to fund research for technology development. A significant
quantity of human, financial, and material resources were dedicated to independent
R&D. Huawei, from its establishment, valued knowledge over traditional capital.
Huaweis world class technology leadership is recognized both at home and abroad.
Leading firms from Europe, Japan, and the US contracted Huawei, and unanimously
agreed that it is a technology leader in the Chinese communications industry and
should not be underestimated.

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6 Ancient Art of War Style Management at Huawei Technologies Co., Ltd.

6.3 Excel at Going Through the Narrow Door

Novelist Yu Hua said, Regardless of the situation, whether in writing or in life,
the correct start is to enter the narrow gate. Do not be fooled by the wide door,
for that path is short. World-class entrepreneurs have an ingrained sense of crisis.
Bill Gates said, Microsoft is always only 18 months away from bankruptcy;
Andy Grove insisted on doing business according to the rule of the survival of
the anxious; and Lee Kun-Hee cautioned that, Samsung is always only one step
away from bankruptcy. In China, Mr. Ren Z.F. is one of the few entrepreneurs
with this urgent sense of crisis. He set an iron rule: never seek to become a
telecommunications operator, but remain only a provider of telecommunications
equipment and network solutions. He ignored the trepidation of others, and firmly
strode through the narrow gate of independent innovation. Huawei chose to follow a
risky road in the national high-tech industry based on technical self-reliance and
in-house development. Huawei firmly adheres to the strategy of supplying only
communications equipment, which also forms the basis for strategic alliances that
guard its long-term strategic interests.

6.4 People-Oriented Corporate Culture

Huawei firmly respects the cultural rule never treat Lei Feng badly. Employees
who make contributions to Huawei are considered to be Lei Fengs. Lei Feng was
a model worker and ordinary hero celebrated by the Chinese Communist Party for
his social contributions. Mr. Ren Z.F. demands a culture of high efficiency, high
pressure, and high wages the so called Three Highs. This ensures a system
of knowledge-based compensation for employees. Huawei is well known for its
high wages, generous bonuses, and benefits that even include equity sharing. All
general employees may participate in after-tax profit distribution, even those who
have not officially taken up their positions. Full wages and benefits are paid to
newcomers during the training phase, contrasting sharply with the standard industry
practice where new employees still undergoing training receive only reduced wages
and benefits. Huawei also follows a policy of recognizing fair competition and
practical skills over mere academic degrees. Huawei does necessarily offer
rapid promotions to highly educated professionals or high school students from
prestigious schools, but instead focuses on gradually training its engineers through
years of work experience. While those who possess academic qualifications as well
as practical experience have a distinct advantage, Huawei emphasizes practical skills
above all else, and so many opportunities exist for the less-educated. One 19-yearold received the distinction of a promotion to senior engineer on just their seventh
day of work at Huawei, providing a classical example of the companys practice of
prioritizing the value of people.

6.5 Chinese Wolf Culture

71

6.5 Chinese Wolf Culture

Huaweis ultimate success, and the reason for its nickname, is deeply intertwined
with its Art of War management style the Wolf culture. The Chinese Wolf has
three characteristics:
a keen sense of smell;
indomitable spirit of selfless ambition;
an intrinsic group mentality.
The Wolf embodies the relentless desire to expand [1].1 Huaweis Wolf
Culture is demonstrated in the militarization of management culture espoused in
the Art of War (Fig. 6.2).

6.5.1 The Sense of Crisis and Huaweis Dialectic Perspective

on the Art of War
Anything or any organization has a life, death, and process from generation
to extinction. From the beginning, Mr. Ren Z.F. has continuously instilled a
sense of crisis throughout the enterprise, continuously setting challenging goals
and relentlessly pursuing a culture of continuous improvement. In 1999, Huawei
achieved sales CNY 12 billion (USD 1.88 billion), and so the sales target for 2000
was increased to CNY 20 billion (USD 3.13 billion). Huawei maintains an unusually
low profile, remaining humble and never blindly optimistic about its growth targets,
but sets higher goals as it gradually develops. Sun Tzus Art of War clearly shows the

Fig. 6.2 Intrinsic group mentality or indomitable spirit of selfless ambition

Co., Ltd., Special Economic Zone Gazette, China (Issue No. 10, 2005).

