Chapter 40 Chapter 7 Technological innovation wins three points in the world

Many people in the outside world believe that Huawei has strong technological innovation capabilities and ranks first in the world in the number of patents.In fact, Huawei's technological innovation stands on the "shoulders of great men"."Bring it" when its own strength is not strong, and then focus on high-intensity R&D investment, aiming at the world's cutting-edge technology, and insisting on independent innovation. This is the inexhaustible driving force for Huawei to develop well and fast. Ren Zhengfei believes that too much "independent" innovation complex will affect the formation of corporate competitiveness.In Huawei's view, patents are not an end, but a business means to enter the market and obtain products and cost competitiveness at the same time.On the one hand, Ren Zhengfei’s proposition is to “create a harmonious business environment through reasonably paid cross-licensing”; 10% of sales are invested in research and development.Ren Zhengfei especially emphasized: "30% of the new development volume is not called innovation, but waste." He called on R&D personnel to develop a new product to minimize their own inventions and creations, and focus on inheriting the technical achievements of previous products, as well as external cooperation or cooperation. Buy.

Huawei has a world-leading product with the largest market share. A key technology that surpasses competitors in terms of function and performance is acquired by Huawei through the purchase of technology from a foreign company.Huawei has searched for and selected a very leading manufacturer in the research of ultra-long optical transmission technology and product solutions. The company has invested more than 70 million US dollars in total. According to the analysis, Huawei believes that its products and technologies have high market value, and finally decided to purchase the technology.After technology transfer, secondary development, and necessary legal procedures, Huawei completed integrated development in just 9 months, successfully launched products that applied new key technologies, and realized large-capacity, long-distance (4600 kilometers) Optical transmission without electrical repeaters. Since the launch of this solution in 2003, Huawei has developed rapidly in related markets. From an unknown long-distance transmission manufacturer in the world at the beginning, it has rapidly grown into the number one manufacturer in the global long-distance transmission market in 2005, and has maintained a stable position. It is particularly worth mentioning that, relying on excellent cost performance, Huawei has achieved market breakthrough applications on the 653 optical fiber system of Telemar, the largest fixed operator in Latin America, relying on stronger bandwidth transmission capabilities than other manufacturers.

Huawei's "technology-bringing doctrine" is also reflected in its cooperation with partners, whether it is with university research institutions or "friends" in the same industry.Huawei's unique matrix management and corporate culture slowly assimilated partners into a part of Huawei. For example, in the early days of cooperation with Tsinghua University, Zheng Baoyong, a doctoral student at Tsinghua University, unknowingly joined Huawei's R&D team, and later Huawei 3Com, the current Huawei Symantec, and Huawei all adopt the same technology cooperation strategy.

A few years ago, Yang Yuanqing, president of Lenovo Group, who wanted to be a "high-tech Lenovo", went to Huawei to visit Ren Zhengfei.Ren Zhengfei told the truth: "It is difficult for Lenovo to develop into a technology-based enterprise. Huawei invests billions of billions in R&D expenses a year and only earns billions. Our high-input, high-output business model has already Formed. Lenovo wants to make enough research and development expenses, but if it can’t sell at a high price, it won’t benefit in the short term, and shareholders and investors don’t agree, it’s still difficult.”

The book "The Truth about Huawei" records that Guo Wei, another member of Lenovo's board chairman Liu Chuanzhi, also went to Huawei to "learn lessons" from Ren Zhengfei.Ren Zhengfei persuaded him not to do R&D at all: "Don't do R&D. R&D is useless. Isn't your strength in marketing? If you do a good job in sales, I will let you sell my products when they are developed." Guo To ask why Ren Zhengfei didn’t suggest him to do R&D, Ren replied: “R&D, if you want to do it, you have to do it big. If you want to make a small fuss, it’s better not to do it, because it’s a very expensive thing.” Regardless of Yang Yuanqing’s Judging from how Ren Zhengfei and Guo Wei felt and made decisions afterwards, simply judging from Ren Zhengfei's emphasis on "expenses" twice, it is indeed not something that ordinary companies can imitate.First, small companies cannot afford to invest; second, if large companies concentrate their efforts on research and development, it means that they must first destroy their original advantages and start over.This risk is far greater than Huawei's "gamble" on the C&C08 machine in 1992.Another point worth noting is that "high investment, high output" is only Huawei's investment orientation, not technology orientation.From the perspective of Huawei's development practice, its technological trend has three reference frames: multinational companies, domestic competitors, and customers.To use a popular analogy: Huawei's technology strategy is like "playing mahjong", focusing on the "upper player", stuck in the "lower player", and optimistic about the "opponent player".

In 1998, Professor Peng Jianfeng of Renmin University of China put forward many suggestions for Huawei's "Second Entrepreneurship" in his article "On the Internal Relationship and Contradiction of Huawei's Second Entrepreneurship", including: "In 10 years, technological development must be achieved. From technology follow-up to technology-leading development model, product development must be followed and imitated, and transformed into a model that combines innovation and improvement.” Previously, Huawei’s technology orientation has always been to imitate and follow multinational companies off-the-shelf products and technologies.

