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The Human Resources Challenge of Huawei —- Cultural clash
Background of Huawei
In 1987, Ren Zhengfei, then 44 years old, founded a telecom equipment-trading firm in Shenzhen, China, with startup capital of CNY 21,000. By the end of 2014, Huawei had 170,000 employees in more than 170 countries and regions, serving more than one-third of the world’s population, and leading the world in international patent applications. Over 30 years, it has grown to become the largest telecom company in the world. As well as that, it has operations and representative offices in more than 100 countries and serves over 1 billion users worldwide. Huawei’s success boils down to two fundamental elements: the changing technology environment and the creativity of its people, so we can realize that employees play a very important role in Huawei and the human resources management is very crucial to Huawei
Human resources challenges of Huawei
According to Fang Lee Cooke (The International Journal of Human Resource Management, 2012, p.1845), there are several challenge to HRM in host countries and management responses of Huawei. First, because salaries are based on performance levels, inexperienced local new hires may have lower wages. Second, unlike local employment laws, as foreign companies, they need to comply more strictly with these laws than China. Third, how to strike a balance between employee development and cost-effective employee disbursement is sometimes a dilemma because HCN employees need training and development opportunities and then leave more famous Western multinationals. Fourth, multiculturalism and diversity management is another issue. Huawei may be one of the few Chinese companies that actively adopt the concept of multiculturalism and diversity management. Fifth, the lack of approval from local employees and their employers and the lack of acceptance of the corporate culture of Chinese enterprises are a double challenge to the issue of retention.
The key challenge
Cultural clash is one of the key human resources aspects that affected Huawei. Huawei as a multinational company, the objective existence of the company’s internal cultural differences, is bound to cause cultural conflicts in the enterprise. As the process of global integration accelerates and the flow of human resources in multinational enterprises like Huawei continues to accelerate, this cultural friction will increase day by day and gradually begin to manifest itself in the internal management and external operation of transnational corporations, resulting in the loss of market opportunities for transnational corporations and the inefficiency of the organizational structure and make the implementation of the global strategy in trouble. Therefore, this essay will attempt to demonstrate how the Huawei can solve this problem and develop better for its brighter future using human resources management practices.
Huawei’s problem of human resources
While Huawei successfully achieved its trans-national development, Huawei also encountered many challenges in its human resources management. The transnational management practice of Huawei shows that one of the important factors that affect transnational management is that various cultural conflicts arise from the differences in value orientation and behavior among people from different cultural backgrounds. How to realize the absorption and integration of culture has become a problem that Huawei constantly solves in transnational management.
How to solve the cultural conflict of human resource management in Huawei
With the continuous expansion and development of overseas affiliates of Huawei, Huawei conducts cross-cultural human resources management mainly through the following tactics:
- Localization strategy
Localization strategy which means the concept of global adaptation is the business trying to integrate into the target market, and strive to become a target market strategy adopted. The essence of “localization” is the process of multinational corporations integrating production, marketing, management and personnel into the economy of the host country in an all-round way. Generally, they conduct a series of surveys to understand the actual local economy, culture and customs. At Huawei’s overseas offices, everyone strives to create an atmosphere in which everyone, regardless of nationality and race, is a Huawei employee. Both Chinese and foreign cultures constantly collide and merge with each other. Under the influence of Huawei’s culture, Huawei is gradually presenting its diversified and international characteristics. With the gradual implementation of “localization” business strategy, the ratio of Chinese and foreign employees in overseas institutions of Huawei continuously changes.
- Culturally compatible strategy
Culturally compatible strategy is also the most important thing which need to understand the differences between different cultural concepts. Therefore, Huawei needs to integrate cultural differences into the overall marketing strategy to ensure that the realization of business goals will always be a major issue. For instance, Huawei’s employees in Uzbekistan’s offices regularly attend local weddings, travel to cities on holidays, watch ballets and learn about local culture and customs. Whenever an employee is on his birthday, everyone congratulates on sending a gift collectively.
