Part Ⅰ　Expansion and Control 1 1　Huawei’s Business Goal 3 　　1.1　Pursuing Sustainable and Profitable Growth 4 　　　　1.1.1　Seeking to Survive as a Legal Entity Beyond Life-Span Constraints of Natural 　　　　　　　Persons 4 　　　　1.1.2　Huawei Only Exists to Serve Its Customers 6 　　　　1.1.3　Inspiring Passion Across the Company Through Steady Growth 7 　　　　1.1.4　Being an Industry Leader and Leading Industry Development 8 　　1.2　The Meaning of Sustainable and Profitable Growth 11 　　　　1.2.1　Pursuing Profitable Growth, Healthy Cash Flow, and Light-Asset Operations 11 　　　　1.2.2　Continuously Improving Huawei’s Core Competencies 15 　　　　1.2.3　Building a Healthy and Friendly Business Ecosystem 18 　　　　1.2.4　Pursuing Huawei’s Long-Term Value 20 　　　　1.2.5　Sharing Gains Based on the Capital and Labor Invested 21 　　　　1.2.6　Passing Market Pressure Down Through Each Layer of the Company to Make 　　　　　　　Sure Our Internal Response System Remains Active 26 2　Huawei’s Competition Strategy: A Financial Perspective 31 　　2.1　Continuing to Invest Boldly to Seize Strategic Opportunities 32 　　　　2.1.1　Seizing Strategic Opportunities Ensures Success While Missing Them Leads to 　　　　　　　　Failure 32 　　　　2.1.2　Increasing Future-Oriented Investment When the Market Is Experiencing a 　　　　　　　　Cyclical Downturn 34 　　　　2.1.3　Avoiding Opportunism and Having Strategic Patience in an Era of Big 　　　　　　　　Opportunities 36 　　2.2　Working Together Towards the Same Goal and Deciding What Not to Do in Order to 　　　　　Do Something Great 39 　　　　2.2.1　Concentrating High-Quality Resources on Core Business and Strategic 　　　　　　　Opportunities to Establish and Reinforce Strengths 39 　　　　2.2.2　Narrowing Strategic Focus to Become an Industry Leader 41 　　　　2.2.3　Maintaining a Narrow Focus to Make Breakthroughs 45 　　　　2.2.4　Never Wasting Strategic Resources on Nonstrategic Opportunities 48 　　2.3　Innovating to Create Greater Value for Customers and the Company 53 　　　　2.3.1　Placing More Emphasis on Value Creation Than on Cost Savings 53 　　　　2.3.2　Changing the R&D Spending Structure and Increasing the Proportion of 　　　　　　　Investment in Research and Innovation 54 　　　　2.3.3　Ensuring Sufficient Customer-Facing Budgets 56 　　2.4　Digging In and Widening Out 58 　　　　2.4.1　“Digging In”: Ensuring Investments in Improving Core Competencies and 　　　　　　　Preparing for the Future58 　　　　2.4.2　Constantly Tapping into Internal Potential and Lowering Operating Costs to 　　　　　　　Provide Higher Value Services to Customers 59 　　　　2.4.3　Sharing More Value with Customers and Treating Upstream Suppliers 　　　　　　　Generously 60 　　　　2.4.4　Never Pursuing Low Prices, Low Costs, or Low Quality 61 　　2.5　Openness, Competition, and Collaboration 63 　　　　2.5.1　Nothing Can Stop Us If We Remain Open 63 　　　　2.5.2　Competition in the Future Will Be Between Supply Chains 65 　　　　2.5.3　Value Sharing Is Vital to a Robust Business Ecosystem 67 　　2.6　Becoming a Truly Global Company 70 　　　　2.6.1　Building a Global Business Ecosystem to Keep Growing 70 　　　　2.6.2　Leveraging Relative Advantages in Global Competition 71 　　　　2.6.3　Locating Strategic COEs in Places Rich with Strategic Resources 72 　　　　2.6.4　Attracting Global Talent and Building a Global Management Structure 76 3　Remaining Flexible to Seize Opportunities Amidst Uncertainties 83 　　3.1　Maintaining Flexibility When Investing in Projects of Uncertainty 84 　　　　3.1.1　Never Putting All Eggs in One Basket When Making Strategic Decisions 84 　　　　3.1.2　Large Investment Along Multiple Paths in Multiple Waves 85 　　　　3.1.3　Absorbing the Energy of the Universe over a Cup of Coffee 90 　　3.2　Technological