This introductory chapter offers an overview of the entire book on the management transformation of Huawei. Huawei is now China’s most prominent multinational company and a leader in 5G mobile telephone technology, which will be rolled out across the world in the next few years. What makes Huawei interesting is its rate of growth and the level of detail in which we can observe not only the creation of routines but also the breaking of routines across most the major functional areas (management, product development, HR, supply chain, finance, R&D, intellectual property, and international). This makes Huawei an ideal case to advance the theory of routines and dynamic capabilities to change routines. Hence the book will particularly appeal to academics in the field of strategy, management, and business history.

This chapter offers concluding thoughts on the entire Huawei study – the totality chapters and commentaries. It offers comparative perspective by placing the firm in the larger context of corporations in China and to some extent in other countries. The comparison with many other firms throughout the entire book reveals that Huawei is among a select number of firms that are able grow at very high rates by continuously transforming themselves. Consistently investing at least 10 percent of sales starting on R&D at least since 1998 was an important ingredient of this growth. But the importation of western best practice routines and the steering of this process by the Huawei founder and the top management team underlie this ability to grow. Huawei stands out among many Chinese companies that internationalize by relying solely on organic growth rather than on growth through acquisitions. Huawei is also different from state-owned companies (SOEs) that dominate a number of sectors in the Chinese economy in that Huawei motivated a large fraction of employees by giving them shares in a profit-sharing plan so that hard working employees could make a substantial amount of money. Building all chapters, we provide advance management theory by articulating in detail the meta-routines that underpin Huawei’s dynamic capabilities. Finally, we discuss the challenges to future growth of the firm, including geopolitical cross-currents the firm currently finds itself in.

Internationalization plays an important role in Huawei’s transformation from a fledgling Chinese start-up to a powerful multinational company. Huawei’s internationalization is characterized by repeated failures, difficult struggles and unceasing learning by doing. In this chapter, we divide the whole internationalization process of Huawei into three stages based on the different challenges at each stage. They are (1) overcoming the liability of foreignness, (2) managing complexity to achieve synergy from a global perspective, and (3) changing from a latecomer mindset to that of a global leader. For each stage, we summarize and discuss how Huawei adopts routinization and de-routinization strategies to efficiently overcome different challenges. The managerial implications derived from Huawei’s internationalization will be useful for other multinational firms.

Although Huawei started its business as a small agent in 1987, the firm began the independent development of telecommunications equipment in its fouth year of operation and then gradually increased its R&D investments over the years. As the scale of R&D efforts increased, Huawei encountered significant problems with its organization of R&D and felt that it was necessary to transform how it conducts R&D several times over its thirty-year history. In this chapter, we develop a four-step model to analyze three major R&D management transformations in Huawei’s long history of R&D activities. The first transformation, from 1991 to 1995, helped Huawei to establish an informal R&D system; the second transformation, from 1995 to 1998, changed the informal R&D management system into a formal system with clear structures and processes; and finally, the third transformation built up a process-oriented, high-performing R&D organization. We find that although the transformations shifted Huawei’s focus from making structural changes to process changes, all of them were closely aligned with the firm’s market position and with its strategic re-orientation.

This chapter documents how Huawei transformed its supply chain management over the past two decades. We argue that Huawei’s supply chain management transformation can be divided into two stages: the establishment of an integrative supply chain from 1999 to 2003 and the establishment of a global supply chain from 2005 to the present. In the integrative supply chain management transformation project, IBM consultants helped Huawei identify problems in its operational processes, IT system and organizational structure. Subsequently, Huawei addressed these problems through process reengineering, an integrated IT system, and organizational change management, respectively. In the global supply chain management transformation phase, Huawei first promoted the enterprise resource planning (ERP) system in overseas subsidiaries and representative offices by tailoring the system to local laws, regulations and customer requirements and then made efforts to build an integrated global supply chain network.

Huawei by 2014 had become the largest patent filer in the world even though it did not file any patents for the first eight years of its existence (1987–1994). This chapter examines the development of the firm’s intellectual property (IP) management capability. It describes important changes that Huawei undertook both in terms of its IP strategy (whether, when, where, and in what technical areas to patent) and the administration of its IP activities. Unlike the other major transformations that Huawei undertook with the help of Western consulting firms, Huawei could not make up its mind about how it was going to manage its IP strategy until a lawsuit filed in 2003 by a US competitor, Cisco, prompted top management to devote significant attention to this area. To support its internationalization strategy, Huawei subsequently implemented a systematic strategy to create a vast collection of independent intellectual property in telecommunication technology. Starting in 2003, Huawei embarked on a series of five-year plans, first to increase the amount of IP that would be generated by its large R&D efforts and later to increase the quality of its IP. To realize this strategy, large changes in the organization of the IP office had to be made. Huawei now employs over 400 full-time IP professionals to implement its IP strategies. Huawei offers lessons for other companies from emerging economies who want to compete successfully on the world market.