Huawei is on the right path

Huawei emerges as a winner despite US companies’ “colonization” activities in information industry. The Chinese mobile giant introduces their tremendous success as an “effective management success”, not as a “Chinese Miracle”.

Continuing down the road of success especially despite the US President Trump’s anti-Huawei propaganda, the company recently released its 2019 “mid-year” report. Given the fact that the fiscal periods of the US companies Amerikan are quite different than the rest of the world, theirs is no healthy way to make a comparison. But, I can only tell one thing: Pretty soon, Huawei will get ahead of their American competitors in terms of financial turnover and profitability, for a very simple reason, which is investing in innovation and technology.

People get mad at when I say this but I will say it again, “Companies that are established with the purpose of producing major household appliances in large numbers will not achieve success when they suddenly decide to produce smartphones as well. Those who succeeded in smartphones manufacturing are where they are today because they spent millions of dollars in R&D and advertising. They figured out long time ago that they would not be able to keep up with their competitors by exerting pressure on government to impose import duties and non-tariff barriers. They figured out that the real competition is out there, not in their home country.

We should know that the only solution for a company whose goods and services are not in demand in international markets is to ask help from government so as to at least ensure their products are sold in domestic market. However, the only real support that the government should provide to companies shall be this: expanding to new export markets through he help of foreign policies.

But, Huawei’s financial turnover, sales figures and profit margin are the only data to compare their effective performance with other companies. As the company is not traded on any public market, it’s not possible to compare Huawei with its competitors that publicly traded. Anyone working for a company outside China cannot buy into Huawei because the Chinese company is held privately only by the company’s China-based employees.

On the other hand, “brand value” is another criterion to make a comparison. But it currently seems unlikely for us to make a brand value-based comparison either since we can’t gather all factors together that determine brand value for Huawei, at least for now, even though the company takes important steps to ensure transparency.

“You need to win consumers’ hearts just like you won their minds…”

As Market Capitalization and Brand Value are the criteria invented and used mostly by liberal economies, Huawei has got a long road ahead. However, it can also be observed that Huawei has no intention to slowing down despite continuous allegations by the US Administration.

By the way, the fact that most of the mobile phone and tablets sales are done in foreign markets is an important development too. The major rise in the Chinese mobile giant’s export volume didn’t go unnoticed either despite recent significant decline in global trade. Apparently, Huawei is the one that will carry the torch of China’s new growth model.

However, as I’ve always said, “having fun” is not only about taking pictures. While American dominance over music industry continues with smart devices, it looks like Huawei doesn’t do much in terms of “producing music”. Today, a lot of people, including me, can create and sell music on their tablets or smart devices, Huawei should offer something bigger than the “best lens or best camera”.

Annoying the US and South Korean companies with its successful performance, Huawei doesn’t have a hierarchical organizational structure. Mobile designs of Huawei are introduced to markets more quickly while other Global Companies have to deal with a lot of levels of management to make senior management take all critical decisions. Huawei has also got a rotating CEO system. Each newly appointed CEO acts as CEO for a tenure of 4 months. The company contains a chain of decision not from the top of the organization to the bottom, but from the bottom pf the organization to the top. Therefore, Huawei hold the principle of “experimentation”. Despite all this, however, the company still has difficulty in taking decisions about various projects, especially the social responsibility projects.

That is to say, the Chinese company has difficulty making final decisions for sponsorship and social aid projects despite their quick decision making mechanism in production, sales and marketing. Companies that have succeeded in winning people’s minds should win their hearts too as they may need it someday.