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Department of Management MGT6209 High Performance Collaborations Group Project Paper Hand-in Cover Sheet and Declaration Acknowledgement of the Rules concerning Academic Honesty & Plagiarism: We undertake that the assignment presented here is our own work and is, with the exception of attributed quotations, written in our own words. All quotations have been placed within quotation marks and referenced. We have not copied or paraphrased the words of any author, published or unpublished, without attribution.We understand if we commit such wrongdoing, it may result in zero coursework grade and further disciplinary action. Tuesday Class Student ID Name Dateof Submission 53975100 Teerakan KASEMCHAIPIPAT 21/4/2015 53854930 Xiao WANG 53718297 Tingting Zhang 53972619 Xiaoxue WU 1

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Page 1: Final Report

Department of Management

MGT6209 High Performance Collaborations

Group Project Paper Hand-in Cover Sheet and Declaration

Acknowledgement of the Rules concerning Academic Honesty & Plagiarism:

We undertake that the assignment presented here is our own work and is, with the exception

of attributed quotations, written in our own words. All quotations have been placed within

quotation marks and referenced. We have not copied or paraphrased the words of any author,

published or unpublished, without attribution.We understand if we commit such wrongdoing,

it may result in zero coursework grade and further disciplinary action.

Tuesday Class

Student ID Name Dateof Submission

53975100 Teerakan KASEMCHAIPIPAT

21/4/2015

53854930 Xiao WANG

53718297 Tingting Zhang

53972619 Xiaoxue WU

53715399 Yuchuan SHI

53652009 Jian SHEN

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Word Count 4721words

City University of Hong Kong

MGT6209 High Performance Collaborations

Failure of Huawei in the US market

Group project (Group 1)

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Submitted to: Dr. Ruodan SHAOSubmission Date: 21 April, 2015

Table of contents

Case Issue Introduction....................................................................................................................................4

Huawei Technologies............................................................................................................................... 5

Conflicts............................................................................................................................................. 8

Persuasion..................................................................................................................................... 11

Negotiation............................................................................................................................... 1413

First Layer: Culture................................................................................................................................ 14

Second Layer: Purpose.......................................................................................................................... 15

Third Layer: Time and Environment..........................................................................................1615

Culture barrier........................................................................................................................ 1716

Recommendations....................................................................................................................... 18

Recommendations for culture barrier............................................................................................18

Recommendations for negotiation..............................................................................................2019

Recommendation for conflict............................................................................................................. 22

Reference........................................................................................................................................ 23

Appendix.............................................................................................................................................................. 25

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Case Issue Introduction

Huawei is a Chinese-own private company in which its core business is telecommunication

equipment (Huawei, 2015). After being able to strengthen its market share locally, Huawei

starts its global strategy to expand its business worldwide.

The United Stateswasisone of many other countries that Huawei planned to execute the

market. Although the United States market lookeds potential to make the move as the United

States Telecommunication Industry wasis a big market and full with innovative technology

but the entry wasis not an easy task for Huawei.

Even though Huawei had made many moves to engage itself to the market, the company got

obstructed by the United States government either direct or indirect way. Huawei lostlose

many business deals with many potential US telecommunication companies. Years and

amount of money had been invested in the attempts to get itself to the market; unsuccessful is

still in Huawei’s dictionary for the United States market until today.

There were many different opinions regarding the obstruction of Huawei in the United States

market. However, according to the United States government, adopting Huawei’s equipment

in the United States telecommunication network wouldwill post a risk to the United States

government regarding the national cyber security. (Scott, 2013. P.6)

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Huawei Technologies

Started in 1987, Huawei whose first company located in Shenzhen, China, produced and sold

Private Branch Exchange (PBX) switches (Huawei, 2015). In 1990, Huawei started to

emphasize on independent research and development of telecommunication equipment. The

company grew up fast locally and made its first move internationally in 1999 by establishing

its research and development center in Bangalore, India (Huawei, 2015).

