Waking the Dragon - The Courtship of Huawei's Father
In China, the dragon stands for potent and auspicious powers, and can refer to power, strength, and good luck. One Chinese dragon in particular, Huawei Technologies, helped 3Com find its power and strength after turbulent times.
3Com found success in all the overseas markets, ultimately having a presence in 45 countries and 182 locations. But during its third decade, in the face of skepticism and doubters, its strategy outside the US became crucial to its survival. 3Com partnered with Huawei to create a highly successful joint venture in China known as Huawei-3Com or H3C.
That partnership was a success for 3Com. The H3C venture was a critical decision to reinvent and reposition itself as an offshore manufacturer of low-cost products for the enterprise networking market. Ultimately, it helped the company orchestrate its exit strategy as an HP acquisition.
This partnership was also referred to as 3Com’s “China Out’’ strategy, and succeeded in bringing 3Com back from its near-death experience. Joining forces to fight their common threat (Cisco), H3C, is an early case study in how US technology companies could create partnerships to successfully compete in and enjoy the rewards of China’s vast and fast-growing marketplace.
That strategy has become a far-more common approach today. The story of the H3C joint venture includes some lessons that remain relevant for companies pursuing that course, and also includes more than a big of corporate cloak-and-dagger intrigue, such as:
The courtship of Huawei's founder Ren Zhengfei by 3Com execs Anik Bose and Bruce Claflin and how they set their common vision and executed it;
An undisclosed story (until now) about Cisco’s John Chambers personal failed attempt at spoiling the H3C party; and
The complexities and challenges of melding US and China cultures and executive teams.
3Com may have used the joint venture to help it find its sea legs in the enterprise networking ocean but Huawei went on to become a global powerhouse ship. Having overtaken Apple in the smartphone market, it's now second only to Samsung in that arena.