01 Jul, 2018

Guanxi: Understanding Chinese Business Etiquette

If you’re going to do an internship in China, you need to understand and learn about the concept of guanxi in Chinese culture. Without a deep understanding about this, you may feel like an outsider when it comes to do business in China.  

What is Guanxi?

Guanxi［关系／關係］is a general Chinese term used to describe relationship or, at times, equal the term "networking" that are beneficial for the parties involved.

Image source: lindamandarin.com

Fundamentally, guanxi is about building a network of mutually beneficial relationships which can be used for personal and business purposes. In this sense, guanxi isn’t so much different than the importance of having a strong network when working or doing business in any country. However, in China, guanxi plays a far more important role than it does in any other countries. In China, it’s not uncommon to find yourself building your networks late into the evening in a bar, swapping business cards, making new contacts through old friendships. In fact, it’s necessary to spend time getting to know your Chinese counterparts outside the boardroom.

Why is it important in China?

Having a collectivist culture, Chinese people think about the needs of society before their own. Guanxi is important at work and business because Chinese people tend to rely on relationships. They can trust it more than the institutions and the laws. Chinese people believe in fostering meaningful long-term relationships, and so you must too. Guanxi also affects face. If you have good guanxi you are more likely to have face and therefore command more respect.

How to Develop and Maintain Guanxi?

While developing guanxi is important to doing business in China it is not necessarily easy to develop, especially for foreigners. Here are some practice to develop and maintain guanxi.

Image source: chinesepod.com

  • Learn the language and study the culture

Knowing a few simple phrases will endear you to your business partners, colleagues, and friends. It shows that you respect the people and their culture. Becoming fluent in Chinese will open up doors and help you build guanxi.

  • Offer your hand

One easy way to gain a Chinese person’s trust is through a simple, thoughtful gesture. For example, say you colleague is busy with work that he cannot even go out to have a lunch. You can try to offer to buy him a meal and bring it to him. While he may decline, the fact that you offered to him demonstrates a level of respect that he won’t forget. Taking this conceptually: look for opportunities where you can jump in and provide a helping hand. Chinese people will remember this and it will sway their affective trust in your favour

  • Stick to your promises

This is pretty much common sense in any business relationship. If you have a set a date or made a promise, it’s absolutely vital that you stick to it. Good guanxi consists of a lot of unspoken agreements. If you don’t gain the trust of your business partners, you are pretty much screwed.

  • Keep in touch

Maintaining and building trust is a necessity, and to keep your levels of guanxi high you must regularly keep in touch with contacts and return a favor if asked.

Coming to China for an internship program will allow you to observe this being practiced by Chinese people closely. No need to hesitate to learn from them and develop guanxi. Do it right and you’ll feel the advantage.