Innovation Without Boundaries Can Take Company Strategy in the 　　　　　Wrong Direction 95 　　　　3.2.1　Product Innovation Must Focus on the Core Business and Must Always Be 　　　　　　　Driven by Business Needs 95 　　　　3.2.2　Research and Innovation on Uncertainties Must also Have Boundaries and Serve 　　　　　　　the Core Business 96 　　3.3　Identifying and Creating Certainty Out of Uncertainty 98 　　　　3.3.1　The Role of a Leader: Setting a Clear Direction Amidst Uncertainties 98 　　　　3.3.2　In Field Offices Are Highly Competent Lean Teams Dealing With Uncertainties; 　　　　　　　In Back Offices Are Functional Departments and Shared Services Centers 　　　　　　　Dealing with Certainties 100 　　3.4　Success Is Not a Reliable Guide to Future Development 102 　　　　3.4.1　The Only Thing that Is Constant Is Change 102 　　　　3.4.2　We Are the Only Ones Who Can Defeat Ourselves 103 　　　　3.4.3　The Best Defense Is a Good Offense; Moving beyond Existing Advantages to 　　　　　　　　Create New Ones 105 4　Enhancing Core Competencies through Strategic Mergers and Acquisitions and Corporate 　　Venture Capital Investment 107 　　4.1　Bridging Gaps in Core Competencies Through Strategic Mergers and Acquisitions 108 　　　　4.1.1　Capital Investment Should Serve the Strategic Purpose and Help Huawei 　　　　　　　Acquire Key Technologies and Capabilities 108 　　　　4.1.2　Focusing CVC Investments on Developing Cutting-Edge Technologies, 　　　　　　　Preventing Technological Risks, and Supporting Development Strategies 　　　　　　　in Our Core Business 108 　　　　4.1.3　The Purpose of Acquisitions Is to Make Up for Weaknesses in Our Core 　　　　　　　Business Rather Than Diversifying Our Business 109 　　4.2　Principles for External Investments and M&As 110 　　　　4.2.1　Never Making Principal Investments Aimed Solely at Achieving Financial 　　　　　　　Returns 110 　　　　4.2.2　Strengthening Post-Investment Management to Ensure Investment Goals Are 　　　　　　　Achieved 111 　　　　4.2.3　No Support for Employees Starting a Business: No Investing or Engaging 　　　　　　　　in Such Activities 111 5　Strengthening Risk Control and Compliance Management 113 　　5.1　Controlling Risks During Expansion: The Purpose of Control Is to Ensure Sustainable 　　　　　and Profitable Growth 114 　　　　5.1.1　Can Huawei Keep Its Balance in an Unbalanced World? How Can It Do So? 114 　　　　5.1.2　Do Not Focus Exclusively on Opportunities Without Considering Risks 115 　　　　5.1.3　Pursuing Sustainable and Profitable Growth and Curbing Blind Expansion 117 　　　　5.1.4　Balancing Expansion and Control 118 　　5.2　A Multi-faceted System for Controlling Financial Risks at Huawei 119 　　　　5.2.1　The “Four Threes” System for Risk Control 119 　　　　5.2.2　Two Perspectives of Financial Risk Control 122 　　　　5.2.3　Three Financial Risk Control Centers 122 　　5.3　Financial Risk Prevention and Control 124 　　　　5.3.1　We Need to Have Contingency Plans to Deal with Financial Crises, But the Key 　　　　　　　Is Improving Contract Quality 124 　　　　5.3.2　Taking Diversified Approaches to Financing and Settlement 126 　　　　5.3.3　Do Not Stop Progressing Because of Risks or Ignore Risks in Order to Progress 126 　　5.4　Business Continuity Management 127 　　　　5.4.1　Huawei’s Primary Obligation: Maintaining Stable Network Operations 127 　　　　5.4.2　Building Strategic Reserves to Prevent Supply Risks 128 　　　　5.4.3　Avoiding the Inclusion of Countries and Regions Affected by War, Civil Unrest, 　　　　　　　or Epidemics into Emergency-Triggered Management Cycles 129 　　5.5　Using the Certainty of Legal Compliance to Deal with the Uncertainty of International 　　　　　Politics 130 　　　　5.5.1　Legal Compliance Is the Most Important Basis on Which We