What Is Guanxi And How Important is It?

There are a lot of things about doing business in Hong Kong that you’ll need to keep in mind, with Guanxi being one of the most significant concepts that you need to grasp. In its literal translation to English, Guanxi basically means “connections.” However, you would be mistaken if you think that it’s as simple as that.

The Bare Face of Guanxi

This age-old concept can have its subtleties, but it can be better understood by the ancient phrase, “It’s not what you know, but who you know.” Basically, if you want to get anything done in Hong Kong, you will need to develop good business relations regardless of what industry you are involved in. This is where it gets a little warped.

For most businesses in the US or other western countries, the concept of owing favours is treated almost like an option. Sure, there are those who would return the favour of they can. In Hong Kong, you are practically expected to.

The matter of scratching each others back is a deeply ingrained mindset in Hong Kong’s business culture and for good reason. Regularly exchanging favours is what allows businesses and associates to form a lucrative relationship and helps their enterprises thrive.

 

The Unspoken Keys to Locked Doors

In many countries and cultures, business is a matter of creating products or services that people will like and then building it from there. This is not how it works in Hong Kong. There are a lot of locked doors that can only be opened with the right contact, but this isn’t always explicitly explained or even mentioned.

A lot of the times, you can even get ahead of everyone else as long as you have the right contact simply because it is so deeply rooted in Chinese business culture. This is why “Guanxi” is so important when doing business in the coastal city.

There’s also the matter of “Guanxi’s” inherent connection to family ties. Basically, the closer you get to the main family, the better your “Guanxi” or connection becomes. As to how you are going to do this is a topic for another time.

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Kathy Sung

author In my everyday life I am very structured and someone will say a little 'geeky', but I also have a great passion for community work, thus this blog. Thanks for dropping by. author