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Huawei's internal forum on the afternoon of the 22nd online an article on "the entire company's business policy should shift from the pursuit of scale to the pursuit of profit and cash flow". Ren Zhengfei mentioned in the article that with the decline in global consumption power, Huawei should change its thinking and business policy from the pursuit of scale to the pursuit of profit and cash flow to ensure that it will survive the crisis in the next three years.

"To survive as the most important program, the periphery of the business is shrinking and closing down, passing the chill to everyone." The article mentioned that Huawei cloud computing should firmly support Huawei's business development and take the road of supporting the industrial Internet. Digital energy increases investment in strategic opportunities and strengthens combat teams. Smart car solutions can not spread a complete front, to reduce the scientific research budget, strengthen the commercial closed loop.

Huawei's most important judgment today is:

The next decade should be a very painful period in history, with continued global economic decline. Now due to the impact of the war and the United States continues to suppress the reasons, the world's economy in the next three to five years is unlikely to turn better, coupled with the impact of the epidemic, there should be no region in the world is a bright spot. Then there will be a significant decline in consumption power, which will put pressure not only on supply, but also on the market.

Of course, this is not the first time Huawei has shouted "survive." The question is, as strong as Huawei, as big as Huawei, are full of crisis, what can we do?

We do motor industry chain, can give the answer will not have too much deviation. That is, the only way out of the crisis is to "reduce costs and increase efficiency." So, in practical terms, what should we do? Let me give you a few important measures that can be used by different companies:

Maintain cash flow, the next three years profit income is not important, cash flow is the most important

Every founder has to look at how much money is currently on the books, and think about it from the worst degree, how much money can be expected to receive in the next 3-6 months? How long will it last? If you survive six months, congratulations. If you only have three months to live, you need to take drastic measures to manage your cash flow.

In order to maintain the collection and cash targets, some customers who may have problems will have to make adjustments. Some problematic receivables may need to be adjusted, and these are all aspects of dynamic management change that should be done in the strategy. In a crisis, there is nothing that cannot be done, and all measures that affect cash can be adjusted.

Of course, do you need to borrow money from the bank? I think the country is concerned about some large enterprises, and many small enterprises may not be able to get loans. The most fundamental thing is to solve your own problems. For example, the co-founders can take some of the money they made in the past and reinvest it.

Perhaps the least important aspect of the strategy for the next three years is the question of making money. May have to lower our profit target, insist on survival is victory.

Cut out all kinds of superfluous costs

The key is the following items, such as material costs, procurement costs, logistics costs, serious inventory structure, research and development cost waste, administrative costs and so on. Each company has to adjust its product strategy according to its own situation. That is to say, it is necessary to hold a product planning meeting for the next three years as soon as possible, so that our corporate executives and experts can do a comprehensive review and make another adjustment. To ensure that strategic products are still determined to do, tighten the belt to do.

Many companies have very many product development projects, very many products, do or do not do, the past is still a little hesitant. This year it was cut. There are some products in the past did not make money, do not know the future can make money, I think this year to make a determination not to do. Because we want to save money to build really valuable, strategic products. There are also marketing costs, administrative costs, including operating costs, which should be adjusted. Save what you can.

However, staff expenses, I can not think of a last resort not to reduce. Do not reduce the salary of employees, do not lay off employees, every more support for an employee, at this moment is to contribute to the country. Of course, there are some employees who are not strivers, from the year-end assessment, they also belong to the bottom 10%, that is, if there is no epidemic, they may have to leave the company this year. So, should this part of the staff move? My advice is to look at the company's cash flow. The company has money. Cut two fewer, or none. The company's really out of money, so there's nothing to cut.

However, we want to keep those real strivers, those who have followed the company all the way, grown up for many years, they are the company's baby, these people must resolutely save, even if they give them shares, but also let them live. Because they are the seeds of revolution.

Also, for middle executives, some adjustments and changes can be made. For example, the relatively high income is the senior executives, can not take the lead in reducing salaries? By how much? It's up to them. I don't think it's too much, just 20-30%. I think it's also a time for values and leadership.

In short, from the point of view of cost, try not to cut wages, do not cut people, and try to reduce transactional costs. In addition, we must encourage the masses to work together to find ways to save money, so that through this reform, a long-term mechanism can be formed. We also encourage 10 to 20 percent of these savings to be awarded to employees who make suggestions, so that everyone can continue to brainstorm.

Re-layout and readjustment around marketing and key markets

We will focus on some key customers and key markets this year. You have to choose your selected customers, key customers to do the service. Therefore, we need to hold an important meeting to select and adjust this year's market segments and target customers, and to evalsuate the existing customers, which customers can continue to cooperate? Which need to make strategic adjustments and changes. Another very important opportunity is our regular customers. In the past, due to inadequate service, old customers were lost. So, this year is your time to pick up old customers, in this difficult time, we want to emphasize customer service management, to help us these old customers.

Ren said that the more difficult times, the more to saturate the key customers, because if the customer dies, you really die. As long as the client is there, you will survive. We should do everything possible and wholeheartedly to help those customers who have difficulties and help them tide over the difficulties. These are The Times when all industries demonstrate true customer-centric values.

Therefore, in the marketing part, we should focus on key markets and key customers, especially the key markets where the epidemic is lighter, and we should make key breakthroughs. The Chinese market is very huge, there is still a lot of room for improvement. These markets are also promising in the future. Therefore, it is necessary to make adjustments and changes around the layout of key markets and businesses.

Supply chain transformation. The supply chain should be adjusted based on sales and market forecasts. At the same time, from the perspective of production planning, stocking, procurement, logistics to make adjustments. I noticed that the core problem of some cross-border e-commerce this year is insufficient inventory. This needs to be adjusted quickly, to communicate with suppliers, to develop new suppliers, to ensure smooth logistics.

For our enterprise, the difficulty is temporary, today's life is a battle, today's enterprise survival is a special battle. Difficulties may bring down a team, but it can also temper a team, a good team, must be in danger to fight out, spell out. Winter is temporary, history is always a cycle of the cycle, can survive in the winter of the enterprise, will be able to meet a more bright spring.