Huawei strivedsforinto the global presence with US$100 million sales revenue in 2000, and

US$552 million in 2002 (Huawei, 2015). Not only the growing revenue, Huawei’s research

and development center wasis also increasing in number around the world same as its number

of registered patents. Today, Huawei Technologies is one of the world’s largest suppliers of

telecommunications equipment, mobile phones, and related services.

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As of the founder, Mr. Ren Zhengfei is CEO and founder of Huawei. Mr. Ren grew up in

Guizhou province in China and graduated from Chongqing Institute of Civil Engineering and

Architecture in 1963 (Forbes, 2015). After graduated until 1983, Mr. Ren joined the People’s

Liberation Army before he started up Huawei in 1983 (Forbes, 2015).

Huawei in the United States

In global market, Huawei’s business grows rapidly. Huawei holds approximately 20 percent

of the telecommunication equipment market and be considered as one of the world’s largest

seller of telecommunication equipment (Regalado, 2014, p. 70).

For the United States market, Huawei has another position in the market. The chart below

(Appendix1) shows that Huawei has increased rapidly in its total revenue globally. When we

break the total revenue down into region, it shows that Huawei’s primary revenue is

fromChina, and its Europe, Middle East, and Africa market. Whereas even though the US is a

big market for telecommunication, the company does not have a lot of revenue generated

from the country.

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Huawei’s Major Attempts in the United States

There are a number of major attempts that Huawei tried to get themselves into the United

States market. Here is the summary of the well-known incidents (Wu &Hoon &Yuzhu, 2011,

p.507).

Year Companies Cooperation Reason of Failure

2005

Huawei offered a highest

bid for 2Wire

2Wire concerned on dealing

with Huawei would slow

down the business revision

processes by the US

government

2008

Bain Capital and Huawei

proposed a joint bid at

US$2.2 billion to acquire

3Com

The US government

obstructed the deal by putting

the concern on Huawei’s

relationship with the Chinese

Government

2009

Huawei tried to sell

equipment to AT&T for

its new phone system

The US government stopped

AT&T from buying from

Huawei with the reason that

Huawei might help the

Chinese Government tapped

into the US Government’s

lines

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2010

Huawei and

SprintNextellooking to

be a potential

partnershipattempted to

cooperate

SprintNextel withdrew from

the partnership with Huawei

as being afraid of losing

business with the US

Government

2011

Huawei was aiming to

have a US$2 million

patents deal with 3Leaf

The US Government asked

Huawei to unwind the deal

Conflicts

Obviously, there wereconflicts between the US government and Huawei, which we use to

illustrate the situation based on the class learning. The conflict and communication indicate

the four general steps of conflict, including the involving parties, exclusive goals, different

values or perceptions and the termination of the conflict.

Step 1: Involving Parties

Firstly, it is well known that during a conflict, there must be at least two parties involved, and

the major parties here in this case are Huawei and the US government. Due to they are totally

different organizations, one is a Chinese business technology company and the other one is

the representative of American country, and the type of this conflict between them is the

interorganizational conflict, rather than the intragroup conflict or intergroup conflict or even

the interpersonal conflict.

Step 2: Exclusive Goals

Secondly, the two parties develops from perceived mutually exclusive goals, which are equal

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to what each of them needs ultimately during the conflict, so we use the mapping skill to

illustrate the different needs of the US government and Huawei separately. On the one hand,

the US government needed to guarantee the national security by avoiding espionage of

communication companies. Also, American government needed to protect the domestic

economy. So the US government worried about that weather Huawei would be a threat to the

national information security or the domestic mobile phone market when it got into the US

market. However, on the other hand, the goals of Huaweiwere to globalize its business and to

promote market maximization, which weretotally from the business perspective.

Therefore,both parts had different goals during the conflict process.