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6 Ancient Art of War Style Management at Huawei Technologies Co., Ltd.

origin of the dialectics of Huaweis sense of crisis strategy. Chapter Two, Waging
War and Chapter Seven, Maneuvering of Sun Tzus Art of War, state that: only one
who is thoroughly acquainted with the evils of war can thoroughly understand the
profitable ways of waging war and maneuvering with an army is advantageous;
maneuvering with an undisciplined multitude is dangerous. This philosophy sees
the use of troops as a double-edged sword. Though success can be achieved through
glorious military achievements, the path is strewn with hidden enemies and saps
national resources. Even allies may suddenly become enemies. Consequently, the
country requires a constant sense of crisis where the potential for military action
always exists. Such an environment improves the success of military campaigns and
increases the likelihood of Winning a Quick Victory, thus conserving resources
and reducing the likelihood of a real crisis.

6.5.2 Huawei Democratic Life and Attack by Stratagem

in the Art of War
A particularly famous quote from the Art of War, from Chapter III, Attack by
Stratagem, states: know the enemy and know yourself, and you can fight a hundred
battles without suffering one defeat. This culture is deeply entrenched throughout
Huawei management, where outstanding performance is considered the norm, and
staff members engage in constant criticism and self-criticism to identify strengths
and weaknesses and enhance the core competitiveness of the company. As Mr. Ren
Z.F. said: We must make self-criticism the center of organizational transformation
and optimization activities. Self-criticism does not mean to criticize for the sake
of criticism, though shortcomings must not be denied; rather self-criticism means
criticism to optimize and improve performance.

6.5.3 Huawei Contingency Focus and Variation in Tactics

in the Art of War
Another famous quote from the Art of War comes from Chapter III, Attack by
Stratagem, which describes the general rule in a war of attrition as follows: If our
forces are ten to the enemys one, surround him; if five to one, attack him; if two
to one, divide our army into two. If equally matched, offer battle; if slightly inferior
in numbers, avoid him; if inferior in every way, retreat. Huawei interprets this to
mean: we should adjust our strategies and tactics to match different conditions
and competitors. In the chapter Variation in Tactics, Sun Tzu further revealed
his philosophy of contingency planning, saying: In war, the general receives his
commands from the sovereign, collects his army and concentrates his forces. When
in difficult country, do not encamp. In country where high roads intersect, join hands
with your allies. Do not linger in dangerously isolated positions. In hemmed-in

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73

situations, resort to stratagem. In desperate positions, fight. There are roads which
must not be followed, armies which must not be attacked, towns which must not be
besieged, positions which must not be contested, and commands of the sovereign
which must not be obeyed. It is often argued that only when generals become
proficient in the use of all these machinations of war and experienced in adapting
their strategy to diverse situations can they truly use troops effectively.
Throughout its past 20 years of operations, in accordance with different development stages and situations, Huawei has implemented various management strategies
and tactics to overcome internal and industry barriers. Prior to 1995, Huawei barely
had a toehold in the industry, and faced a fiercely competitive environment and giant
rivals. As a fledgling company in the domestic communications industry, Huawei
sought to gain a firm foothold for itself in the face of competition. The main problem
Huawei faced was how to develop core products and competitiveness. Huawei
thus focused on research and development, and invested heavily in developing
internal R&D manpower, materials, and financial resources. From 1995 to 1998,
with the gradual opening up of the domestic telecommunications equipment market,
Siemens, Sony-Ericsson and other giant multinationals entered the domestic market,
and immediately carved out enormous and often monopolistic market positions. To
survive, Huawei needed to defeat these international competitors in the domestic
market, which it did by focusing on market development, and cultivating its marketing staff. After 1998, riding on its domestic success but also seeking alternatives
to competing in the increasingly challenging domestic market, the company shifted
its focus abroad, implementing a period of internationalization that saw it enter the
international market.

6.5.4 Guerrilla Style Marketing Strategy and Staying Clear

of the Enemys Main Force and Choosing to Attack Its
Vulnerable Spots
Huaweis implementation of guerrilla marketing involved a strategy of encircle
the cities from the rural areas to gradually occupy them. In 1992, foreign
behemoths such as Alcatel, Lucent, Nortel, and a host of others dominated the
domestic Chinese landscape. Huawei surveyed the situation and noted existing market and infrastructure deficiencies. China had a poor national telecommunications
infrastructure, profit margins were low, and foreign manufacturers focused on the
big domestic players in the cities and neglected the rural market. Huawei seized
this opportunity to supply domestic communication equipment to the rural market.
Sales staff penetrated deep into Chinas numerous counties and townships, creating
a powerful base of operations to support firm survival. Leaping rapidly from small
to large opportunities and capturing significant market share, Huawei methodically
launched offensives in municipal and provincial markets, and ultimately carved out
a national market. The cost of communications equipment plummeted.

