« Guanxi » démystifié : Comment diffère-t-il de nos « raccordements » habituels ?
Par Shawn He Yuxun
Dans le monde occidental, avoir les bons rapports ou raccordements, tandis que très important, n'est habituellement pas un état suffisant (ni dans beaucoup de cas un nécessaire) pour obtenir des affaires faites. Vous devriez avoir des principes essentiels des affaires sains d'abord. En Chine, pendant longtemps ayant Guanxi ce « ultra-rapport » ou « superbe-raccordement « a pu déjà SEUL assurer « faire-s'occupent », indépendamment des principes fondamentaux…
Vous pourriez avoir entendu que le mot chinois « Guanxi « (guan-shee prononcé, littéralement signifiant le « rapport » ou le « raccordement « ) fréquemment espionné par beaucoup de consultants en matière de la Chine ou « vieille Chine remet » qui ont été là et ont fait cela. Est-ce que mais nous tous sur cette planète ne parlons pas et n'avons pas besoin de « rapports » et de « raccordements » dans les affaires ? Alors va comment ce Guanxi différent des « rapports » habituels et des « raccordements » ces nous savons. Et juste combien de lui coûte une « garantie » pour le succès en Chine, et combien de elle coûte-t-elle simplement une consultation de la Chine « chic » ?
Avant les années 80, chaque aspect de la vie économique de la Chine a été projeté, commandé, dirigé et actionné par le gouvernement. On n'a permis aucune propriété privée de n'importe quels propriété ou capitaux, beaucoup moins de mercantilisme pour un individu ou groupe. Le gouvernement assignerait chacun une tranche prédéfinie du « grand pâté en croûte « (par ailleurs la terminologie équivalente en Chine - où le riz règne la table dinante - était « ventilateur de Da Guo « (da-fuseau-amusement), qui signifie le « riz dans un grand wok « ). If one wanted any more than what was allocated to him/her, he/she would have to circumvent the system and rely on another individual in charge of a particular function in that “allocation chain” to do him/her a special favor.
During those days of hyper Communist ideology control, people were obliged to sacrifice their individual interest for that of the whole society. Any act of favoritism was a serious offense not only regulatorily/legally, but also ideologically. The only people that anyone would risk their reputation, career or livelihood (and in some extreme cases even lives) to do special favors to would be those with extremely strong or solid ties or relationships (i.e., guanxi). In fact, the Chinese themselves would say the guanxi between so and so is very “Ying“ (ying) — which means “hard“ or “solid“, or very “Tie“ (tyeh) — which literally means “iron“ or “iron-like“.
On the other hand, since all resources and assets (both tangible and intangible) belonged to the government and not any individual or group, there was never a nominal economic cost/value (i.e., price) on the transactions associated with those acts of favor, nor could they be monetarily bought or sold. Effectively a “barter“ system was created in which anyone could leverage whatever resource or asset within their power or control to “barter” for a return favor from another individual in the future. And this “barter” system only functioned within those transaction parties’ “iron guanxi” network, or Guanxi (note that I use the bold font to emphasize that this is not your average relationship — i.e., guanxi in its normal, literal sense — that we are talking about), so as to minimize “credit” risks (i.e., betrayal, rip-off, and/or exposure.)
Back then, when people sought such Guanxi in a hurry, they would say I need to “pull some relationships“, or in Chinese, “La Guanxi”, pronounced la-guan-shee. (Funny how Americans would say I need to “pull strings” in a very similar fashion). Because you could never practically “develop” such a relationship or guanxi in a short time — This was an exceptional type of relationship that only existed among close relatives, friends and associates, or generally speaking, a closely-knit group of people who are mutually dependent.
For obvious reasons, at the time “La Guanxi” was always coupled, and almost synonymous, with “Zou Houmen“ (zoe-hoe-mun) which literally means “entering through the backdoor“.
In the Western world, having the right relationships or connections, while very important, is usuallly not a sufficient, nor in some situations necessary, condition for someone to accomplish a business objective. You’d need to have sound business fundamentals first. Good relationships and connections only serve to facilitate a transaction that makes good business sense in the first place.
It is perhaps fair to say that in the business environment that we are familiar with, relationships and connections (i.e., normal guanxi) only play a secondary role, except in some extraordinary cases. (And it is in these exceptions that you’d most likely find Guanxi, in the Chinese sense, at play.)