Step 3: Different Values or Perceptions

Thirdly, as the Chinese culture is distinctive from American culture, so the two parties have

different values or perceptions, such as their different concerning points, which we chose to

use mapping skill again to list their different concerns. Actually, the US government

concernedHuawei’sclose relationship with Chinese government, so it regardedHuawei as the

representative of Chinese government or Chinese information companies, to a large degree,

not only a business company, which was sort of a sensitive political problem, but also, the US

government concerned the information omission, especially from technology companies.

Meanwhile, what Huaweiconcerned about was that the profit of the company and the future

development. Hence, from the illustration above, it is easy for us to figure out that

Huawei,based on ourthe business perspective, really concerned the future and profit of the

action by getting into American market, However, the US government concerned the issues at

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a higher level of national security and domestic market protection. So neither of the two

parties concerned for each other, and they just concerned for themselves, like the own

different interest, the distinguishing beliefs based on different value and culture, for example,

one of the most critical causes of the conflict we will illustrate and analyze in detail later, is

the lack of transparency of Huaweiand the CEO of the company, which is regarded as

unreliable behavior in the US culture. In particular, during the investigation, it was pretty

hard for US government to know the details of the annual reports or receipts and

disbursements of the company, which really confused the investigation team of America.

Nonetheless, this situation is such normal among Chinese companies. People work for a

company, but they even never know and the CEO before or after joining one company, which

shows a typical hierarchical management system with high power distance. As a result, it is

really hard for the two parties to settle down a satisfying solution to deal with the conflict.

Step 4: Termination

Finally, as for the termination, we know that normally, conflict would be terminated only

when each side is satisfied that it has won or lost. Yet, for this case, Huaweiwas not satisfied

at all obviously, and the US government won for several times by preventing from Huawei’s

merger. In this step, we use the orientations or predispositions style for conflicts to

demonstrate the irreconcilable conflict of the two parties. We know that there are five styles

during a conflict, and they are competitive, avoidant, compromising, collaborative and

accommodative type, which are based on the degree of party’s desire to satisfy own concern

or other’s concern. As the matter of fact, as we mentioned above, the US government

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concerned its own pretty much, and showed the uncooperative position for Huawei’s merger,

so the US government was the typical competitive style. Whereas, although Huawei had the

issue of lacking transparency, it had actually took a series of actions to persuade the US

government to trust and admit the business nature of Huaweiwithout any threat to its national

security, which we will explain more detailed in the following paragraphs. In the figure 2,

Huaweihas the traits of compromising and collaboration. Therefore, as the figure 2 shows, the

two parties have different positions and different orientation styles facing the conflict, which

means that it is really hard to deal with the conflict indeed.

Persuasion

In order to persuade US government, Huawei has taken many different actions during the

past years. However, the US government still said no. US government blocked Huawei from

building networks in America for the national security concerns (Telecommunications

Reports, 2011).

Huawei’s persuasion actions can be analyzed by ACE Theory. This theory has three aspects

that are appropriateness, consistency and effectiveness(Reardon, K., 1991). For

appropriateness, it was appropriate that Huawei tried to acquire small-scale high-tech

America companies like 3Com and 3Leaf. Those acquisitions were just normal business

activities between companies. Besides, Huawei has followed America’s normal acquisition

procedures and instructions. Huawei submitted a timely request of completing the purchase to

US government in advance and government certified that no license was required to export

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the 3Leaf technology(Huawei, 2011).

As to consistency, Huawei had successful businesses in many other countries like UK and

India. Huawei has become embedded into UK telecoms infrastructure(Daniel, T., 2013).

Huawei has been operated businessesing in India for more than 14 years and currently works

with all major local telecom operators( Juro,O., 2014) . But Huawei did nothing about

damaging national information security in those countries. So, Huawei is a reliable company

and will not steal national information from America.

For effectiveness, Huawei’s business can provide high quality products and services at lower

price for American customers and offer more jobs to increase local employment as well.

Huawei have haslong been offering customers innovative products and services and have

hasalways been a responsible investor, employer, taxpayer and corporate citizen in

America(Huawei, 2011).

