The place of guanxi in the modern Chinese society and impact on management processes within China and also on international business relations with China

Résumé du document

China is a unique country that places personal relationships above any other aspect of life. The guanxi is a famous relationship aspect of China, and with the recent interest from the whole world concerning China and its expansion, it is interesting to study the importance of this historical Chinese concept in this evolving context. In this study we are going to answer several important questions namely, the meaning of guanxi, and its influence on the modern Chinese society. How important is it for both Chinese and foreign businessmen to consider this concept in order to do business in China? What is the impact of guanxi on the functioning of a company? How does the concept of guanxi make the Chinese business context unique and different from Western applications? What is the future of the concept of guanxi? We will first give a complete definition of guanxi, which is both historical and can be applied to the modern Chinese society. The concept will also be compared with its Western counterpart. In the second part, the emphasis will be placed on the influence of guanxi on the functioning of a company. We will analyze its impact on company performance, managerial function and on global professional behavior in China. Finally, we will analyze the concept of guanxi applied to outside environments. The implication and relation of guanxi with the government, market economy and process of globalization as well as an application to foreigners will be studied.

Extraits

[...] Have the influential people in the companies moved or been replaced ? Has our company created guanxi with people newly employed in other companies The answer to those questions will enable the company to include guanxi in the company business plan as a serious and material concept and capital. The construction of the map does not only depend on employees' affirmations, but requires a lot of managerial intelligence. Indeed, we have affirmed that guanxi is most of the time overestimated by people who possess it. [...]

[...] But in this context in which power and appearance of power is necessary, and considering the historical, social and legal aspects, we can say that guanxi is an absolutely essential tool in order to gain a positive answer to any request. Comparison between guanxi and Western concepts : It is important to be able to differentiate two concepts which are often confused, and by error or inattention considered as identical. Confusing the typically Chinese concept of guanxi and the Occidental concept of public relations can lead to dramatic consequences, especially for a foreign investor in China. [...]

[...] Opposition friendship / principle centred : The concept of guanxi is based on a real knowledge of the people in the network. It is very frequent that the links between two people in one guanxi are more than simple interest-based relations. Most of the time, the secret of long-term and efficient relationships is real friendship. People know each other very well. The relationship in that case is not immediately based on friendship, but the two parties take the time to know and appreciate each other, in order to allow a real complicity and respect to develop. [...]

[...] The importance of integrating and learning the notion of guanxi and applying its principles : We already explained why a foreign company should absolutely consider its guanxi as an essential tool if it has the ambition to implement its activity in the Chinese market, or if they want to deal with Chinese partners. However, having in its possession an important and efficient relational network is a key, but not the only one for this purpose. One must not only know the basic principles, but also and especially know how to use them. For centuries, the Chinese only did business with other Chinese. [...]

[...] By taking as references the definitions and analysis made in the previous pages, it is now possible to establish that guanxi is an absolutely necessary step in order to build an efficient and successful business relationships network in China. This concept regroups most of the principles on which the Chinese civilization and people are based. That is why its influence is still intact in Chinese society. However, we cannot say that the entire culture and people can be summarized in this one word : guanxi, but it is true that this word represents a major cultural difference between the People's Republic of China and the West, and especially we can say that it represents a major barrier at the entrance to the Chinese market. [...]