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By Jeff J. Brown

Pictured above: a quote from the writings of Mao Zedong, the greatest and most influential national leader of the 20^th century. It says, “Do not keep thinking about me and do not expect me to come back. (Instead) When it is my time to go, you will become me. Long live the people（不必时时怀念我，也不要指望我回来，我离开以后，你们就是我，人民万岁！– 毛泽东）”.

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Sixteen years on the streets, living and working with the people of China, Jeff

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As I wrote extensively in The China Trilogy (see below), it is impossible to understand and appreciate Mao Zedong behind the Great Western Firewall, since the Big Lie Propaganda Machine (BLPM) brainwashes people to loathe and fear anything and anyone associated with communism-socialism (https://chinarising.puntopress.com/2019/12/26/merry-maomas-mao-zedong-was-born-126-years-ago-today-china-rising-radio-sinoland-191226/). The global capitalist oligarchs have to blind their sheeple to its century-long string of successes, starting in 1917’s Russia (https://espressostalinist.com/) and up to today (https://chinarising.puntopress.com/2020/04/12/the-winners-of-the-sars-cov-2-panic-are-communist-socialist-anti-imperialist-peoples-the-losers-are-the-99-in-gangster-capitalist-eurangloland-and-its-global-vassals-china-rising-radio-sinoland-2004/). Otherwise, the 1% would have a citizens’ revolution on their hands and be forced to give their many stolen trillions of dollars/euros in social services, education, medicine, infrastructure and real wage jobs back to the 99% (http://chinarising.puntopress.com/2017/10/25/how-can-western-capitalism-beat-this-thats-the-rub-it-cant-china-rising-radio-sinoland-171022/ and https://chinarising.puntopress.com/2019/10/01/still-unstoppable-after-70-years-chinas-communist-liberation-changed-the-world-forever-for-the-better-china-rising-radio-sinoland-191001/).

This is not a problem for Huawei’s founder, Mr. Ren Zhengfei. In fact, he credits Mao Zedong Thought for Huawei’s unbridled success, since beginning 1988 with $5,000 as a startup, to today being among the most successful IT companies around (https://chinarising.puntopress.com/2019/09/29/huawei-offers-to-tie-both-arms-behind-the-back-so-the-west-can-compete-china-rising-radio-sinoland-190930/ and https://chinarising.puntopress.com/2020/03/26/et-tu-brute-why-huaweis-development-of-frances-5g-network-will-be-a-game-changer-china-rising-radio-sinoland-on-sputnik-news-200326/).

Below is Mr. Ren explaining how Mao Zedong permeates Huawei’s corporate culture. Before continuing and in addition to my other Huawei-related articles referenced above, here are a couple more (https://chinarising.puntopress.com/2018/12/19/us-trying-to-sabotage-huawei-zte-and-sino-5g-too-late-game-over-china-rising-radio-sinoland-181219/ and https://chinarising.puntopress.com/2018/12/21/60-seconds-over-sinoland-huawei-redux-omg-uncle-sam-co-are-way-more-screwed-than-i-thought/).

Ren Zhengfei’s Self-Report:

Because of the special background of the times, our generation has been stamped with the deep imprint of the Mao Zedong Era. We are passionate and rational in the pursuit of ideals and aspirations. It seems that the purpose of life is to achieve an ideal state we yearn for through constant struggle, and the process is more important than the result.

My understanding and inheritance of Mao Zedong are not only formal imitation, but also the inheritance of philosophical Thoughts absorbed from Mao Zedong, among which the most core is dialectical thinking and self-negative consciousness. Some people say that Mao Zedong’s military Thought is an ideological weapon specially provided for the weak to defeat the strong… The development of Huawei in the past 20 years is actually a dramatic historical drama in which the weak become the strong and the weak win the strong. There is no recognized corporate culture in the start-up stage of Huawei, and Mao Zedong Thought is the company’s thought.

Mao Zedong Thought created Ren Zhengfei, and Ren Zhengfei used Mao Zedong Thought to create the “Huawei model”…

A company appears to be listed as if the enterprise has the strength, growth as a high-end symbol, so a lot of substance does not have the strength of its public shell…… Also have different examples, such as in some restructuring process, with the original enterprise should be restructured into joint-stock company, the original factory director changes to chairman of the board of directors, demanding a minimum percentage of shareholding, but as the big man leader chairman of the board of directors, not everyone else can own more shares, but will be decided by regulation reform. There can also be a nominal personal stake, internal, it is still the same… There are certainly a few such examples, but there are some… Huawei, on the other hand, is a different case.

