Important Elements of Chinese Culture —“Guanxi” and “Renqing”

There’re a number of Confusion elementsthat drive how China thinks and acts in many ways.

One that you often hear about is “Guanxi”,or relationships.

It’s not that Guanxi doesn’t exist inother cultures.

Our own relationships are important as well.

But the Chinese concept of Guanxi is veryimportant.

What I often tell people when we start outis: Guanxi is necessary but not sufficient in any relationship.

So you’ll find potential Chinese partnersthat would try to sell themselves to you solely on their own merits of Guanxi.

It’s called the “I know a guy” concept.

You shouldn’t ever base a business decisionon somebody that tells you that they know a senior official and that’ll be enough.

However, if you watch good Chinese businesspeople, they work their Guanxi networks like nobody’s business.

If you were to draw a picture as a westernerof your Guanxi network, it would involve a bunch of knows and lines, but if you lookat the same version on behalf of a Chinese business person, theirs will be like ten timesyours.

As a result, people build that Guanxi networkbuilding structure into their social lives, into their work lives.

It often relates to whom you studied with,whom you worked with, and there are also family connections.

It’s very important to know that it’snot enough that we met 5 years ago and now we meet again.

You need to really continue to strengthenthe Guanxi with particular people, so it takes a lot of time and effort.

One of the things that I discovered is thatwe westerners can never expect to be as good at it as our Chinese counterparts.

As a result, we need to think about what wecan bring to a relationship that’s truly unique.

Is there some element of our Canadian nature,the location we come from, something like that, that provides a unique element to theestablishment of the relationship that your partner can’t get from somewhere else.

This is some of the things we have to do totry to make up for that “Guanxi deficit” so to speak.

It’s also the case that a western or Canadianperspective on work-life balance will mean that we’re not willing to spend our nightsand weekends on things that may be related to work, whereas in China, that’s oftenvery different and it’s often different because it’s done in service of buildingyour Guanxi.

One of the mistakes that people make is they’llcome to China and they’ll do a three day trip.

“Bang Bang Bang!” I’ll set up my meetings and we’re done,whereas the building of Guanxi, often needs to happen in a fairly protracted way.

So maybe you come for a trade show, and youmeet a company with which you have good synergies, and you say “OK, well, I’m off tomorrowbut maybe we’ll follow up in 6 months.

” If you’ve actually left yourself a bit oftime, and you say “You know what? I think we have a lot in common.

Why don’t we go out to lunch tomorrow?” You can use that time to take that relationshipto a point where you can do more.

This is also very important to keep in mindin negotiations, because the Chinese counterparts when negotiating with “No!” that we’reoften in a hurry, and they have much more patience.

We have members that have told us that theysuccessfully saved a deal that went south at the very end of negotiations because theyleft but they didn’t leave the country.

They actually left for a different city andthe counterpart chased them to the other city and brought them back and they finished negotiatingon the terms they had agreed to.

But if they had gotten on a plane and flewback to Canada, they never would’ve salvaged that deal.

So building that sort of flexibility in isvery important.

There’s another Confusion element called“Renqing”, which is essentially kindness.

It’s the concept that you would put yourselfout on behalf of others, and you have an expectation that they’d do the same for you.

This is very much related to Guanxi.

But our westerners coming in to do business,often we’ll not understand that they should be doing so much else on behalf of someone.

It’s more transactional.

We found this on cross-cultural teams wherethe Chinese members of a team in a company may find the westerner members of the teama bit cold and indifferent, because maybe when those colleagues travelled to China,the Chinese colleagues really went all out to make them feel good.

Maybe they showed appreciation, but it didn’tend up being reciprocated in the way that the Chinese side expected.

So I often find on these cross-cultural teams,you’ll have team members that are really good indicators of Renqing.

So having the Canadians to understand that,and at least be able to acknowledge sufficiently how much the other person did, that’s important.

They need to be prepared to do much more socializingfor business purposes, and it may feel like sometimes business isn’t getting done.

But that might just be the precursor to businesshappening.

So the ability to understand the people youare doing business with and for them to understand you and to build trust is really important.

So we’ll find business people that tellus “Yeah, you have to go out and drink Maotai!” for example.

It’s happening less and less.

In fact the popularity of wine makes it abit easier.

As an anticorruption campaign has taken rootin China, there’s less drinking of high value liquors and stuff like that.

But it’s not just going out and drinking.

It’s going to networking events, it’smeeting somebody for lunch on a Saturday, and it’s also doing things for people andin exchange they would expect you to do things for them.

But the other thing to know about both Renqingand Guanxi is that if somebody extends you a favour, or does something for you, and youcan’t possibly reciprocate, either because you don’t have the means, or because theremight be ethical considerations in it, then you have to be careful not to accept thatfavour.

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