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3 - Transforming Product Development at Huawei

The IPD Initiative

Published online by Cambridge University Press:  21 March 2020

Xiaobo Wu ,
Johann Peter Murmann ,
Can Huang  and
Bin Guo
By
Zihan Zhang  and
Johann Peter Murmann
Xiaobo Wu
Affiliation:
Zhejiang University, China
Johann Peter Murmann
Affiliation:
Universität St Gallen, Switzerland
Can Huang
Affiliation:
Zhejiang University, China
Bin Guo
Affiliation:
Zhejiang University, China
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Summary

Most companies discover that management practices that work on a smaller scale no longer work when the company grows substantially. This is also true for the product development process. As Huawei grew, the firm experienced problems in terms of higher product failure rates, longer development cycles and increased R&D costs. It then turned to the consulting services of IBM to upgrade its product development processes to a larger scale. The integrated product development (IPD) system implemented at Huawei was copied from IBM’s practices. IPD’s central idea is that companies must expand cross-functional teams to perform product development and use standard processes and templates to guide those development activities. IBM promoted the IPD system by providing consulting services to other firms. However, most of them failed during implementation, and only a few of them actually benefited from the IPD system; Huawei was one of them. The IPD transformation completely changed Huawei’s product developing system and helped the company overcome its problems in developing products on a larger scale. The IPD transformation was a turning point for Huawei in becoming a world-class company. This chapter explains how the IPD system helped Huawei solve its management problems and why Huawei was successful in IPD transformation when many other companies were not.

Keywords

HuaweiIntegrated Product Development (IPD)ChangeIBM ConsultantsChange of routinescross-functional teamscustomer centricityEfficiency IndicativesDevelopment CostsReduction of Product Failures
Type
Chapter
Information
The Management Transformation of Huawei
From Humble Beginnings to Global Leadership
 , pp. 110 - 135
Publisher: Cambridge University Press
Print publication year: 2020

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References

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