Strategic Management and Leadership Report: Huawei Case Study Analysis

This report offers a comprehensive analysis of Huawei's strategic management and leadership, addressing the company's challenges and proposing solutions. It begins with an executive summary and introduction, followed by a justification for using agency theory to explain the relationships between strategies, stakeholder expectations, and organizational performance. The report then identifies and evaluates the effects of external factors, including economic, political, and cultural influences, on Huawei's strategic management in an international context. A new strategy is formulated to address challenges and meet organizational objectives, with a critical evaluation of the strategy provided. The report also examines how business strategy encourages and supports innovation and change, comparing the proposed strategy against competing strategies based on their contribution to organizational success. An implementation plan is developed, and the report concludes with recommendations. Furthermore, the report includes an analysis of Huawei's current organizational structure, an evaluation of its effectiveness, and a critical evaluation of a restructured plan to address potential issues and negative consequences.

Running head: STRATEGIC MANAGEMENT AND LEADERSHIP
Strategic Management and Leadership
Name of the Student
Name of the University
Author’s Note:

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Table of Contents
Task 1: Strategic Report.............................................................................................................3
1.1 Executive Summary and Introduction..............................................................................3
1.2 Justification for a selected Theory of Strategic Management for explanation of
Relationships between Strategies, Stakeholder Expectation and Organizational
Performances..........................................................................................................................3
1.3 Identification and Evaluation of the Effects of the External Factors on Strategic
Management in the International Context such as Economic, Political and Cultural Factor 5
1.4 Formulation of a New Strategy for facing Challenges and meeting Organizational
Objectives with Critical Evaluation of the Strategy...............................................................8
1.5 Explanation of the Process Business Strategy encourages and supports Innovation and
Change with Evaluation of Strategy against Competing Strategies based on the
Contribution to Success of the Organization.......................................................................10
1.6 Development of an Implementation Plan for the Strategy developed and documented to
fulfil Expectations of Stakeholders......................................................................................11
1.7 Recommendations and Conclusion................................................................................13
Task 2: Organizational Redesign.............................................................................................16
2.1 Introduction....................................................................................................................16
2.2 Analysis of the Current Organizational Structure and Evaluation of its Effectiveness to
meet Organizational Objectives with reasons for Restructuring and Organizational Chart 16
2.3 Critical Evaluation of the Restructured Plan to address Possible Issues and Negative
Consequences and ways to overcome them.........................................................................20
2.4 Conclusion......................................................................................................................22

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References................................................................................................................................24

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Task 1: Strategic Report
1.1 Executive Summary and Introduction
The objective of the report is to understand about strategic management for a popular
as well as significant company in the world, Huawei. This type of management is the
significant ongoing planning, analyses and evaluation of all requirements, which is needed
for the business for meeting each and every goal and objective (Rothaermel 2017). Huawei
Technologies Co. Ltd is a popular multinational technology organization, based in China that
provides different telecommunications equipment as well as sells smart phones and consumer
electronics. They have headquarters in Shenzhen, Guangdong and have been doing business
for more than 32 years (Huawei. 2019). The following report has outlined a detailed analysis
on the failed strategy of Huawei as they were highly internally focused. As a result, market
shares were lost to a high level. This report will be describing about a suitable theory of
strategic management and formulation of new strategy with proper recommendations.
1.2 Justification for a selected Theory of Strategic Management for explanation of
Relationships between Strategies, Stakeholder Expectation and Organizational
Performances
Huawei, being one of the most significant and noteworthy technological organization
in the world has faced issues, related to the network infrastructure (Huawei.msn.com. 2019).
They have been doing their business in the entire world, however the US intelligence
agencies have claimed that the equipment of this particular organization comprises of
backdoor for utilization by the government spies (Huawei.msn.com. 2019). They are still on
target for shipping 200 million smart phones units in spite of having threats from cyber
security, however in a major bid for improving the overseas standing. They would be
investing 2 billion dollars on cyber security for the next 5 years. The issue of network
infrastructure was faced by them due to the failed strategies and their top management has

