Upon graduation, Wang (family name) An sent his resume to IBM for an intern position. When the interviewer found out about his Chinese ethnicity, he ridiculed him, "IBM is a first-class enterprise in the country. We work with high technology. You should try your luck in a garage instead!". Humiliated, Wang An vowed to himself to establish a computer company of his own and beat all the others in the U.S. After he got his doctorate degree, he developed magnetic core memory and filed the patent for it. This gave him the very first pot of gold and unfolded the "Wang An Legend". He later founded the computer company Wang Laboratories.
From then on, Wang Laboratories never stopped inventing and innovating: card recognizer, automated typewriter, radio typing & printing device in 1950s, digital logarithmic converter in 1960s, and world's first word processing machine with editing & retrieval functions in 1975... We have to highlight the word processing machine, which was the prototype of a desktop computer: screen displaying characters and keyboard allowing for rapid modification of documents. Tens of thousands of office clerks were literally liberated from tedious work by this innovation. Thomas Watson Jr., the President of IBM, who was hospitalized then, learned from the newspaper how well the "word processor" had been received and reprimanded people around him, "How come? Why didn't you inform me earlier?" He almost passed out from anger.
Heading into its prime period, Wang Laboratories had an annual revenue of USD3 billion and employed over 30,000 people. Estimating his worth at USD2 billion, the press ranked him as the fifth richest American. Even Bill Gates admitted, "If Wang Laboratories had not collapsed, Microsoft would not have existed. I might have to work as a mathematician or lawyer somewhere else." Four years after the word processor was launched, a corporate Vice President suggested that they start to develop PC (Personal Computer). Unfortunately, Wang An, not being able to stay abreast of the situation, replied with a big no, "Personal computer? This is ridiculous!" In contrast, IBM at that time, spared no efforts to move forward by adding huge input into PC R&D (Research and Development) and making open technological standards, thus encouraging vendors of PC compatible computers to spring up. In addition, these vendors formed a strong alliance with IBM. Not only did they develop the application software compatible with IBM's PC, they also stimulated IBM's PC sales in the meantime.
Thus, people's interest shifted to PC in the early 1980s, leaving the word processor an undesirable antique. Wang Laboratories had no choice but to delve into PC, and quickly launched their first product within a few weeks. Somehow, Wang's PC had a fatal defect: it was incompatible with IBM's software. Wang An did this on purpose as he firmly believed that Wang Laboratories has built its name on personal products and once customers bought their hardware, they must purchase their software as well, which he assumed would naturally and definitely lead to more profits for his company.
Back in 1984, over a hundred of software could run on IBM's PC, while Wang An did not allow software from any other vendor to run on his. When Wang An became fully convinced and finally decided to produce IBM compatible PCs, IBM PCs represented already the industry standard. Within three years, Wang Laboratories' fortune sharply declined, with a loss of USD424 million and a 90% drop of share value. Like this, Wang Laboratories failed to extend its history beyond 1992. After filing for bankruptcy protection, both the company and its founder suddenly disappeared from the stage.
[Pursuing development is the absolute path to follow.]
In 1994, President Ren participated in the COMDEX (an abbreviation of Computer Dealers' Exhibition) held in Las Vegas.
This exhibition made us realize what technological crisis and market crisis were actually about. Wang Laboratories enjoyed an annual revenue of USD 3.5 billion three years ago and they were filing for bankruptcy. Mitsubishi, a leading group in Japan, had to quit from making computers. A prevailing sense of crisis pushed this world forward. Huawei was placed by history in a position where ithad to forge ahead in order not to fall behind. There is no end to technological innovation and growth. If you miss the chance for development,you will lose once and forever.
To survive, Huawei has to keep a reasonable growth rate.
We will not be able to sustain our development without sufficient profits resulting from a reasonable growth rate.
The rapid expansion and development of information networks led to an ever increasingly shorter life cycle for new products and technologies. It will be extremely hard for a company to grow if it fails to capture economies of scale by seizing the transient windows of opportunity. Without a huge service network worldwide or a large-scale management system to drive and support such network, a company would not be able to obtain enough profits to sustain its own growth and rapid development.
Without a reasonable growth rate, we cannot offerour staff more opportunities to develop themselves, thereupon attracting moretalented people we need.