Survive, Provide 　　　　　　　Services, and Contribute Worldwide 130 　　　　5.5.2　Focusing on Protecting User Privacy in the Same Way We Have Done in Cyber 　　　　　　　Security 132 　　5.6　Compliance Management and Subsidiary Boards’ Oversight Responsibilities 132 　　　　5.6.1　Strengthening Compliance Management to Harvest More Crops 132 　　　　5.6.2　Subsidiary Boards: Performing Integrated Oversight in the Field on Behalf of 　　　　　　　the Company Without Interfering in Business Operations 134 6　Finding the Right Amount of Openness, Compromise, and Huidu, and Properly Balancing 　　Expansion and Control 141 　　6.1　Opportunity-Driven Versus Resource-Driven 142 　　　　6.1.1　More Emphasis on Opportunity-Driven Resource Allocation 142 　　　　6.1.2　Channeling High-Quality Resources to Valued Customers, Valued Countries, and 　　　　　　　Mainstream Products 144 　　　　6.1.3　Managing Investment Portfolios and the Pace of Investment Based on Corporate 　　　　　　　Strategy, Investment Capacity, and Business Opportunities 146 　　　　6.1.4　Keeping the Costs of Resources in Mind and Acquiring Resources to Achieve 　　　　　　　Growth Goals 148 　　　　6.1.5　Guiding Resource Allocation with Differentiated Value Assessments 149 　　6.2　Growth Versus Profits 151 　　　　6.2.1　Focusing on Long-Term Strategic Development to Turn Today’s Cash into 　　　　　　　Tomorrow’s Profits 151 　　　　6.2.2　Focusing on Both Opportunity-Driven Scaled Growth and Profit-Driven 　　　　　　　Sustainable Growth 151 　　　　6.2.3　Company Operations: A Dissipative Structure 153 　　　　6.2.4　Pursuing Rapid Growth on the Basis of a Reasonable Profit Margin 154 　　6.3　Long-Term Versus Short-Term Interests 155 　　　　6.3.1　Short-Term Interests Ensure Survival 155 　　　　6.3.2　Striking a Balance Between Long-Term and Short-Term Interests 156 　　6.4　Centralization Versus Decentralization 158 　　　　6.4.1　Development: Staying Focused, Involving Little Uncertainty, and Supporting 　　　　　　　Business Success 158 　　　　6.4.2　Research and Explore Across a Wide Scope 160 　　　　6.4.3　Narrowing Our Strategic Focus and Setting Ourselves Apart from Competitors 　　　　　　　in Our Core Business 164 　　6.5　Opportunities Versus Risks 165 　　　　6.5.1　Managing Both Opportunities and Risks, with More Attention Paid to Risks 165 　　　　6.5.2　Inaction Has No Risk, But Will Leave Us Behind 166 　　　　6.5.3　Promoting Sales Growth While Effectively Managing Risks 167 　　6.6　Creating Order Out of Chaos Versus Creating Chaos Out of Order 169 　　　　6.6.1　Purpose of Fine-Grained Management: Preventing Chaos During Business 　　　　　　　Expansion 169 　　　　6.6.2　Striking and Disrupting a Balance 171 Part Ⅱ　Value Management 175 7　Guidelines for Value Management 177 　　7.1　Huawei’s Most Valuable Asset: An Enduring Management System 178 　　　　7.1.1　Management Is Key to Ending Reliance on Talent, Technology, and Capital, and 　　　　　　　Enabling the Company to Evolve from the Realm of Necessity to the Realm of 　　　　　　　Freedom 178 　　　　7.1.2　Goal of Transformation: To Harvest More Crops and Increase Soil Fertility 180 　　7.2　Business Plays a Leading Role and Accounting Plays an Oversight Role 183 　　　　7.2.1　When We Say That “Business Plays a Leading Role and Accounting Plays an 　　　　　　　　Oversight Role”, We Mean That We Do Not Focus Solely on Financial 　　　　　　　Returns on Investment 183 　　　　7.2.2　Accurately Recognizing Revenue, Accelerating Cash Inflows, Ensuring 　　　　　　　Visibility of Project Profits and Losses, and Managing Business Risks 184 　　　　7.2.3　How Can Financial Personnel Effectively Serve and Oversee Business If They 　　　　　　　Do Not Understand It? 188 　　　　7.2.4　Oversight Means Firm Commitment to Process Management 189 　　　　7.2.5　