The private enterprise that Ren Zhengfei individually established, accomplishes today so that no stone is left unturned, to find strength that presses the scales, and is not seen in the market all the time. What the market worships is the Rate of Return God…… But instead of listing Huawei, Ren keeps the company private, with founder Ren Zhengfei owning 1.4% of the company… No wonder some people say that Ren Zhengfei is the best boss. They say that he is only 1% of the bosses, and 99% of the rest goes to the employees. In Huawei, there is not an employee who does not work hard, because everyone knows that the company is closely integrated with them… In this way, Huawei has provided the widest space for its employees with an extremely tolerant attitude…

What is co-ownership? This is common ownership — common prosperity! Make money everyone counts, benefit – good more points, benefit poor – less points, the rise and fall of the enterprise and the vital interests of the staff are closely related… What is more valuable is not to earn more and more money to send money to the markets in the West, but to pay taxes to the country……

Why did Ren Zhengfei do this? Personal feelings! Personal feelings by what decision, outlook on life! Mao Zedong cultivated Ren Zhengfei – patriotic red feelings! Ren Zhengfei, born in the year before the victory of the war of resistance against Japanese aggression (1944), grew up in new China. He was a college student trained by the People’s Republic of China in the Mao Zedong Era in the 1960s. He joined the army in the 1970s and retired to Shenzhen in the 1980s to start Huawei. Mao the great leader said, of all things in the world, man is the most precious… Under the leadership of the Communist Party, as long as there are people, miracles can be created… And for Ren Zhengfei, it is precisely the Mao Zedong Era where he was trained for the new Era of the people, who do not forget the original intention.

Ren Zhengfei consciously maintains a healthy humanity and strong Party spirit cultivated in the era of great leaders. As an excellent communist with a strong Party spirit, Ren Zhengfei also participated in the “Twelfth National Congress” of the party. In 1963, just three years after the natural disasters (floods and droughts during the Great Leap Forward), Ren Zhengfei studied in Chongqing University in architecture and engineering. In 1966, when the PLA (People’s Liberation Army) founded a new branch of the army, Ren Zhengfei graduated from the university as an infrastructure engineer and entered the ranks responsible for key national infrastructure projects and national defense construction. After enlisting in the army, he served successively as technician, engineer, deputy director (deputy regiment level); Thirty-three-year-old Ren Zhengfei also won first prize for the PLA’s technological achievements. He attended the national science conference in 1978, and among the 6,000 there, he was the youngest… Mao Zedong cultivated him as a college student at that time, the army gave him a big stage to display his talent…

So, Business Week magazine said Ren was “born with a red silver spoon in his mouth”. Ren Zhengfei created the “Huawei miracle”. Without Ren Zhengfei, there would be no Huawei. Ren Zhengfei has the courage, knowledge and ability, all benefited from the cultivation of the Mao Zedong Era and experience…

Just as Dr. Tu Youyou (discovered artemisinin) was a scientist trained under Mao, Ren is an entrepreneur. Ren Zhengfei: my mentor is Mao Zedong! Ren Zhengfei is an outstanding talent cultivated in the Era of Mao Zedong. Ren Zhengfei continues to create the “Huawei miracle” with Mao Zedong Thought! The establishment of an enterprise needs the direction and thought of the enterprise. The direction and thought set up by Ren Zhengfei when he founded Huawei are deeply saturated with the sunshine and dew of Mao Zedong Thought… This has also become the focus of the mainstream media. Take a look at these titles:

Interpreting the Truth of Huawei’s Rise: Mao Zedong Thought Guides Huawei

Huawei Is Invincible: Ren Zhengfei: My Mentor Is Mao Zedong!

Ren Zhengfei, the Most Mysterious Entrepreneur in China

Ren Zhengfei, President of Huawei: Learning from Mao as a Model among Entrepreneurs

Ren Zhengfei, Military President: Learning from Mao as a Model among Entrepreneurs

Why Chinese Entrepreneurs Worship Mao: Ren Zhengfei Is a Disciple of Mao Zedong

Etc.

So how did Ren Zhengfei use Mao Zedong Thought to guide Huawei?

When he was young, Ren Zhengfei was a pacesetter for Mao.