From the three aspects, Huawei has done pretty well of the persuasion actions. As for the

specific persuasion process, the further analysis is as follows.

Huawei tried their best to persuade during the persuasion process. First, Huawei understood

US government’ motivations and needsof ensuring national information security. They were

committed to working together with governments in all countries to take all necessary

measures to protect information security for the total understanding of the significance of

security problems in IT industry.

Second, Huawei tried to establish credibility with US government. Huawei has published an

open letter and cyber security white paper to commit that they would take cyber security

assurance as one of their core company strategies. They published “Cyber Security White

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Paper” and looked forward to making cyber security as a part of Huawei’s DNA (Huawei,

2013).

Third, Huawei tried to establish a common ground to benefit both Huawei and American

general publics. Huawei can bring more advanced technologies and services at a lower price

to American telecom operators, as well as the general publics. At the same time, Huawei can

get profits and market share.

Fourth, Huawei engaged US government in joint problem solving. They sincerely

appealedthe US government carry out a formal investigation on any concerns it had about

Huawei. Actually, the US government did carry out an investigation. However, the

investigation report had no evidence to prove that Huawei stole America national

information. Huawei was a normal commercial institution and nothing more.

Fifth, Huawei reinforced its position and attitude with logic and reasoning explanation in the

open letter. In terms of four major concerns of US government, Huawei did an exactly logic

and reasoning explanation. “Close connections with the Chinese military”, Mr. Ren was just

one of the many CEOs around the world who have hasserved in the military. "Disputing over

intellectual property rights”, they have applied for and have been granted their own patents

globally. They also bought access to other patent holders' technologies through cross-licenses.

"Allegations of financial support from the Chinese government”, Huawei received tax

incentives similar to those offered by American government agencies to U.S. companies.

"Threats to the national security of the United States”, they hired independent third-party

security companies, such as EWA, to audit their products in order to certify the safety and

reliability of the products at the source code level(Huawei, 2011).

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Finally, Huawei reinforced persuasion with an appeal to emotions and basic instincts.

America is an advocate for democracy, freedom, rule of law, and human rights. Huawei had

faith in the fairness and justness of the US government who hass demonstrated its efficiency

in management, fairness and impartiality. Huawei appealed the US government treat them the

same as other companies to show America fairness and justice.

During the whole persuasion process, Huawei has tried their itsbest. Unfortunately, the US

government still rejected Huawei acquire companies excusing for national security. So, the

persuasion ended as a failure.

Negotiation

For the negotiation part, we will use the strategic model to analysis, followed by each layer.

First Layer: Culture

We think cultures between two organizations are really different, typically between eastern

and western cultures. By comparing the differences in doing business between two countries,

we can see why they have problem in negotiation.

Chinese prefer to build good relationship with cooperators first when they do business, which

is called “Guanxi”.We believe that if we can build good relationship with our business

cooperators, we trust each other and make the business go smoothly. If Chinese businessmen

want to enter a new market, usually they are more used to find a fastest and easiest way to

achieve goals, for example acquisition. And due to the core values in Chinese culture: humble

and modesty, most of the Chinese traditional companies are low profile, they seldom do lots

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of promotions or advertisements, like the old saying in Chinese “Good wine needs no bush”.

We believe that the key point of success is the product, so we do notneed to do many

advertisements or promotions. Once we can make good products, we can attract many

customers.

However, American businessmen do things in an opposite way. They are more used to obey

the law and rules. When they want to enter a new market, they will achieve it by policies or

standard regulations. They believe more in the reputation and are good at doing promotionsor

advertisements. Because they can gain better reputation and become more famous by

promotion. They think only if customers recognize them, then they will make the company

stronger and do business smoothly.

Second Layer: Purpose

We separated the purpose into two parties, the sender and the receiver.Sender was Huawei

and receiver was US government. There was no BATNA between two parties, so our analysis

only focused on the MSO (maxim supportable outcome) and LAO (least acceptable

outcome).

