GROUP 4: Tran Xuan Duong Vo Ngoc Thuy Duong Cam Van Nguyen Viet Dung Le Truong Son.

OUTLINE
* Introduction * Initially Internationalization * Internationalization Process * Entry / Ownership Modes Through The Internationalized Process * How to succeed * Q&A.

INTRODUCTION
* Established in Shenzhen in 1987 by Ren Zhenfei as a sale agent for Hong Kong company producing Private Branch Exchange (PBX) switches. * Core activities: - Building telecommunications networks; - Providing operational and consulting services and equipment to enterprises; - Manufacturing communications devices for the consumer market - Providing telecommunications networks products, services and solutions for 35 of the worlds top 50 operators.

As of the end of December 2010, Huawei has over 110,000 individuals from 150 countries.

INTRODUCTION

FINANCIAL STATEMENT

INITIALLY INTERNATIONALIZATION
From 1991 to 1999, Chinese Telecommunications industry grew very fast.
* Increasingly fierce competition in the small market (China) *Through internationalization process, to acquire international advanced technologies and R&D resources * Actively competing in international market is better than passively defend domestic market.

HUAWEIS INTERNATIONALIZATION PROCESS

I. 1996-1999: Tentative Stage * First target customer: Hong Kong - Cooperated with Hong Kong Hutchison (1996) * Followed target customers: - Russia & Brazil (1997) - Yemen & Laos (1998): Huaweis first successful international bidding - Ethiopia (1999) Huawei was not identified by clients, hence Huawei started focusing on: - Brand building & International marketing - Increasing R&D investment on new technologies as well as improving R&D cooperation with world top Telecom enterprises.

HUAWEIS INTERNATIONALIZATION PROCESS

II: 1999-2001 : Take off Stage Huawei was identified by clients - South East : Thailand, Singapore & Malaysia - Middle East : Saudi Arabia & United Arab Emirates - Africa : South Africa & Egypt Huawei established branch offices in over 40 countries.

III: 2002 Now : Mature Stage Stepped into advanced countries * Germany; French; Sweden * UK: - Set up European HQ (2004) - Signed a mutual distribution agreement with Marconi to sell each others products - Selected by British Telecom as the supplier of 21st Century Network for Multiservice Access Node & Optical transmission - Spain (2006): Built the radio access for Vodafone network
Huawei consistently stresses on international R&D cooperation. Established R&D centers in Silicon Valley & Dallas (US), Stockholm, Sweden,..

ENTRY / OWNERSHIP MODES THROUGH THE INTERNATIONALIZED PROPCESS

* 1996 -1999: Tentative Stage Sale agent: Hong Kong Hutchison-Whampoa Joint venture: Brazil, Rusia Umberto Konzern International bidding: Yemen and Laos * 1999-2001: Take-off Stage Launching the New Silk Road marketing initiative and started to participate in all kinds of international trade fairs and events around the globe. Penetrating Southeast Asia, Middle East and African countries through trading partners or JV modes. Wholly investment: Bangalore R&D center in India In 1999. 2002-Now: Mature Stage Joint venture with MNCs like Nokia Siemens, 3COM Setting up its European Headquarters in United Kingdom in 2004 - The largest organization invested by Huawei in the oversea market Mutual distribution agreement with global competitors: Marconi (UK), Cisco (US) Key supplier for leading telecommunication corporation: British Telecom, Vodafone

ENTRY / OWNERSHIP MODES THROUGH THE INTERNATIONALIZED PROPCESS

Brief summary:
* Internationalization process has been from the easiest to the most difficult * The mode of entry / ownership has been transformed accordingly, from simple to sophisticated ones with the increasing of company strength. * The Modes from: - TRADING AND SALE AGENT to penetrate the internationalized process. - FULLY OWNED OVERSEA INVESTMENT to speed up the internationalization. - M&A AND ALLIANCE to be the global market leader

BAD MOVE
1997, Huawei enter Russia: Advantages: Closing diplomatic relation between China & Russia Competitors withdrew from Russia Opportunity for Huawei first supplying contract: 4 years later

GOOD MOVE
Marketing campaigns Eastern Silk Road invite guests to visit China Telecom experts, executives of telecom including the Russian, the Brazilian and others.

operators

Eastern Expressway for European in 2004 Focusing on buyers understanding on products through testing and experiment.

Two brochures Huawei in China and Global Huawei

IMPORTANT MOVE
* 1999, Huawei established the first R&D center in Bangalore, India.
* Now, their have R&D centers in US, Europe and Russia. * Huawei has over 17,000 authorized patents and has participating with over 120 international standardization organizations.

Q&A