Facing the China’s Telecom Equipment industry double-digit grow and becoming the largest telecom market in the world, all leading firms in each subsectors of Global telecom equipment take this opportunity to invest in china. Huawei, a Chinese challenge, was starting its challenge to Cisco insurmountable leadership position in international telecom equipment industry.
Besides, to succeed its challenge Cisco in this industry, Huawei’s needed to show it pin-point company strategy on its capabilities and core competencies, generic competitive strategy framework and international strategy to against Cisco.
Huawei’s Capabilities and Core Competencies
Huawei’s Resources audit
First of all, Huawei’s existing finance funds is large included working capital such as investment on more than US$370 million for its own Code-Division Multiple Access Technologies. On the other hand, Huawei’s have its “guanxi” relationship network to raising funds. For example the bank will give financial support and give favorable credit limit for the company. This showed Huawei’s have enough finance resource to supporting it strategy.
Secondly, Huawei’s human resources own total 24,000 employee’s majority of staff have high education level such as bachelors, master or Phd. Furthermore, the overall standard of the staff training is higher because all new employees were put through intensive military-style training for few months. In addition, it affects the intangibles resources such as the morale and business culture. The morale is high because military-style focus on team-success rather than individuals, the business culture of Huawei’s was aggressive on marketing and highly sensitive of global trend.
Thirdly, Huawei’s physical resources included production facilities, six research laboratories in china, Russia, India and Sweden, it headquarters technologies house was 1.8 square-kilometer properties together with 55 branch offices worldwide eight regional headquarters. Furthermore, the company has information technology on its IT systems such as Corporate Management Systems which integration with product development and supply chain.
Finally, Huawei’s owned many intellectual properties-patent. At the ended of 2004, more than 8,000 patents was owned, which 800 is applied for more than 20 countries. Value Chain Analysis
Value Chain Analysis describes the activities that take place in a business and related to the business core competencies. It can classify by primary activities and supporting activities.
First, from the firm infrastructure of supporting activities, leadership of maturity background affect the human resources to establish a strong service culture in aggressive marketing policy by provide maturity training. Huawei’s also concerned the primary activities improvements by replica the Western Management Systems to the Company includes financial, human resources systems. etc. The management systems enhance the company efficiency management on human resources and marketing together with the other primary activities. Also, in Human Resources activities, Huawei’s giving high salary to keep the workforce and the morale of the Company. Huawei’s staff is exceptionally high pay by Chinese standard with housing and other benefits. The higher morale and educated levels help the services delivery more effective and efficiency by actively obtain customers opinion.
Huawei’s director vision is to build innovation capability into the company. The company focus on it technology development, Huawei’s put through many resources such as finance investment and human resources on research & development, it lead to a large number patents created. The patents improve the company technology level. As a result, the Company can develop high technology products. Because of the focusing on the innovation of technology development, Huawei’s recruiting highly education levels staff for R&D department. Furthermore, the Company classify it...