Ren Zhengfei: Huawei has three major breakthroughs. If we want to be the best in the world, we must do it.

Huawei Xinsheng Community published an internal email from Ren Zhengfei on May 22. In this email, Ren Zhengfei said that those who do not understand strategic retreat will not be able to engage in strategic offensive.

1. Carry out division of labor and combination of industries to strengthen the ICT industry.

After several years of hard work, the company has developed a set of clear rules on how to "nurture" the industry. Next, you must manage the "birth" and "death" of the industry, especially the "death".

First, for the ICT business, I hope to make it stronger rather than bigger , so the "funnel" should not be opened too wide to avoid weakening the attack power. When choosing opportunities, only when the market scale is large and the technology is difficult enough can we establish a threshold. Without a threshold, we will struggle in the red ocean. Moreover, we must have a leader before launching a project to make a product, rather than looking for a supervisor after the product project is established. Otherwise, this is the biggest mistake. People who don't understand will mess up the structure and system, and it will be difficult to change it. For leaders, we must select and train them early.

I think the life cycle of the industry will become shorter and shorter, and the threshold will become higher and higher. This may be a good thing for us . As soon as the people behind catch up, they will be eliminated. We need to consider how to speed up the pace of the 5G industry and pull the world to run, not wait. Customer demand is a philosophical issue, a question of selecting the best from the dross, and moving from one thing to another. It is not a question of which customer expresses it. We must focus on the needs of the end customers and the essence of the business. We must dare to pull the customers who are willing to run first and run to create value.

We need to gather some PhDs in mathematics, physics ..., and our engineers, and operate in the "Google Army" way to sort out end-to-end system research on 5G networks. We will use these teams to overcome difficulties and make the entire 5G system more scientific, faster, wider and cheaper. At the same time, we will test the research results on the 5G commercial network.

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Screenshot of Ren Zhengfei's previous media interview

Second, we should do what we should do and not what we shouldn’t do. I think products that cannot be strategically leading in the world should be withdrawn from their life cycle. The strategic withdrawal of an industry must be done in an orderly manner.

Leaders and chief officers should bear the main responsibility for the failure of an industry , but the employees engaged in these industries are our company's valuable assets. Their experience is also useful for other businesses, and they can make new contributions to new businesses based on their expertise. Some time ago, we commended the telecom software team, which reflects this strategic thinking. Although the telecom software business was not successful, its R&D personnel went to other businesses and made new contributions and achieved victory. We recognize them as heroes. Therefore, these non-standard and chaotic personnel are also valuable assets, and we should let them enter the field of standards.

Third, we will continue to increase investment in basic theoretical and technological innovation research , guide the direction of industrial development, and contribute to human society and the industry. We can further improve the investment decision-making process for research and innovation, but we must consider the characteristics of research and innovation, give the research team room for trial and error, and not be too rigid.

I believe that the carrier business should focus on connectivity, making connectivity the best in the world, the lowest cost, and always safe and reliable. Don't load too many things, so as not to stop running. Don't blindly pursue expansion, and becoming stronger is the first priority. Aim at the future architecture of the world and lead the industry and customers forward. Reduce customization, so as not to hold back the progress of the big team. A strategic research department should be established. This strategic research department is different from the 2012 laboratory. It specializes in studying strategic forward-looking needs and conducting preliminary research, just like the staff group around Lin Biao, who didn't look at the present. When the present was finished, he looked up and found that he was two years late. How big is this organization? It's hard to say now, but there should be such a strategic organization.

2. Dare to break through yourself and lead the development of the industry.

First, we will invest $100 billion in R&D in the next five years to solve the trust problem by reconstructing the network architecture. This $100 billion is not only for reconstructing the network, but also for the company to achieve annual sales revenue of $250 billion (including terminals). We must move forward and improve at the same time. We must open our arms, absorb talents, further improve software capabilities, architecture design, chip design capabilities, etc., and build the world's strongest and most trusted ICT industry. Software engineering must be strengthened and transformed. We must introduce some internationally advanced examination companies to test software personnel before they can take up their posts. The software department should learn from Li Jianguo's talent management model. We have 50,000 software personnel ourselves and 60,000 outsourced personnel. For such a large team, qualification certification is a step to success. Otherwise, we will lose opportunities in the cloud.

Second, the core network strategic high ground. Controlling the strategic high ground means controlling the "black soil". We need strategic high ground. The top of "Mount Everest" may not be able to accommodate a lot of output value, but it is profitable and fewer people are also progress. The organization of the connection industry has been sorted out, and the organization of the cloud industry will continue to be adjusted next year. Safe cities, terminals, and GTS are allowed to keep a small "private plot", but they must grow on the large "black soil" of the cloud.

Looking vertically, we need to expand into parts that serve us and large parts that we need, and master the design and production process. However, even if we have mastered the most advanced productivity, we do not necessarily have to produce, and we still need to find parts manufacturers to produce and purchase.

