Huawei's Blue Army attacks the company from inside — even Ren Zhengfei is fined

In 2006 Huawei's founder Ren Zhengfei kept repeating a fear: the force most likely to defeat Huawei was Huawei itself. The company had outgrown the stage where a few founders' decisions set everything; scale now threatened to make it slow, conformist and blind to outside threats. His answer borrowed from military wargaming, where a 'blue force' plays the enemy so troops train against a live opponent rather than a theory.

So Huawei created a Blue Army Staff inside its Strategy & Marketing department (the practice of a standing adversarial force dates at least to Israel's 1966 foreign-air-force simulation brigade). Ordinary business units became the 'Red Army'. The Blue Army's only job is to challenge them: it analyzes Red Army strategies, simulates the rival's moves, publishes criticism on the internal Xinsheng community, and holds the power to contest decisions of any unit — even, famously, the founder himself.

The proof of its teeth came in 2018. Blue Army chief Pan Shaoqin circulated the broadside 'Too deep, too fine, too hasty, too assertive — the Ten Sins of Ren Zhengfei', attacking the founder's over-centralized style, his undervaluing of experts and one-size-fits-all pay — and fined him ¥1 million. Ren accepted all ten points and paid in full. Earlier, in 2008, the Blue Army had reportedly blocked the sale of Huawei's phone business after the iPhone's debut, arguing that terminals, pipes and cloud would fuse; by H1 2020 consumer devices were ¥255.8 billion of Huawei's ¥454 billion revenue.