Everything We Do Must Support Field Operations, Serve Business, and 　　　　　　　Contribute to Business Success 191 　　7.3　Using the Certainty of Rules to Deal with the Uncertainty of Results 192 　　　　7.3.1　Setting Rules to Prevent Chaos 192 　　　　7.3.2　Using the Certainty of Rules to Deal with the Uncertainty of Results for Major 　　　　　　　Processes, Allowing Flexibility at the Endpoints 193 　　　　7.3.3　Using the Certainty of Rules to Deal with the Uncertainty of Execution 194 　　7.4　Effectively Conducting Oversight While Further Delegating Authority to the Field 195 　　　　7.4.1　Centralized Authority Over Treasury, Accounting, and Auditing Management 195 　　　　7.4.2　Delegating Command Authority to the Field and Giving Field Commanders the 　　　　　　　Final DecisionMaking Authority 196 　　　　7.4.3　Moving Oversight to the Field While Delegating Authority to the Field 199 　　　　7.4.4　Oversight Is the Means to Our End Goal: Business Success 201 　　7.5　Streamlining Our Organizations and Processes to Create Value for Customers 203 　　　　7.5.1　Simplicity Is Key: Standardizing and Streamlining Routine Management 203 　　　　7.5.2　Any Department or Process That Doesn’t Create Value for Customers Is 　　　　　　　Redundant 206 8　Financial Management Throughout End-to-End Business Processes 211 　　8.1　Financial Management Throughout the OTC Process 212 　　　　8.1.1　KCPs Throughout the OTC Process 212 　　　　8.1.2　Controlling Contract Quality at the Very Beginning 217 　　　　8.1.3　Integrating Payment Collection, Revenue Recognition, and Project Budgeting 　　　　　　　and Accounting Based on Customer Contracts/POs 221 　　　　8.1.4　Setting Up a Contract Support Office That Offers One-Stop-Shop Services to 　　　　　　　Support Contract Fulfillment 225 　　8.2　Financial Management Throughout the IPD Process 227 　　　　8.2.1　The Essence of IPD: From Opportunity to Commercial Success 227 　　　　8.2.2　Key Control Points Throughout the IPD Process 231 　　　　8.2.3　Industry Business Plans and Product Investment Portfolio Management 233 　　　　8.2.4　Integrating IPD and Other Business Processes 235 　　8.3　Financial Management Throughout the PTP Process 237 　　　　8.3.1　KCPs Throughout the PTP Process 237 　　　　8.3.2　Integrating Procurement and Financial Processes 240 　　　　8.3.3　Automation and Payment Security of the PTP Process 243 9　Project Financial Management 247 　　9.1　Shifting from Being Function-Centered to Being ProjectCentered 248 　　　　9.1.1　Projects Are the Basic Units and Cells of Business Management 248 　　　　9.1.2　Establishing a Corporate-Level Project-Centered Management System 250 　　　　9.1.3　Back Offices Need to Collaborate to Provide Timely and Accurate Support for 　　　　　　　Field Operations 253 　　9.2　Key Activities for Project Financial Management 254 　　　　9.2.1　Closed Loop Operations: Project Estimation, Budgeting, Accounting, and Final 　　　　　　　Accounting 254 　　　　9.2.2　Building an Awareness of Project Operations and a Project Operations 　　　　　　　Management Mechanism 261 　　　　9.2.3　Integrating Pre-sales and Post-sales Activities 263 　　　　9.2.4　Closed-Loop Management of Project Risks and Assumptions 265 　　9.3　Matching Project Managers and Project Management Teams’ Authority with Their 　　　　　Responsibilities 266 　　　　9.3.1　Matching Project Managers’ Authority with Their Responsibilities 266 　　　　9.3.2　Further Developing Project Management Teams and Inspiring Passion Across 　　　　　　　Field Operating Units 269 　　9.4　Project Appraisals and Incentives 270 　　　　9.4.1　Adopting an Appraisal and Incentivization Mechanism Based on Final Project 　　　　　　　Results 270 　　　　9.4.2　Exploring Project Bonuses and Implementing the Contribute