From a horizontal perspective, the Internet of Vehicles, artificial intelligence, and edge computing are our three major breakthrough points in the future. Engineers who have been adjusted from the connectivity industry are allowed to be selected from these businesses. They have practical experience and are still young and strong in their thirties or forties. The key is to have a teacher and an understanding person to lead them. This teacher may not have a beard.

The Internet of Vehicles can set up a commercial organization and increase investment. The connection of smart cars, on-board computing, and autonomous driving are all important directions for the Internet of Vehicles. We must resolutely invest in them as a strategy. LiDAR and other technologies must focus on the direction related to ICT core technologies. We must resolutely not allow the production of batteries. The production method of batteries is very complicated and requires a lot of labor. We still need to focus on the direction related to algorithms and mathematics, and be more cautious about chemistry and physics.

In terms of artificial intelligence, we are still lagging behind the rest of the world, and we need to invest more. We can divide it into two parts: one is for improving internal production management, and the other is for product services. These two parts of artificial intelligence can complement each other. The first part can be separated, with intelligent manufacturing as the center, to solve supply chain and financial problems together. Don't think that all AI practitioners are PhDs, but we also need to assign some business personnel to them. PhDs understand mathematics, but if they don't understand business, they still can't do AI well.

For edge computing, we only provide the basic platform. There are different edge computing for different businesses, and there will be dozens of edge computing things in the future. Edge computing should have many forms, and the software in these forms is not a complete operating system, but a streamlined "embedded software". Although there are many forms, we try to converge them as much as possible. Too many software versions will cause great management costs.

3. R&D should strengthen metabolism and enhance personnel mobility.

Recently, I talked about the talent structure at CNBG: "Change the arrangement of the battle queue to form a formation of 'warhead + theater support + strategic resources'. Let the 'generals' be at the forefront facing customers, implement the 'generals + elite soldiers' structure, enhance the front-line project decision-making ability and contract closing ability; let the middle and low-level backbones who are experienced, capable, and good at 'biting bones' enter the theater support; let the leaders and low-level young people enter the strategic resources and cadre reserve team."

I think that the warhead part should be led by a group of experienced people on the battlefield, the regional part should be experienced young and middle-aged people, and the strategic resource part should be led by the top elites and the young and strong, forming these three layers of "army". Why not let the "generals" go to places that are eager to "fight"? What's the point of "generals" hiding in the office all the time? For the sales, business management and services of mature products and mature technologies, we should gradually localize them, and draw Chinese employees to the "field army", so that the cost will be reduced.

New soldiers must learn to "shoot" before they can go to the battlefield. Examinations are used to promote training. Excellent personnel are selected through examinations to go to the battlefield for assessment together with veterans. "Examination + assessment" is the training method of the US military. Only if you do well in the examination can you have the opportunity to go to the battlefield; only if you do well in the assessment can you have a promotion in rank, otherwise you will be eliminated. Some people have good assessment results, but fail the examination. These people will stay to be "Huang Jiguang", and they are not suitable to be "General Qin Jiwei"; if you do well in the examination but not in the assessment, you will be dismissed; if you do well in the examination and the assessment results are also good, then you are a good seedling.

R&D must strengthen metabolism and promote the flow of talent in the company. R&D should have a large number of people who can go to the market and GTS. In the future, the market and GTS will gradually stop recruiting fresh graduates, but transfer them from R&D. If they don’t understand technology, what can they communicate with customers? By exporting people with product development experience, R&D can be replenished with fresh blood and vitality can be stimulated. We have attached great importance to the use of PhDs during this period, and the situation has changed a lot.

We should also strengthen the flow of personnel within R&D, especially the flow between the 2012 laboratory and the product line. We should form a large-scale flow from the 2012 laboratory to product development. In the process of researching and incubating new technologies in the 2012 laboratory and then handing them over to the product line for product development, we should not let the people in the product line re-understand them before starting development. Instead, a large number of people who are familiar with these technologies and products should work together with a group of newcomers to develop. R&D should move talents to the market, services, etc. on a large scale. People move to live, trees move to die.

4. Gather the best talents in the world and make every industry the best in the world.

I hope everyone understands that we must be the world's number one. If we are the world's number two, we may not survive. However, to be the world's number one, we must have a breakthrough in theory. Therefore, when there is chaos in the world and large companies are adjusting, we must absorb outstanding talents and make use of the world's talents. We must unswervingly lay the theoretical and technical foundations in the past few years. Each country has different characteristics, and we must give full play to local advantages.

Huawei's industry portfolio must be balanced. We must have short-term intelligent terminals, medium-term high-stickiness connection and computing businesses, and relatively long-term Internet of Vehicles businesses. However, overall, we must focus on the ICT core technologies that Huawei has built over the past 30 years. We must focus and insist on strengthening industries rather than expanding them.

The ICT industry is the foundation of Huawei's overall industry portfolio and the basis for Huawei's sustainable development. The ICT industry is full of opportunities. The ICT team must seize the opportunities brought about by new technologies such as 5G, artificial intelligence, and cloud, and be proactive. Our goal is to become a leader in the ICT industry, to be the best in the world, and to contribute to the development of human society.