Ren Zhengfei issued Huawei Document No. 118: We must fail boldly, because succeeding too quickly is conservative!

Why do we need heroes?

It is not because of the greatness of the heroes themselves, but because we need to give ourselves a benchmark and motivation to move forward. Since Huawei entered the "strategic no man's land", it has been in a dilemma of "no one to guide, no established rules, and no one to follow". "It feels that the future is bleak and there is no direction to find". This feeling of exhaustion is initially a hearty feeling after sweating profusely, but over time, it will turn into a kind of laziness that is "unprecedented and unrivaled".

This is what Huawei does not want to see, and it is also what Ren Zhengfei absolutely does not allow! Because, in Huawei, laziness is defined as "the most widespread and harmful form of corruption"!

Obviously, the concept of "no man's land" has no benchmark significance except for the pleasure of the moment of collapse. Huawei needs to find another benchmark, but it is neither a friendly company nor other cross-border companies.

Become a "leader" instead!

Ren Zhengfei said that Huawei is only a leader, not a leader. "Leadership means establishing rules and standards for common victory. Leading means leading in a series of aspects, such as technology, business model, quality, service cost, and finance." A leader is still a little short of being a leader! This has helped Huawei find a new direction for its collective struggle.

Whether Huawei can become a leader depends on the realization of the 5G strategy. On October 17, 2018, Ren Zhengfei delivered a speech entitled "Adhere to the multi-path, multi-level, and multi-scenario R&D route, attack the "Shangganling", and achieve 5G strategic leadership" at the 5G business report meeting of the Shanghai Research Institute. He said that the 5G battle is related to the survival of the company. It is necessary to achieve an extremely simple network architecture, an extremely simple transaction architecture, an extremely secure network, extremely reliable privacy protection, and extremely low energy consumption, so as to achieve comprehensive leadership and win at all costs.

The significance of 5G is that it is the first to break through the key technologies of large bandwidth and multiple antennas and gain first-mover advantage. If we take advantage of this advantage and the critical time window of system replacement, we can optimize the global pattern and see the victory of rules. This will be a victory for an enterprise, a nation, and a country!

"The times remind us that we must have the courage to fight." Please sound the clarion call for Huawei!

Adhere to a multi-path, multi-tier, and multi-scenario R&D route

Attacking "Shangganling" and achieving 5G strategic leadership

——Mr. Ren’s speech at the 5G business report meeting of Shanghai Research Institute

October 17, 2018

Everyone must understand that leading is different from being a leader. Leadership means establishing rules and standards for common victory. Leading means leading in a series of aspects, such as technology, business model, quality, service cost, and finance. If our products are good, we can serve the vast majority of operators in the world, and we can take the initiative. So when it comes to 5G, we must be determined to be a strategic leader.

1. Start with 5G SA networking, and ensure that the network architecture is extremely simple, the transaction architecture is extremely simple, the network is extremely secure, the privacy protection is extremely reliable, and the energy consumption is extremely low, so as to achieve comprehensive leadership.

5G SA networking will be separated from the current mechanism and established independently. 5G SA leaves complexity to itself and simplicity to customers through minimalist sites, minimalist operation and maintenance, and minimalist transactions. This is very correct. Although you have achieved success in the first phase of 5G, there are still greater efforts to be made in the future. In the 5G SA independent networking, 5G base stations and core networks will take the lead in promoting minimalist network architecture and transaction models, do a good job in network security and privacy protection, improve quality, and reduce costs according to Moore's law. In new products, we use new development methods to continuously reconstruct product architecture, accumulate experience, and cultivate strength. As the market for new networks expands, an advanced network is formed. Our seeds have grown exponentially. Not only have new networks been born, they can gradually replace the past, thereby iterating and updating the network inventory, but a large number of warriors are our precious wealth.

The core network of NSA needs to be associated with 4G and connected with 2G and 3G. The association is relatively complex. We must resolutely continue to attack and advance along the original path. We do not waver. We do not have the power to transform the entire network. We must not waver along the past route and also be world-leading. Past products can be optimized, but we should not idealize them and change them all the time. If we change them all the time, they will be nothing. We are only piloting SA. For all other product lines, we will attack along the original route.

Terminals should also be involved in the 5G simplified network strategy. We hope that the 5G terminal, pipe and cloud will have some joint design. Our own network is the fastest and best. Both parties can simplify the algorithm based on a special interface, which will be faster, consume less energy and be more popular with users. It is also possible to use other people's networks, which are standard interfaces.