and Share System 271 10　Optimizing the Management Control System for Responsibility Centers 275 　　10.1　Every Operating Mechanism Is Ultimately Value-Driven 276 　　　　10.1.1　Making Accounting Granularity Small as Needed 276 　　　　10.1.2　Using the Value Distribution System to Drive Business Units to Operate on 　　　　　　　　Their Own, Responsible for Profits and Losses, and Incentives and Constraints 281 　　　　10.1.3　Leveraging the Value Sharing Mechanism and Strategic Investment to 　　　　　　　　Reinforce Our Culture of “Toasting Those Who Succeed and Offering a 　　　　　　　　Helping Hand to Those Who Fail” 283 　　10.2　Methods for Managing Responsibility Centers 285 　　　　10.2.1　We Establish Responsibility Centers to Define Responsibilities, Streamline 　　　　　　　　Management, and Motivate the Workforce 285 　　　　10.2.2　Incorporating Checks and Balances into Responsibility Center Management 288 　　　　10.2.3　Responsibility Centers Must Adopt Different Approaches to Manage Certainties 　　　　　　　　and Uncertainties 293 　　10.3　Operating Mechanisms for Profit Centers 295 　　　　10.3.1　Focusing on Business Operations, Making Decisions Independently, and Never 　　　　　　　　Rigidly Setting Job Grades Based on Scale and Levels 295 　　　　10.3.2　Positioning HQ as a Resource Pool and Adopting a Resource Buy & Sell 　　　　　　　　Mechanism 297 　　　　10.3.3　Authority Delegation and Responsibility for Profit Centers 299 11　Developing a Better Planning, Budgeting, and Accounting System 303 　　11.1　Aligning Planning, Budgeting, and Accounting with Strategy and Business Operations 305 　　　　11.1.1　The Primary Purpose of Budget Management: Pushing the Company Forward Rather 　　　　　　　　Than Only Determining What Can Be Done with the Resources Available 305 　　　　11.1.2　Establishing a Planning, Budgeting, and Accounting System to Support 　　　　　　　　Business Success 306 　　　　11.1.3　Linking Budgets to Contributions and Strategies 308 　　　　11.1.4　Shifting the Focus of Business Management from BPs to SPs 310 　　　　11.1.5　Establishing a Budget Allocation Mechanism Based on the “SP–Project–Budget” 　　　　　　　　Logic 312 　　11.2　Preparing Plans and Budgets from the Bottom Up 314 　　　　11.2.1　Projects and Customers: The Focus of Planning, Budgeting, and Accounting 314 　　　　11.2.2　Proper Planning: Integrated Operating Plans Are the Foundation of Effective 　　　　　　　　Management 315 　　　　11.2.3　Making Business Forecasts More Reliable 317 　　　　11.2.4　Continuously Optimizing Expense Baselines, Reducing Operating Costs, and 　　　　　　　　Improving Management to Increase Efficiency 318 　　11.3　Implementing Flexible Budgeting to Adapt to Opportunities and Changes 320 　　　　11.3.1　Reasonableness Analysis of Detailed Business Department Budgets and Strict 　　　　　　　　Control of Functional Department Budget Caps 320 　　　　11.3.2　Preparing Flexible Budgets to Allow Field Teams to Obtain More Resources 　　　　　　　　After Their Business Grows 322 　　　　11.3.3　Strictly Implementing a Process for Granting and Increasing Budgets 324 　　11.4　Accounting: An Important Indicator of Management Improvement 325 　　　　11.4.1　Overseeing the Exercise of the Delegated Authority Through Accounting to 　　　　　　　　Ensure Field Teams Have Command Authority 325 　　　　11.4.2　Improving Management Through Scientific Accounting 326 12　Service and Oversight Functions of Accounting 329 　　12.1　Keeping Accounting Independent from the Top Down and Letting It Serve as a “Dam” 330 　　　　12.1.1　Roles of Accounting: Service and Oversight, with the Latter Being More 　　　　　　　　Important 330 　　　　12.1.2　Oversight by Accounting: Comprehensive Oversight Throughout All Processes 332 　　　　12.1.3　“Accounting Plays