Guanxi is the word that Chinese people use to describe important relationships in their network, whether it is friends, relatives or business associates that can assist them in any situation whether it is personally or professionally. If you seek to be successful in business in China, developing strong relationships with suppliers, buyers, intermediaries, or other influential people outside of your industry will increase those chances. Below is a list of actions that will increase the likelihood of developing strong guanxi in China.
- Guanxi can be seen as being dependable, trustworthy, and honest to establish a strong relationship. Do what you say you are going to do and you will develop guangxi in China. Words are hollow and empty unless they are supported by concrete actions that develop trust and loyalty. Act humbly in your interactions with Chinese business people to aid in guangxi. Arrogance is perceived as weakness in Asian culture.
- Guanxi will not be developed overnight but through the continuation of seeking to assist other people with the problems they face in their business or personal life. Give and you shall receive will be the mantra that will help you achieve not only your associates goals but your own. Crossing over to aid people in their personal life may seem outside the norm of business conduct in America and feel unnatural. Just make sure you are sincere in your help, and value the person more than the end business result.
- Guanxi will be created by having a native born Chinese person on your staff that may have familial ties to China. Naturally, they will have an increased knowledge of the culture and language that will give you an advantage in your China dealings.
- Guanxi will be fostered by having a long term presence in the Middle Kingdom, by establishing satellite offices. This will give your business the opportunity to truly understand the culture of the city you are located in, not just the overall culture of China. Think how differently business may be conducted in oil fields of Texas or downtown Manhattan. Beijing’s culture will be slightly nuanced from that of Chongqing’s.
- Guanxi will be accelerated through learning a Chinese language, whether Mandarin for the Mainland or Cantonese for Hong Kong. Learning a Chinese language is a difficult undertaking and will take years, especially if you can only allot a few hours a day to study. Using translators does limit the intimacy in which relationships can be fully developed.
- Guanxi will be re-enforced by studying the history and culture of China, to prove to Chinese business people that your involvement in China is beyond profit seeking motives. Go to the local bookstore or public library and you can find an assortment of books that will deepen your understanding of the Cultural Revolution, special economic zones, and the imperial examination system. This will give you the ability to converse with your business associates over those alcohol fueled dinners.
- Guanxi will be achieved by providing gifts to other business people that you interact with on a regular basis. It should be noted that more senior individuals in the organization should receive better gifts so that you can acknowledge their status within the organization. However, the use of giving gifts may be construed as a form of bribery if given at inopportune times, like when you are seeking a contract while in competition with other firms. Pay special attention to the timing of your gifts to avoid this situation from happening. The value of a gift is in the act of giving, not necessarily the price.
- Guanxi will be solidified by regularly traveling to meet with buyers, suppliers, and important figures in the organization. Advances in technology such as email, Skype, and chat applications make international communications with people easier and less costly, but do they establish trustworthy and long lasting relationships? Taking that 18 hour flight to Hong Kong to meet with your business partner once a quarter will show them their value to your organization.
- Attend business events in China both inside and outside of your industry. While Chinese business people with similar interests will be the strongest source of your guanxi, meeting other Chinese leaders outside of your industry may prove beneficial if a unique opportunity appears.