For Huawei, we think their MSO was getting into the US market no matter how much they

cost. We think there was no bottom line for Huawei as long as they could get US

government’s permit, so the LAO was to leave the US telecommunication market. That

means they could still do something in the smartphone business even though it was not

profitable enough. For the receiver-US government, we think they did not have MSO. Their

only goal (LAO) was to prevent Huawei getting into USmarket. They just wanted to make

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sure that their telecommunication market would not be invaded and to protect their so-called

“national security”.

That is why the negotiation failed. Because there was no room overlapped between two parts’

purposes. They could not achieve a common ground during the negotiation and could not find

an effective way to solve the conflict. As a result, US government left no choice to Huawei.

Third Layer: Time and Environment

For the time, we think it was a wrong time to get into US market because of the furious trade

war between China and US recently. Actually after China joined WTO in 2001, it was more

convenient for Chinese companies to do business with other member countries. But at the

same time, we had to obey the rules of the organization, which means more limitation in our

export. At that time, many countries took the Anti-dumping and Anti-subsidy regulations to

prevent importing Chinese products. Because Chinese products’ price was much lower and

this made a big influence in the domestic market. After the economy crisis, this situation

became more and more serious. Even the WTO’s chief director believed that the trade friction

between China and US was rising (Bradley, 2010).

As an innovation and technology company, Huaweiwouldbenefit from the government

privilege policy. However it did not mean they get illegal subsidy from government.

For the environment, we think Huawei also lacked of advantage. The negotiation happened in

US, which means US government had more power and initiative. Huawei had to follow all

the processes and procedures for the negotiation.

According to the analysis above, we find that Huawei had no advantage in all the three layers.

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Firstly, Chinese culture has a big difference from American culture, which leads to the

different ways in doing business. Secondly, the purposes of Huawei and US government

show us that there was no room for two parties to negotiate. Last but not least, Huawei chose

a wrong time to enter US market, and the negotiation environment was not helpful at all. That

is why the negotiation failed in the end.

Culture barrier

The biggest cultural barrier for Huawei’s growth in US was lacking transparency. Americans

wanted to know a lot about the company. However, for US government, trying to understand

Huawei was a bit like Vatican-watching (The Economist, 2011).

Huawei was still unknown to most Americans, including the politicians and the public.

Although Huawei had successfully built the brand in Indian and European market with

highly-cost effective telecommunication equipment and mobile phones, American market

was still unexplored and unadvertised. Less exposure to the Americans led to the

misunderstanding and mistrust. The lack of transparency made the acquisition like a threat

rather than an opportunity of collaboration.

Misunderstanding and mistrust came from two aspects. Firstly, due to the financial and

strategic concerns, Huawei refused to become a publicly listed company (Wu, F., Hoon, L., &

Yuzhu, Z., 2011). Thus, outsiders had no legal right to investigate the account books and

transaction records. Some key information was untouched when US government made

Huawei into the investigation procedure. Secondly, the problem could be largely attributed to

an individual, REN Zhengfei, who is the founder of Huawei.

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Ren was known to always keep a low profile, who rarely accepts any interview invitation.

Maybe he was the most reclusive CEO in technology industry over the world (The

Economist, 2011). Rumors coming out showed that Ren cared less about the public image of

himself. He was very modest about his achievement and once claimed that he basically knew

nothing about the business. Although he was a powerful boss in a leading company, he was

cautious about everything and always prepared for challenges. He was a typical Chinese

leader, who was regarded as a strong person with great self-discipline, modesty and a sense of

urgency. However, the behavior pattern of Ren confused the US government. In western

society, the very detailed and even private information of the influential person is available to

the public. For instance, it is fairly easy to find the private information about Jeff Bezos, the

founder of Amazon that is also a leading company in the high-tech industry (Stone, B., 2013).

