Excerpted from "From the Kingdom of Necessity to the Kingdom of Freedom", No.71of Huawei People's Daily, this article is selected from the report of Mr. Ren, president of Huawei Company, to the investigation team of China Telecom and his speech at the forum of Unicom headquarters and above.

How to maintain long-term stability of an enterprise is the biggest problem throughout the ages. How long can Huawei's banner last? When studying this issue, Huawei mainly studied what is the main driving force of Huawei's progress, and how to make these driving forces run stably for a long time and constantly optimize itself. It is increasingly understood that the source of joint force of nuclear power, petroleum electricity, coal electricity, electricity and biogas electricity is the core values of enterprises. These core values should be confirmed by successors, and at the same time, successors should have the ability of self-criticism, and successors should be bound and shaped by core values, so as to make the enterprise long-term stability. Successors are generalized. They are not successors when the supreme leader steps down, but a process that happens all the time. Everything, every post and every process has this alternating behavior, which is an improvement, improvement and continuous optimization behavior. We should let every post have a successor, and the successor should recognize this core value.

Huawei's core values are divided into seven parts.

Article 1 (Pursuit) Huawei's pursuit is to realize customers' dreams in the field of electronic information, and make us a world-class leading enterprise by relying on dribs and drabs of efforts.

In order to make Huawei a world-class equipment supplier, we will never enter the information service industry. Through independent market pressure transmission, always activate the internal mechanism.

Maybe everyone thinks it's ridiculous for Huawei, a small company, to put forward such a crazy slogan, especially in previous years. However, it is precisely because of this goal orientation that we have gone from yesterday to today. This year, our output value is about 654.38+0 billion yuan, and the number of employees will reach 8,000 by the end of the year. The gap between us and international standards is gradually narrowing. This year, our R&D expenditure is 880 million, equivalent to 654.38+0/60 of IBM's, and the output value is 654.38+0/65 of IBM's. Compared with Lucent, our R&D expenditure is 3.5% and our output value is 4%. This gap is still very large, but it is narrowing every year. We have recently made a plan to make access network products reach the world-class leading level in a short time and make us a first-class access network equipment supplier. This is a strategic turning point in the company's development. After ten years of hard work, the company began to achieve high goals.

1, guided by customer values and evaluated by customer satisfaction. Aim at the best in the industry, plan the strategic development of products with lofty goals, base on reality, pursue tirelessly and realize it bit by bit.

The most serious problem of the company now is backward management, which is even worse than backward technology. We are developing rapidly and there are many problems. Without management, the benefits will decline. The urgent task is to learn from well-known foreign enterprises seriously. We have hired many large foreign consulting companies to provide consulting services for us. For example, in our qualification evaluation system, Heyi Company of the United States was invited as a consultant. Through their own digestion and absorption, bit by bit for rectification. Any rectification must first dig up the soil, which requires self-criticism in order to listen to other people's opinions.

Talents, technology and capital can be introduced, but management and services cannot be introduced, and they must be created by themselves. Without management, talents, technology and capital cannot form strength; Without service, management has no direction.

2. Adhere to the allocation of scientific research funds according to more than 10% of sales revenue, and pursue the maximization of growth at a certain profit level. We must achieve and maintain the growth rate higher than the industry average and the growth rate of the main competitors in the industry, so as to enhance the vitality of the company, attract the best talents and realize the optimal allocation of various business resources of the company. In the electronic information industry, there is no third way, either to become a leader or to be eliminated.

3. The advantages of technology, quality, cost and service in architectural design are the basis of our competitiveness. Establish a product line management system, and implement the system that product line managers are responsible for products rather than research results.

4. Implement a system that only encourages small improvements, big rewards and big suggestions. Pursue continuous optimization and improvement of management, and establish and promote comprehensive and optimized guided spontaneous mass movements.

People who can make big suggestions are no longer ordinary employees and do not need rewards. We don't encourage ordinary employees to make big suggestions, because every employee should do his job well. Big business decisions should have stage stability, and people can't keep expressing their opinions at every stage. We encourage employees to make small improvements and make up for every deficiency, and the company will make progress.

Retire people to do four things, one is the goal, the other is the measure, the third is to evaluate and select cadres, and the fourth is to supervise and restrict; Pragmatic people should first implement their goals, mobilize and utilize resources, evaluate cadres, and turn human resources into material wealth. The retreat is an open retreat, where everyone can speak freely and then sum up. Therefore, it is advisable to implement the democratic decision-making system of the Committee and the authoritative management system of the office meeting of the department head.