an Oversight Role”: Incorporating Service and Oversight 　　　　　　　　into End-to-End Processes; Exercising Oversight While Providing Services 333 　　12.2　Accounting Must Get Deeply Involved in Business Operations and Implement 　　　　　　　　Integrated Financial Management While Serving Business 335 　　　　12.2.1　Accounting Must Be Proactive While Serving Business 335 　　　　12.2.2　Accounting Must Get Close to Business and Establish a Multi-level Shared 　　　　　　　　Service Model Based on Business Scenarios 337 　　12.3　Payment Management 339 　　　　12.3.1　Basing Performance Appraisals of Payment Personnel on the Quality of Their 　　　　　　　　Work and Maintaining Appropriate Redundancy in the Headcount 339 　　　　12.3.2　Establishing a Mechanism to Ensure Daily Reconciliation at Three 　　　　　　　　Organizational Levels340 　　　　12.3.3　Having a Correct Understanding of Error Rates 342 　　12.4　Complying with Accounting Ethics and Rules342 　　　　12.4.1　Being Bold and Able to Stick to Principles 342 　　　　12.4.2　Complementing Institutional Oversight with Ethical Constraints 344 13　Treasury Management 347 　　13.1　Exploring a Capital Structure for the Company’s Long-Term Development 348 　　　　13.1.1　Growing from Within Is the Core and Major Driving Force Behind Huawei’s 　　　　　　　　Future Development 348 　　　　13.1.2　Improving Working Capital Efficiency and Quality to Ensure the Continuity 　　　　　　　　and Robustness of Operating Cash Flow 350 　　13.2　Building a Global Treasury Management System to Better Manage Fund Risks 355 　　　　13.2.1　Scaling Up Financing, Enriching the Financing Structure, and Dispersing 　　　　　　　　Financing Risks 355 　　　　13.2.2　Establishing Diversified Financing Systems and Cash Settlement Centers 356 　　　　13.2.3　Guaranteeing Financing Capabilities with Stable Financial Policies 357 　　13.3　Centrally Managing Funds to Ensure Fund Security 357 　　　　13.3.1　Centrally Managing Funds and Enhancing the Process Ownership System 357 　　　　13.3.2　Standardizing Account Management and Establishing a Unified Treasury 　　　　　　　　Management System 359 　　　　13.3.3　The Ability to Deal with Strict Foreign Exchange Controls Helps to Guarantee 　　　　　　　　the Company’s Fund Security. It Is Also a Core Competency That Helps 　　　　　　　　Affected Regions Maintain Their Competitive Advantages and Robust 　　　　　　　　Business Performance 361 14　Tax Management 363 　　14.1　Paying Taxes Is a Corporate Social Responsibility 364 　　　　14.1.1　A Company’s Biggest Contribution to Society Is to Pay Taxes and Do Its Work 　　　　　　　　the Best It Can 364 　　　　14.1.2　Abiding by Applicable Tax Laws in All Business Activities 364 　　　　14.1.3　Performing Intercompany Transactions in a Standard and Effective Way Based 　　　　　　　　on External Laws and Industry Practices 366 　　　　14.1.4　Establishing a Long-Term Transformation and Operation Management 　　　　　　　　Mechanism to Ensure Taxes Are Paid According to Law 367 　　　　14.1.5　Creating a Positive Business Environment to Support Huawei’s Global 　　　　　　　　Operations 368 　　14.2　Proactively, Effectively, and Appropriately Managing Tax Risks and Costs 369 　　　　14.2.1　Clarifying Goals and Responsibilities of Tax Risk Management 369 　　　　14.2.2　Effectively Developing Global Tax Plans and Keeping the Company’s Taxes 　　　　　　　　at a Reasonable Level 370 15　Internal Controls and Internal Audit 373 　　15.1　The Company’s Oversight System: The Governance Structure and Three Lines of 　　　　　Defense 374 　　　　15.1.1　The Oversight System: Governance Structure 374 　　　　15.1.2　Internal Controls: Three Lines of Defense 375 　　15.2　Process Controls 378 　　　　15.2.1　Oversight Aims to Prevent Corruption, Improve Operations, and