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From 1998, Huawei applied this same strategy in the global market, focusing
on underdeveloped markets before going after more mature markets. Initially,
Shenzhen Huawei targeted neighboring Hong Kong. Huawei then focused on
developing countries with relatively large untapped markets primarily Russia and
South America. In 2000, Huawei launched operations in other developing regions,
including Thailand, Singapore, Malaysia, and other Southeast Asian markets, as
well as the Middle East and Africa. Huawei later also targeted markets in socalled developed countries, first France, then the Netherlands, and finally fighting
for market share in England. Huawei has now established a firm foothold in the
European market.
Huaweis guerrilla warfare fully embodies the Art of War tactics of avoid the
main force and attack the vulnerable spot. Ancient Chinese military tactics are
likened to water, which in its natural course runs downwards from high places.
The Chinese strategy in war thus is to avoid what is strong and strike at what
is weak i.e., to target low hanging fruit. Water mobility and its ubiquitous
adaptability are reflected in warfare. In war, combatants should avoid what is strong
and strike at what is weak, act according to circumstances, and give full play to ones
own characteristics as well as seeking to defeat the enemy. When applied to the
battlefield of business, this philosophy requires that companies avoid competing
in saturated markets, focus on market segments ignored by competitors, and create
competitive differentiation.

6.5.5 The United Front and the Wu-Yue Covenant Stratagem

Huawei cleverly applied the united front stratagem to neutralize and vanquish
competitors. The textbook case study occurred in 2002, when Huawei sought
to encircle Cisco. Mr. Ren Z.F. commanded this siege warfare for a year.
Cisco retaliated by suing Huawei for violation of its intellectual property rights.
Mr. Ren Z.F. employed the best local lawyers to deal with litigation and settlement
negotiations in the United States. Simultaneously, Huawei initiated an alliance with
3COM Corporation, a fierce and powerful rival of Cisco in the United States.
Co-operation with various sympathetic stakeholders in the United States enabled
Huawei to establish an extensive united front. At the most critical moment in
the lawsuit, Huawei announced to Cisco that it was cooperating with its rivals,
meaning Cisco was under attack from two sides. The battle between Huawei and
Cisco eventually ended with reconciliation. Mr. Ren Z.F. notes proudly that this case
was particularly special, and the cross-border alliance strategy may never again be
successfully deployed.
The Huawei-3COM united front battle stratagem is identical to the famous
Wu-Yue Covenant stratagem, described in the Art of War as follows: The men
of Wu and the men of Yue are enemies; yet if they are crossing a river in the same
boat and are caught by a storm, they will come to each others assistance just as
the left hand helps the right. Although they share a mutual hatred: : : when facing

6.5 Chinese Wolf Culture

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a common enemy in the same boat, they will also help each other, as united as the
left and right hands. The skillful tactician may be likened to the shuai-ran. Now the
shuai-ran is a snake found in the Hengshan Mountains. Strike at its head, and you
will be attacked by its tail; strike at its tail, and you will be attacked by its head;
strike at its middle, and you will be attacked by both head and tail. With its wide
ranging alliances, Huawei was able to lead a sufficient force to neutralize one of its
most powerful international competitors. Like the shuai-ran snake of Mt. Hengshan,
the head and tail rescued each other, warded off attacks and launched their own
powerful counter-attack.

6.5.6 Huawei Human Resource Management

and the Art of War
Recruitment and Selection
External Candidates When recruiting, Huawei focuses on talent, character,
qualifications, and experience with information systems. The company also uses
a candidate interview management system whose selection criteria incorporate
Art of War philosophy specifically The commander epitomizes the virtues of
wisdom, sincerity, benevolence, courage and discipline. The selection criteria
also evaluate security principles such as know your enemy, know yourself.
Internal Selection Huawei has never used the tenure system. Almost all senior
managers are indirectly promoted, and must demonstrate experience of success
and failure, as well as flexibility and adaptability to change, before entering the
senior management track. Huaweis management team is very young, so this
system tempers them, and inspires and encourages them to mature rapidly.
Huawei implements a flexible system of temporary demotions and promotions.
It is common for this years president to be deployed next year as director of some
remote regional office, and afterwards to take up an overseas assignment. Huawei
sends groups of senior cadres to regional markets for training, and dispatches its
best staff to the most challenging environments to experience, understand, and
overcome business hardships, following the principles of sleeping on woodpiles
and tasting hardship and the story of Shepherd Su Wu a Han Dynasty diplomat
famous for his arduous and successful mission in enemy territory. Mr. Ren Z.F.
said that only the best people selected from the grassroots level, who are mature,
appreciative, and truly understand grass roots concepts, can be improved through
such rigorous training. Additionally, Huawei also enacted a qualification system to
ensure the matching of professional competence with employee assignments. These
actions demonstrate a staff philosophy intended to identify, cultivate, and use talent,
consistent with the Art of War philosophy: The clever combatant looks to the effect
of combined energy, and does not require too much from individuals. Hence he can
pick the right men and use their combined energy.