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failed in executing the strategies as they were extremely internally focused (Ansoff et al.
2018). In spite of facing a ban from the US and Australian governments, the CEO of Huawei
has decided to enter into the market.
The above mentioned case study of Huawei refers to the fact that they have faced
issues related to strategic management (Huawei.msn.com. 2019). A proper relationship
between the organizational stakeholders and other members is required for ensuring that only
the best strategies are being selected for the organization, under every circumstance (Hill,
Jones and Schilling 2014). It is needed to manage different strategies as well as stakeholder
expectations. The entire procedure to manage stakeholders is the distinct activity to
communicate with the stakeholders and then manage their expectations or concerns to meet
the respective requirements of the stakeholders, address the existing issues, resolve various
conflict situations and then achieve project objectives (Moutinho and Vargas-Sanchez 2018).
As a result, a proper relationship between strategies and expectations of the stakeholders is
required to be maintained, so that better effectiveness and efficiency is maintained under
every circumstance.
It could be easily analysed with a strategic management theory. It is a specific system
of ideas that are intended in explaining the origin, principles, evolution as well as applications
of the strategic management (Goetsch and Davis 2014). This particular theory stem mainly
from the perspectives of system as well as IT approach towards corporate management. The
most popular theories of this strategic management are applicable to the modernized
industrial as well as governmental companies are the resource based theory, HR based theory,
contingency theory, agency theory and many more (Ginter, Duncan and Swayne 2018). The
most suitable theory of strategic management that can demonstrate the relationship of
stakeholder expectations and strategies for the organization of Huawei would be agency
theory.

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This particular theory is the distinct principle, which is being utilized for explaining as
well as resolving different issues within the relationship between business principals and their
subsequent agents (Lasserre 2017). This relationship is mainly within shareholders, company
executives and principals as agents. The agency is the relation within two parties, where any
1 agent majorly represents the other principal in regular transactions. The top management of
the organization have recruited the respective agent for performing a specific service on their
behalf (Hitt and Duane Ireland 2017). These principals are responsible for delegating the
authority of decision making to the agents and they affect the principal financially for
understanding the differences in interests and priorities. As a result, it is being referred to as
the problem of principal agent. An agent is utilizing the resources of a principal (Noe et al.
2017).
Agency theory can easily address the disputes that mainly take place within two major
areas of a modification in objectives as well as a difference in the aversion of risks. The
organizational executive of Huawei might take decision to increase their business into the
new market and it would sacrifice their short-termed profitability within the expectations of
higher earnings and growth in future (Hill 2017). However, few of their shareholders might
place a major priorities on the short-term capital growth as well as face on the organizational
decisions. Hence, the strategic management theory of agency theory is the most suitable
theory for Huawei for understanding the relationship between their strategies and stakeholder
expectations (Stead and Stead 2014).
1.3 Identification and Evaluation of the Effects of the External Factors on Strategic
Management in the International Context such as Economic, Political and Cultural
Factor
Several external factors could eventually impact the core capability of any business as
well as investment for achieving the strategic objectives and goals. These distinct external

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factors may eventually involve high competition, technological, legal and social changes for
understanding the entire environment of economic, cultural and political backgrounds
(Morschett, Schramm-Klein and Zentes 2015). The uncontrollable as well as controllable
aspects, which impact the business could be categorized as external and internal factors.
From setting of goals to the regular operations, it could be easier for the organization to
emphasize on what is being felt for controlling internally (Gamble, Peteraf and Thompson
2014).
The major and the most significant external factors, which impact the business
include economy, competitors, politics and customers that could not be controlled under any
circumstance (Meyer, Neck and Meeks 2017). It could easily influence on the organizational
performances for ensuring that the internal factors are being achieved on highest priority. The
organizational profitability as well as stability are interdependent on the core ability of
quicker identification as well as response to different changes within the external
environment (Frynas and Mellahi 2015). Any type of change is inevitable for having the
major flexibility in dealing with the unexpected market mutations for understanding the
significant difference within success and failure of the respective company.
One of such popular example of change in the organization would be shifting in the
governmental policies that can have a major impact on the organizational success. A
proposed legislation at the state and federal level may need the organization in making
suitable changes to the operations and hence becoming a basic critical success factor (Morden
2016). For the case study of Huawei, they have faced issues related to strategic management
in their business and the external environment would have a major impact on the
organizational strategies and business impacts. The external factors such as government
policy changes are highly unexpected and the most effective and efficient method for the
business to prime itself to be flexible for development of a framework to conduct the