Continue to be a pioneer in entrepreneurship. Senior Huawei employees who know Mr. Ren say he pays great attention to studying politics, and that he studied “The Selected Works of Mao Zedong” the most. In his spare time, he ponders how to turn Mao Zedong’s military tactics into Huawei’s strategy. Ren Zhengfei said, “I started Huawei this source of strength is Mao Zedong! My mentor is Mao Zedong! This reminds me of Putin’s words: my idol is Mao Zedong!”

Huawei’s management thoughts and strategic methods are “deeply imprinted by Mao Zedong Thought”, as Ren Zhengfei said and did. On December 26, 1995, the birthday anniversary of Chairman Mao, Ren Zhengfei published the current situation and our tasks at the training conference of the Marketing Department. In 1998, Ren Zhengfei wrote an article titled “How Long Can the Red Flag of Huawei Last?” which was all quoted from Mao Zedong. In the same year, he gave a speech entitled “Hope in You” and used Mao Zedong’s famous words to students in the Soviet Union to encourage Huawei’s young R&D staff to have confidence in the future.

Huawei adheres to the principle of seeking truth from facts, Mao’s mass line and independence. See how Ren Zhengfei implements Mao Zedong Thought: some of Huawei’s market strategies follow Mao Zedong’s strategy of fighting wars. The most important thing is to seek truth from facts, follow the mass line and be independent. The so-called seeking truth from facts means formulating strategies based on objective conditions. The so-called mass line is customer-oriented and requires long-term hard work. Luxury and pleasure will make it easy to lose touch with the masses. The so-called independence is to adhere to independent research and development. Ren Zhengfei embodies Mao Zedong Thought in enterprise management culture and “Huawei Basic Law”.

An example for managing enterprise management cadres in accordance with Mao Zedong Thought: In 1974, Chairman Mao summoned the commanders of the eight military area commands to Beijing for a meeting. After standing up and singing the Internationale, Ren Zhengfei announced that the commanders of the eight military area commands were to be switched, and only one orderly was allowed to be brought with them. According to the situation of “The Exchange of Commanders of Eight Military Regions”, in 1996, Huawei asked for major resignations in the Marketing Department. More than 1,000 employees of the Marketing Department, mainly the principal cadres resigned collectively, and wrote the resignation report and the report on duty report respectively… There was no collective mutiny in Huawei’s sales team, and the “ability to go up and down” in Huawei’s organizational culture was formed.

Criticism is mainly self-criticism. Ren Zhengfei carried out the criticism and self-criticism advocated by Mao Zedong in Huawei… Huawei has such a few rules: first is not nobody gets a free ride; second, focus on self-criticism; third is to emphasize the “truth”, to seek truth from facts; fourth is not to be infinite, grasp the appropriate; fifth, goodwill and constructiveness are the main premises.

Adhere to Mao Zedong’s independence, adhere to independent research and development. Huawei adheres to Mao Zedong’s Thought of independence and autonomy, which is clearly defined as “insisting on independent research and development”. “Foreigners come to China to make money,” Mr. Ren said, “they don’t teach core technologies to the Chinese, but they expect us to import, import, import again. Markets for technology were all lost, we did not really grasp which technology. And the core competitiveness of enterprises, in fact, is technology. A Huawei classic quote, “Resources will be exhausted, only culture will be endless”!

Huawei unveils 5G commercial era : by the end of December 2018, Huawei had signed commercial contracts for 5G with operators in 25 countries including the UK, Germany and Italy, and more than 50 countries were conducting commercial tests with Huawei. Huawei is the “only real 5G supplier” in the world, and Huawei stands at the peak of the information world in the Era of 5G.

Huawei has not forgotten Mao Zedong’s original intention of building public ownership: innovating a new form of public ownership. Ren Zhengfei read “Das Kapital”, read “Mao”, not forgetting the heart, remembers to create the socialist public ownership sacrifice of more than 20 million martyrs…… Compared with Huawei’s contribution to the national economy and science and technology, Huawei innovates a new form of public ownership practice, which is a milestone with more historical significance!