5. Burn your bridges and pass on the sense of crisis and pressure to every employee. Through independent market pressure transmission, always activate the internal mechanism.

We are determined never to enter the information service industry, and set the target as an equipment supplier. This is a big debate in the discussion, and it was finally affirmed because only in this way can we complete independent pressure transmission and keep the team active forever. What are the disadvantages of entering the information service industry? Without your own contacts and internal pressure to sell your own products, your understanding that quality service is the life of an enterprise will also fade, and if there is a problem, you will shirk it, so that the enterprise will die.

Article 2 (Employees) A serious, responsible and effective employee is Huawei's greatest asset. Respect for knowledge, respect for individuality, collective struggle and not accommodating meritorious employees are the inherent requirements for the sustainable growth of our cause.

Huawei allows individualism, but it must integrate collectivism. HAY Company once asked me how I found outstanding employees in the enterprise. I said I'll never know who is a good employee, just as I don't know who is the leading wolf in the vast wasteland. Enterprise is to cultivate a group of wolves. Wolves have three characteristics: one is a keen sense of smell, the other is a tenacious and selfless offensive spirit, and the third is group struggle. To expand, enterprises must have these three elements, so it is necessary to create a relaxed environment for everyone to work hard. Under the new opportunities, a group of leaders will naturally come forward to compete for market opportunities. The marketing department has a "chaotic organization" plan, which emphasizes the aggressiveness (wolf) and management (embarrassment) of the organization.

1. Opportunities, talents, technology and products are the main traction for the company's growth. These four forces interact, that is, opportunities attract talents, talents attract technology, technology attracts products, and products attract more and greater opportunities. Employees are in an important and active position in the enterprise growth circle.

2. We insist that the value-added of human capital is greater than that of financial capital.

We don't engage in tenure, but it doesn't mean that we can't work in Huawei for a lifetime. The company and employees are equal in the right to choose, and employees' contribution to the company is voluntary. The free employment system makes every employee become a strong person with self-reliance, self-reliance and self-esteem, thus ensuring the company's lasting competitiveness.

4. In the process of recruitment and employment, Huawei values the quality, potential, personality and education level of employees most, followed by experience.

5. The salary distribution is based on the ability-based functional salary system. The distribution of bonuses is linked to the performance improvement of departments and individuals; The distribution of security pension and other benefits is based on the evaluation results of work attitude; Medical insurance is different from ordinary employees in terms of contribution to senior managers and senior professionals. In addition to medical insurance, senior managers and senior professionals also enjoy medical and other health benefits.

6. Automatic salary reduction. In the period of economic depression, temporary frustration of career growth or according to the needs of career development, the company will start the automatic salary reduction system to avoid excessive layoffs and brain drain and ensure the company to tide over the difficulties.

7, promotion and demotion, we let the most responsible person hold the most important position. Being responsible for people or things are two principles of management. Our company has established a process responsibility system and is responsible for things. We delegate power to the most knowledgeable and responsible people and let them manage the daily process. The high-level committee system devolves the power of exception management to the committee, and constantly turns exception management into routine management. In the process, multiple monitoring points are set up, which are continuously monitored by the higher authorities, leaving the company at a loss.

8. Job rotation and professional training. There are two kinds of cadre rotation: one is business rotation, such as R&D personnel engaged in pilot test, production and service, so that he can truly understand what goods are, then he can become a senior technician at the top. Without relevant experience, you can't call it senior. Therefore, the word senior controls him and makes him work hard in this direction; The other is job rotation, and the positions of senior and middle-level cadres change; First, it is conducive to the spread of company management skills and form a balance.

Article 3 (Technology) We should extensively absorb the latest research results in the field of electronic information in the world, learn from excellent enterprises at home and abroad with an open mind, develop leading core technology systems in an open and cooperative way on the basis of independence, and stand tall among the world's communication powers with our excellent products.

1, closely around the development of electronic information technology, not tempted by other investment opportunities. Establish the concept of providing customers with a package of problem-solving and all-round service.

2. Attach great importance to the independent intellectual property rights of core technologies. China has introduced many industries, why didn't it form its own industry? The key core technology is not in your own hands. Only by mastering the core and opening up the periphery can the enterprise grow rapidly without being controlled by others.

3. Follow the principle of extensive open cooperation on the basis of independent development. Pay attention to extensive peer-to-peer cooperation and establish strategic partnership, so as to enhance their own advantages and make them more advantageous.

4. Without the depth of basic technology research, there will be no high-level system integration, and without market and system integration, traction basic technology research will deviate from the right direction.