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Motivating Staff
Huawei follows the principle, Never put Lei Feng at a disadvantage. This
means that the company pursues a high-wage, high-benefit compensation system,
consistent with Sun Tzus Handsome salary philosophy of military management,
to motivate employees by appealing to their materialism. Article 69 of the Huawei
Basic Law stipulates that: Huawei shall ensure during times of economic prosperity and positive development that the per capita income of its staff shall exceed its
industry and regional competitors.

6.6 Huaweis Dilemma

Huawei, with its Art of War culture, has deployed numerous strategies and tactics to
drive its growth from a small factory to a powerful Chinese IT brand, consistently
recognized as one of Chinas leading domestic businesses. However, as Huawei
enters the twenty-first Century, with its new social environment and development
opportunities, this military-style of management seems irrational, controversial and
indicative of crisis.

6.6.1 The Ubiquitous Compliance Culture [2]

Mr. Ren Z.F., as an entrepreneur steeped in military thinking, exercises a management philosophy in which compliance is a key tenet. This philosophy is
implemented throughout Huaweis systems and management practices. Huaweis
militarized compliance culture has become institutionalized, and was important
in the growth of the company. However, Huawei is now a well-established large
enterprise with overseas operations, and the weaknesses of its current culture are
increasingly apparent.
After college recruitment, fresh graduates report to Huawei for 1 month of
military training, plus 5 months of stringent closed-door corporate training. The
coaches who oversee this training are well-known veterans, and many recruits
are eliminated during the training process. Employees who complete the training
process, like soldiers who have completed a challenging mission, develop a sense of
duty and absolute obedience to their superiors. After their formal appointment, new
employees must study selected works of Mao Zedong, sing military songs, learn
the Huawei Basic Law, among other requirements. Huawei implants its corporate
culture in new recruits to override other learned behaviors, instilling in employees a
temperament similar to that of a cohesive military force.

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77

6.6.2 The Quick Success of the Incentives

Huaweis incentives can be summarized as high-wage, high-pressure,
high-efficiency, a strategy with readily apparent advantages and disadvantages.
The advantage is that high wages attract talent and inspire initiative, but the
disadvantage is that the company culture becomes focused on quick success, and
that Huawei staff sacrifice their personal lives for handsome salaries. When Huawei
was immature, this culture may have helped the company adapt to prevailing
development conditions, but whether this culture can continue to play a positive
role as Huawei grows is uncertain. Additionally, a breeding ground for instability
develops as many of the senior and middle leadership of Huawei achieve sufficient
wealth to start their own businesses and enjoy the benefits of being their own boss.
Of course, not all of these leaders have what it takes to strike out on their own.
Huawei is well known for its high pressure environment. Initially, the company
had a Mattress Culture. In the early days almost every Huawei manager had a
mattress under their desk. They would use this mattress to take a nap at noon, and
to sleep at night when working overtime. On waking up they would immediately
commence working again. The business trips made by marketing staff while
building markets in rural China equated to dozens of circumnavigations of the
earth. Huawei staff treated user needs like orders, working hard by day and then
performing tasks such as maintenance and installation by night. Staff never rested
between assignments and there were even regular incidents of death from overwork.
Huaweis continues to have a high-pressure work environment today, and this causes
an attrition problem as some employees quit because they cannot take the pressure.

6.6.3 The Sense of Excessive Crisis

The sense of perpetual crisis instilled throughout Huawei has been highly effective
during the companys rapid growth phase, but strategic thinking is also necessary.
Constant anxiety, as if constantly negotiating a path over egg shells or thin ice, is
a recipe for failure. To quote Mr. Ren Z.F. in his article Next Year is the Winter
for Huawei: if a company is always in a state of high anxiety, and lacks strategic
thinking, the company culture is not sustainable, and its strategy must eventually
fail.