Establish 　　　　　　　　Deterrence 378 　　　　15.2.2　“Wearing American Shoes” and Starting from Scratch to Build Huawei’s 　　　　　　　　Internal Control System 381 　　　　15.2.3　Internal Control Management: Objectives and the Framework 383 　　　　15.2.4　Implementing the Process Ownership System 385 　　　　15.2.5　Internal Control Ownership System 387 　　15.3　Internal Controls Over Financial Reporting (ICFR) 391 　　　　15.3.1　Building Sustainable and Profitable Growth with High-Quality Process 　　　　　　　　Controls and ICFR 391 　　　　15.3.2　ICFR Is a Means, and Consistency of Business and Accounts Is an End 392 　　　　15.3.3　ICFR: Starting by Managing the Quality of Business Data to Ensure the Quality 　　　　　　　　of Financial Reports 395 　　　　15.3.4　ICFR Management Should Shift Its Focus from Moving Targets to Fixed 　　　　　　　　Targets 396 　　　　15.3.5　Finance: Building an Effective Internal Control System; Business Departments: 　　　　　　　　Rigorously Fulfilling Their Internal Control Responsibilities 397 　　　　15.3.6　ICFR Is Designed to Continuously Improve the Quality of Financial Reports, 　　　　　　　　Not Merely to Hold People Accountable 399 　　15.4　Internal Audits and Investigations 400 　　　　15.4.1　Establishing Deterrence Through Internal Audits 400 　　　　15.4.2　Strengthening Legal Deterrence and Tightening Accountability Criteria Every 　　　　　　　　Year 403 　　　　15.4.3　Separating Investigations from Disciplinary Actions 404 　　　　15.4.4　Oversight Is the Best Way to Care for and Protect Our Managers 407 　　　　15.4.5　Audit: Assuming Innocence Until Proven Guilty and Taking Appropriate 　　　　　　　　Disciplinary Actions Against Mistakes at Work 410 16　Digital Financial Management 417 　　16.1　Data Is a Strategic Resource 418 　　　　16.1.1　Managing Data in the Same Way as Managing Capital 418 　　　　16.1.2　Fully Leveraging Data Resources to Create New Competitive Advantages 419 　　16.2　Data Cleaning Is the Most Effective Approach for Internal Controls 421 　　　　16.2.1　Ensuring Data Quality from the Source 421 　　　　16.2.2　Whoever Creates Data Must Be Responsible for Data Quality 422 　　16.3　Making Routine Financial Management Automated and Intelligent, and Leveraging 　　　　　Big Data Analytics to Improve Financial Management 424 　　　　16.3.1　The Basis of Scientific Management: Rational Analyses Based on Data and 　　　　　　　　Facts 424 　　　　16.3.2　Establishing a Future-Proof Data Governance System 426 　　　　16.3.3　Leveraging Automation, AI, and Big Data Analytics to Reduce the Complexity 　　　　　　　　and Uncertainty of Financial Management 428 17　Making Financial Management Process-Based and Professional 433 　　17.1　Financial Personnel Should Understand Business and Business Personnel Should 　　　　　　　　Understand Finance 434 　　　　17.1.1　Financial Personnel Can Help Business Grow Only by Understanding Business 434 　　　　17.1.2　Managers Are Also About Managing Finance 435 　　　　17.1.3　Financial Personnel Can Become Well-Rounded Managers Only by Knowing 　　　　　　　　How to Manage Projects 437 　　　　17.1.4　Developing a Mixed Financial Team 439 　　17.2　Building a Process-Based, Professional Financial Management System 440 　　　　17.2.1　Reducing Costs Through Process-Based and Professional Financial 　　　　　　　　Management 440 　　　　17.2.2　Building a Professional Financial Team That Has Solid Integrity, Dares to 　　　　　　　　Shoulder Responsibilities, and Sticks to Principles 442 　　17.3　Progress in Finance Is the Basis for All Management Advances 443 　　　　17.3.1　Financial Transformation Is Not Limited to the Finance System, But a 　　　　　　　　Company-Wide Effort 443 　　　　17.3.2　There Will Not Always Be Flowers Along the Road Ahead 445 Epilogue 447 Acronyms 451