Guanxi Case Study

2193 Words9 Pages
The Importance of Guanxi for businesses in China Guanxi, a special word in Chinese, stands for all kinds of relationships, which is one important concept in Chinese culture. In many cases, Guanxi is about connections in social networks that can be used to help accomplish certain objectives or goals one has. Furthermore, it emphasizes connections one can use for conducting a favour or receiving a favour from the mutual connection. The Chinese word guanxi as stated above, in directed translation means relationship. Guanxi consist of two words, guan and xi. Guan means to close up or a door. Literally, thinking, someone inside the door is known to separate between insiders and outsiders. The word guan is also used to mean doing a favour for someone (Hsu and Saxenian, 29). Xi on the other hand means to extend relationship to another party. The word Xi is used in place of maintaining a long term relationship. With the above definition in mind, guanxi is used to refer to “drawing closer connections with people in order to gain personal relationship with the parties” (Luo, 2007). Guanxi is seen to have originated a long time ago and its exact point in history cannot be traced. All that is known is that the concept has always been in existence to bring people together and helps people who have good social ties. As the saying goes “reciprocity respect for hierarchy, and the ritual materialization of sentiment.” People are not treated equally in this traditional society so they start to depend on important people. Indeed, under this philosophy, Chinese strive on managing their guanxi with special persons in hope of better opportunities. Finally yet importantly, in Confucianism, guanxi network is dedicated to building harmonious relationships... ... middle of paper ... ...he ideas through dialogue and building relationship, both parties agree and on terms that enhance both parties to benefit. The result that China and the Chinese people have had in building business and trade relationships have influenced people in most developing countries. It has compelled and forced some of the developing countries to change their policies and strategies relating to terms and conditions in business and trade within governments and the residents of those countries. Some countries in the so called developed world that relied on giving other people aid under strict and unfavorable terms and conditions have now resulted into using Guanxi to look for partners to conduct and trade with and the citizens, as well. They see the success and the impact that it has had 0n the Chinese people and in terms of trade and business and they have resolved to copy

More about Guanxi Case Study

Open Document