When China first embarked on its economic reform and opening policies in the late 70’s, since there was no pre-existing market-driven system to guide the economic flow and since most of the transactional entities were state-owned, things were carried out predominantly over this Guanxi-based system since that was the only proven means for one economic entity, be it an individiual or a company, to reach out to another that had not been its normal point of contact under the old, “by-government-mandate-only” system.
So by and large throughout the 80’s and most of the 90’s, having Guanxi this “ultra-relationship” or “super-connection“ ALONE had proven to be a sufficient, and in many cases also necessary, condition to get something done, regardless of the fundamentals. With Guanxi, a completely unqualified and incompetent person could land a very important job and/or position. Also with Guanxi, a company with no track record whatsoever could be awarded massive contracts. You get the point…
As the economy becomes more and more marketized / privatized and competitive, the value and effectiveness of the Guanxi system has also greatly deterioriated. In industries that have been substantially deregulated / privatized or where there is much competition, business is business, and Guanxi has been neutralized / marginalized to resemble just what relationships and connections are like in the Western world.
When commenting on the subject during an AeA event co-sponsored by MeetChinaBiz in July, 2007, Greg Shea, president of Beijing-based U.S. Information Technology Office (USITO), a US advocacy group for the ICT industry (a fairly deregulated and fiercely competitive one participated by all players around the world), said: “Don’t let those consultants scare you into thinking you’d still need Guanxi to play in that market nowadays. It is bollocks, bollocks, bollocks, as the British would say…”
If Guanxi in its true, original sense (where a phone call or a note from a VIP would land a person or a company an otherwise impossible permission or deal) still exists today, it would only exist in highly controlled or non-transparent sectors, at very high levels and behind closed doors — i.e., not easily accessible to the average business people and consultants that crowd the busy China scene of today.
Shawn He Yuxun, MeetChinaBiz
January 2nd, 2008 at 4:45 am
I’d say Shawn is right, but then so is Brian. How? Neither are talking about the same thing. Nor do they mention a key aspect of guanxi: mutually shared obligation.
Shawn is right that the role of guanxi ALONE getting business done is less and less, especially in the industry areas he notes. The further you get from the big cities though, the more effective guanxi remains.
Brian`s guanxi is more the interpersonal than the business kind, and here I`d say that guanxi exists much as it always has.
Inherent in guanxi (of any kind) is the idea that one is obliged to help. Why? To maintain that most crucial of Chinese bonds, the relationship.
I need business cards printed. A Chinese friend says he has a high school classmate who owns a printing company, and his friend will give me a great deal. (Which is how things get done: how many Chinese use the Yellow Pages to find a plumber? Very few. It is all connections, a friend of a friend.) I meet the friend and arrange the job.
Cards done, but the color is red, not blue (as I requested.) What do I do? When I complain the printer tells me that “red is nice,” then, when I continue to complain he says, “but you can still use them.” If I force the issue, saying that I won`t pay for the cards because they are the wrong color, I cause the printer to lose money. If I do that I then risk hurting my relationship with the original friend who recommended the printer in the first place.
My choice is stark: I either accept the red cards to preserve our relationship, or I refuse to accept and pay for the cards, thus hurting the relationship.
This type of guanxi is different than Shawn`s, and in some senses Brian`s as well, but nonetheless is the reality of guanxi on the street. Once you accept a favor you are then obliged to offer a favor to someone else, even if doing so is against your interests. “The old hippy saying I grew up with, “What goes around comes around,” comes to mind.
I counsel clients not to ask for or to accept favors (as much as this is possible), as the only way to make decisions based on objective realities in China is when doing business with people who have not granted you favors. Either that you or you must be extremely flexible about the results you are willing to accept. Or the loss you are willing to eat, like the boxes of red cards I threw out.
January 2nd, 2008 at 4:56 am
It’s true that “guanxi’ is very important in China. It is not helping China to progress.
In my opinion, I think both business fundamentals and relationship are important in transactions. I’m happy to hear that the role of “guanxi” alone getting business done is less and less.
January 2nd, 2008 at 4:30 pm
“Guanxi” is a VERY important key in doing almost everything in China! I recall that I led a group of American int’l trade lawyers to China for anti-dumping conference 3 years ago. Just one night before the conference, I was told that Americans would not be allowed to attend due to “national security concerns” - I was stunned by the last minute notice because Americans were invited guests by the Chinese host. However, I managed to connect with the keynote speaker that evening. He was a high ranking official (from Beijing) who happened to be graduated from the same college I attended in China. After an half hour friendly conversation about college life, he finally nodded, and told me to have Americans sit in the corner. He saved my “FACE”!