Cybersecurity should be raised to the highest level, because the future society is a cloud society, and cybersecurity faces greater challenges. Whoever is secure will have competitiveness and the possibility of survival. You are right about the 5G cybersecurity strategy. Different domains and sub-domains must achieve their own security resistance. In the past, we attached importance to the construction of "walls", but we did not build a good security mechanism for layered resistance, which was not suitable for "street fighting". When I asked Tao Jingwen to build the company's intranet, I proposed to use "American bricks" to build the "Great Wall", and now the value is reflected. We stack a "brick" here and a "brick" there. Others don't know how the "bricks" are stacked, and these "bricks" are not from the same company. Even if they find an entrance and attack, only a small area will be affected. In this Bitcoin network extortion, our company did not have major problems and the entire company was not paralyzed, because after attacking the "wall", we still have layers of security resistance, and the software of foreign companies has the ability to "street fighting". Layered resistance to foreign invasion will not cause problems throughout the city. The "wall" of our product is good, but the "bricks" that build the "wall" contain the software of the C&C08 machine, which cannot be removed. It is like tofu dregs and is weak.

Extremely low energy consumption will definitely be a competitive advantage in the future. Reducing energy consumption is not a matter of electricity bills, but a matter of level. We must not equate reducing energy consumption with saving electricity bills. Bandwidth, latency and other performance indicators can be achieved by all 5G manufacturers, just a matter of early or late, but extremely low energy consumption is not necessarily something that other manufacturers can achieve. Our thermal research institute must increase investment, with the goal of reducing energy consumption. To reduce energy consumption, we must not only reduce the energy consumption of chips, but also the energy consumption of the entire base station. In the future, there will be strong competitiveness, even stronger than electronic technology. We must see this point, and see that sometimes the kung fu is beyond poetry, and the kung fu of wireless is also beyond poetry.

2. For future research, we need to use multiple paths, multiple levels, and multiple scenarios to build the foundation for our victory.

What is multi-tier? Our research and development is from scientific experiments and verification to scientific prototypes, commercial prototypes, multi-scenario prototypes, and fully simplified prototypes, and we optimize them over and over again. For scientific experiments, we must be bold to fail. It is conservative to succeed too quickly. The A-tier team only does scientific prototypes, regardless of whether the prototype makes money or not, whether it uses "diamonds" or "gold" as brackets. It is to prove the feasibility of the theory. If it is not feasible, it is also successful. We should not judge heroes by success or failure, but explore boldly. The B-tier team is responsible for developing commercial prototypes based on scientific prototypes. We must study its applicability, high quality, easy production, easy delivery, and good maintenance. The C-tier team should face multiple scenarios. Products that meet customer needs for multiple scenarios are reasonable, applicable, and economical products, which are conducive to reducing users' construction costs and operation and maintenance costs. Just like the RuralStar agricultural network product you made, it is a scenario-based product. The D-tier team studies how to use tolerance design and ordinary parts to make the best products. The best quality, the easiest to use, install, produce and maintain, and the lowest cost architecture. The challenge is huge. Your "bayonet" is aimed at your own chest. Be bold in experimenting, be brave in innovation, and revolutionize yourself, which means revolutionizing the entire network. For example, the design of Japanese TVs is tolerance design. Not every component is the best, but the overall design is the best. Why can't our 5G base stations reach the level of TVs? Tolerance design is a reasonable cost structure.

We need to have multiple echelons, maintain our strategic leadership, maintain long-term human resource iteration, and have successors. The Human Resources Department should develop an assessment model. Different assessment methods are adopted for the four echelons A, B, C, and D. Not all echelons have to bear great delivery pressure. Some echelons just need to release pressure and go into battle lightly to stimulate imagination. For echelons A and D, if they fail, their salary will increase, and if they succeed, their rank will increase. We fully estimate their difficulties. If they fail, as long as they can explain the path clearly, it is also a success. This is what "not judging a hero by success or failure" means.

