Corporate Financial Strategy Of Telecommunications Equipment Manufacturer

After more than ten years of rapid development, China’s economy has made greatachievements. Behind China’s rapid economic development over the past decade, weshould also be noted that China’s economic development is gradually carried out thetransformation. The leading industry of China’s economic development will graduallytransfer from the traditional manufacturing to the high-tech industry. High-techenterprises gradually highlight its strategic role in the national economy. In mosthigh-tech industries, the development of China’s telecommunications equipmentmanufacturing industry momentum is very strong. The development ofcommunications equipment manufacturing industry has become the most powerfulone of China’s high-tech industry. Key to the survival and development ofcommunications equipment manufacturer is in its ability to carry out technologicalinnovation activities continually for core competencies and competitive advantage.The technological innovation activities need long-term and large amounts of capitalinvestment and the financial strategy is the fundamental guarantee. And successfulfinancial strategy determines whether the company can survive. Therefore, the studyof the communications equipment industry’s financial strategy is very necessary.This paper analyzes communications equipment manufacturer’s financial strategywhich including investment strategies, financing strategies, and income distributionstrategies. Then this paper takes Huawei communications equipment manufacturingcompany’s financial strategy analysis as typical case.Firstly, this paper reviews the theoretical basis research of communicationsequipment manufacturing as well as technology innovation theory, competitiveadvantage theory and financial strategy theory. Concerning technological innovationis a major attribute communications equipment manufacturing industry, this paper carried communication equipment manufacturing research based on technologicalinnovation.Secondly, this paper takes a general analysis of the communication equipmentmanufacturing industry, including communications equipment manufacturing industrydefinition, history, current situation and development of China’s telecommunicationsequipment manufacturing as well as its problems and the reasons for the currentanalysis. On this basis, the paper analyzes the important role of technology innovationfor sustainable development of the communications equipment manufacturingenterprises played.Thirdly, the paper analyzes communications equipment manufacturing industry’sfinancial strategy based on technology innovation. At first, the current externalenvironment for China’s telecommunications equipment manufacturing industry isanalyzed. Then company investment strategy, financing strategy and incomedistribution strategies for communications equipment manufacturing industry basedon the characteristics of technological innovation has been focused on the analysis.After analyzing the characteristics of each sub-strategy, this paper analyzes of theinteraction among the three sub-strategies deposited into mutual relationship.Then, this paper analyzes Huawei’s financial strategy including investmentstrategy, financing strategy and distribution strategy case based on analysis of2008-2013annual reports to get some inspiration for other communicationsequipment manufacturers in growth stage.Finally, we draw three main conclusions. Firstly, the analysis demonstrates theimportance of technological innovation on the communications equipment industry.Secondly, theoretically demonstrated the characteristics of financial strategy ofcommunications equipment manufacturing based on technological innovation. Thirdly,this paper gets a series of revelations based on Huawei’s financial strategy analysis.