Value Chain - Huawei and Its Competitive Opponent

The Value Chain

-HUAWEI and its competitive opponent

Name: BAI TIAN

ID Number: 10648002

Instructor: Todd Elliott

References:

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徐洁云. (2012, 02 10). it.sohu. Retrieved from sohu: http://it.sohu.com/20120210/n334274782.shtml

This essay will deal with the following aspects of the question about how the value chain defined; what kind of areas of the value chain does my company or organization focus on and what improvements I could propose for the value chain? The aim of this essay is totally about my own ideal and thoughts of the value chain and the company or organization I chose.

It is clear that, the value chain is a combination of activities that a company operating basic activities and support activities to make sure the process of design, production, service and marketing is running faultlessly in the right position. All those activities could be indicated with a value chain.

Value chain is ubiquitous in every economic activities, associating the upstream and downstream with the enterprises industry value chain. The relations of the different business units constitutes the value chain of the enterprise. Each exist value chain activities in the value chain would affect the value of the enterprise. The value chain of earnings, the international division of labor force and the management strategy plays a big role.

For instance, Microsoft and its Windows operating system. As a personal computer desktop, many commercial software is developed base on the Windows operating system. Windows system is regarded as a development core to drive the value chain and as a representative of the company and products. When companies purchase Windows software for their personal computers, additional software spending is far more than the basic operating system and the operating system is the de facto standard of running these additional software. As long as implementing on the Windows operating systems, other companies must comply with the standard of Windows. In this point of view, Microsoft completely hold this value chain in hand. According to the McKinsey report, this unique value chain was worth $383 billion in 1998.

The first part of the analysis will examine HUAWEI Technologies Co. Ltd. which is providing Chinese multinational networking and telecommunications technology and related service. From its main service such as broadband, IP, optical network, the network energy to its recently top-hit product——smartphone. HUAWEI’s products are committed to providing the best service. To guarantee the user at anytime, anywhere can enjoy consistent communication experience through any terminal and to enrich people’s life and to convenient the communication.

In order to keep improving the development and the market share of the global world. HUAWEI’s business concept and practice is to get the “globalization” and the “localization” together, integrate the global optimal resources and build a global value chain to help the local enterprise make value. HUAWEI believes that any other global company have to focus on the localization of different market demand, and provide the corresponding differential products and service for the customers, so as to lead the global success to the local market. On the other hand, in this highly globalized economy era, information technology, especially internet application dramatically developed era. The localization of culture, products, and services may frequently introduced to the world, which makes more localized companies have the potential globalization, compared to the past time.

HUAWEI is mainly talking about two points in its developing and spreading agenda, which is Localization and Globalization.

Localization: localization means more than just local employment, local tax and local needs of provided products. A higher level of the localization should be through the industrial division of labor cooperation with local enterprises to integrate their innovation ability become one part of the HUAWEI’s global value chain and by according to this value chain, promote the local innovation achievements to the global market, make value of local creation in the global world.