SWOT analysis of Huawei
This detailed SWOT analysis of Huawei aims to examine the strengths and the weaknesses of Huawei. It also aims to examine the opportunities the company should explore and the likely threats it should keep an eye on. Huawei Technologies Co., Ltd is a Chinese multinational technology company headquartered in Shenzhen. It was founded in 1987.
Strengths of Huawei
Huawei has already reached out to more than 170 countries and regions with a relatively short period of time and serves more than 3 billion people around the world. It is a leading global provider of ICT infrastructure and smart devices. Phones, laptops, tablets, wearables, smart homes, mobile broadband, cloud computing, web security, and mobile device management are some of the popular products and services of Huawei (Huawei Technologies Co., Ltd, 2019).
Huawei’s products are very popular around the world. Particularly, the smart phones have made global fames. The company offers both high-end and low-end handsets. Its Mate 20 Pro is one of the best smartphones in the world with a beautiful design, excellent screen, and snappy performance (Eadicicco & Villas-Boas, 2019). As of the first quarter of 2019, Huawei holds 19% of global smartphone market share making it the second largest giant after Samsung (IDC, 2019). It is worth noting that Huawei is the market leader in its home market, China.
One of the biggest strengths of Huawei’s products is the combination of high quality and affordable prices. Huawei is indeed one of the cheapest smartphone manufacturers out there in the market. Its laptops and tablets are also cheaper than most of its competitors. Another important strength to note is the ownership of the company. Huawei is a private company wholly owned by its employees. No outside organisations or agencies hold its shares (Huawei Technologies Co., Ltd, 2019).
Huawei is very committed to research and innovation. It invests 10% of its annual revenue in research & development (R&D) every year. Its long-term commitment to innovation is reflected in its classification of innovation into three types: application innovations, product innovations, and fundamental technology innovations (Huawei Technologies Co., Ltd, 2019). Its great efforts in innovation are well recognised and is reflected by its winning of a number of awards and accolades over the years e.g. prestigious awards such as ‘Best Telecom Service Innovation’ and ‘Leadership in IoT’, that it won at the TechXLK8 Asia Awards 2018 in Singapore.
Weaknesses of Huawei
There is no doubt that Huawei is the smartphone market leader in China and some other countries. However, its performance in many countries is very poor. For instance, its mobile vendor market share in the UK as of September 2019 is 9.24% which is weak compared to Apple’s 48.71%, and Samsung’s 29.14% market share. Likewise, its market share in India is 2.83%, while 6.41% in Canada (Stat Counter, 2019).
Many people perceive that Huawei as a provider of cheap tech devices and services. This perception has not been helpful for the company. Likewise, it was accused of espionage for the Chinese government. It was also accused of breaching various intellectual property rules. These allegations have negatively impacted on the brand image, though Huawei has rejected them.
Opportunities for Huawei
Huawei should pursue the opportunity to increase the smartphone market shares in countries such as India, the UK, Canada, France, Germany, South Korea, and some others around the world. Demands for other tech products such as tablets, wearables, mobile broadband, cloud computing, and web security are also high in many countries; hence an opportunity for Huawei for growth.
As Huawei is a R&D-oriented company, surely many new opportunities are likely to emerge with the passage with of time. Particularly, 5G technology and artificial intelligence (AI) offer the company opportunities for further growth. In fact, the company is now behind two-thirds of the commercially launched 5G networks outside China, including but not limited to countries such as South Korea, Switzerland, the UK, Germany, and Finland (Liao, 2019).
Threats to Huawei
Threat is the last element to address in the SWOT analysis of Huawei. Huawei faces a number of competitors in its global markets. For instance, its main competitors in smartphone market are Samsung, Apple, Xiaomi, OPPO, Vivo, Sony, OnePlus, Lenovo & LG. Likewise, its main competitors in the tablet market are Apple, Samsung, Amazon, Lenovo, and Microsoft.
Bans on Huawei by some countries pose a significant threat to the company. For example, as of May 2019, countries such as the USA, Australia, New Zealand, Japan, and Taiwan have decided to ban and phase out the company’s products within their mobile networks (Buchholz, 2019). Likewise, some countries have already decided to restrict the activities of Huawei as well. These bans and restrictions are likely to cause damages to the company’s finance and brand image globally.
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Last update: 18 October 2019
Buchholz, K. (2019) Which Countries Have Banned Huawei?, available at: https://www.statista.com/chart/17528/countries-which-have-banned-huawei-products/ (accessed 18 October 2019)
Eadicicco, L. & Villas-Boas, A. (2019) Why Huawei smartphones are so popular all over the world — except in the US, where stores don’t sell them, available at: https://www.businessinsider.com/huawei-smartphones-are-popular-all-over-world-not-united-states-2018-12?r=US&IR=T (accessed 18 October 2019)
Huawei Technologies Co., Ltd, (2019) Corporate introduction, available at: https://www.huawei.com/uk/about-huawei/corporate-information (accessed 17 October 2019)
IDC (2019) Smartphone Market Share, available at: https://www.idc.com/promo/smartphone-market-share/vendor (accessed 15 October 2019)
Liao, R. (2019) Huawei says two-thirds of 5G networks outside China now use its gear, available at: https://techcrunch.com/2019/06/25/huawei-wins-5g-contracts/ (accessed 18 October 2019)
Stat Counter (2019) Mobile Vendor Market Share Canada, available at: https://gs.statcounter.com/vendor-market-share/mobile/canada (accessed 15 October 2019)
Photo credit: Pixabay
Author: Joe David
Joe David has years of experience both in the UK and abroad. He writes regularly online on a variety of topics. He has a keen interest in business, hospitality and tourism management.