Guanxi: A Way of Showing Respect in the Business World

Representatives of different companies are doing handshakes

In Western societies, personal and business endeavours are usually kept seperate. While business dinners and banquets are held occasionally, there is a sense of distancing that is kept. However, in the Eastern hemisphere, specifically China, personal and business connections are important ties that often intertwine.
The term that is used to describe this relationship is known as “guanxi”, which essentially translates to the idea of reciprocity. It’s the notion that respect will be returned later on in the relationship.

It is a way of maintaining connections and creating “networks”. This idea stems from the teachings of Confucianism. In Confucianism, there are Five Relationships that are held as the key to social harmony. With four of the five relationships being related to family and close friends, guanxi takes these fundamental teachings and applies them to the world of business.

Guanxi is not synonymous to bribery and gift giving. There is a sense of formality with guanxi and is known as mutual respect and trust. For example, giving a toast to someone at dinner would be an initial act of guanxi. However, this toast must only be done between two individuals (no more) as when toasting to everyone, it may be considered rude. This “dyadic relationship” shows the bond that is being established between the two. When conducting this toast, it is the custom to hold your glass slightly lower and use two hands as a way to say “I respect you”.

The idea of hierarchy also plays heavily into this. Whether that be who sits down first, who enters the door first, or who pays for the meal, these little factors can end up dictating a business relationship between two people. Specifically looking at who pays for the bill, it is important to never split it. The person who pays for the full meal is understood to be the one with the upper hand in the moment and receives a sense of superiority. The other individual must acknowledge that they will pay the next time. In this scenario, it’s not a matter of paying back the person who paid but showing that you “owe” them one. If the bill was split, the relationship would be over after the meal. However, having this IOU connection ensures that individuals will come together again in the future.

Certainly guanxi is not an idea that only exists in China. While this term may be from the Chinese language, it exists through many forms throughout society. In Western society, you can see this through alumni connections or club organizations. As business is a very interactive field, it’s important to maintain these connections and guanxi is a way of approaching this. As the saying goes, “It’s not what you know. It’s who you know”.

Bubufds Solution offers the chance to find relevant connections and enhance your business’ success. Contact here for more personalised advice.