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The importance of guanxi when      negotiating in China        A ChinaSolved       10 Slide Solution
About Andrew Hupert - Author• 9+ years in China,   – 3 in Taiwan & HK• Principal at Best Practices China ltd   – Specialis...
Guanxi for the Busy American• A professional’s guide to  building relationships in  China.• Written for the Western  negot...
1) The Take-away• Guanxi is a network of connections and  relationships among members of a business  community.• It is int...
2) What is guanxi?• Guanxi – A network of counter-balancing  relationships and social business connections.• It is systema...
3) Is guanxi unique?• Is ‘guanxi’ different from a network of  relationships elsewhere in the world?   – To you, maybe not...
4) Guanxi is Due Diligence• In traditional Chinese business, audited  financials, company profiles, credit reports  and 3r...
5) Guanxi rules• It’s reciprocal. Debits and credits.• It’ based on mutual utility value• It’s personal.  – Who are you?  ...
6) Myths about guanxi1. Guanxi is a euphemism for corruption.2. Guanxi is the only key to success in China.3. If you have ...
7) Guanxi caveats:• The same people who can open doors  for you in China can also shut & lock  them .• Guanxi can’t be bou...
8) There are 2 main types of            guanxi relationship:• The Guanxi Buddy   –Flattery   –Wants to get paid• The Guanx...
9) Guanxi Best Practices•   Deals are driven by fundamentals•   Guanxi is a strategic policy•   Guanxi is easy to build, h...
10) Final Warning• Guanxi rarely helps foreigners.• The only time you will ever hear the  word from an existing partner is...
Guanxi for the Busy American• A professional’s guide to  building relationships in  China.• Written for the Western  negot...
Further Reading  www.ChinaSolved.comwww.ChineseNegotiation.com  Linkedin: China Solved
Importance of guanxi in Chinese negotiation
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Importance of guanxi in Chinese negotiation

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Guanxi matters to your Chinese partner, supplier, and colleagues -- so it matters to you. Will guanxi help westerners in China? Possibly -- but it is certain that mishandling guanxi and relationships will hurt your chances. Learning to manage relationships in China is vital to success.

Published in: Business, Technology
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Importance of guanxi in Chinese negotiation

  1. 1. The importance of guanxi when negotiating in China A ChinaSolved 10 Slide Solution
  2. 2. About Andrew Hupert - Author• 9+ years in China, – 3 in Taiwan & HK• Principal at Best Practices China ltd – Specialist in US-China Negotiation – Corporate training, consulting, and project management – Client list available upon request• Publisher of ChinaSolved.com and ChineseNegotiation.com Full list of publications and slideshows available on www.AndrewHupert.com
  3. 3. Guanxi for the Busy American• A professional’s guide to building relationships in China.• Written for the Western negotiator who needs to transact and execute.• Available on Kindle, iBook and all major e- formats.
  4. 4. 1) The Take-away• Guanxi is a network of connections and relationships among members of a business community.• It is intentional, planned, and negotiated.• Guanxi is one of the many skills you should develop to be successful in China.• It should not be the sole driver behind your business decisions in China.
  5. 5. 2) What is guanxi?• Guanxi – A network of counter-balancing relationships and social business connections.• It is systematic, formalized, and can be quite ritualistic.• Guanxi places the same obligations on YOU as it does on your new Chinese partner.
  6. 6. 3) Is guanxi unique?• Is ‘guanxi’ different from a network of relationships elsewhere in the world? – To you, maybe not. – To your Chinese counter-part, YES.• Some Chinese tend to understand guanxi as a uniquely Chinese phenomenon that is beyond the understanding of Westerners.
  7. 7. 4) Guanxi is Due Diligence• In traditional Chinese business, audited financials, company profiles, credit reports and 3rd party ratings either didn’t exist or were meaningless.• Guanxi, networks and relationships served as the primary means of performing ‘due diligence’ among Chinese business people.
  8. 8. 5) Guanxi rules• It’s reciprocal. Debits and credits.• It’ based on mutual utility value• It’s personal. – Who are you? – What do you believe in?• It’s ongoing and long-term.
  9. 9. 6) Myths about guanxi1. Guanxi is a euphemism for corruption.2. Guanxi is the only key to success in China.3. If you have guanxi, you don’t have to worry about laws, regulations, bureaucrats, etc.
  10. 10. 7) Guanxi caveats:• The same people who can open doors for you in China can also shut & lock them .• Guanxi can’t be bought, borrowed or transferred.• Guanxi is between people – not organizations, departments, bureaus or institutions.
  11. 11. 8) There are 2 main types of guanxi relationship:• The Guanxi Buddy –Flattery –Wants to get paid• The Guanxi Boss –Teacher –Wants to run things
  12. 12. 9) Guanxi Best Practices• Deals are driven by fundamentals• Guanxi is a strategic policy• Guanxi is easy to build, hard to repair.• It’s a two-way street.• Relationships take work.• Over-compromise, with limits.• Contracts are your last and worst defense.
  13. 13. 10) Final Warning• Guanxi rarely helps foreigners.• The only time you will ever hear the word from an existing partner is when – He expects to be paid for his relationships with someone else – He is calling in a “guanxi debt” on you, and expects you to make some kind of sacrifice.
  14. 14. Guanxi for the Busy American• A professional’s guide to building relationships in China.• Written for the Western negotiator who needs to transact and execute.• Available on Kindle, iBook and all major e- formats.
  15. 15. Further Reading www.ChinaSolved.comwww.ChineseNegotiation.com Linkedin: China Solved

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