Almost everything of an influential character is transparent to the public. Therefore, after US

government’s failure in more understanding of the history and career development of Ren, he

was defined as a secretive leader with a lot of legends. An invisible leader brought a lot of

rumors about the business strategy, training system and fortress-like headquarter (The

Economist, 2011), which ruined the image of Huawei.

Recommendations

Since Huawei’s endeavor of entering US market was rejected and impeded for several times

by US government, Huawei should carefully and thoroughly think about the core problems

and handle them appropriately.

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In this section, wethe author will raise several proper and feasible recommendations for

Huawei, and those recommendations are majorly based on the theories that wethe

authorsdiscussed before.

Recommendations for culture barrier

Corporation level

At the beginning stage of the interaction, Huawei did not even have an in-house

spokesperson, who could speak to the media and the public (Wu, F., Hoon, L., & Yuzhu, Z.,

2011). Thus, At the corporation level, it is better for Huawei to change the culturally Chinese

style, even a traditional family business, to an internationalcorporate stylethat could be more

acceptable by US government. Moreover, Huawei should have an official response to the

rumors, in order to eliminate the negative effects. Also, this is a way to show concern about

the issues Americans care about. Furthermore, Huawei should keep persisting in its efforts to

prove its trustworthiness to US lawmakers and other holdouts (Embling, 2012). Making the

transparency as one of the norms of the business is very important to Huawei in the

international business milieu.

Individual level

Some suggestions are prepared for the publicity-shy founder of Huawei. Ren should not hide

behind the huge success of the company. More is expected from him so that he would be

better coming out to clarify the rumors about his identity. Maybe he could learn from Zhang

Ruimin, the former CEO of Hair, and Terry Gou, the CEO of Foxconn, to have more

exposure to media and the public (Wu, F., Hoon, L., & Yuzhu, Z., 2011). The last but not the

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least, Ren and the senior executives of Huawei may still have to overcome the second

language problem. Ren required the executives to learn English. He was trying to learn

English when he was 58 (Hua. J., 2010). Now, he is 71, still no English speech or interview

ever happened to him. Thus, the language barrier is another worrying issue.

Recommendations for negotiation

For the negotiation between Huawei and US government, the authors use the first three layers

of strategic model to identify the specific process of this negotiation and several problems are

distinguished. By this way, the authors will raise recommendations for Huawei at each layer.

Layer 1: Culture and Climate

In china, the prevalent cultural values are humble, guanxi and respecting for etiquette (Faure,

G. O., & Fang, T, 2008) while the American culture emphasizes on competition,

individualism and innovation. (Zhong, L, 2013) At the beginning, Huawei conducted its

business in a very humble and careful way, and tried to win the trusts from the target

company and the US government with modest and polite attitudes, but it failed all the time.

So, we recommend Huawei to change its acting style from humble style to aggressive style.

Huawei needs to show its real strengths and ambitious for entering US market and leave

people with the image of mighty and this may more in line with the American culture and the

ways of doing business. Meanwhile, it can help Huawei responds more vigorously to US

government’s allegations.

Layer 2: Sender, Receiver and Purpose

As mentioned in analyzing section, there is no room for two parts to start the negotiation

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because the Maximum Supportable Outcome (MSO) of Huawei and the Least Acceptable

Outcome (LAO) of US government were not overlapped during that time. Hence, creating a

bargaining zone for two parts should be a key way to revitalize this negotiation. To be

specific, Huawei can introduce US stakeholders into this negotiation for creating overlapped

bargaining zone. And the authors conclude four measures for Huawei reference.

First, Huawei should build business connections with the local power companies, such as the

connections with the mobile network operators, and try to become one of their suppliers.

Second, Huawei can set up its US branch and R&D department by recruiting US employees

rather than assigning Chinese employees to work in US. It may help Huawei have a better

understanding of local market and utilize the local resources to conduct business.

