Huawei Technologies announced on Thursday it is replacing internal software management systems it previously sourced from US vendors with its own in-house version, cheering the move as a victory over US sanctions that had threatened its survival.
The Chinese tech giant held an internal ceremony to celebrate the switch to its ‘MetaERP’ — an enterprise resource planning system — to replace tools it largely purchased from Oracle earlier.
ERP software is used by companies to manage key business operations ranging from accounting to supply chain management.
“We were cut off from the old ERP system and other core operation and management systems three years ago,” said Tao Jingwen, a Huawei board member and president of its quality, business process and IT management department.
“Today we are proud to announce that we have broken through that blockade, we have survived!”
The ceremony held in Dongguan, south China was attended by the Huawei’s rotating chairperson Meng Wanzhou, the daughter of the company’s founder Ren Zhengfei.
The in-house Meta-ERP has been rolled out across 80% of the company’s business, Huawei said in a news release.
In May 2019, the US Commerce Department added Huawei to a trade blacklist over alleged security concerns the company denies.
The listing and several successive rounds of trade sanctions hobbled Huawei’s ability to source items made with US technology.
It also cut it off from servicing and patches for ERP tools it largely purchased from Oracle.
The cut off was a “massive crisis” for Huawei, Tao said in his speech, saying that the old system had been core to the company’s operations for over two decades.
“Not having access to ERP became Huawei’s ‘Dadu River’ that blocked our way forward and threatened our very existence,” Tao said, referring to a famous escape for China’s Red Army during the country’s civil war.
Potential new business
While Tao’s speech did not mention if Huawei intended to commercialise its ERP system and compete with the likes of Oracle and SAP, it provides a potential new business line for the company which has been expanding into areas in a bid to survive under US pressure.
Huawei’s ‘meta-ERP’ system is a ‘cloud-native’ product, which uses the company’s cloud-computing systems for greater efficiency than traditional ERP products, a person familiar with the matter said.
While the older system was like “a massive old building in disrepair,” the new system has been fully tested and is processing 15 million lines of accounting entries daily, Tao said.
- Reuters, with additional editing by Vishakha Saxena