6.6.4 Successor-Less Individual Hero

Mr. Ren Z.F. is the idol of every Huawei employee, and a strong personality cult
surrounds him. It is said that half of Huaweis success is thanks to Mr. Ren Z.F. He

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is behind every call to action, has a vast breadth of knowledge, is familiar with Mao
Zedong thought, and speaks logically and eloquently at meetings. His articles are
required reading for employees, and he is the undisputed spiritual leader of Huawei.
Mr. Ren Z.F. is the ruler of an empire engaged in a ferocious business war. He
shows loyalty and courage, piercing eyes and a stable character, but is not overtly
aggressive. He never takes the initiative to provoke a dispute with opponents, nor
does he engage in risky business. He is characterized by generosity, kindness, and
warmth.
Like founder, like enterprise, so the saying goes. In China, behind every
successful business lies the superior wisdom and ability of a strong leader. Huawei
is no exception. Mr. Ren Z.F.s military-style, vigor, and resolute character created
Huaweis ferocious and resilient Wolf culture. Many Chinese corporate cultures
strongly reflect the characteristics of their bosses, and Huawei is no exception.
Mr. Ren Z.F.s ideology permeates the history of Huawei. Mr. Ren Z.F. is Huawei
and Huawei increasingly resembles Mr. Ren Z.F. This situation inevitably leads
to concern about Mr. Ren Z.F.s successor. Can a suitable successor be found and
trained? How will Mr. Ren Z.F.s successor overcome the obstacles he will face?
Can the Huawei culture continue to flourish after Mr. Ren Z.F.s departure? For
how long can Huawei sustain rapid growth? If some day, Mr. Ren Z.F. suddenly
departed, what would Huawei be like without him?

6.7 Commentary
To other private enterprises in China, Huawei is a compelling, often controversial
company. From the self-professed Wolf Culture to the staff Mattress Culture;
from the Winter of Huawei to the Huawei Basic Law; from the staff practice of
a Karoshi Culture to Mr. Ren Z.F.s article Hard Work Ensures Great Success!,
and the more recent mass layoffs and staff re-signing of contracts, all these elements
have contributed to significant achievements. Huaweis success is commendable. It
has achieved rapid development amidst strong competitors in the IT and foreign
high-tech industry with its strategy of Rushing out of Asia and striding into the
world.
Huaweis success is based on a culture of militarization. This is immediately
apparent on entering Huawei. The philosophy of one of the best known works of
traditional Chinese culture, the Art of War, affects the management of Huawei at all
levels, and significantly influences the companys rapid development. Huawei can
be said to employ a typical oriental style of management.
It is often said that doing business is like waging war. This phrase describes
the present era of fierce business competition and may hold some truth. But in
fact the phrase should be considered carefully, and does not necessarily hold true
for Huawei. Military and business wars differ in ends and means. The purpose
of a military war is to defeat the enemy and win, even using unscrupulous
means to achieve this. Meanwhile, a business war emphasizes both competition

References

79

and cooperation, and while enterprises are rivals, they may also be cooperative
partners. Competition thus should follow the rules of market competition, rather
than being a fierce, unscrupulous, life and death ordeal. Although both fierce
business competition and a sense of urgency are important, the Art of War also says:
The principle of Kings Wen and Wu was to alternate tension with calm. Modern
management emphasizes people first, and human resources are the most important
capital of high-tech companies. Excessive emphasis on competition, ignoring the
human harmony within and outside businesses, will create a sick corporate culture
and reduce enterprise competitiveness.
Like many high-tech IT companies, Google Inc. has created a relaxed office
environment and a battery of user-friendly management practices, including flexible
working hours and even allowing employees to bring pets to work. Microsoft and
others use similar management styles. These practices, while on the surface appear
very Western, may in fact be consistent with OM culture. After all, OM culture
stresses: Favorable weather in heaven is less important than advantageous terrain
on earth, and advantageous terrain on earth is less important than human unity.
Only by full consideration of OM and comprehensive study of Eastern thinking can
a business achieve good health and sustainable development.
In the face of intensifying industry competition and challenges, what is the next
step for Chinas controversial wolf?

References
1. Ren ZF (2001) Huaweis Winter. Corporate Culture (12):13
2. Sun Yougang (2005) Existence vs. paradox Huaweis corporate culture. Enterprise Management (6):22