Guanxi: Foreign Companies Beware

“Foreign investors who think they have created a guanxi network in China are usually simply deluding themselves”.

-Dan Harris

Guanxi in Chinese culture is a system of social connections and relationships that play important roles in how business is conducted.  But can Westerners establish guanxi?  Do they even need to?

According to Dan Harris, a lawyer who specialized in Chinese law, foreign business entities who make reference to guanxi are often not granted their deal.  This is because they come across as pandering since everywhere in the world relies on strong business connections; not just China.

Harris claims that we believe guanxi is accomplished after we make two or three connections in China but in reality, it come about through years and years of party, family, and work connections.  Additionally, guanxi is not held up by one individual. The system of guanxi doesn’t crumble when one connection is removed from it so that is why foreign companies should not rely on only one source.

-Taylor Conley


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