"Everywhere was an emerging market at one point" - Interview with Huawei's Dr. Leroy Blimegger

"Everywhere was an emerging market at one point" - Interview with Huawei's Dr. Leroy Blimegger

Dr. Leroy Blimegger is the Senior Vice President of the Global Services Division at Huawei. Based in Shenzhen, he has worked at the company for 13 years.

Having started in wireless product R&D, Blimegger moved some years ago to services, overseeing the assurance and managed services business, which encompassed customer support, managed services and CEM.

Now Senior Vice President of the Global Services division, Blimegger has overall responsibility for Huawei’s global services business. DT Editor James Barton caught up with him recently in Munich, Germany, at the Operations Transformation Forum 2018 to discuss how emerging markets are a core part of Huawei’s background, and the importance of this to the vendor’s corporate ethos.

Customer experience management is one of the main focuses of this event – the idea of a streamlined network that connects the customer more closely to the provider. How do you see this evolving?

In 2011 when we created the assurance and managed services business, mine was the first team to focus on customer experience management. As an industry, we all knew that we were not very customer-centric – we were very network-centric. Carriers and vendors focused on technology; we’re engineers, we build networks. We knew there were end users out there, but when you start looking at net promoter score and all the things that impact a user’s decision to keep using a service or even pay more for it, as an industry, it just wasn’t on the top of the list. As an industry, we were focused from the inside-out.

To address this Huawei developed a platform called SmartCare, and we started raising the flag, saying we had to put customers at the centre of the business. That is related to the way Huawei does business; we were telling operators that they needed to put customers at the centre of their business, so we started looking at ourselves and asking if we were doing the same. One of our core values is customer centricity – if that’s not a tenet of a company then they won’t stay in business. We had to really reflect on that and ask if we were serving ourselves or indeed our customers.

This has evolved into how we approach the entire industry and also why we don’t just focus on the big players. If you base it on the volume of transactions, most of our transactions still come from emerging markets. That’s where we started our business. Back in 1988, Huawei couldn’t even do business in the major cities in China. We were not in Shanghai, Beijing or any of the provincial capitals, because older and better known companies such as Nokia, Motorola, Nortel, Ericsson etc. were there already. Instead, we started to work in the rural areas of China which were the only places open to us at that time.

When we expanded our business out of China, we did the same thing. As an example, when we first went to Russia, we knew we couldn’t build a network in Moscow. But, we could start doing business in rural areas where our industry peers weren’t interested. As our business matured and we became one of the better known companies, we were invited to do business in more and more major cities.

I talk about this with a lot of our customers now, particularly those in emerging markets, because one of their concerns is that “Huawei is now the number one in the industry – so why am I important to you?” I tell them our original mission statement, “to enrich life through communications”, doesn’t just refer to places that are convenient and high-profit to work. We have a sense of social responsibility to bridge the digital divide, and that is predominantly in emerging markets and other underserved rural areas.

Being an international vendor that grew from a background in emerging markets must carry a lot of significance for operators in these regions – particularly, as you mentioned, since European and North American players weren’t as interested in these markets. Has the situation effectively reversed now – are western vendors piling in to play catch-up?

Yes – because that’s where all the growth is right now. Our platforms are built, we’ve developed all the relationships with the subcontractors and the communities. Aside from the technology work we do, we make sure we’re engaged in the community to support the next generation of engineers that could be coming to us – for example by building labs for schools.

However, we have learned more recently that this also carries weight when you come to a developed market and people understand that you’re big now, but you’re not pretentious – you still remember where your roots are. We will never move away from emerging markets because that’s where we started, and frankly that’s where they need the most support. It’s not an aspiration to move away from these markets – there’s no “we’ll set up in Africa, but eventually we won’t have to do that anymore”.

Within Huawei, in order to make sure that our people in Shenzhen know how to make the best decisions, we rotate people from HQ out to the front line, and they’re posted for several years in various places around the world, in various job roles. Everyone is required to work in an emerging market first; if we hire new engineers in China, they go through their probation period and go through all the training, but they won’t be heading to Europe first. It’s giving them the idea of our grassroots beginnings and the very real challenges still faced, and that they need to understand how to do business in these regions before they can go anywhere else.

Emerging markets are clearly in Huawei’s DNA – to the extent that understanding them is part of the corporate ethos, it would seem?

We have teams in Huawei that focus specifically on emerging markets to make sure that when we get engaged in a larger event, or when we’re doing R&D and considering our roadmaps, we still bear in mind whether operators in Africa will be able to afford our products. We have to maintain that focus to make sure that what we develop can be scaled appropriately so that it works just as well for Safaricom in Kenya as it does for Deutsche Telekom in Germany.

The event we are at now - OTF 2018 - is a great example of this. The focus of this event is operational transformation. Many telecom events only focus on the most up to date technologies, and the fear is that only the more developed markets will find this relevant. We look to make the technology at our events as relevant to operators in emerging markets as those in more developed markets

Right now, the big transformation is getting ready for 5G because it’s in the pipeline. A lot of the discussions here are about what needs to be done – keeping the customer at the centre, developing use cases based on their expectations and requirements – things that operators should already be focusing on but which are becoming much more critical with 5G.

Operators may not have been customer centric when they had a 2G network, but if they were one of two players they’d have made money anyway. However, if you have to invest billions of dollars and massively change your organisation in order to deploy 5G, but you’re still not customer centric, it’s going to have a much bigger impact than it did for 2G - your return on investment will disappear.

Even though events tend to focus on preparing for the latest technologies, increasing the focus on customers and improving network agility isn’t exactly exclusive to 5G. How do you ensure the benefits of the latest technologies are passed on to emerging markets?

Everything we learn about what needs to happen in 5G can still be used as Africa starts deploying 4G. Network slicing is not exclusive to 5G. Customer centricity might be more important the more advanced a network is, but if we learn how to improve operations with automation and AI, all of that can be implemented in a 3G or 4G network too.

In addition Huawei believes it is important to view markets from the customer and end user perspectives. Prior to 2011, our carrier business was our main operation. We did some enterprise work and we had devices, but they were never Huawei-branded. In order to support our main business we needed to start playing in these spaces to make our name known – in the enterprise space to support our B2B business, and in the consumer space to understand better how our end users use their devices and what demands that puts back on the network.

We make handsets that cost around $2,000, but we also make sub-$75 devices that might not have all the bells and whistles of a more expensive device, but still offer excellent quality. We make sure we’re covering all the different market segments to support our enterprise and carrier customers – because if their customers can’t get phones then they have no network business.

Above all, it is important to keep in mind that everywhere was an emerging market at one point.

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