China's Huawei to Lay Off Bottom 10% Performers Amid Prolonged US Sanctions

Ren Zhengfei, Huawei Chairman, "Will Dismiss Bottom 10% Managers with Low Performance Annually"
Chairman Ren Emphasizes Inevitable Difficulties for at Least 2 Years, Overcoming Crisis with New Talent Injection

[Asia Economy Beijing=Special Correspondent Jo Young-shin] Huawei, which is struggling due to U.S. sanctions, will conduct annual layoffs for the bottom 10% of managers based on performance evaluations.

China's state-run Global Times reported on the 2nd, citing Huawei Chairman Ren Zhengfei, that to inject new talent, Huawei will lay off the bottom 10% of managers with the lowest performance every year.

[Image source=Reuters Yonhap News]

To implement this employment policy, Huawei plans to categorize all employees into professionals, experts, and executives (CEOs).

It is reported that Huawei has set a policy to lay off the bottom 10% of manager-level executives in particular.

Chairman Ren said, "The U.S. made things difficult for Huawei with just one document," adding, "Huawei must reprogram everything and create new hit products through this."

This is interpreted as a desperate measure and a new personnel policy to inject fresh blood into the organization, given that difficulties due to U.S. sanctions are inevitable for at least two years.

The Global Times stated, "Huawei must establish a new strategy in response to U.S. attacks," and "Huawei has first established personnel and employment policies to optimize human resources." The Global Times emphasized that the layoffs are not due to Huawei's deteriorating financial situation but are policies to respond to the rapidly changing international and technological environment.

Chairman Ren said, "The next two years will be a critical period for Huawei's survival," and "Huawei will not only maintain normal research and development (R&D) but also invest billions of dollars in new projects."

He added that outstanding talent will lead the company's survival and development, and Huawei will continuously discover domestic and international talent.

The Global Times reported that Huawei hired 8,000 new employees last year and plans to recruit at least 8,000 more next year.

Meanwhile, Huawei's smartphone shipments in China for the third quarter of this year were 34.2 million units, down 18% compared to the same period last year. This marks the first time in six years since 2014 that Huawei's quarterly smartphone shipments in China have declined year-on-year.

Huawei unveiled its new strategic smartphone, the 'Mate40 series,' last September, but due to supply disruptions of key components such as system-on-chip (SoC), it has been unable to supply products to meet market demand.

This content was produced with the assistance of AI translation services.