We offer opportunities to employees to further their self-development by sustaining a reasonable growth rate. The increase of corporate profits ensures a fair and sound remuneration structure, which attracts more talented people to join us. Only thus can an optimal configuration of resources be achieved. And only by keeping a reasonable growth rate can we preserve our vitality.
[Memory at Huawei] Li Jian's Story
Li Jian (now Vice President of the Joint Committee of Regions) joined Huawei right after obtaining his Master’s degree. While working as Product Manager in Nigeria Representative Office, once, he had to go through great pains before he was allowed to meet a president on the customer side. He ended up meeting this president by chasing after him to a rest room after a 3-hour wait outside the office. Li Jian, in his business suit and with a laptop & projector, visited one customer after another, under 40°C heat. Three months later, he signed contracts with total worth of USD30 million; a year later, USD200 million; in the third year, the figure jumped to USD400 million. Four years in a row, sales of Nigeria Representative Office ranked No. 1 globally across Huawei, and the Office was called the "Mountain Top" of the company.Li Jian was promoted by three grades in a short time, from Product Manager to Vice President (and then President) of the Western Africa Region, with a total of 2,000 staff working under him.
[Not swayed by short-term benefits, but stay focused on developing Huawei's core competencies]
As we all know, Shenzhen experienced two eras of economic bubbles: one was in real estate, the other in stock market. Thankfully, in neither field Huawei was affected. We did not mean to sing our own praises but it was simply because we take our technology business seriously. Even though we did foresee the upcoming surge in real estate and stock market, we chose to skip the chance as we believe that the future is a knowledge-centric world other than bubbles-centric. We were not swayed by short-term benefits, but stayed focused on developing our core competencies in operation and management. Anything detrimental to this goal was resolutely rejected. Huawei stood the true tests of temptation.
[Memory at Huawei] I suffered for eight to ten years because of PHS (Personal Handy-phone System) and TD (abbreviation of TD-SCDMA: Time Division Synchronous Code Division Multiple Access).
As an extension of landline telephone, PHS supported both landline and wireless communications and there has been huge market demand for it. Technologically speaking, PHS is rather underdeveloped. Leading players, including Huawei, remained pessimistic on its prospects. UTStarcom however seized the opportunity and bought the PHS technology that had been weeded out from the Japanese market. Unexpectedly, UTStarcom won this impossible game under the specific circumstance, where China Telecom had not yet obtained the license for mobile communications. In 2003, UTStarcom once took over 70% of the market share in major marketplaces. In 2004, UTStarcom got listed in NASDAQ and became a FORTUNE 1000 company. For a consecutive 17 months, UTStarcom outperformed the expectation of Wall Street. In all its flourish, the sales revenue increased hundredfold.
However, built on the ideology basis of customer-centricity, Huawei executives persisted in exercising what represents the universal truth in the market: to position the company in a "rational, unequivocal, and unforced" way towards customer needs. It was with this understanding in mind that the company refrained from investing in PHS. This led to a heated debate within the company. In fact, only an investment of CNY20 million and around 30 key engineers back then could have churned out products in six months and an equivalent of CNY10 billion of profit. Huawei's executives went against external and internal pressure, choosing instead to focus on the R&D of WCDMA (Wideband Code Division Multiple Access) technology. We then witnessed with mixed feelings the sharp rise of UTStarcom and other domestic vendors. Negative growth for the very first time in 2002 added to our woes. Concerns about "how long exactly can Huawei's red flag wave" began to spread. But President Ren Zhengfei's resolve was unyielding: Huawei never lets go of any business opportunity, but it remains a company with lofty ideals.
"I suffered from depression for eight to ten years because of PHS and TD. I did not fear the outside pressure, but feared the internal pressure the most. I had no idea whether my insistence on refraining from PHS would lead Huawei to a big mistake, or even a collapse. If we chose to go for PHS, would it be a waste of our resources intended for further strategic moves? I was terrified. When TD market was active, we had no chance at all due to insufficient input and lost the first bid round. With added input, we won the second round and began to take the leading position in the third round. This is what we call a strike-back strategy. I could hardly look back on how I survived those eight years. Assuming the responsibility over Huawei's life and death was too much to bear. Are all of you going to lose your jobs? I was terrified and depressed, because I really had no idea."(Source: Drawing Energy from the Universe over a Cup of Coffee --Speech Given during the Meeting with Experts in Shanghai Research Institute)
On June 1st of 2007, Wu Ying left UTStarcom, marking the rapid decline of the company...