In 2000, Ren Zhengfei visited a high-tech enterprise in Zhongguancun, Beijing. Someone asked him to talk about his impressions. He said something intriguing: Founder has technology but no management, Lenovo has management but no technology, and Huawei has no management. No technology either.Many people simply interpret Ren Zhengfei's words as "modest", which is actually a "misinterpretation".In Ren Zhengfei's eyes, the real core "technology" is the technology that can "create opportunities and guide consumption", not Huawei's technology that "finds opportunities and seizes opportunities".

Ren Zhengfei criticized the pride of Huawei people in his article "The Spring of the North Country": "Many of our employees are blindly proud. They are like frogs at the bottom of a well. When they see that we accidentally lead Western companies in some products, they think that Our company is already world-class. They don’t know the connotation of a world-renowned company, nor do they know the trend of world development, and the potential achievements that others are unwilling to announce.” Ren Zhengfei is soberly aware that it is necessary to keep a low profile in terms of technology. It must be admitted that international manufacturers are far ahead. This huge gap is formed by history. It is relatively easy; on the other hand, when we are still in the initial stage of the founding period, some foreign patents have already been formed. Whether it is the principle of system implementation or the details of technical implementation, leading international manufacturers are already far ahead.

In the article "How long can Huawei's red flag last", Ren Zhengfei clearly pointed out: "We are aiming at the best in the industry, and now the best in the industry are Siemens, Alcatel, Ericsson, Nokia, Lucent, Bell Labs... the products we have formulated and planning and management must move closer to them, and must follow and surpass them. For example, in terms of intelligent network business, our switches are already ahead of Siemens, but we still have a gap with Siemens in terms of product stability and reliability We can only survive if we aim at the best in the industry.” What Ren Zhengfei is soberly aware of is actually the real situation of the development of most enterprises in our country.

Before Christmas in 1997, Ren Zhengfei visited Hughes, IBM, Bell Labs and Hewlett-Packard in the United States.After the visit, he wrote an article "What We Can Learn from the American People", comparing the essential differences in technology development between Chinese and American high-tech companies: "IBM invests about 6 billion US dollars in research and development every year. Large companies spend about 10% of their sales on research and development to create opportunities. Our country is relatively backward in this regard, and the understanding of opportunities is often made after the opportunity has already appeared before making a correct judgment, seizing the opportunity, and achieving success. Huawei That's it. The world-renowned companies that have come to the front, they rely on research and development to create opportunities and guide consumption. They swept through the profits of the "opportunity window" in a short period of time, and invested in creating greater opportunities. This is why they are better than us The root cause of rapid development." He positioned Huawei as a "latecomer": "Looking for opportunities and seizing opportunities is the famous saying of latecomers. Creating opportunities and guiding consumption is the motto of pioneers." He also said: " Opportunities are realized by people, and people must have a tool to realize opportunities, which is technology. Technology creates products and opens up the market, which in turn creates opportunities. This is a spiral cycle.”

It is a successful experience of Huawei to do technology development with the help of external force.In the early days of Huawei's development, Ren Zhengfei once believed that independent development is the only path that enterprises should take for R&D.After the introduction of IBM's process transformation, IBM's consultants found a problem. Huawei did everything in R&D by itself. The advantage has been built in the market, and it is impossible to profit in the competitive market. Therefore, it is recommended that Huawei shorten the time to market its products. After summing up the experience of competitors, Ren Zhengfei let Huawei's technology research and development take the path of "relying on external forces": the main core technology is developed by itself, but some relevant and forward-looking technical research is done by domestic universities or laboratories.This not only ensures that Huawei has mastered the core technology, but also guarantees the efficiency of its research and development.Huawei has established long-term technical cooperative relations with universities such as the Radio Department of Tsinghua University, University of Science and Technology of China, University of Electronic Science and Technology of China, and Southeast University.This large-scale cooperation with domestic universities not only solves Huawei's front-end technology problems, but also trains a large number of high-end technical talents for Huawei. Overseas, Huawei has also established laboratories for multinational employees through integration.The overseas research institute is of great significance to Huawei. It not only provides support and services for Huawei's overseas business, but also means that Huawei, like other international IT giants, can establish a global 24-hour uninterrupted R&D system. In the past 20 years, Huawei has not invented many original products. What it has mainly done and achieved is to improve some functions and features and enhance the integration capabilities of the achievements of Western companies, and it is more manifested in engineering design, Compared with the accumulation of foreign competitors for decades or even hundreds of years, there is still a big gap in the technical progress of engineering realization; for the core technologies we lack, Huawei only purchases and pays patent license fees. It has realized the access of products in the international market and gradually strived to survive in the competitive market. This is much lower cost than bypassing these patents by other methods. Since Huawei paid the fee, it also achieved cooperation with Western companies. of peaceful coexistence. At present, Huawei has established 18 research institutes in the United States, Germany, Sweden, Russia, India, and China, and has established nearly 20 joint innovation centers with leading operators. Huawei research institutes are blooming all over the world. In 2008, Huawei was selected as the "Innovative Enterprise of the Year" by the US "Business Weekly", and it is also the only mainland company on the list. In October 2010, the famous British magazine "The Economist" awarded the prestigious "2010 Company Innovation Award" to Huawei, China's largest communication equipment manufacturer.Technology-based is the foundation for Huawei to get to where it is today.