Question 1
Introduction
The Guanxi idea persists as a die-hard network model that is culturally engrained within the Chinese business community and can have both interpersonal and organisational ramifications. The goal of the question is to study the functions of Guanxi in business interactions, such as decision-making processes, plus its effect on managing human resources, especially in the case of Western companies in China. Besides, it will try to solve the problems now associated with Guanxi in modern China; these include its innovations, which adapt to meet the influences of international factors like globalisation and altered social culture.
Understanding Guanxi
Guanxi, among its many meanings, is not just a Chinese word used to indicate social relationships; it is a complex system of networks, strands, and relationships that significantly impact economic life. This means the communities, in the course of their life, are inclined to live together with the principle of reciprocity assigned a higher value and always on the forefront (Chen et al., 2022). Effective relations emphasise mutual trust and proportionate benefits. In business, Guanxi communicates the bidding procedures, as what counts is not mere networking but the exchange of information, resources and favours for long-term relationships (Xu et al.,2021). Most Chinese think people who wish to be successful in business should form these kinds of relationships in China because these networks may be a source of unique strategic resources that determine the future of their ventures (Xu et al.,2021). The quid pro quo principle, the backbone of Guanxi, where they grant each other right now, does not stand still but reach for profit later (Jamil & Yukongdi,2020).
Utilisation of Guanxi
Although Guanxi is the key to ensuring the quantities of business running in the markets for the Chinese, this connection is an excellent help. It facilitates the Chinese company in the market as they compete for dominance. It is built to establish a relationship with relevant stakeholders whose type is either with government officials, business partners, or suppliers with whom they can be comfortable (Chen et al.,2022). On the other hand, hotel organisations can leverage core Wei or Guanxi concepts such as sourcing resources, nailing lucrative business relations, and strategically navigating through bureaucratic obstacles.
Potential Problems of Guanxi
If it is used skillfully, the power of Guanxi can deliver profitable results, but it also carries along some obstacles that Western businesses should be able to overcome. Ethics and related issues are the biggest obstacles to implementing artificial intelligence (Zhang,2023). The nature of relational ties Guanxi can generate can bring along the happenings of favouritism, nepotism, and corruption, let alone the probable breach of Western ethical norms and legal standards. Additionally, there is the problem of fame trend, and the clique-closed nature of the Guanxi networks has tended to be (Zhang,2023). The statement of serious objectives with the creation of reliable and sufficient relations with the target group could be a way. However, it may take some time and a gift; there is also a chance that such contact is forbidden. Such an event favoured the local counterparts with plentiful Guanxi, exceeding that of some of them without this relationship (Chen et al.,2022). The second factor is that individuals using Guanxi excessively might slow down new thinking and vital flaws in Meritocracy, which is the idea that people with the best skills should get the best positions and rewards.
Impact on HRM Elements
Recruitment and Selection: Guanxi significantly impacts recruitment processes, ensuring that the best candidates with close ties with current staff or influential figures are prioritised for the job openings (Jamil & Yukongdi,2020). In such instances of nepotism, opportunities for the most qualified candidates get narrowed, creating a scenario where candidates with connections are favoured over merit.
Reward Systems: In business, where interrelating is quite important, peer interactions might be the game’s name; this can also result in some drawbacks, such as monotony and irresponsibility among workers (Chen et al., 2022). Social connections might overshadow Meritocracy; merit may only sometimes bring the more deserving into the limelight. The team spirit and performance will also be affected (Chen et al., 2022). These challenges need to be sorted out in a very subtle and complex way, which means combining the cultural notion of Guanxi with the necessity to follow open and fair grading systems, thus increasing employee effectiveness and motivation in the workplace.
Performance Management: The social dimension through the process of Guanxi would also affect the performance evaluation by creating unfair scenarios as managers may mistakenly shield their contacts from the standard scrutiny, subsequently impacting the manager’s perception (Sun et al., 2023). A similar problem (preview bias in the evaluation) may affect an employee’s motivation if they feel that their contributions are understated or forgotten, leading to a weak psychosocial climate within an organisation (Sun et al., 2023). Developing interpersonal relations and creating a fair environment of performance ratings are of the highest importance as chances to have a decent and just climate in the workplace are given here.