[Shift from Scale Centricity to Cost-effective Growth]
[In Pursuit of Growth with Ensured Profitability]
In 2000, the Internet bubbles spectacularly burst.
As a matter of fact, there were also bubbles within Huawei. Had we chased after the bubbles in those years, we would have perished then. All bubbles are doomed to burst, aren't they! What was our measure to clear out the bubbles? It was to enhance the cost-efficiency per capita. ... In my point of view, winter may not be a bad thing, since we haven't gone far to the cliff edge.
It is the perfect time to quiet down, to align the troop, to adjust our structure and to enhance the cost-efficiency per capital. So that when spring comes, our organizational structure and strategic layout of employees can still be properly maintained.(Source: Be aware of objective laws, let core teams exert their roles, increase cost-efficiency per capital, and weather the storm through joint efforts, 2002)
Later months of year 2008 witnessed the bankruptcy of Lehman Brothers, and it triggered the global financial crisis. The IT industry got soon affected, causing a global layoff exceeding 160,000 in the technological sector.
In the first two decades following Huawei's inception, the market was large and profits were high. At that time, we focused on scale as it guaranteed profits. However, we have adjusted this practice. Now, we require every Representative Office, every Region, and every Product Line to focus on positive cash flow, reasonable profits, and improvements in employee efficiency. I believe significant changes will take place over the next three years. If we continue to be scale-oriented, the company will spin out of control. Hitting our profit targets should be our ultimate goal.(Source: Remarks at a Meeting with Senior Managers at PMS, 2009)
In June 2017, President Ren visited Thailand, Germany, Poland and Russia, four countries within four days. He highlighted numerous times in his speeches the principle of "profitable growth and healthy cash flow".
? Our transformations must lead to fruitful harvest. Ultimately, we need to see an improvement in data and metrics. Ideally, we need a balanced combination of form and results, orienting to outcomes.? The emphasis has to be on profitable growth and healthy cash flow. We must make profits. To this end, the scale of network sales can be reduced if necessary. If a contract is unfavorable to us, don't sign it. When revenue drops, expenses must be cut accordingly. In the coming year or two, we will continue to see growth in our enterprise and consumer businesses. This means the company's total revenue will grow. We must ensure our survival, not getting ahead of ourselves.
? Under a sluggish global economy and a hard time for carriers, we cannot force growth. Otherwise, we may end up in a dead end. We have to ensure profits and go through this tough period. Afterwards, we can start picking up the pieces. Don't be too eager to expand. If we don't stand firm, even a breeze could blow us away. We need to get through this difficult period in a sustainable way.(Source: Summary of a Meeting Between Mr. Ren Zhengfei and the Germany Representative Office, 2017)
[Thoughts at Huawei] What are your thoughts? Scale development or profit growth?
"I suffered from depression for eight to ten years because of PHS and TD". The story of PHS, mentioned in this article, is very well known. But most people know little about what actually happened to TD. Let me tell you the whole story of Huawei's TD-SCDMA development. This is complied based on documents and information available on W3 and from press articles. More inside stories are welcome.
I. The dark horse broke its leg.
As early as 1998, Siemens started the study of TD-CDMA. TD-CDMA later lost its competition to WCDMA, and the latter became the 3G standard. With an accumulated investment of USD170 million, whether to stick with TD-CDMA became a dilemma for Siemens, not to mention the prospect of relocation for related employees, a considerable number at the time. As a result, TD-CDMA was forced to move from Europe to China, integrating into China's 3G standard--TD-SCDMA. With the establishment of TD-SCDMA Industry Alliance in 2002, Datang Mobile opened the TD-SCDMA's technological patents on a large scale and Chinese government’s support continued to grow. Facing TD-SCDMA, a Chinese homegrown 3G standard contributing to the advancement of national telecom industry, Huawei had to make itself a part of it. Huawei was however pessimistic towards TD-SCDMA and made huge investments in WCDMA and CDMA2000. Under such background and with joint efforts from multiple parties, the collaboration between Siemens and Huawei began: Siemens needed a place for its technology and employees, Huawei to fulfill its corporate citizenship mission.