Article 4 (Spirit) Loving the motherland, people, career and life is the source of our cohesion. Sense of responsibility, innovative spirit, professionalism and spirit of unity and cooperation are the essence of our corporate culture, and seeking truth from facts is our code of conduct.

1, the gentleman takes the road, and the villain seeks profit. It is impossible to build a strong team based on material interests, nor can it last long.

2. Resolutely oppose empty ideals and do your job well. Without grassroots work experience, young students can't be promoted, not just because of their academic qualifications. The biggest shortcoming of young students is their ambition. Therefore, no matter what degree you have entered the company for a week, your degree will automatically disappear. Everyone will get the opportunity to practice on the same starting line with themselves, and emphasize the progress the day after tomorrow, which is conducive to employees' continuous learning.

3. Cultivate employees to care about others from trivial matters. We should respect our parents, help our brothers and sisters and be responsible for the people we love. On this basis, we should care about others, support Project Hope, poor students and candlelight programs ... We should care about our colleagues, people with difficulties around us and cultivate ourselves.

Huawei's corporate culture is based on national culture. China's national culture is the culture of the * * * production party. Huawei decomposes the minimum program of * * * producers into operational objectives bit by bit to guide and motivate employees.

Article 5 (Interests) Huawei advocates the unity of interests among customers, employees and partners, and strives to explore the internal dynamic mechanism of distribution according to production factors. We will never let Lei Feng suffer, and the devotees will get a reasonable return.

Article 6 (Culture) Resources will be exhausted, and only culture will be endless. All industrial products are created by human wisdom. Huawei has no natural resources to rely on. Only by digging out the big oil fields, forests and coal mines in people's minds can the spirit be transformed into matter. Material civilization is conducive to consolidating spiritual civilization. We adhere to the policy of promoting material civilization with spiritual civilization.

The culture here includes not only knowledge, technology, management and emotion ... but also all intangible factors that promote the development of productive forces.

The only thing Huawei can rely on is people, of course, hardworking, selfless, self-disciplined and skilled people. How to cultivate such people is a very difficult thing.

1. In the era of knowledge economy, the mode of survival and development of enterprises has also undergone fundamental changes. In the past, they relied on doing things correctly. It is more important to do the right thing now. In the past, people regarded innovation as taking risks, but now not innovating is the biggest risk; In the past, capital hired labor, and capital occupied a dominant position in the elements of value creation, while the era of knowledge economy was knowledge-hired capital. The value and dominance of intellectual property rights and technical know-how exceeds that of capital, and capital can only maintain and increase its value if it is attached to knowledge.

2. We should gradually get rid of the dependence on technology, talents and capital, let enterprises move from the realm of necessity to the realm of freedom, and establish a more reasonable management mechanism. When we are still relying on technology, talents and capital, our thoughts are bound, and our value evaluation and value distribution system are distorted to some extent.

3. Emphasize the professionalism of employees, select and train employees who are fully committed to their work, implement positive incentives, do not avoid the unfavorable factors of the company, and stimulate the enthusiasm of employees to work hard.

Knowledge, management and enterprising spirit are important resources for Huawei to create wealth. We often use one sentence to evaluate cadres: this person is willing to invest, willing to work hard, and has a bright future. Only employees who devote themselves wholeheartedly to their work can become excellent cadres. We often put these people in the most difficult place, the most difficult place, and even the most unfavorable place for the company to mature quickly.

Article 7 (Social Responsibility) Huawei is committed to serving the country through industry and rejuvenating the country through science and education, and will repay the society through the development of the company.

After ten years' efforts, Huawei has established its own values, which can gradually justify itself and form a closed cycle. Therefore, we will constantly self-flow, self-optimize, constantly enrich and improve management, constantly flow, constantly optimize, increase the scale of enterprises, automatically increase traffic, and constantly enrich ourselves through management. The existing problems are not optimized this time, and the next time the traffic is large, it will definitely be exposed. Continuous flow, continuous optimization, continuous flow, continuous optimization, continuous circulation and continuous sublimation gradually dilute the direct control of entrepreneurs (not macro control), then the replacement of entrepreneurs and the end of their lives are divorced from the fate of enterprises, and the Yangtze River is the best way to govern by doing nothing, no matter whether you care.

The company has established the successor standard, and thousands of outstanding sons and daughters have emerged at all levels. They recognize Huawei's core values and have the ability of self-criticism. After decades of continuous optimization, growth and expansion, anything that does not conform to the law of development cannot stand the test of time, and enterprise management will have a good purification ability. Through the efforts of generations of Huawei people, Huawei's red flag will be more vivid from generation to generation.

As long as we work hard, we will be able to move from the realm of necessity to the realm of freedom.