Every leader knows how important a cohesive culture is to the success of the company, but it's difficult to get it just right. Any combination of pressures from investors, a poor business climate, or the wrong attitude toward your employees could ruin the chances of unifying the whole team under one strategic goal.

Huawei, the Shenzhen, China-based networking and telecommunications equipment and services giant, is one of the most successful privately held companies in the world. In 2014, it posted record-high revenues of $46.5 billion and $4.49 billion in profits. In a Harvard Business Review article, David De Cremer, a professor of management at Cambridge's Judge Business School in the United Kingdom, writes about how Huawei founder Ren Zhengfei built a cohesive culture at the company.

One of Zhengfei's first company slogans, De Cremer writes, was a saying he pulled from his time in China's People's Liberation Army. "We shall drink to our heart's content to celebrate our success, but if we should fail let's fight to our utmost until we all die." Zhengfei says that this mantra is the foundation of a mindset of drive and determination to succeed, which Huawei needed to best competitors like Ericsson.

Below, read four culture hacks Zhengfei employed at Huawei.

1. Eyes on the customer, back to the boss.

Every leader knows that the customer is always right all the time. But few companies actually go out of their way to fix problems customers may have that are only marginally related to their company's product or service. To instill a sense of purpose in his employees, Zhengfei has repeatedly told his troops "to turn their eyes to the customers and their backs to the bosses."

De Cremer offers this example of how this works in practice: At one time, a big problem for Huawei's rural customers was service outages due to rats chewing through telecom wires. Most telecom companies, he explains, saw this rat issue as their customers' problem. Huawei, however, "viewed the rat problem as one the company had the responsibility to solve. In doing so, they acquired extensive experience in developing sturdier equipment and materials--such as chew-proof wires--which helped them later on to gain several big business accounts in the Middle East, where similar problems stymied the multinational firms." 

2. Build employee ownership.

Most progressive companies create employee-ownership incentives, but Huawei has taken it a step further. In its early days, Huawei onboarded employees by giving them all a blanket and a mattress so they could work late and sleep in their offices. "The pads were to us a representation of hard work in the old days and this idea has now been translated into the spirit of being dedicated to do the best in anything we do," an employee told De Cremer.

Zhengfei instituted a performance-based ownership system. The vast majority of shares in the company have been given to its more than 82,000 employees; only those who perform well enough qualify. The system also prevents the company from being controlled by one investor. Zhengfei says he did this because he wants to share both responsibilities and benefits with his colleagues. But most importantly, he tells De Cremer, he wants everyone to "act like the boss." 

3. Don't be a despot.

Many leaders like being the top dog, but Zhengfei has introduced a rotating CEO system to further the ownership-sharing model he created. The three deputy chairmen take turns acting as CEO for six-month stints while Zhengfei acts as a mentor and coach. Zhengfei says that he learned this structure from James Belasco and Ralph Stayer's book Flight of the Buffalo. He instituted it to help buffer the company from the risk of failure due to one executive's mistakes, as well as to create a system where there isn't one person making all the decisions.

4. Make slow decisions.

To go along with his shared ownership and rotating CEO system, Zhengfei also employs a strategy he calls "the power of thinking." He emphasizes the importance of intellectual curiosity, and requires executives to read books about things that are outside of their expertise. Zhengfei also makes executives share ideas and strategy with the entire company. But his most important mandate is that every employee issues feedback, which is the key to "the future vision" of Huawei, De Cremer writes.

Published on: Jun 12, 2015