January 7th, 2008 at 6:25 pm
[…] Guanxi in Chinese means “relationships” and most foreigners and Chinese alike will assure you of the need to have good Guanxi to get business done in China. While I doubt anyone who has done business or lived in China will argue that relationships aren’t necessary here, Shawn He Yuxun, from MeetChinaBiz offers some excellent insight in his blog post into the history of this infamous word Guanxi, its place within China historically and what place Guanxi may have in the future. […]
January 10th, 2008 at 11:42 pm
Brian, Greg, and Ruth:
First and outmost, I’m very appreciative of your comments.
Second, I’d like to remind all readers of this article that I was discussing the distinction between “Guanxi” (note the capital “G”, a unique business success factor - perhaps more so in the past/under-developed regions than today/big cities - to China) and the usual relationship (or “guanxi”, in its original, literal sense, which all humans are familiar with and need/use), as clearly indicated by the article’s title.
I believe the reason why so many first encounters of the contemporary Chinese business culture have been puzzled by and thus curious about how “Guanxi” works in China is largely due to its existence in the former scenario.
Whereas in the latter case, “guanxi” and “relationship” can very well be used interchangeably, so there is really little need to differentiate or discuss them (much less analyze or argue the ‘obvious’)…
I think the interchangeability of the two words in the second scenario has in fact added much confusion and thus has helped mystify this unique Chinese phenomenon altogether.
A case in point: one person argued in his comment in another blog site that in fact “guanxi” existed much earlier in China than the period that I was talking about (in fact the author suggested a couple 1000 years earlier — think Confucius! :-)) because people relied on it to trade and etc. while in the West people rely (or relied) on laws! Hmm, which people are we talking about here that did not have relationship/guanxi in the West in that era? There were the Celts, the early Romans and the Greeks in Europe and ?? (I need some help here) in America… Joking aside, I hope you get my point.
Here are some other examples that I have personally encountered to illustrate my point:
Brian - One time when our delegation was visiting in Beijing, we were trying to get the US Embassy to send a representative to attend a function of ours. The invitation was initially turned down. Then we put a delegate who was a former US congressman on the phone with them… Sure enough, a representative came. (I might be able to come up with an even closer counter-example to yours later on :-)
Greg – I am glad that you recognized that I was talking about a different type of Guanxi. But that is the very reason why I did not have to mention what you correctly pointed out as a key aspect of guanxi: mutually shared obligation — because to me that is an integral part of any good relationship (or, interchangeably, guanxi, as in its normal, literal sense, in China or anywhere else).
I am not aware of any consumer-oriented yellow pages available yet in China (please let me know if there is now). I know there are some publications or websites with “China Yellow Pages” or something like that in their names, but they are mostly a B2B thing.
While in the past Chinese purchase managers (as well as consumers) relied on their Guanxi network to procure well-sought-after products (such as Zhonghua Cigarettes and Flying Pigeon or Phoenix bicycles in the late 70’s), today they hit websites like Alibaba first. BTW, did you read that concert-goers had recently lined up overnight outside the newly opened RMB 2bn National Opera House to buy discounted standing-only tickets? That used to be “Guanxi” territory!
As a direct counter-example to show that what you were talking about (i.e., normally guanxi-facilitated business transaction) is not unique to China, our corporate members here in the US routinely ask us to recommend printers to print their bilingual business cards. I can easily imagine ourselves getting into the same situation as what you had gotten yourself into. Luckily I don’t think we have (or perhaps the affected member(s) had simply tossed out the cards and decided not to bother telling us about it for the sake of our ‘relationship’ –- after all, recommending a printer was not the primary reason why they’d join as a member in the first place).
Ruth – I believe you agree with the central point of my article, i.e., in the West good relationships and connections only serve to facilitate a transaction that makes good business sense in the first place (i.e., not a sufficient condition), but in China Guanxi used to be (may still be in certain cases) only and/or all what you’d need (a necessary and/or sufficient condition).
Yes, it is always important to have guanxi (note the lower-case “g”) in China. Again, I deliberately introduced the capital “G” and lower case “g” to differentiate the two types of “guanxi” – former being an ultra-relationship or super-connection and the latter being the normal, literal one that is shared by the entire (hu)mankind.
Please excuse me if I have appeared to have been arguing for the sake of arguing or trying to defend my ego/vanity (perhaps not necessarily untrue subconsciously :-). But I thought I’d respond to your comments in order to better illustrate my points in the article. I hope other readers may find some educational value in this.