VZCZCXRO5977
RR RUEHCN RUEHGH RUEHVC
DE RUEHGZ #2401 3490803
ZNR UUUUU ZZH
R 150803Z DEC 06
FM AMCONSUL GUANGZHOU
TO RUEHC/SECSTATE WASHDC 5574
INFO RUEHOO/CHINA POSTS COLLECTIVE
RUCPDOC/USDOC WASHDC
RUEHC/USDOL WASHDC
RUEAIIA/CIA WASHDC
RUEKJCS/DIA WASHDC
RHHMUNA/HQ USPACOM HONOLULU HI

UNCLAS GUANGZHOU 032401 
 
SIPDIS 
 
SIPDIS 
 
STATE PASS USTR 
USPACOM FOR FPA 
 
E.O. 12958: N/A 
TAGS: ELAB ECON ETRD EINV CH
 
SUBJECT: Huawei: The Human Resource Component of a Modern Chinese 
Company 
 
 
The Face of China's Future 
-------------------------- 
 
¶1.  (U) When you walk around the Huawei "campus," you are staring 
into China's future in more ways than one.  Huawei, one of China's 
brightest lights in terms of telephone service (fixed, mobile, 
routers and connectors) and one of the country's most 
internationally-oriented firms, is also a pioneering company in 
terms of human resources, working closely with Mercer management 
consultants to develop a well rounded, educated and productive work 
force. 
 
Training: In depth and Continuous 
--------------------------------- 
 
¶2.  (U) During a briefing for the Consul General and consulate 
econoff on December 13, Huawei's Senior Vice President for Global 
Sales, Ding Shaohua, affirmed the old adage that success is measured 
by the quality of people you have.  And the first step toward that 
success is recruitment.  Huawei recruits primarily from Beijing, 
Qinghua, Zhejiang and Wuhan Universities; it hardly recruits at all 
in Guangdong province, he said, noting that graduates of schools 
here are clearly not in the same league as graduates elsewhere. 
Depending on the type of job they perform, the new employees, once 
on board, receive 1-3 months of training at Huawei University (which 
Mr. Ding proudly termed the equivalent of Motorola University in 
Beijing) and then receive continuous in-service training, sometimes 
using computers for self study, sometimes actually being released 
from work to attend classroom sessions.  If at the end of their 
training, they decide to move on elsewhere, they are not required to 
repay the company for the costs incurred. 
 
¶3.  (U) The new hires, mostly single, are also provided with a one 
bedroom apartment on the 1.3 kilometer campus, a food subsidy and 
medical insurance; when they marry, they are assisted in finding 
housing off-campus. One fly in the ointment: it seems that managers 
get overtime but shop floor workers may receive it only an irregular 
basis. 
 
Employees May be Encouraged to Leave - But Not Fired 
--------------------------------------------- ------- 
 
¶4.  (U) Huawei's employee force in Shenzhen - 25,000 strong out of 
55,000 globally - are constantly being evaluated, as many as 3-4 
times a year.  Managers use an alphabet scale - A, B, C, D - and 
those who receive D's four or five times in a row are closely 
counseled and, in many instances, encouraged to find other 
employment.  People are rarely fired, however, and the attrition 
rate is no more than three percent annually.  Those who leave 
voluntarily may be asked to sign a "no compete" agreement; the 
likelihood is that they will form a company that does business as a 
Huawei affiliate. 
 
Comparison to ZTE's Management Style 
------------------------------------ 
 
¶5.  (U) Service/employment in Huawei, Mr. Ding told us, is a 
lifetime career commitment on the part of both employees and 
managers.  Speaking of managers, Ding told us that the number of 
managers in Huawei is purposefully kept small; that way there is 
less office politicking and more effort directed at innovation. 
This he pointed out is unlike ZTE, where the operating style is less 
collegial and more bureaucratic, perhaps a reflection of ZTE's 
government connections and focus on the domestic market and Huawei's 
looser corporate management style, greater private investment, and 
focus on the international market (which today accounts for 68 
percent of its sales).  Huawei employees also have a more polished, 
open approach to work and play, Mr. Ding told us and you can see 
that in the manner in which Huawei employees interact with their 
customers as well as their demeanor in engaging one another in 
private conversation. 
 
GOLDBERG