The importance of Guanxi (relationship) when doing business in China
Chinese businessmen have traditionally relied on guanxi, or personal relationships. Guanxi is a system of interpersonal relationships built on mutual trust and respect that can build strong business partnerships. Businessmen use guanxi to build personal networks at the same time as forming alliances with other individuals, companies, or organizations. Guanxi is by no means an easy task and requires a lot of work in the long run. It's so easy to rely on ease over hard work when doing business but guanxi can help you make these crucial connections to succeed in China!
Guanxi may not be relevant anymore but it's important professional advice for anyone thinking about doing business in China.
What is Guanxi?
Guanxi means "alliances or connections". It's the intimate network of personal relationships between people. Guanxi is used for business to build connections, for social interactions, and for identifying opportunities. It's a very important aspect of the Chinese culture but it is often taken lightly by many foreigners in China.
Guanxi can occur anywhere -- you don't need to be a Chinese citizen to have guanxi. Guanxi can be built very quickly with the click of a mouse. Guanxi is built through personal relationships and often builds upon existing relationships.
What does guanxi mean for business?
Guanxi is very important for business in China because it helps build rapport, trust, and respect between parties. It's incredibly easy to form guanxi in China and build networks as you meet new people. In fact, many Chinese people don't really know what guanxi means; they just know that it's important. It's also an easy way to form professional ties or business partnerships.
Guanxi can help you to secure deals and business contracts. It can introduce you to new opportunities that may not have been available in your network.
How do I build guanxi in China?
The first step to building guanxi is being genuine. Guanxi is built over time so you need to be willing to spend the time and energy it take to form a strong relationship. Building strong relationships can take years and even decades but it's worth it! As mentioned above, building guanxi often builds upon pre-existing relationships. Don't hesitate -- when you meet people, ask them about themselves, their families, what they do for work, etc. Find opportunities to connect with them.
Many foreigners fail in China when it comes to guanxi because they don't think it's important. The Chinese are very communicative people and value their personal relationships -- so build your relationships! Share information about yourself, your family, etc. Don't hesitate to ask the other person questions too! It may seem awkward at first but that can be overcome as well. It just takes time and a little effort.
Finally, if you want to build guanxi in China, you need to understand the cultural differences between China and your country. In Western countries like the USA or Australia, there is a line between work and private life. In China, this line doesn't exist. In fact, in many cases, it's frowned upon to separate work and private life.
Many foreigners get confused when they try to form guanxi in China because their concept of guanxi is different from the Chinese. The two cultures are very similar and understanding that difference can be the key to building authentic connections. A final note: realize that it's not essential for you to have guanxi with everyone you meet. Guanxi is about your personal relationships -- so don't rush to build guanxi with everyone you meet. Take your time and allow the relationship to develop naturally.
Remember, you can always find ways of building guanxi in China, even if it's not built on personal connections. There are many website and services where you can build guanxi by identifying professionals like lawyers or accountants who want to be connected with other professionals.
Guanxi is a very hard thing to build through communication. In some cases, it's easier to build guanxi through professional connections. It depends on the type of business you're into and the type of people you want to do business with. Guanxi isn't a part of Chinese business that's dying but it's definitely something that has been changing in recent years. It's still important for many Chinese businessmen and women but it doesn't mean as much as it once did in the past!
Liam Thomas is from Beijing China and has been teaching English in Beijing for 2 years. He studied Business Management at St. Thomas University in Canada and loves to blog about China and life in Beijing.
His blog can be found at: http://www.echinacities.com/author/liamthomas
Article Source: http://EzineArticles.com/?expert=Liam_Thomas
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Conclusion
The word "guanxi" (guan xi) has a very interesting history. It's used as a term describing relationships between people without regard to national origin, race or gender. Guanxi is closely related to the practice of guanxi, which existed in ancient China as well as in traditional Chinese society.
Today, guanxi only refers to relationships between people who are part of the same social group or family. When you work with Chinese business partners, you usually don't need to know their full name, or the names of their parents and siblings.