Multiple paths means exploring multiple feasible forms in technology, and not rejecting them lightly. Of course, we can also study global paths and regional paths, and we may take them. We must adhere to global standards because we are a global company, but we must also be ready to respond to the requirements of various countries at any time. The world is changing. Can we change this change? We can't change it. We can only adapt and respond with multiple paths. At the same time, we must have strength to be independent and have the ability to solve the problem of substitution. Ten years ago, I said that we should prepare for war according to extreme situations and establish spare tires. At that time, most people didn't believe it. (Blue Blood Note: Huawei's operating system is also a spare tire! Spare tires can achieve harmony with the world, but they will not be killed by someone's arrow.) I said that the biggest spare tire in the world is the atomic bomb. When has a nuclear war ever been fought? It has never been fought. We must insist on using dual versions. About 80% of the time, we use the mainstream version, but there is also about 20% of the applicable space for alternative versions, maintaining this dynamic spare tire state.

Solve network problems in multiple scenarios and reduce construction and operation and maintenance costs. Multi-scenario networking is very complex, and we can solve it through AI. We have only solved product problems, not network problems. In the future, when 5G large traffic is rolled out globally, the network will definitely be congested. We have set up theoretical departments in several domestic research institutes in advance to study the problem of network traffic diversion. At present, the Russian Institute has successfully diverted network traffic. The Russian Institute can guide various theoretical departments to solve the 4G traffic problem one after another. When the 5G network traffic is congested, there will be experience in diversion. In addition, the Shanghai Institute can also recruit some PhDs in mathematics, physics, neurology, etc., starting with anti-fraud software research. In theoretical research, we also need to have a ladder. We cooperate with many professors, and we also need to list how many PhDs under the professors are cooperating with us. We also recruit some PhDs and send them to cooperate with professors. The research results belong to the professors, and we just apply them. After ten years, the iterative ladder will be established.

We should pay more attention to basic research and increase investment. For example, terahertz may be the future. I suggest that we recommend Professor Liu Shenggang[1] as the "Father of Terahertz". Of course, this is not for the world, but for us. We should support great scientists like Liu Shenggang and Li Xiaowen. They are beacons.

3. The market selection of 5G must be concentrated, and the strategic reserve force of 5G must be integrated and connected, with “four groups and one team” attacking “Shangganling”.

5G has taken the lead in breaking through the key technologies of large bandwidth and multiple antennas, and has gained a first-mover advantage. We should take advantage of this advantage and the critical time window for system replacement to optimize the global pattern. I think we should do "Tian Ji Horse Racing". Our customer base is based on national customers, and we concentrate our superior forces on high-quality customers. This is Tian Ji Horse Racing. The 5G market selection must be concentrated. We must improve services, improve the value system and the training of reserve teams, and thousands of troops will go to the battlefield.

I emphasize that sales, service, MKT and R&D should be integrated. We continue to recruit some outstanding employees to join the strategic reserve team for rotation training. Who knows who will be the "general" in the future. There are "privates" coming to the meeting today. Why do we open the 13th and 14th level to participate in the company's strategic decision-making meeting? It is to let you feel it, listen and see, your mind will be blown up and you will grow rapidly.

When delivering training to the "Four Groups and One Team", there should be multiple stages, and public relations, supply chain, finance, etc. should all be included. Because they may not understand in the theoretical stage, but they may understand a little in the practical stage. Their thoughts should also be sublimated so that the "militia" can cooperate with the main force in combat. You can't let the "militia" not know how to cooperate with you. At least they can deliver "food" and carry "shells". The "Four Groups and One Team" also have to deal with different scenarios. When doing this scenario, don't worry about other scenarios, and focus on conquering this "hill". Times are changing, and our methods must also keep changing with them, with rounds of training and airdrops of the entire organization.

I emphasize again that our 5G is the battle for "Shangganling", the world's high ground. The 5G battle is related to the survival of the company, so we must win this "war" at all costs. The attack on "Shangganling" depends entirely on you.

In addition, don't get hung up on my few words. When I talked about the water in Dujiangyan, I was talking to everyone in the company. It's not that only Sichuan people take a bath and are gentle, but aren't people from the south of the Yangtze River gentle and Shanghai people coquettish? It is the times that remind us that we must be brave to fight, and being passionate does not necessarily mean we are not heroes. Here, I apologize to Chengyan. I have seen the changes in your product architecture. The "claws" of the "octopus" have been stretched out, and you have washed yourself and fought again. I don't want to be covered in mud.

Submitted by: Members of the Board of Directors and Supervisory Committee

Mainly sent to: All employees, fully open

November 5, 2018

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