The temptation of Huawei: How to play the city well

Huawei's overseas mergers and acquisitions strategy is known as the "rural siege of the city", the current situation has been to the suburbs of our correspondent Stone 2 million dollars and 2.2 billion U.S. dollars is not an order of magnitude.　　But for Huawei, these two numbers mean the same thing: mergers are blocked. The Foreign Investment Commission (CFIUS) of the United States has recently stirred up a small business for Huawei. Originally, Huawei was prepared to buy a patent for the three-leaf company (3Leaf), a small American technology company, at a price of $2 million.　　But it was eventually rejected by Cfius. This unpleasant setback is a thought of 4 years ago when Huawei was working with Bain Capital to try to buy 3Com companies with $2.2 billion trillion.　　At that time, the merger demand also because the U.S. side worried about national security and abortion. In the past two years, such things have made Huawei feel depressed. Huawei, for example, has failed to bid for the US private broadband Internet software provider 2Wire.　　Similarly, Huawei's takeover of Motorola's mobile network has been snatched by Nokia Siemens. Huawei is one of the best High-tech companies in China.　　But in the face of the high threshold and high profile of the US market, the world's second-ranked telecoms equipment supplier is always doors. Prices have never been a problem, and Huawei's bid is no less than its rivals. But whether you buy a company or buy a patent, you don't play with it anyway. As if a hand holding heavily, respectful of the youth door-to-door Qiuqin, the woman's parents is to you see not eyes.　　The reason is not clear, let people say: "You may be a bad birth." Overseas opinion has always said that Huawei has a "military background", presumably from the founder of the company Ren is a veteran. But by this standard, many of America's multinational corporate presidents and senior staff have a "military background" after the Second World War, all kill on the battlefield, and the Military Academy is hailed as the "cradle of business talent" beyond HBS. The mall is like a battlefield. As long as the military talent transforms the practice space, it is longer than the strategic thinking, the discipline is strict, carries out the strong characteristic, can reveal the superiority completely in the commercial competition.　　This is not surprising. Obviously, "Born" is just an excuse. Guoqing, a US researcher at the Chinese Academy of Social Sciences, says the U.S. government's vigilance against Huawei is largely based on strategic considerations.　　Just as the U.S. national security strategy clearly points to maintaining America's absolute dominance, America's economic strategy is "unable to accept other countries to overtake themselves".　　If combined with CNOOC's failure to merge Unocal, the failure of Chinalco's merger with Rio Tinto, and the failure of the Chinese group to join Singapore's Temasek takeover of PotashCorp, to see how Huawei, a rare High-tech company in the North American market, has been frustrated by many microscopic technical difficulties may be more clear. In the view of the American people, the control of the two lifelines of the Internet and energy in the 21st century will determine the competitive advantage of a country. In "Matters of the big picture", Guoqing said, "No matter how warmly Huawei approaches Washington, the huge icebergIt is difficult to melt in a short time. " This analysis is sharp. Look at these two years of Chinese companies overseas Investment Report card. China's non-financial investment in 2010 amounted to $59 billion trillion, an average annual growth rate of 50% in the past 10 years and a forecast of $100 billion trillion in 2013. It seems pretty good, but it's too limited for China, which is now the second-largest economy and has the world's largest foreign exchange reserves.　　Even in the horizontal contrast, China's foreign investment is ranked only fifth in the world. The data also showed a 12% per cent failure rate for cross-border acquisitions by Chinese companies in 2009, which fell to 11% per cent in 2010 and remained the highest in the world.　　By contrast, the failure rate for US and UK companies to acquire overseas acquisitions in 2010 was only 2% and 1%. At the same time, China's overseas investment is mainly focused on infrastructure projects and raw materials.　　In the High-tech sector, European and American companies still dominate, and Chinese companies only win some limited advantages in less value-added industries. Overseas, Chinese companies are only building houses, building roads, generating power stations and building dams, and these projects, which require people, effort and work, are progressing more smoothly.　　