Training and Development: Guanxi could become an opposing side of a business in the field of training and development when the company is inclined to select an individual who has the better Guanxi over the one who is more capable of doing the job (Sun et al.,2023). That people are not considered human might be because many employees are not given fair opportunities to benefit from those development resources. In turn, the whole workforce is affected.
Employee Relations: Guanxi relationships do not seal solely the worker-worker or employee-employee interaction; instead, these relationships produce multiple groups of friends and an entire function affectionately called “cliques” inside the company (Zhang,2023). In addition, it may lead to an adverse labour climate for the employees and eventually threaten teamwork and other practical collaboration efforts. In return, there will be less productivity in the company, which will result in a low profit or no profit at all, as desired. Additionally, the management may face problems with administration since the team will have different views regarding some issues facing them.
Question two
Guanxi in Modern China
Today, China considers Guanxi a highly prized factor in socialising and doing business; a case when Guanxi is not used is associated with a specific problem or issue. The topic of networking carries different waves – whether in the conference room or at ground zero, interaction and development of personal contacts are prominent daily issues in our lives. You can easily see the symbol of Guanxi in affiliated businesses or even in a context where the network can lead you to success or failure (Barbalet,2021). Let us consider incentivising the comprehensive deals proposed by third parties as an illustration of Learners fighting against the ropes of administrative ness, which involve mounds of bureaucratic hurdles (Barbalet,2021). Later, Guanxi not only worked on a particular business, but it also expanded itself to the real social world. In politics, relationships become the currency people use to interact (Jamil & Yukongdi,2020). They extend until they become precious connections or networks that make the difference between winners and losers and between the approved policies. Another link in science, academia, and business is that we have shared preferences in funding research and encouraging collaborations.
Current Examples of Guanxi
Recent studies have shown that notwithstanding the economic advancement in China, Guanxi is still relevant- just like the increased significance of networks, for instance, dinners “Guanxi”, which are preparatory dinners organised to strengthen the informal networks (Nolan & Rowley, 2020). They are where one trades the right to be important and the wisdom that comes to the table to be socio-professionally boosted. Despite this, however, this phenomenon can be witnessed in business settings and other areas like education, where Guanxi can become the key to getting various privileges to prestigious schools or universities (Du et al., 2020). This trails cultures back to the societal capital that parents draw upon their social network by making working relationships, especially with the school administrators or public officials, to get their children in and consequently get slots for admission using the privilege route (Barbalet,2021). Such means of practice, however, are very important as they aim to show how deeply influential the Guanxi practice is to Chinese society, as relationships are essential to control or gain access to resources or opportunities.
There are instances where guanxi-driven views are considered all right, but they can also generate questions of justice and meritocratic traits; hence, when there is a credibility concern, a more transparent decision-making process is necessary (Jamil & Yukongdi,2020). China’s economy and society will remain in flux, making Guanxi a faster developing and even more relevant issue for both individual and organisational actors who strive to master the Chinese business context (Du et al., 2020). Another example is seen particularly in government and administration. Although the measures are legalised and formal Meritocracy is promoted, people’s relations operate through bureaucratic mechanisms (Barbalet,2021). To illustrate, when working in business ventures, and in this case, one is required to obtain permits, people usually leverage their Guanxi with relevant government officials and intermediary agents to enable them to speed up the process or gain favourable outcomes.