In March 2005, TD Tech Ltd. (TD Tech in short) was founded in Beijing. Being a joint adventure between NSN (Nokia Siemens Networks) and Huawei, TD Tech was evidently born with a silver spoon in mouth. By the end of 2006, the accumulated investments from both parent companies exceeded USD300 million, ranking No. 1 in capital input among all TD players. Siemens started the TD R&D back in 1998 and had invested over EUR200 million before the establishment of the joint venture. Plus, Siemens had many TD patents at hand. Seemingly, both parent companies wreathed TD Tech in glory: Siemens' quality control system, both companies' noted expertise in patents and technologies, market channels and sales capacity. TD Tech so far appeared to have everything expected of a dark horse.
In 2007, when China Mobile invited Phase I bid for TD-SCDMA equipment covering eight cities, Maler, CEO of TD Tech, boldly proclaimed that TD Tech was going to take 30-50% of the share. The figure estimated by industry insiders was at least 20-30%. Beyond all expectations, TD Tech only obtained a share of 13%. ZTE and Datang became the biggest winners in this round, taking market shares of over 40% and 30% respectively. In May of the same year, China Mobile revealed the results of first round of TD-SCDMA bid: ZTE and associated subsidiaries (ZTE, Ericsson) reaped 46.78% of the shares, Datang and associated subsidiaries (Datang Mobile, New Postcom Equipment, FiberHome Communication) 36.68%, TD Tech 13.82%, and Potevio 2.72%.
13% was a dreadful number for TD Tech. Huawei's executives were highly dissatisfied about such an outcome and issued the following punishment: Pay cut for Xu Zhijun and other project owners. Xu Zhijun was by then the Senior Vice President of Huawei, taking in charge of corporate strategies and markets, and also the owner of TD-SCDMA Project.
II. What led to such a crushing defeat?
For Huawei and foreign telecom equipment vendors, TD was like a chicken rib: something you neither want to eat nor throw away. It is a standard heavily influenced by Chinese national policy. It is not a matter of whether to go for TD, or of how much market share TD will take. In the end, it is a question of whom TD serves. Since we were talking about the so-called "China's homegrown 3G" (I use the word "so-called", as technically it is not homegrown. Datang's core patents account for only 8%, less than those of Siemens. Obviously, 8% is by no means a majority), we had intended to change the market landscape of 2G era, where foreign vendors took the leading shares. Plainly, policy favored Chinese domestic vendors: Datang, ZTE and Huawei to be exact. Datang is state-owned, ZTE state-owned yet publicly listed, and Huawei private. Support to Datang and ZTE means protection and growth of national assets; but equal support to Huawei implies simply more tax revenue. A deal with Huawei made no difference from that with Nokia or Ericsson. So, the shares of TD market were already divided before TD was even launched. Things were planned to protect and grow national assets. This explained the dilemma both Huawei and foreign vendors were facing: they had to contribute, but how much?
ii. Mutual exclusion in gene
Looking back on multiple M&As (Merge and Acquisitions) in the telecom industry, we can conclude that these moves were made with extremely specific agenda. For example, Alcatel-Lucent complemented each other by their respective advantages on WCDMA and CDMA2000. The collaboration between Nokia and Siemens enabled their new company to be in a leading position in converged communications, both in wireless and fixed-line networks. Even in the TD-SCDMA area, alliances were made between vendors of wireless access and core network solutions.
It is however a different ball game for Siemens and Huawei, as the two are absolute competitors in WCDMA. And both enjoy sufficient resources/capacity to support the core network solution of TD-SCDMA. Besides, Siemens and Huawei were in a head-to-head battle while fighting over the ownership of Harbor Networks. Just before Siemens was about to become the new owner of Harbor Networks, Huawei came out of nowhere and won the final round. Such two competing companies eventually built a joint venture. So it is not a surprise if the subsidiary company struggled to survive.
iii. Pains of starting from zero
Vigilant guard against each other stopped the two parent companies from opening technological patens to TD Tech. Although “born from noble blood”, TD Tech had to actually start from zero. In October 2005, Datang Mobile announced they had successfully implemented the upgrade of TD-SCDMA system and enabled HSDPA service. TD Tech in turn responded publicly that the R&D of their TD-HSDPA product would follow the actual commercialization progress of TD-SCDMA. The industry insiders all knew that TD Tech had no other choice but to say this. Moreover, TD Tech failed to get any support from parent companies in RRU (Remote Radio Unit). RRU was Huawei's invention in WCDMA, but ZTE stole a march by launching the first remote radio solution in TD. As for Datang Mobile, it introduced Smart Antenna in support of 6 sectors. Even in such situation, TD Tech joined the battle with its "routine weapons". When three vendors put their cards on the table, it was easy to judge who the winner would be.