“When I started the company, I designed the employee stock ownership system to unite employees through benefit sharing,” Mr. Ren said. “Based on past life setbacks, I realized that I should share responsibilities and benefits with employees”. Ren Zhengfei used public ownership to unite employees and create Huawei’s form of public (employee) ownership with five characteristics. First, it is a huge form of public (employee) ownership with more than 170,000 employees. It is the largest information industry company in the world (Tencent has a total of 110,000 employees). Second, Huawei is the only non-listed company among the world’s Top 500, which subverts the myth of the western model of the capital market. Third, it is a worldwide form of public ownership. Huawei employees come from 156 countries and regions, and foreign employees represent about 20-30%. Fourth, advanced forms of public (employee) ownership of high-tech enterprises, with more than 170,000 employees and 70,000 R&D personnel. Fifth, the realization of public (employee) ownership with a mature organizational structure. In order to ensure that Huawei belongs to Huawei, Huawei has a mature organizational structure, such as the composition of employee shareholders, the exercise of relevant rights by the shareholding union, and the election by the board members…

I strongly agree with this conclusion: as an advanced mode of production relations, the new form of public (employee) ownership created by Huawei undoubtedly meets the requirements of advanced (Marxist) productive forces and provides a broad space for the development of high-tech advanced productive forces. This is of great significance and even far more valuable than 5G!

As the boss or partner of an enterprise, have you ever thought that the Era of equity investment in China has come, which is the best time for small and medium-sized enterprises (SMEs) to enter the capital market?

The average life span of Chinese SMEs is only 2.5 years, and that of group enterprises is only 7-8 years. Not only the life cycle of the enterprise is short, but strong and large enterprises are few. Enterprises that do not last long do not have the deep root to run the course, since the core root is only one – the enterprise’s equity went wrong!

Zhenfund founders argue that partners matter more than business models and industry choices, more than whether you’re in the hot seat.

The death of an enterprise is not caused by external competition, but by internal friction.

There is an old saying in China, business is easy, but business is hard.

Equity is not only a technology, but also an art!

If the employee is disobedient, you can tell him to pack up and leave! What if shareholders disagree?

How many bosses fall into the top 10 traps of equity, because they don’t understand equity?

Companies that play out every day the Romance of the Three Kingdoms (greed, revenge and betrayal), the Five Kings of War, with performance, profit and enthusiasm significantly damaged?

How many companies are unable to grow quickly or get listed because they are stuck in an equity impasse that leads to shareholder infighting?

How do enterprises allocate equity?

1. The term of equity can be set. There is long-term, medium-term and short-term equity. Equity stratification will have a body!

2. Do you have shareholders in your company who pay for everything, but work? How much should his equity ratio be set to be reasonable? Should they buy the shares at the same price as you?

3. What kind of equity ratio is the most reasonable? How to build a perfect shareholding structure?

4. When the ownership structure is not reasonable, enterprises will never much, equity distribution that is not good makes enterprises that are easy to split. How to avoid one mountain, two tigers, three kingdoms, five kings (https://www.britannica.com/topic/Journey-to-the-West)?

5. The future trend is not the employment system, but the partnership model. What is the partnership model and how to establish the partnership model?

Fifteen years ago, how did Jack Ma Yun gain 18 arhats (http://www.buddhanet.net/e-learning/history/lohans.htm), the achievement of today’s Alibaba myth? Because he started a business to do clear equity planning and equity incentive design! The event of Ma Yun’s listing tells us: equity can attract talent (Joseph Tsai), equity can retain talent (18 lohans/arhats), equity can be financed (Masayoshi Son – https://www.businessinsider.com/softbank-masayoshi-son-predicts-15-vision-fund-bankrupt-rescue-package-2020-4), equity can play the market (cooperating with Yahoo), with equity design holdings (Ma Yun controls the company with less than 10%).

Why did Huawei grow from 40,000 yuan to more than 200 billion yuan? Because he began to carry out full staff shareholding in the 1990s, began to establish joint ventures with customers in the country!

The point is that with less than 1 per cent of Mr Ren’s shares, how can he still control the company?

On the contrary, how was Sina founder Wang Zhidong kicked out?

Little sheep raised a baby and called it daddy!

Source article in Chinese:

https://page.om.qq.com/page/OU6ZF0XrekjRS8185lKehlrA0?source=omapp&from=groupmessage&isappinstalled=0&ADTAG=tgi.wx.share.message

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In Solidarity, Jeff

Why and How China works: With a Mirror to Our Own History

44 Days Backpacking in China: The Middle Kingdom in the 21st Century, with the United States, Europe and the Fate of the World in Its Looking Glass

China Rising: Capitalist Roads, Socialist Destinations

 

 

 

 

 

 

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