Huawei Value Chain Analysis Case Solution

1.Huawei value chain assessment

1.1.Huawei Company: drawing lessons from core competencies

The value chain of a company is developed after taking into account and consideration its various competencies and resources. This is because a company adds value, undergoes the value creation and addition process in tis products and services to provide a better consumer experience, and enrich the brand image and standing. This is possible by optimising the resources and advantages that a company may enjoy in terms of tangible as well as nontangible resources and goods. Huawei has made a resourceful value chain as well that is optimised by capitalizing on the advantages and resources enjoyed by the company.

• The core competencies and strengths of Huawei include innovation, economy of price and effective operations. Additionally, the strategic marketing tactics are also part of the company’s core competencies that have enabled the business to realize the leading retailer position of smartphones globally (Vizard, 2018).

• The important core competencies for Huawei are dependent on its human resources, as well as on its technological advancements and progress,
• In addition to the core skills, Huawei also enjoys and experiences non-core and non-central capabilities that allow it to maintain a profitable business operation, and enhanced value addition.
• Though Huawei has developed effective core competencies, it has been restricted in terms of slow regional expansion.
• The core capabilities and resources that are enjoyed by Huawei take up important roles in the company’s value chain. Based on resource based view Huawei’s value chain is equipped to develop and deliver innovative and advance products to its consumers
• The following section highlights the value chain for Huawei company

Figure 1 Value chain for Huawei

1.2.Value framework and approach for Huawei

• With the vision of digitalizing the world, and creating connectivity for everyone, Huawei’s business model is focused on value addition and value creation for the customers (Huawei, 2019 e).
• The value chain of the company assists in the attainment of this value oriented business model adopted by Huawei.
• As is seen through the value chain, Huawei works with the contractors, as well as has direct control over the supply chain and value chain for various activities.

1.3.Example from value framework for Huawei

• The organization supplies directly to the consumers through online retail channels. The company has limited delivery vehicles that are fully owned and operationally controlled by Huawei, through which it makes deliveries. This system, however, is limited to the company’s country of origin – China.
• The value chain and value framework of Huawei is competent in allowing benefits for the consumers in addition to capitalizing on the strengths and core competencies of the business itself.

2.Value chain activities

Brief details of Huawei’s value chain are discussed in the following section:

2.1.Primary activities

2.1.1.Inbound logistics

• Huawei has storage space controlled and owned by the company in china for manufacturing, assembling and storing its rpoducts
• Distribution of products in china take spalce through vehicles owned as well as contracted with by the company
• For global locations, Huawei rents warehouses, as well as employs contractual agents and managers for warehouse management
• These agents are trained by the company, and are responsible to align operations with the company appointed sales agents for distribution purposes.

2.1.2.Operations

• Huawei is a global company, and retails to different international destinations
• The company is headquartered in china, and has the bulk of its operation there.
• The R&D capacities of Huawei are spread across many countries like UK, Pakistan, Canada, Turkey, Ireland, Sweden, Russia, etc.
• Huawei’s products and services are deployed in around 140 countries all over the world through systems of export, sales agent and distributor models (Success Story, 2019)

2.1.3.Outbound logistics

• The bulk of the manufacturing and assembling process takes place in china for Huawei
• The company makes use of the export model to ship its products to different international destinations
• In each of the various global destinations, Huawei has contracted trustworthy and trained sales agents
• The sales agents are responsible for channel development to ensure smooth distribution and availability of the Huawei products and services
• Channel partners and agents work to make Huawei products easily available and accessible for consumers (Huawei, 2019 b)

The company has contracted agents in offshore countries and sites to manage product selling. However, a majority of the products are sold directly to licensed sellers and shops locally as well as internationally.

2.1.4. Marketing and sales

• Huawei invests in market research and consumer behaviour studies