Guanxi
In the past I’ve discussed the Chinese term guanxi. You can find a detailed explanation here, but here’s an overview.
“Guanxi” literally means “relationships”, stands for any type of relationship. In the Chinese business world, however, it is also understood as the network of relationships among various parties that cooperate together and support one another. The Chinese businessmen mentality is very much one of “You scratch my back, I’ll scratch yours.” In essence, this boils down to exchanging favors, which are expected to be done regularly and voluntarily. Therefore, it is an important concept to understand if one is to function effectively in Chinese society.
I mention this because of the Chinese New Year holiday. Most of the wealth in Beijing is located in the cities. The rural areas are still poor and the people lie simple lives. Chinese parents work hard to ensure that their children get a good education, then send them to one of the main cities for college and a career. Since Chinese New Year is basically an amalgam of Thanksgiving and Christmas, a time when people go home to celebrate with families, the cities largely empty out as people go back home. The most common means of transportation are the trains.
One of my employees has been trying for three weeks to get a ticket home. There is a train ticket agency right near our company, and she went in and made a reservation. However, just because you make a reservation doesn’t mean you can get a ticket. The people who work for the train company, recognizing the profit potential in train tickets, essentially become ticket scalpers. Thus if you really want a train ticket, and are not lucky enough to be able to buy one through legitimate channels, you have to turn to alternate means.
My employee has a friend with a great deal of guanxi. Yesterday she made a phone call and said, “My friend has guanxi. He should be able to help me.” Today she came in and happily announced that last night she was able to get her train ticket home.
Yesterday I described authoritarianism as being woven into the fabric of the Chinese identity. Concepts such as guanxi, which have been around forever, are exactly the same. Who do you know, who are your family, what can you do for me if I help you, and so on. The Chinese may sign western-style contracts, but the real deals aren’t done in the conference room, they’re done in a restaurant, over a delicious meal with plenty of beer. Handshakes, cash, and guanxi. That’s how this country operates.
