Guanxi, which means connections or relationships or network, signifies a relational system based on repaying favors among partners, friends and even family. It is the backbone of how many Chinese relationships function. Good “guanxi” can be the keys to opening doors otherwise closed.
Inviting or hosting dinners for partners or friends can create an environment for “guanxi.” Also the exchange of gifts or “inside information” may amount to good “guanxi.” The best way to build up good Guanxi is to know someone in a position of power willing to help you. There is a well-known Chinese expression that says “the nail that stands out gets hammered down.” We can add unless that nail is made of the Chinese equivalent of kryptonite – personal power.
Power comes from the implied authority of position. Most senior ranking government officials have a great deal of power. Their positions do not net them high salaries, but they do net them privilege. Power also comes from the respect and trust of those that know you. People of authority who make good decisions, offer good advice and help others when they are able are also revered. This is a kind of power that a university professor, doctor or senior businessman can have.
Whether helping your guanxi partner get a job, introducing them to your other “connections” in advantageous positions, or helping them out of a tough situation, building guanxi can someday benefit you when you are the one in need. The flip side of the guanxi system is that it can leave you feeling used when an acquaintance’s previous generosity and hospitality later seem like down payments on the unduly large favor they eventually ask for you.
If you want to live in China for a while, you have to understand “Guanxi”, which will make your life much easier. Though I admit that, as a Chinese, Guanxi can become somewhat time consuming and intricate, sometimes it gives you such a headache.