- Cross-cultural training strategy
Huawei implements cross-cultural training strategy. As international enterprises become the most important intercultural organizations in the world, the source of human resources is increasingly showing an international trend among a considerable number of enterprises. More and more people of different colors become colleagues. The employees from different countries and nations have different cultural backgrounds. Employees’ values, needs, attitudes and behaviors are quite different. Such cultural differences within the enterprise inevitably lead to cultural conflicts. At the same time, due to cultural differences, the human resources management concepts, human resources management systems and methods of different countries vary. As a result, the human resources management concepts and management methods among the managers in the enterprises also continuously impact and collide. In the daily operation of enterprises and foreign exchanges, if employees are lack of the knowledge and skills of intercultural communication, the differences between cultures will create misunderstandings and unnecessary friction, which will affect the work efficiency and reduce the competitiveness of enterprises. Therefore, the cultural difference is also an obstacle that must be overcome in the internationalization and transnational management of human resources. Huawei employees will receive relevant training in the training department before leaving the country, such as the local cultures and related products. Daily training also includes seminars, language training, books, websites, discussion and simulation exercises and more. These trainings enhance the adaptability of employees with different cultural backgrounds and promote communication and understanding among people of different cultural backgrounds. Through continuous cross-cultural training, cross-cultural awareness has gradually developed among employees and learned to regard cultural differences as differences without distinction between good and bad, helping employees to be good at standing with people of different cultural backgrounds considering each other’s point of view, cross-cultural conflicts are greatly reduced.
- Common values management.
A reason why a company can become a good company, a very important reason is that it has successfully created a kind of core values and mission to enable all employees heartfelt identity, as the core values of the enterprise culture once being all staff sincerely agree or share, it will affect people’s thinking and behavior patterns. HuangWeiwei (dedication – the Huawei Philosophy of Human Resources Management) claims that Huawei doesn’t like to make too much money. And the profits are not its motive – growth is. This aspect of the enterprise culture is what drives its HRM policies and approaches. In addition to regulating and managing overseas institutions under Huawei’s business conditions, Huawei’s corporate culture restricts every employee’s behavior in an invisible ideology. Even away from overseas, the militarized management style from Huawei headquarters is still not diminished. Huawei believes that only those who persist in fighting unjustly for the collective can form a united community. Therefore, Huawei advocates desire-driven, decent means, so that the formation of a group of vigorous, good management style. Huawei believes that unity and cooperation, collective struggle is the soul of Huawei. No one in Huawei has the privilege, and everyone shares the common aspiration and hardship, equality for all. Any individual interest must serve the collective interests and integrate individual efforts into the enterprise. Huawei integrated this common value, the entire enterprise burst out of the incredible combat effectiveness. So we could realize that in human resources management, only understanding cultural differences and respecting multi-culture can improve the ability of cross-cultural management.
Suggestions for Huawei Cross-cultural Human Resources Management
Under the multi-cultural background, the core of human resource management lies in how to integrate the scattered and isolated functions, responsibilities and activities in human resource management. By coordinating the operation of human beings and creating the competitive advantage of enterprises. In order to give play to this advantage of enterprises, Huawei can consider the following aspects in implementing cross-cultural human resources management:
Firstly, Huawei should strengthen cross-cultural selection and training. Cross-cultural selection and training can enhance people’s responsiveness and adaptability to different cultural traditions, promote communication and understanding among people of different cultural backgrounds, mitigate cultural conflicts and enhance teamwork and corporate cohesion. The specific measure is that Huawei should try to select those who have the skills and qualities of a global manager. They should love the new culture, have the adventurous spirit, have strong interpersonal skills and work hard with people from different cultures to understand their opinions and attitudes. Such a global manager can adapt to the requirements of cultural integration and they also have to attend a series of trainings about the language, culture and personal occupation of so as to better adapt to the future work. Huawei should also adopt some new cross-cultural training methods, such as setting up intercultural communication programs, setting up “global service projects” and setting up business institutes.
Secondly, based on the common understanding of culture, Huawei should establish the strong corporate culture according to the requirements of the external environment and the strategic development of the company. It helps Huawei not only to reduce cultural conflicts, so that each employee can put their thoughts and behavior with the company’s business operations and objectives together, but also to make the subsidiary and the parent company closer. At the same time, it can establish a good reputation in the international market and enhance the transnational corporations’ ability of cultural change.
