How Huawei Beats Organizational Entropy: R&D Management Lessons

01 Huawei's Growth: Success Through Accumulation

Huawei’s development is portrayed as a classic case of "thick accumulation and sudden release," resulting from patient, focused, and relentless strategic execution. The company has consistently invested heavily in R&D—over 485 billion CNY in ten years, with 1.015 billion CNY in 2018 alone—ranking among the world’s top spenders.

Despite occasional financial constraints, Huawei has never reduced R&D spending, adhering to the principle “produce first, live later.” Its 2018 patent filings topped the globe, reflecting a commitment to fund innovation rather than treat it as a romantic or speculative venture.

02 Keeping the Organization Vibrant Through HR Management

Growth brings the risk of entropy increase, which can lead to organizational decay. Huawei counters this by maintaining openness, strengthening elimination mechanisms, and balancing spiritual and material incentives. The company identifies 18 forms of corruption—including complacency—and stresses eliminating mediocrity, laziness, and blind conformity.

Effective human‑resource management is presented as the decisive driver of Huawei’s commercial success and sustained development; it is argued that without strong HR practices, neither technology nor talent alone can ensure growth.

03 Wolf‑Like Spirit, Hard Work, and Self‑Criticism

Huawei promotes a "wolf‑like" spirit characterized by sharp market awareness, aggressive execution, and collective effort. Leaders are encouraged to focus on customers rather than superiors, and the organization enforces rigorous self‑criticism to avoid complacency.

Self‑criticism is institutionalized through regular pledges and a “red‑blue” confrontation system that forces cadres to speak truthfully and confront mistakes, reinforcing a culture of accountability.

04 Countering Entropy: Long‑Term Hard Work

Persistent hard work is described as a universal driver of progress, yet maintaining it over decades is the greatest challenge. Huawei combats entropy by staying open to external energy, continuously learning, and embracing self‑criticism.

05 Openness and Learning as Growth Engines

Open systems can absorb external energy, reducing entropy and fostering continuous improvement. Huawei emphasizes learning from others—regardless of origin—while rejecting opportunism and short‑term speculation.

The ultimate goal is to build a strong value‑chain loop that creates, evaluates, and distributes value efficiently, ensuring the organization remains vibrant and resilient.

Author: Wu Chunbo (source: Notesman)