Chapter 37 Deep wash beach, low weir

In order to "help customers succeed and create long-term value for customers" in the fierce competition of future converged broadband services, on April 24, 2009, Ren Zhengfei proposed a future-oriented full-service operation strategy in his speech at the Huawei Operation and Delivery System Struggle Commendation Conference. The concept is called "deeply wash the beach, low for the weir". Ren Zhengfei said in his speech: Cleaning the beach deep and making weirs low are the profound governance concepts left to us by Li Bing and his son more than 2,000 years ago.The hanging gardens of Babylon, Roman aqueducts and bathhouses of the same era have all disappeared, but Dujiangyan is still watering and benefiting the Chengdu Plain.Why?Li Bing left behind the principle of "digging the beach deep and making weirs low", which is the main "knack" for Dujiangyan's long-term prosperity.The wisdom and principles contained in it go far beyond water control itself.If Huawei wants to survive forever, these principles also apply to us.Deep Taotan is to continuously tap internal potential, reduce operating costs, and provide customers with more valuable services.Customers will never pay more for your glamor and high benefits.Any desire we have, in addition to hard work, don't expect pie in the sky.The company's short-term irrational welfare policy is to quench thirst with poison.Working low is to control one's greed, keep less profit, give more to customers, and treat upstream suppliers well.The future competition is the competition between one industrial chain and one industrial chain.The overall strength of the industrial chain from upstream to downstream is the foundation of Huawei's survival.Natural selection, survival of the fittest.

The core of the concept of "shoveling deep into the beach and working low in weir" is "helping customers succeed".Ren Zhengfei's "low work weir" refers to how to deal with the relationship with operators.Operators are customers of equipment suppliers and parents of food and clothing.As a manufacturer, it is necessary to pay close attention to and deeply understand the new requirements of operators for network equipment.In recent years, the ARPU (Average Revenue Per User) of operators has shown a downward trend year by year, and it is a global phenomenon that incremental revenue does not increase.Operators have to care about procurement costs and operation and maintenance costs. When purchasing network equipment, they not only put forward high requirements for equipment performance, technology, and subsequent evolution, but also set strict standards for equipment prices.This tendency is more prominent in the environment of financial crisis.How do equipment manufacturers respond to this new demand from customers at this time?Indeed, sometimes this kind of appeal makes some equipment manufacturers feel deeply distressed in the face of equipment orders.Signing the bill may not make money, and not signing is afraid of losing the market.what to do?Ren Zhengfei proposed not to sacrifice long-term goals for short-term goals, but to output more and create more long-term value for customers.This is undoubtedly a far-sighted idea, and it does require some courage.After all, the supplier's cash flow pressure is always there.

In September 2009, Huawei started from the horizontal integration of consumer, entertainment, finance, service and other active fields in the personal telecommunications business to form an open ecological environment centered on broadband experience.The value of the telecommunications industry will accelerate the transfer to platform-based and diversified data services; for the home market, the combination of high-definition video, the concept of "OnDemand" and new media centered on the Internet will greatly promote the development of home networks, and the network traffic will increase rapidly , and operators should pay attention to the penetration and extension value of the market at both ends of the channel, and strive for the initiative of industrial integration through access control, open media distribution service platform, intelligent flat network and customized terminals; In the future, industry applications are expected to become the next potential market of "50 billion users". Operators can take advantage of the advantages of large networks, integrate industry chain capabilities, focus on the development of intermediary business platforms, provide general terminal modules, and cooperate with manufacturers to reduce costs and promote digital cities. process.

Huawei has always focused on the challenges and pressures of customers.Under the new market situation, Huawei will work with operators to explore the road to success in all services, continue to innovate, and fulfill the promise of "go all out to achieve customer success". As a leading manufacturer, Huawei still achieved performance against the trend even in the global financial crisis that broke out in 2008, but Ren Zhengfei clearly felt the severe challenges brought about by the financial crisis. "Shoveling deep into the beach, working low into the weir" actually puts forward the internal and external strategies of enterprises during the financial crisis.Deep Amoy Beach refers to further tap the potential of enterprises.Facing the financial crisis, in order to reduce expenses and save costs, some enterprises did not hesitate to drastically cut R&D and marketing expenses, which are actually the key links of the core competitiveness of enterprises. Cutting these expenses will have a fatal impact on the long-term development of enterprises.For example, in the past few years, some mobile phone manufacturers ignored R&D and technological innovation for immediate benefit, and even outsourced marketing to channel distributors.As a result, it didn't take long for the once prosperous brands to disappear one by one, and the lesson was very painful.These cases in turn prove that the cost expenditure related to the core competitiveness of enterprises cannot be reduced at any time. Even in the financial crisis, we must grit our teeth and insist on continuous investment.Otherwise, an enterprise will soon be overwhelmed by the tide of technological progress, and may fall down before the arrival of the industrial spring.

Yao Chuanfu, a senior reporter for People’s Post and Telecommunications, who has reported on Huawei for a long time, believes that the more important significance of “shoveling deep into the beach, and making low weirs” is that it proposes a new business model for the equipment manufacturing industry. Investment, high return" subverts the traditional business model.If equipment manufacturing enterprises want to maintain sustainable development, on the one hand, they must always maintain their investment in core competitiveness such as technological innovation; on the other hand, they must also look at the relationship between investment and return dialectically.Some equipment orders may have no or very low income in the short term, but in the long run, it reduces the cost pressure of the operator, wins the long-term trust and cooperation of the operator, and will eventually obtain a reasonable return.The rapid rise of Huawei and ZTE in the global equipment market in recent years is inseparable from their leadership in business philosophy and business models.Survival of the fittest. In the new market environment, whether other equipment suppliers can keep up with Huawei and ZTE will also affect their future market position.