CEO Interview: Huawei's Eric Xu
Huawei is now, very clearly, the leading supplier of communications networking technology in the world. It has been challenging, and overtaking, established rivals in the telecom networks technology sector for years and is now also an emerging player in the enterprise IT sector and a significant force in the global smartphone market.
With that broad sweep of the market, something that other vendors have abandoned, Huawei has managed to grow its annual revenues at a relentless pace, even while the global economy has stuttered and other major names in the communications technology industry have hit a sales brick wall.
Here's a reminder of what relentless growth looks like: In 2012, Huawei's full-year revenues totaled 220.19 billion yuan renminbi (at that time, the equivalent of US$35.5 billion): In 2016, its reported revenues will be in the region of RMB 520 billion ($75 billion), nearly double that of 2012. (See Huawei's Network Sales Up Around 32% in 2016.)
And, as you'll find out in the following interview, Huawei is far from being done with its sales growth ambitions, despite still being vendor non grata in the US. Growing fast, though, can also lead to significant challenges. (See Is Huawei in for a Bumpy 2017?)
Those that do business with Huawei will know that as it has grown, it has changed. Once known primarily for cut-price networking products (that were sometimes regarded as not very subtle copies of existing market-leading offers), aggressive competitive tactics (such as the Supercomm Spygate saga of 2004) and haphazard customer relationships, the company has changed and evolved into a more sophisticated global operation that has benefited from building business propositions based on customer needs.
That, by the way, is a view not offered up by Huawei, but one shared (often in private) by its service provider and enterprise customers that have been almost shocked but certainly very pleased by the company's cultural maturity. Ten years ago, doing business with Huawei made sense mainly to a customer's CFO who was focused on up-front cost and pricing -- now it makes sense for many more senior decision-makers. That's not to say Huawei isn't still undercutting its rivals: That certainly still happens, though there's often a payback further down the line when service and support charges kick in, according to some network operators that talked to Light Reading on condition of anonymity.
Huawei also differentiates itself from its rivals in other ways, such as its management strategy. It has several lead executives who, as well as having a seat on the board, hold the title "Rotating CEO" -- they take it in turn to be the "acting CEO," dealing with day-to-day decisions and running the senior team meetings.
Eric Xu is one of those rotating CEOs and, currently, is the acting CEO.
We secured some one-to-one time with Xu during the recent Mobile World Congress event in Barcelona to talk about future growth, the challenges that brings, the changing nature of Huawei's business (as the communications sector itself evolves) and the impact of technology trends such as artificial intelligence, virtual reality and IoT.
— Ray Le Maistre, , Editor-in-Chief, Light Reading
Next page: The five-year view