Third, Huawei must continue promoting its brand image in public by demonstrating the

economic and social benefits of Chinese investment and making people that Chinese capital

could be an opportunity rather than a threat for US people. By doing so, Huawei can gain the

supports from the local level and increase its negotiation leverage.

Fourth, this resort could be a last resort for Huawei, which is IPO in US. Because IPO is a

transition from private to public ownership by issuing liquid shares. (Certo, S. T., Holmes, R.

M., & Holcomb, T. R, 2007) If Huawei can IPO in US, that means it can represent the

benefits of millions of US stakeholders. Obviously, the US government cannot do things

against US stakeholders’ wills any more.

Layer 3: Time, Environment, Content and Channel

At this layer, the authors will present suggestions in terms of time and environment.

Huawei should choose an opportune moment to start this negotiation. For example, after

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Chinese government and US government signed a cooperation framework regarding to

environment and energy, the intense relationship and competition in these areas are relaxed,

and the cooperation brings mutual benefits and generates synergy for two countries. (Liping

Xia, 2005) Accordingly, the best chance for Huawei is the time when Chinese government

and US government sign a cooperation framework regarding to telecommunication industry

and the favorable environment can eliminate the hurdles that Huawei may encounter.

Besides that, Huawei should fully understand the American mainstream culture, the

competitive culture, and the behaviors of doing business before entering the US market.

Layer 4: Core Strategy

From the perspective of negotiation strategy, the authors strongly recommend Huawei to use

the strategy called “Take it or leave it”. This strategy means that contract offer directly

instead of negotiating over the contract in a more complex way. (Peters, M, 2003) By this

way, Huawei should directly show its bottom line and draw the US government’s attentions.

It may be risky but it is worthwhile as well, because Huawei can save its limited recourses

and capabilities and put them to more profitable areas by avoiding the escalation of

commitment.

Recommendation for conflict

The initial purpose for Huawei was entering the US market by acquiring high-tech US

companies, but US government stopped it. To a large extent, this was not a simple negotiation

between Huawei and Us government, actually, it reached the level of conflict.

For this situation, we have 4 basic skills for fixing the conflict, which are mapping,

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negotiation, mediation and broadening perspectives. (SHAO, R, 2015) From this angle, the

authors choose mediation to give advice.

To some extent, this negotiation was imbalanced. The powers of two parts were not identical

because the US government was the most powerful government in the world while Huawei is

a Chinese private company. Therefore, Huawei should introduce the third part to leverage this

negotiation. To be specific, Huawei can ask the Chinese government for help because the

Chinese government has right to protect its own companies to be treated fairly overseas and

its power can influence the outcomes as well. (Ma, H, 2006)

In order to achieve the ideal outcomes, the Chinese government can set preferentialpolicy

regarding to finical, tax, insurance etc. and create a supportive environment for those

companies go global. Furthermore, the Chinese government can investigate the similar US

companies in China market and set entry barriers for US companies as well, then make those

companies place great pressures on US government and force US government make a

compromise in the negotiation.

References

Bradley S. K.(2010).WTO Chief: U.S.-China Trade Friction Rising, Huff Post

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wto-chief-us-china-trade_n_432620.html

Certo, S. T., Holmes, R. M., & Holcomb, T. R. (2007). The influence of people on the

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performance of IPO firms. Business Horizons, 50(4), 271-276.

Daniel, T. (2013). Huawei has become embedded into UK telecoms infrastructure. New York

Institute of Finance.

Faure, G. O., & Fang, T. (2008). Changing Chinese values: Keeping up with paradoxes. 

International Business Review, 17(2), 194-207.

Forbes. (2015). The World’s Billionaires #1741 Ren Zhengfei. Retrieved on 20 March

2015from http://www.forbes.com/profile/ren-zhengfei/

Government blocks Huawei from building networks. Telecommunications Reports.77(21).16.

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Appendix

Figure 1. Huawei’s sales revenue

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Source: Shen Jingting, China Daily USA, 2014

Figure 2. Conflicts Grid

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