Who is Huawei?
Maybe Not What You Expect
Launched in 1987, Huawei has grown from a small seller of phone switches in rural China to the world’s largest maker of telecommunications equipment and its second-large smartphone company.
Founded in 1987 with just US$2,500 in start-up capital, Huawei generated revenue of US$108.5 billion in 2018. We employ more than 180,000 employees in 170 countries.
Today, Huawei finds itself under attack. Our detractors, chiefly the government of the United States, claim – without providing evidence – that the company is a security threat. Media coverage has been influenced by the steady drum-beat of anti-Huawei rhetoric, and while some of it is even-handed, much of it is colored by politics.
Like any company, Huawei has made mistakes and learned from them. We try to change when change is warranted. One thing that has not changed is our devotion to customers. While nearly every company claims to be customer centric, Huawei has had to put customers first because it had little else to work with. As tiny Chinese company competing in a market dominated by large multinationals, without money or technical know-how, our one source of competitive advantage was our dedication to satisfying the customer, no matter what.
In the company’s early days, for example, rats would chew through telecom wires in China, cutting off customers mid-call. The multinationals providing phone service at the time considered this to be the customer’s problem, and offered no solution. Huawei stepped in and developed sturdy, “chew-proof” cables that the rats couldn’t get through. Customers noticed.
A few years later, Huawei entered Europe. Customers in that market wanted base stations – the towers that send and receive cell phone signals – to be smaller and easier to install. They also wanted them to be more energy efficient, and to offer wider cellular coverage. In response, Huawei invented a new type of base station that checked all of these boxes, and became popular with European carriers
Over time, the company developed a reputation for doing whatever it took to meet customer needs:
- When a magnitude 6.8 earthquake hit Algeria in May 2003, killing more than 3,000 people, many multinational companies fled the country. Huawei stayed. Three days after the quake, the company’s engineering team completed a network migration as scheduled, ensuring uninterrupted coverage during the crisis.
- In 2007, Huawei was contracted to build two base stations on Mount Everest. Despite extreme cold and low oxygen levels, the project was delivered on time. It was, and still is, the highest wireless communication base station in the world.
- When civil war broke out in Libya in 2011, most expatriates left. Once again, Huawei stayed. The general manager of the project said we did so because, “in times of war, people need to report back home more than ever.”
Some might ask whether Huawei is to be praised for selflessly serving its customers, or censured for putting its employees in harm’s way. But our employees are different: they want to go the extra mile. One reason is that they own the company. Despite what you might have read about close ties between Huawei and the Chinese government, the company is 100% owned by the people who work for it. We have built a dedicated workforce due through an Employee Stock Ownership Program that allows our people to prosper when Huawei does.
Being privately held lets Huawei think long-term. Rather than focus on making our quarterly numbers, as publicly listed companies must do, we’re making plans for the coming decade – an ability that has fueled our growth.
What innovation means
In addition to our customers, Huawei is focused on innovation. Last year, we were the fifth-largest investor in R&D worldwide, outspending companies like Apple, Intel, and GE. Over the past decade, we have spent more than US$61 billion on research and development, including basic research in areas like algorithms, mathematics, and material science. Nearly half of our employees work in R&D, and we are one of the world’s largest patent holders.
Our innovation extends beyond hardware and software to encompass our approach to management. For example, in Huawei’s rotating chairman system, three executives take turns acting as Chairman for six months each. In this way, the company always has a leader, but key decisions are made collectively by an executive triumvirate with shared experience and unique viewpoints. This helps avoid the rigidity that can come from having one person in charge all the time.
Innovation means nothing unless our customers trust us. Despite what has been suggested in some media coverage, there has never been a major cyber security incident involving Huawei, nor has anyone ever produced evidence of any security problems with our equipment. Huawei is the most audited and inspected company in the tech industry. We have set up security centers to identify and mitigate cyber risk; undergone independent third-party certification of our hardware, software and solutions; and allowed strict review and screening by regulators, customers, and industry experts. As part of our continued commitment to security, we will invest more than US$2 billion over the next five years to further upgrade our software engineering processes with the aim of making our network equipment more secure.
So who is Huawei? In short: a company that delivers innovative, reliable, secure products; brings out the best in our employees; and delivers on the promises we make to our customers.