Everyday Economic Journalist Chen Shijun reporting from Shanghai - The mainland telecommunications manufacturer Huawei, which saw growth in its mobile phone business last year, was yesterday (February 23) hit with news that Yang Xiaozhong, the mastermind behind this business and President of Huawei Terminal China, had been reassigned from his original post.
Previously, Zeng Tao, the IT/Telecommunications industry consulting director at Zero Point Research Consulting Group's Shanghai branch, revealed on Weibo that there was a major shake-up in personnel at Huawei Terminal China, with the president and two vice presidents leaving or retiring. He questioned why such an event occurred during a period of rapid development for Huawei's mobile phones, seemingly making the management reshuffle hard to understand.
Huawei clarified to the "Everyday Economic News" that Yang Xiaozhong's reassignment from his position as President of Huawei Terminal China was a normal rotation, and it is currently in the handover phase. Huawei disclosed to reporters that "Yang Xiaozhong's personnel change is actually a promotion; he will subsequently serve as the company's global sales president for terminals. His successor will be Wang Weijun, who previously served as the president of the Southeast Asia regional department."
Moreover, regarding the claims of high-level executives leaving mentioned in the aforementioned industry insider's revelations, Huawei stated that they "have not yet received such information."
The possibility of a "group layoff" is small
According to insider Zeng Tao's Weibo revelation, Huawei's significant personnel reshuffle actually took place before CES (the Consumer Electronics Show in the US). However, the relevant Weibo posts by the whistleblower were soon deleted.
Regarding the core situation of the personnel reshuffle, Huawei pointed out to the "Everyday Economic News" reporter that no official announcement has been made yet, so the exact time of the transfer is unclear. According to Huawei's past practices, it is very common for mid-to-high level team leaders to rotate positions every two to three years. Moreover, President Yang Xiaozhong’s move is due to excellent performance leading to a promotion.
As for the reshuffling at the vice president level, Huawei confirmed that "the retirement of the vice president is a personal decision."
In fact, as one of the three leading domestic mobile phone manufacturers known as "China-Huawei-Lenovo" (ZTE, Huawei, Lenovo), Huawei has shown great momentum in the emerging mobile communications field, especially receiving good returns in the layout of smartphones over the past year.
In 2011, Huawei Terminal's global sales revenue exceeded $6.7 billion, with a year-on-year increase of 50%. In terms of shipment volume, it surpassed 150 million units (including more than 20 million smartphone shipments), growing by 30%. Among these, the C8500 model customized with China Telecom and the U8500 customized with China Unicom ranked high in industry sales. Leveraging the trend of the three major operators promoting "affordable smartphones," Huawei quickly expanded into second- and third-tier markets.
Yang Xiaozhong, then head of Huawei Terminal China, planned detailed competitive strategies and market goals for the company. "In the next 3 to 5 years, we have a rather challenging vision and goal. First, we openly state that within the next 3 to 5 years, our market share in China should reach the top."
A senior industry expert told the reporter that Huawei's current terminal development trend is generally upward, and the possibility of a collective "withdrawal" is very small.
The battle for performance among "China-Huawei-Lenovo" in 2012
Research data recently released by Analysys Mason in their "Q4 2011 China Mobile Terminal Market Quarterly Monitoring" report showed that Huawei's mobile terminal sales outperformed domestic rivals ZTE and Lenovo, ranking third after international communication giants Samsung (with a 22% share) and Nokia (with a 15% share), holding a 13% share and maintaining this position throughout 2011.
However, the three domestic communication enterprises under the "Android system" camp have been fiercely competing in the mobile terminal sector. In the market share of the fourth quarter last year, ZTE, in fourth place, was only 2 percentage points behind Huawei, at about 11%, with extremely similar product line layouts. Lenovo, with its traditional 3C channel advantages, leveraged its concentrated scale advantages and full product line development strategy, allowing it to match Huawei's sales share of 6% in the first quarter of last year.
He Shiyou, Executive Vice President and Executive Director of ZTE Communications, frankly told the "Everyday Economic News" in an interview, "Currently, ZTE has significantly exceeded its initial sales target of 12 million smart devices set at the beginning of 2011. In 2012, ZTE's smart device sales are expected to at least double."
"Our vision is to build a mobile internet business of the same scale as our current PC business within five years. We have a clear layout for smartphones." Chen Xudong, Senior Vice President of Lenovo Group and General Manager of the China region, defined his determination to expand the business in this way.
"In reality, competition among the 'China-Huawei-Lenovo' trio is becoming increasingly fierce. Although the contributions of business department leaders are significant, as mature business teams, personnel changes basically won't greatly impact the company's operations. This year, as all three gradually 'find their rhythm,' how to launch powerful flagship products with strong operator resource support and high cost-performance ratios will be the key to sustaining growth," the aforementioned industry insider told the reporter.
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