Once you meet the point level, high technology level of investment, always cast a vote of no confidence. The company also recently planned to support the UK's 2012 Olympic Games with a Subway wireless communication system, which was also said to be a threat to UK cyber security. A senior telecoms insider laments: "They always seem to feel like you are a servant, how can you wear a suit like your master?" "Supposedly, Huawei is one of the highest-international companies in China." 2008 Huawei global sales reached 23.3 billion U.S. dollars, the international market accounted for more than 75% of the revenue.　　Their overseas strategy was developed and laid out as early as 10 years ago. Repeated war repeatedly defeated, repeatedly defeated.　　From the hundreds of thousands of dollar contract to the billions of dollar contract, Huawei from small to large, from point to face, by product penetration, research and development center set up to mergers and acquisitions, through a very difficult and successful way of globalization. In particular, Huawei's "rural siege of the city" overseas market expansion strategy. They put the mainstream market such as Europe, America and Japan, as the "city" on the strategic map of the telecom market, and regard the market of emerging markets as "country".　　Huawei's first overseas contracts began in Russia, then to Africa, Southeast Asia, the Middle East, South America, in these "rural" market after the establishment of the periphery, and then gradually enter Europe, Japan and other central areas.　　However, in the face of the North American market, the "City of the battle" key areas, Huawei's "Combat Corps" is now struggling, it seems that only in the city's suburbs spin. Huawei does not lack the "will to fight". The company, which has worked overseas for many years, has a reputation for "bone hard", and has a spirit of not reaching the goal, and a flexible tactic of cooperation and mutual benefit in cross-border competitions. This is also a technology-emboldened enterprises, their number of patents in the global rankings are also very close to the front。 Perhaps it is Huawei's aggressive growth posture that gives the North American market rivals the greatest vigilance.　　At this time, the concept of free trade and freedom of competition has long been thrown into the brain, like Yi Walls, they do not go to war at all, do not give competitors "combat" opportunities. China also needs a lot of Huawei. Every setback in the company is the best MBA lesson for the Chinese companies that go out. Now, with the "Wolf culture" and the rapid rise of Huawei, in full holed up against the opponents of defense, I am afraid to need some change. When the PLA entered Shanghai, the soldiers slept in the streets with armour in their bodies.　　What kind of spirit is this?　　The US Wall Street Journal admits the biggest challenge for Huawei in the US is "concept": every week, American politicians and business leaders condemn China for violating U.S. intellectual property rights, computer hacking, the low renminbi exchange rate and trade imbalances, which have made policymakers look at Chinese investment with suspicion. They advise Chinese companies to increase "lobbying and PR". It is said that in 2010 Chinese companies spent a total of 425,000 dollars on U.S. federal lobbyists, but only one agency in the American Chamber of Commerce spent 81 million dollars.　　This seems to be a public offer for "road money". Maybe it's a necessary investment.　　and professional consultants say Chinese companies need to learn and make good use of the "Washington Strategy", to actively communicate with key Washington institutions and parliamentarians, to build corporate reputations and prestige, and to be more transparent. In the market entry mode, we should take "circuitous tactics" to "play skillfully". For example, investing in sensitive industries and sectors should be done with small caps or direct investments to create successful cases in the US market to reduce nervousness in government agencies such as CFIUS.　　All these options are worth a try. Huawei also needs support from the rear. A few days ago, the State Council announced that since March, mergers and acquisitions in the Chinese market, which are considered to be related to national security, must be reviewed by relevant departments. The Chinese version of the National Security merger review is long overdue.　　At this moment, for Chinese companies conquest overseas, this is a moderate and firm, and very necessary "counter" measures. Most importantly, Huawei needs more patience. When the time is not fully mature, things slow round. In some ways, the American market's overly conservative performance in the face of Huawei's offensive has actually exposed their fears of strength.　　Self-closure often stems from inner fragility, especially in the economic battlefield. Long-term advantage on the latter side. The future does not belong to "besieged cities", but to adventurers who constantly seek new opportunities and create new markets in the vast expanse of heaven and earth.