iv. Cultural conflicts
Cultural conflicts of the two parent companies also held back the development of the joint venture. Siemens follows the typical European style while Huawei is well known for its culture of Wolf. In the early days, if you were at TD Tech, you would see the following amusing scene: employees from Huawei kept a sharp eye on those from Siemens, saying, "Don’t leave before finishing this work”. Disparate corporate cultures brought about more disputes and conflicts. Plus, at the leadership level, “if this or that could not be accomplished” was often put forward as a threat to split up, demonstrating a lack of determination to engage in a long-term collaboration. When internal conflicts worsened, it became rather easy for other multinational companies to poach talents inside this young firm. As a result, TD Tech suffered from brain-drain of many key talents, and became somewhat a training center for other vendors.
v. Fight for dominance in conversation
In 2007, when China Mobile invited Phase I bid for TD-SCDMA covering eight cities, the total price of the bid was CNY26.7 billion, whereas China Unicom invested even less with CNY 24 billion when it officially launched its CDMA networks. By comparison, it was evident how much potential the future TD-SCDMA market would hold.
Huge profits are inevitably accompanied by fierce competitions. Both Siemens and Huawei knew very well that the dominance in conversation foreshadowed the final profits. Both had the ability to support the core network solution of TD-SCDMA. To enable the end-to-end network solution, the final decision on integrating which company's core network product with wireless access equipment will greatly affect both parent companies. Hence, both parties did their utmost to fight for the dominance in conversation. It was clearly impossible for them to unite under one banner.
III. Better late than never, turn the tide.
In 2008, with the approach of the Olympic Games, China Mobile intended to launch the second round bid of TD-SCDMA.
With only eight cities covered in Phase I bid, China Mobile planned to include probably 300 cities in the second round. The total price for the second bid far exceeded the first. Chine Mobile was serious this time. If Huawei failed to act on this, ZTE may probably strengthen the relationship with China Mobile based on their collaboration on TD, so as to further nibble away Huawei's leading position in the Chinese domestic market. According to the Agreement between Huawei and Siemens regarding the establishment of TD Tech, as parent companies, neither Huawei nor Siemens was supposed to engage in the R&D of TD-SCDMA wireless access system; instead, both should give full support to the joint venture in such direction and efforts. Considering that much of its plans and actions were constrained by the clauses in the Agreement, Huawei saw clearly the situation, and made up its mind to take over TD Tech at this sensitive moment and to go all out to win TD market.
Chances favored Huawei. At that time, Nokia Siemens Networks (joint venture between Nokia and Siemens) was not quite stable after the M&A. Problems arising during this period offered Huawei an opportunity. After rounds of arduous negotiations, the new "couple" of Nokia and Siemens decided to break the deadlock by involving Huawei and asking Huawei to take care of both of their bankbooks.
On April 29th 2008, Maler, the founding member and previous CEO of TD Tech, quit and Hou Jinlong, Vice President of Huawei's Wireless Product Line took the position. Likewise, more Huawei people were introduced into the mid-level management team, which gradually brought in Huawei's strong Wolf culture. In light of its disadvantages in TD, Huawei added R&D employees, strengthened R&D efforts and gave top priority to TD R&D. Based on upgrades and updates of original R&D platform, buildup of sales channels and service architecture, and more competitive products, Huawei recaptured the lost market share.
On November 12th of 2008, China Mobile announced TD-SCDMA equipment bidding results as follows:
Datang and associated subsidiaries: 35-40%
TD Tech and associated subsidiaries: 25-26% (only 13% in Phase I)
Then there was not much to tell, as President Ren mentioned: When TD market was active, we had no chance at all due to insufficient input and lost the first bid round. With added input, we won the second round and began to take the leading position in the third round. This is what we call a strike-back strategy.
Back then, we gave up on PHS because we put our bet on the 3G R&D in which we continuously invested CNY6 billion. But because the 3G license issuance was delayed again and again, Huawei's 3G business gained almost nothing within three years. Each time President Ren met with the heads of the Wireless Dept., he would raise the same question, "When can you earn back the six billion we had invested?" ... Around 2003, only a few operators in developed countries/regions worldwide were building their 3G networks, e.g. Europe, the U.S., Japan, Hong Kong, Saudi Arabia, etc.
