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Keeping the Peace: The Power of Guanxi

May 17, 2019


Many foreigners travelling to China for business or work are stepping into a different ecosystem of commerce and professional development. For a very long time, there has been a powerful force at play that can affect the projection of one’s career in China. This force is called guanxi. I spoke with Eric Liu, Founder and CEO of Foreign HR, about the invisible power of guanxi. Eric explains what it is, why it is important, how it applies to foreign workers, how to develop it, and how it has affected him personally. Take a look at our interview with him:

CJD: Briefly describe your background. Where are you from? Where do you work? What is your position?

Eric Liu: My name is Eric Liu, I have been working at Foreign HR since I graduated from my university in 2003. I founded Foreign HR after four years of working at another agency. This year marks my 16th year in the international talent industry. Foreign HR, founded in 2008, is a foreign talent recruitment company based in Beijing, China. We have recruited one thousand foreign experts for the Chinese organizations we work with, the roles we have filled are from a multitude of industries, and our candidates have been placed in many different Chinese cities.

CJD: How would you describe guanxi to a foreigner looking to work or do business in China?

Eric Liu: Guanxi, traditionally, is a culmination of the relationships you build with your friends, partners, clients, and those within China’s government sector. Guanxi is very important in every country, but especially in China. The guanxi, however, has changed considerably over the last ten years. In the past you could do almost anything easily if you had good enough guanxi, but in today’s context, it isn’t so. Guanxi today is something that you have to constantly build and maintain, it consists of the money, knowledge, and connections you need to support your work and strive for further development. Guanxi plays its role most effectively when all of these resources come together. This is different from the past, because now all of these things must be present, you can no longer substitute and abundance of one for the lack of another. Modern guanxi is limited by laws and regulations and operates under the condition that you have all of the other necessary elements.

CJD: How can guanxi affect one’s career or business?

Eric Liu: Guanxi in China today is classifiable as a social ability, you are constantly working with all the people in your network to accomplish your targets and forward your business. This network may include your team members, partners, and clients, to those within the entities of the public sector. Your guanxi can decide the fate of your job and your business. I am sure you could imagine, a person will have great trouble finishing a task or achieving a professional goal if he has a bad relationship with the people around him.

CJD: Is guanxi important for foreign workers living/working in China? Why or why not?

Eric Liu: Yes, Guanxi is important for both Chinese locals and foreigners, but moreso for local Chinese. Western people usually work or live in China for a short time, several months or years, then they leave. So the guanxi they develop may not go on, or serve any purpose, after their leaving. Also, westerners in China have a simple, often undeveloped, relationship with their networks in China. From what I have seen, they often make friends with more westerners than with Chinese, and they just work or live for a short term. They also don’t have a family in China, thus they don’t involve themselves that much with the society as the local people. Also, as Chinese people we usually understand that westerners have a different cultural background, we don’t expect as much investment from them as we do from our locals. I will say, however, that it’s obvious to see that if a foreigner is isolated, selfish, or arrogant, he likely has a bad guanxi in China. It is or will likely become very difficult for him to work and live in China. This will be the result of this outlook and behavior anywhere else in the world, I think.

CJD: How does a foreign worker go about developing guanxi in their network?

Eric Liu: Guanxi is very important, the tips for developing excellent guanxi is very simple: be friendly, be kind, be hard working, be happy, be useful, be considerate. I believe if you live and work by these simple guidelines, you will build brilliant guanxi in China and elsewhere.

CJD: What effect has guanxi had on your career or business?

Eric Liu: I have excellent guanxi with my friends, clients, team members and all of the people around me, I work hard and be kind to the people around me, I behave honestly and decently. This positive guanxi makes my work and business go very well and leaves me with great satisfaction. I feel happy and confident with my career and business, so guanxi, in my opinion, is more than the resources you have in your life but also the positive and healthy attitude to propel you into a successful future.

So, as you can see guanxi is far more than just personal connections and influence. It is a combination of your positive energy, the resources at your disposal, the interactions you have with others while you work, and the connections you build with those you work with. Although it may carry a different name depending on where it exists, it’s conceptual roots are universal. As foreigners in China, we are building our reputations within our networks every day. It is of utmost importance that we work to not only better ourselves, but to better those within our professional circles.

(by Ted Salonek)

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