Abstract

This case describes the challenges and negative impacts of US-led export controls and trade sanctions since 2018 on key components and technologies for Huawei’s consumer electronic products, leading to the discussion on how Huawei should drastically change its business strategy to stay viable in such a challenging geopolitical environment. In the midst of every crisis lies great opportunity. While many business analysts expected these US-led sanctions and political efforts would quickly turn Huawei into a dysfunctional company, even if it could survive, Huawei had successfully staged a surprising comeback after just a few years by synergizing artificial intelligence (AI) and open innovation (OI) to develop other core businesses and regain the momentum for growth and profitability. What came next would be the execution of many of Huawei’s initiatives to profitably revive its business growth.

Learning Objectives

Primary learning objectives:

1. Compare and contrast open innovation with closed innovation

2. Discuss the effectiveness of Huawei’s latest push for AI and open innovation to revive its business growth and profitability

3. Explore the different roles that AI should play in open innovation at Huawei

Secondary learning objectives:

1. Analyze Huawei’s unique role and characteristics in the AI business ecosystem

2. Use the business ecosystem theory analysis to explain the path of value co-creation between Huawei and its ecosystem partners