There is another management system that many companies around the world could consider. China’s Huawei Technologies Co has opened up about its unique leadership approach: it has three senior executives who take turns acting as the company’s chief executive. No other business in the world adopts the same leadership structure although there is possibility that it would get more popular.
The unique management structure gives each of the three executives six months each to head the company. The telecommunications network equipment supplier adopted this rotating leadership system in 2011. So far, it indicates that the approach is working. In fact, Huawei considers it as one of its innovations.
The three CEOs are supported by 13 other board directors, each having equal voting power during meetings. The three chief executives take more influence over the company’s decision making process. They supervise committees that craft company policies.
One overall CEO
But that is not the only interesting aspect about Huawei’s leadership. Its founder, Ren Zhengfei, keeps his role as overall CEO. His authority is different and is greater than the CEO role assumed by each of the three rotating chief executives.
Mr. Ren also has the power to veto any company decision approved by the board of directors. Interestingly, he has never exercised that right so far. Moreover, he does not possess the right and authority to make policy recommendations, although he could always share his opinions with the other three executives.
The company disclosed that since the rotating CEO system was adopted, Mr. Ren has become busy spending time mentoring and coaching the three rotating chief executives. But Huawei clarifies that this setup is not a succession strategy.
Not a succession strategy
It is easier to infer that the system could be a way to narrow down possible candidates who would succeed Mr. Ren. But as mentioned, Huawei does not intend it to be a succession tool. It is not intended to screen one successor to him.
Huawei did not reveal any plan whether to make this arrangement temporary or permanent. But the company believes that the traditional leadership structure comes with more and greater risks. The company also reiterated that this rotating leadership system is not about changing leaders. It is part of the firm’s initiatives to improve management as inspired by the business leadership book ‘Flight of the Buffalo,’ authored by Ralph Stayer and James Belasco.