Thirdly, Huawei should enhance cross-cultural communication. In order to ensure the effective implementation of effective communication in cross-cultural enterprises, Huawei must establish a culture of mutual understanding and mutual respect between management, management and employees as well as between the company and the outside. In addition, Huawei must actively establish a variety of formal and informal, effective and invisible cross-cultural communication organizations and channels, so that every employee in the enterprise have more opportunities to express their opinions. Some successful companies often organize seminars, classes and language training within the enterprise and enhance the role of managers by effectively promoting communication with people, teams and organizations through the use of media such as books, bulletin boards, websites, videos and television. As a result Huawei could improve business efficiency and maximize the effectiveness of cross-cultural human resources management.
Fourthly, Huawei should enhance the localization of employees. As local managers have a deep understanding of local culture, they are easily accepted by employees and at the same time provide a promotion channel for local employees. Therefore, they have strong incentives. Local employees are familiar with the local customs, market dynamics and government regulations, hiring local employees will undoubtedly facilitate cross-cultural enterprises in the local market development and gain a firm foothold. In the development of intercultural human resources, most large multinational corporations have proposed the strategy of employees’ localization and continuously raised the proportion of senior and middle-level managers in the country. The management concept of “local affairs managed by local people” is being gradually realized. To some extent, the implementation of this concept can make cross-cultural enterprises eliminate cultural friction, develop their own adaptability to local culture, and its unique foreign culture affect the host country’s cultural environment, showing a company’s great tolerance to multiculturalism , So Huawei could attract more outstanding employees and enhance their competitiveness. Through the above measures, the effectiveness of cross-cultural human resources management at Huawei will be greatly enhanced so that enterprises can implement effective and strategic personnel planning in a multicultural environment.
With the continuous expansion and development of Huawei’s overseas subsidiaries, Huawei, as the leading telecom solution provider in the world, has faced the challenge which is cultural conflicts in the implementation of human resources management. In order to solve the conflicts caused by cultural differences, Huawei implement cross-cultural human resources management, mainly through the implementation of localization strategies, cultural compatibility strategies, cross-cultural training and common values management strategies.
Huawei mainly implements localization strategy when implementing cross-cultural human resources management, including staff localization, localization management, R & D localization and localization of partners. There are more than 100 countries around the world applying their products. International markets have become the main source of Huawei’s sales. In all countries and regions, Huawei has set up hundreds of branches and dozens of research institutes. More than half of its employees are local employees, and more and more local employees have become local technical backbone. Huawei has established training centers around the world, which greatly enhance Huawei’s ability to provide high-quality training in these regions. While maintaining sound management, Huawei persists in its localized operation globally and has made great contributions to its countries and regions. As well as that, Huawei has established branches in more than 100 countries around the world, investing locally, setting up sales and service offices, research and development centers, training centers, technical support centers and factories, and hiring local staff. This not only deepens Huawei’s understanding of the local market, but also raises the local employment rate, enhances the technical level of local engineers and promotes the development of the local economy. In addition, Huawei regards employee training as the most basic level of cross-cultural management. Cross-cultural training for employees, including training on basic knowledge of culture, training on cultural conflicts, and training on cultural adaptability, has been conducted. In terms of value management, Huawei’s corporate culture affects every employee as an invisible ideology. Huawei creates the unique “wolf” corporate culture and it requires employees to develop the habit of learning, to have a good learning ability and a unique sense of innovation and awareness.
In summary, cross-cultural human resources management has an important impact on the survival and development of Huawei and also plays an important role in the productivity of Huawei. A successful human resources management will bring a value-added effect of 1 + 1> 2 to the enterprise, otherwise, it will have a negative impact and hinder the development of the enterprise.
Fang Lee Cooke The International Journal of Human Resource Management, 2012, p.1845
Huang Weiwei Dedication — the Huawei Philosophy of Human Resources Management
Huawei The startup that became the largest telecom company in the world
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