Huawei's Wireless Dept. broke through the European market with distributed BTS (Base Transceiver Station). Before their collaboration with Huawei, European operators held a habitual distrust against Chinese faces. When we submitted a bid for a Telfort project (a small telecom operator in Netherland), they asked us bluntly, "Why should we choose you? Your only advantage is your low price. You cannot guarantee our success..." The head of our Wireless Marketing felt distressed: our price was 20-30% lower than others and we were rejected nevertheless. What was the specific concern of Telfort? After several discussions with them, we found out the source of their pain: indoor coverage. Then the head of Huawei Wireless Marketing said, "Let us resolve this for you." And he drew some sketches to explain his proposals, and was told, "If you can do this, we will buy your equipment." Driven by this specific customer demand, Huawei's Wireless R&D organized a group of tech talents, who worked countless extra shifts. Finally, we presented Telfort our solution, which became the very first breakthrough of Huawei's 3G products in the European market.
Before becoming the Gold Wireless, Wireless Dept. borrowed a lot of money from other Product Lines for bonus distribution. They needed money to survive. Yet, this practice continued for several years. From what I could tell, they still had not paid the money back. Putting ourselves in their shoes, we can sense our company's resolution in wireless but we can also imagine the pressure the Wireless employees had to face.
I understand it is easier to cut costs than other more sophisticated measures, and in a structure as large as Huawei, simple directions work as they scale better.
Nevertheless, my view of the situation is that given the quality of our products and solutions, our technological leadership and our high reputation in the market, we are often selling cheap and this impairs our profitability.
Maybe our customers still see us as the price disruptors of the past, and we cannot overcome it. But we need to address this at all levels.
As we pursue cost reduction, I would spare a thought as how we can be better in presales. Our competitors, with more limited solutions, tend to do a much better job at influencing the customers, and when the tenders arrive are very biased against us. Then to recover, we need to sell cheap.
It is a pity, as this sows the seeds for stunted growth for the company.
It only takes one time to lose control completely. Back in those days, imagine when a team of 300 made a revenue of ten billion, while the majority of Wireless staff already spent six billion without making a cent. How are the employees supposed to react? They would all chisel their way into the PHS team, turning a team of 300 into a team of 30,000. What are the resources left to us in preparation for the opportunities in 2007?
I would rather leave strategy planning to the Huawei leadership. Failures of Wang An and UTStarcom offer a lesson to learn for everybody:
1. Wang An's complacency and narrow vision failed him. Refusing to walk out of his comfort zone, he even feared walking too fast. In fact, life is like this too. On the summit, we should be more cautious. Never rest on past laurels, never refuse to grow. The less challenging you find your work or the narrower is the room for thinking, the more it should raise a red flag in your mind.
2. UTStarcom's gambler mentality caused its failure; it bet all it had on one single throw. Reaching one's peak is usually followed by a decline. For a company, we need to think about its long-term survival instead of remaining in the comfort zones. Think and plan for the future. Find a long long trail, so that you can hike longer. Similarly for us at Huawei, we need find a direction to strive for, keep persevering, and become a high performer.
“Hardware mentality” is hard to get over because we have been doing like this for many years. For “soft things” such as Clouds, big data, etc… however, we are not yet ready in terms of conception/thought and process/architecture. Everyone knows that 5G will be our new profit point over the coming years, something we will depend on to survive winter. Yet, we chose to do Cloud services, putting us in direct competition with operators. They very probably will put us out on a limb in the domain of future 5G. Will our gamble on 5G finally pay off? It is hard to tell now. If the two matters mentioned above were resolved, we could possibly survive the upcoming winters, safe and sound, and keep a fast growing rate.
The growth of an individual enterprise must be analyzed under its social economic development. When the social economic development and reform favor rapid growth of an industry, individual firms are supposed to seize the chance to grow and aim for scale. Yet, when the industry hits a stagnant or slow phase, cost-efficiency becomes more important. Even ships, as big as they are, need to make a U-turn sometimes. Window of opportunity and transitional periods are equally important. In my opinion, a company should base its long-term development on big opportunities. Lean seasons are inevitable but we need to focus on the big opportunities while rationally managing the recession and risks during the transitional periods. After all, perseverance through the cold season is expected to multiply fruits in the warmer seasons.