Chinese tech giant Huawei announced the replacement of its software system as a victory over US sanctions.
Huawei launched an internal software system to replace the US one-time internal software management systems. The Chinese multinational technology company made the announcement today, nearly four years after the United States imposed sanctions on it over alleged security concerns.
In May 2019, the US Department of Commerce placed Huawei on a trade blacklist which ultimately hindered the company’s ability to obtain US technology. However, the recent announcement of Huawei’s self-created software platform is a victory over sanctions that previously threatened the company’s survival.
Huawei held an internal ceremony in Dongguan, heralding the transition to its custom’Metairp‘ System. This ERP system replaces the components and tools that the Shenzhen-based company used to purchase from Oracle (NYSE: ORCL).
Speaking at Huawei’s internal party, which was attended by the Chinese tech giant’s rotating chairman, Meng Wanzhou, board member Tao Jingwen explained:
“We were cut off from the old ERP system and other essential operating and management systems three years ago. Today we are proud to announce that we broke that blockade. We survived!”
Huawei relied on an older third-party software platform for two decades before launching a new internal initiative
Huawei has relied on the legacy system to run its operations, from accounting to supply chain management, for more than 20 years. Hence, Tao called the US cut-off “a colossal crisis” for China’s technological heft.
Furthermore, Tao, who is also the Head of Quality, Business Operations, and IT Department at Huawei, added:
“Not having access to an ERP system has become Huawei’s ‘Dado River’ that has blocked our way forward and threatened our very existence.”
Tao’s reference to “Dado River” invokes the famous escape of the Chinese Red Army during the East Asian country’s civil war between 1927 and 1949. The escape analogy is also apt because ERP software is important to a company’s main business operations.
In a press release, Huawei said it has rolled out its internal Meta-ERP system across 80% of its business. However, it is still unknown whether the company will commercialize its ERP system and potentially compete with third-party software solution providers such as Oracle. However, Huawei’s in-house software development opens up a potential new business opportunity for the company to expand into other areas.
Reports indicate that Huawei’s new “meta-ERP” system is a cloud-native product. In addition, the company’s internal software system deploys cloud computing functions to improve efficiency compared to traditional ERP products. Tao likened the ancient system to “a huge old building in disrepair”. However, a Huawei board member described the new software as rigorously tested and capable of processing millions of accounting entries per day.
Huawei’s biggest annual profit drop ever occurred in 2022
In late March, CoinSpeaker reported that Huawei posted the largest annual profit drop ever in 2022. The annual profit drop resulted from China’s strict pandemic controls that also affected many other companies.
Last year, Huawei suffered a significant annual profit drop of 69% year-on-year to 35.6 billion yuan ($5.18 billion). The numbers were the lowest since 2011 when Huawei saw a 54% drop in annual profits.
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Tolu is a cryptocurrency and blockchain enthusiast based in Lagos. He likes to demystify cryptocurrency stories down to the bare essentials so that anyone anywhere can understand without much background knowledge. When not deep into cryptocurrency stories, Tolo enjoys music, loves to sing, and is a movie lover.