Huawei’s Tian Tao tells secrets of company’s success to Business School students

Huawei’s Tian Tao gave a keynote speech on the secrets of the company’s success at Imperial College Business School last night.

Mr Tian, an advisor of the Huawei International Advisory Council and author of the book ‘Huawei: Leadership, Culture and Connectivity’, discussed the Chinese technology company’s strategy and structure with students.

Mr Tian, whose son studied at Imperial, said he had fond memories of returning to Imperial, as he used to visit over Christmas and New Year.

Explaining Huawei’s rapid growth, Mr Tian said: “In the past three decades Huawei was driven by idealism and values. I think Huawei’s success was driven by the power of will.”

“Huawei only has a history of 30 years but those three decades are a miracle of world class business because very few companies have managed to maintain the growth for that long. And for most years it was double digit growth.”

Mr Tian said that Huawei expects revenue to reach $150 billion by 2021 and it will become the equivalent of a top 10 Fortune 500 company.

Core driver of success

Huawei is a private company which is owned by its founder Ren Zhengfei and employees. Professor Tian said that Huawei does not consider having external investors because they would not allow it to spend so much on research and development.

Mr Tian said: “Traditionally business schools explore one idea of economics or management studies, which is to maximise shareholder interests.

“Huawei’s creation is different from traditional management science. The development of knowledge workers is the source for long term sustainable development of the company.”

He explained that employee retention at the company is good because staff are prioritised over shareholders when value is being distributed.

Mrr Tian said: “I’ve studied Huawei for 20 years – in my view the core driver behind their competitiveness is the management of knowledge workers.”

Encouraging failure and adventure

Mr Tian also said that delegating authority was a rare example not only in China but the rest of the world. Professor Tian said that the founder had also created a fully open culture to encourage failure and adventure.

But Mr Tian warned that past success is not a reliable guide to the future success of the company. He said that “consumers are fundamentally flirtatious – today they embrace you, tomorrow somebody else”.

Succession planning

Mr Tian was asked if Huawei should be worried about its future if founder and CEO Ren Zhengfei was to retire from the business.

Mr Tian said that Huawei had already been planning for succession and had implemented strategies such as rotating CEOs to delegate power and smooth a future transition.

He said: “If he was to announce his retirement there might be a little bit of a tremor at Huawei but no shocks. In the long term there will be no issue.”

Talking about future global challenges, Mr Tian said that many traditional jobs will be replaced by robots and with life expectancy increasing, this would be major challenge to every government.

Inspiring talk

Dr Paolo Taticchi, Director of the Weekend MBA and Global Online MBA at the Business School, hosted the event.

Dr Taticchi thanked Mr Tian for a ‘very exciting and inspiring talk’ and added “your book is a reference for people inside and outside China to study Huawei.”

Huawei and Imperial have a joint research laboratory based at Imperial’s Data Science Institute to fund research into areas such as big data.

About Tian Tao

Tian Tao is an advisor of the Huawei International Advisory Council (Huawei IAC) and Co-Director of the Ruihua Innovative Management Research Institute at Zhejiang University. As a senior advisor of the Huawei IAC, Mr Tian published a well-known book which focuses on research into Huawei's management philosophies. In this book, Huawei: Leadership, Culture, and Connectivity, Mr Tian makes an in-depth analysis of the operation and management philosophies behind Huawei's rapid growth. This book has been translated into multiple languages and has become the most important book of reference for people inside and outside of China to study Huawei.

Prior to this, M. Tian founded Top Capital magazine in 1991, serving as Editor in Chief. Since 1996. He has also served as an advisor or a board director for multiple businesses in both China and abroad.