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environmental scanning (Hubbard, Rice and Galvin 2014). The impacts of different external
factors on the strategic management context of Huawei are provided below:
i) Political: The first vital external factor is political. Huawei is being operated out of
China, in which maximum of the manufacturing is also completed (David and David 2019).
However, the smartphones of Huawei are being sold in the entire world and specifically,
these smartphones are quite famous in the EU. Huawei is hence subject to the political forces
from the entire globe, majorly relating to the European Union and China. Various notable
areas of politics is referred to the trade politics. In present situation, these trade policies are
extremely widespread and could facilitate the subsequent export of goods from the host
country to the respective European Union (Bryce 2017). The strategies of the organization of
Huawei would be majorly affected by the political turmoil and new strategies and policies
implemented by the government.
ii) Economical: The second vital and significant external factor for understanding the
impact is economical. Since, all the smart phones of Huawei are built in China and then sold
overseas, it refers to the fact that minimum of 2 geographical macro environments are
involved in this scenario (Bettis et al. 2014). As a result, the economic success is reliable on
the Chinese economy as well as economy of the target market that is in the United States and
the European Union. The core relation within the economic factors is major and the
respective target markets of Huawei can perform well economically. As they have faced
issues related to network infrastructure, it is evident that there would be a major effect of
different economic factors on the organizational of Huawei (Trigeorgis and Reuer 2017). It is
a consistent amount of business, irrespective of the economic conditions in different parts of
the world. Moreover, the organization has invested around 2 billion dollars in the business,
which would bring out several issues in the business eventually and they would not be able to
handle them under any circumstance.

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iii) Socio Cultural: Another vital and significant external factor is socio cultural.
There is a high demand for different smart phones in the entire world, after including China.
It is a socio cultural phenomenon, in spite of the fact that the effects are majorly economic
and the growing need for smart phones is subsequently impacting the complete market of
youth generation (Simon, Fischbach and Schoder 2014). Moreover, due to the network
infrastructure, it becomes extremely important and significant to entire into the market and
satisfying their customers to the most effective manner.
iv) Technological: Another significant and noteworthy external factor that is required
to be considered is technological (Steiss 2019). One of the most interest technological factors
for these smart phone manufacturers would be the rise of 5G. However, due to the issue with
network infrastructure, the government of the United States have banned 5G networks.
Huawei wanted to boast improvised speed, low costs as well as saviour of energy. The
respective technology of 5G needs new hardware, which is a requirement that would require
to be fulfilled by the component manufacturer (Certo et al. 2016). As a result, Huawei has a
strong impact from technologies.
1.4 Formulation of a New Strategy for facing Challenges and meeting Organizational
Objectives with Critical Evaluation of the Strategy
After properly analysing the internal and external environments of the organization of
Huawei, it is being observed they require proper effectiveness in checking the performances
of the company (Hanson et al. 2016). Since they had been facing issues in the markets of
Australia, New Zealand and the United States, it would be highly recommended for them to
change the markets. As a result, they would be able to implement new products and services
in their business. For this purpose, the management of Huawei would require proper planning
and investments (Jenkins and Williamson 2015). A successful business requires major
financial support from the top management, so that they are able to implement new strategies

