What is “Guanxi”?
The term Guanxi is refers to personalized networking. In other words, the relationships formed with the use of Guanxi are very personal and normally non-transferable. Therefore, the term Guanxi does not describe a usual family relationship, and it can be barely used for an extended family member. Moreover, Guanxi does not refer to traditional relationship between superior and subordinate (examples like a teacher and a student, a boss and an employee), or obvious friendship (for example a boyfriend and a girlfriend).
In summary, Guanxi refers to the benefits one gains from extended social connections, and it is a Chinese custom to cultivate an intricate web of Guanxi relationships, which may expand in a huge number of directions. It also entails lifelong relationships. Reciprocal favours are the key factor to maintain one’s Guanxi web, and the failure to reciprocate is considered an unforgivable offence for the Chinese. Therefore, Guanxi can preserve a never-ending cycle of favours. In brief, remember that the more favours you ask someone for, the more you owe the person!
Networking is a must
In China, proper networking, reflected in all aspects of social life, is a combination of related concepts that, besides Guanxi 关系, also includes Renqing 人情 (the moral obligation to maintain a relationship) and Mianzi 面子 (social status, propriety, prestige). By taking into account them all, it is possible to measure the depth of feelings within an interpersonal relationship in the Chinese society.
At its most basic meaning, Guanxi describes a personal connection between two people, in which one is able to prevail or be prevailed over another to perform a favour or service. The key point here is that two people in this case cannot have equal social status.
Guanxi can also be used to describe a network of contacts, which an individual can call upon when something needs to be done, and through which he or she can exert influence on behalf of another.
Moreover, Guanxi can describe a state of mutual understanding between two people (one person is aware of another person’s needs and will take them into account when deciding one’s course of actions which concern the other one, without any further discussion between them).
For instance, someone can be described to have a “good Guanxi” if its particular network of influence could assist in the resolution of a problem currently affecting the majority.
Guanxi is considered in the modern Chinese society as common inter-personal ties that reflect the Chinese nature, and even though the Chinese normally tend to deny or hide the strong importance of Guanxi in their society and their culture, Westerners should never underestimate Guanxi as a significant element of the Chinese society!
Guanxi and business
Guanxi has a major influence on the management of business based in China, and also on the business owned by the Chinese overseas.
In the Chinese society, the boundary between business and social life can sometimes be quite blurred, as people tend to rely heavily on their close relations and friends. This can result in nepotism in the workplace, as it is common for boss to draw from his/her family and close ties to fill employment opportunities. Additionally, nepotism often prevents the most suitable qualified and talented person being employed for the position, as it is the norm in Western societies. It is just to point out that nepotism is only one representation of the manipulation and corruption caused by a selfish and sometimes illegal utilization of Guanxi.
In the world of business, Western economists have already pointed out that whoever trades regularly with China should improve the "cultural competency" with regard to practices such as Guanxi, in order to avoid financial fallout due to lack of cultural awareness.
In conclusion, we have to “make ourselves Chinese” when dealing with the Chinese, therefore we must not hesitate to build up our own Guanxi web, as long as we avoid the selfish and illegal utilization of it!
Ostrowski, Pierre; Gwen Penner (2009). It's all Chinese to Me: an overview of culture & etiquette in China. Tuttle. pp. 48–49. ISBN 978-0-8048-4079-8.
China Characteristics – Regarding Guanxi GCiS China Strategic Research.
Jun, Lin; Steven X. Si (2010). "Can guanxi be a problem? Contexts, ties, and some unfavorable consequences of social capital in China". Asia Pacific Journal of Management 27 (3). help)
Smart, Josephine (September 2012). "Dancing with the Dragon: Canadian Investment in China and Chinese Investment in Canada".
Mr. Cesare Romiti, President of the Foundation Italy China, his phone interview with China Daily International Edition on the 11th of June, 2015.
- Video and explanation of “Guanxi” from BBC: http://www.bbc.com/news/business-29524701
- Guanxi in business: http://www.businessinsider.com/the-most-misunderstood-business-concept-in-china-2011-2?IR=T
- The role of Guanxi in business Enterpreneurship: http://www.asiaentrepreneurshipjournal.com/AJESIII3Anderson.pdf