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without any type of complexity or issue in the business. Moreover, it would be extremely
effective for them in driving revenue to a high level and also manage different processes,
advantages and people of the respective company. It would ensure that communication is
being maintained under every circumstance for the core purpose of retaining different
customers, by analysing operations as well as accounting (Foss and Hallberg 2014).
Technological advancement would be increased to a high level and the company would be
benefitted effectively.
The management of Huawei would be benefitted from the new strategy of changing
their target market to the European Union for facing any type of challenge as well as
fulfilling the objectives and goals (Hitt, Ireland and Hoskisson 2016). The first and the most
significant step in changing the respective target market to the European Union is
acknowledgement of the target market. It is vital to understand that the products as well as
services comprise of a target market, which could be eventually defined. The major objective
of the management of Huawei would be finding out of suitable methods for successful
identification of the people, who could create different marketing campaigns, which speak to
them on a direct manner (Engert, Rauter and Baumgartner 2016). The second distinct step in
this aspect would be determination of the criteria that are being intended to use for properly
identifying the consumers in the most effective manner.
The objective of the step is eradication of the people, who would not be relevant for
their business. They could easily and promptly focus on the marketing messages for reaching
out to the organizational business (Baumgartner and Rauter 2017). The next step is
identification of the customers as well as prospects from the strategy. Identification of the
bets channels for using to communicate with the organizational members is the fourth step in
this particular strategy of Huawei to change their markets. Finally, in the fifth step, they
should measure their campaign results for successful determination of the correct people in

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the organization (Benos et al. 2016). The above provided five steps would be extremely
significant for them to formulate this new strategy of changing market to the European Union
and they would be able to gain maximum popularity and success without much complexity.
1.5 Explanation of the Process Business Strategy encourages and supports Innovation
and Change with Evaluation of Strategy against Competing Strategies based on the
Contribution to Success of the Organization
This type of management is responsible for providing new direction to the company
and also for involving specifications to the company’s goals, so that proper plans and policies
are being developed to obtain these objectives (Foss and Hallberg 2014). It is also required to
allocate appropriate resources to the organization for implementing the plans successfully.
The business strategy of Huawei would be combining every decision, undertaken as well as
action performed by the business for successfully accomplishing the business goals and
objectives as well as securing the most competitive position within the market (Simon,
Fischbach and Schoder 2014). This business strategy is the backbone of the respective
business as it could lead to the desired goals.
These types of strategies are also important for the purpose of encouraging as well as
supporting advancements in the services and technology, by eventually investment of money
in the research and development activities (David and David 2019). As a result, the strategy
would be required for the organizations in gaining competitive advantages to a better level.
Such strategies would be highly inspiring and would be adding unique features to the
products and services of Huawei. Hence, the issue of network infrastructure would be
resolved completely and their brand value would be increased.
The US government hence would not be able to stop them from doing business in the
global market. Success would be gained majorly with those innovative products

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(Huawei.msn.com. 2019). The investment of the organization for their smart phones would
be taken into consideration for understanding the total effectiveness and efficiency of the new
strategy to be undertaken in the respective business. Innovation leadership would also be
required for their business to ensure that every aspect of the strategy is being communicated
effectively (Simon, Fischbach and Schoder 2014). Moreover, they would be able to eradicate
the existing issue easily and promptly for checking the impact of the project success. The
business strategy would encourage strategic innovation for maintaining a stable position in
the competitive market and competitive advantages would be gained on a priority basis. The
businesses could eventually become a failure, when they could not grow in the ever changing
US market (Hubbard, Rice and Galvin 2014). As a result, shifting to the EU would be much
more effective as their business would be successful and profits would be gained under every
aspect. Revenue would be increased and they would be able to support their financial
conditions, since strategic innovation would be enhanced to a high level.
1.6 Development of an Implementation Plan for the Strategy developed and
documented to fulfil Expectations of Stakeholders
Competitive advantages are easily and promptly gained and as a result, overall market
shares are improved for better plan in the future. Different changes within the subsequent
business environment requirement the companies to continuously assess their distinct
strategies to obtain success (Meyer, Neck and Meeks 2017). The entire procedure of this
strategic management would be quite helpful for the companies in taking stock of the current
situation, chalking out the strategies, and deployment of the strategies and finally analysis of
the total effectiveness as well as efficiency of the implemented management strategies. It is
being predicted over the organizational clear understanding of the purpose and mission for
existence and even vision for where it wants to be in the future, so that respective values are
guided to gain better actions (Gamble, Peteraf and Thompson 2014). Strategic management