Threats to Guanxi
To externalise and localise the evolution of Guanxi, it is required to condense all the factors that form a chiral system, but at the same time, it is challenged to counteract emerging pressure. Internally, the world’s economy is becoming increasingly innovative, and there is mass media growth; thus, the world is not opaque anymore, and the globe has taken a more interconnected view (Barbalet,2021). These have drawn the last nail in the thread of people trying to use habitual contacts as their immediate way out to concentrate only on their labour skills for self-improvement. Furthermore, the global market as the Meritocracy and efficiency focal point may be a great concern to the job market people who may be well-qualified for what they do but need more connections (Barbalet,2021). Traditions are from the soul of Chinese society, and people always emphasise “Guanxi”, which has been pushed and even questioned by a new mentality that comes with the development of the social climate and changes in etiquette (Barbalet,2021). The key is the young people; this way, they could be more influential in producing changes in their friends’ purposes that go from following the traditional authority to the place where they champion individualism and equality (Butt et al.,2020). These ancient values, such as the status of the family and the hierarchical order, are perpetuated in the third generation of Chinese youth. Such is the evidence of recent people who are against the system of nepotism and bureaucracy, and this situation is seen as more and more unacceptable in modern China (Nolan & Rowley,2020). One more issue, as an example of the anti-corruption campaign by the Chinese government, is concentrated on the gables of Guangxi province (Nolan & Rowley,2020). No kind of mercy is impinged on getting captured, even if one is a friend or family member and acts against the regime (Barbalet,2021).
Conclusion
Guanxi remains the most important aspect of Chinese culture and business, as it is the main pillar or foundation for interpersonal communication and companies’ lifestyles. Western commercial players strolling into a minefield, which is the complexity of Guanxi, have no other alternative but to ensure that their business is conducted fairly, justly, and ethically (Zhang,2023). Furthermore, Ganxi is beneficial and harmful. It opens up the possibilities of unique strategic advantages but often with the cost of nepotism and bias; thus, balancing a relationship-based approach with merit-based decision-making becomes important. However, with China’s development and openness, the essence of Guanxi may transform. Still, core Guanxi values like belief and mutuality (IMO) will probably be forever present attributes of Chinese society (Du et al., 2020). As for me, I am confident that a measure of being informed and recognising Guanxi as being valuable can be the greatest contributor to issues of cross-cultural relationships and business deals in China.
References list
Barbalet, J., (2021). Where does Guanxi come from? Bao, shu, and renqing in Chinese connections. Asian Journal of Social Science, 49(1), pp.31–37.https://doi.org/10.1016/j.ajss.2020.11.001
Barbalet, J., (2021). The theory of Guanxi and Chinese society. Oxford University Press. https://www.researchgate.net/publication/352897659_The_Theory_of_Guanxi_and_Chinese_Society
Butt, A.S., Shah, S.H.H. and Sheikh, A.Z., 2020. Is Guanxi important in a buyer-supplier relationship? Case of the Chinese logistics industry. Journal of Asia Business Studies, 14(1), pp.1-14.https://www.researchgate.net/publication/341967017_Personal_relationships_and_supply_chain_communication_an_exploratory_case_study_of_buyers_and_suppliers_of_logistics_service_provider
Chen, M., Bedford, O. Measuring Guanxi Quality in the Workplace. J Bus Psychol 37, 581–599 (2022). https://doi.org/10.1007/s10869-021-09762-3
Du, Y., Liu, P., Ravenscroft, N. & Su, S. (2020). Changing community relations in southeast China: The role of Guanxi in rural environmental governance. Agriculture and Human Values, 37, pp.833–847.https://www.researchgate.net/publication/369214619_Semi-Acquaintance_Society_in_Rural_Community-Based_Tourism_Case_Study_of_Moon_Village_China
Jamil, S. and Yukongdi, V., (2020). Information systems workforce and innovative work behaviour: The role of participatory management, affective trust and Guanxi. International Journal on Semantic Web and Information Systems (IJSWIS), 16(1), 146–165.https://www.researchgate.net/publication/338321545_Information_Systems_Workforce_and_Innovative_Work_Behavior_The_Role_of_Participatory_Management_Affective_Trust_and_Guanxi
Nolan, J. & Rowley, C. (2020). What are Guanxi and social networks in China? A review of theory and practice. Asia Pacific Business Review, 26(2), 113–123.https://doi.org/10.1080/13602381.2020.1737391
Nolan, J. & Rowley, C. (2020). What are Guanxi and social networks in China? A review of theory and practice. Asia Pacific Business Review, 26(2), 113–123.https://doi.org/10.1080/13602381.2020.1737391
Sun, Z., Zhao, L., Wei, H., Wang, X. and Riemersma, R.R., 2023. Do Guanxi and harmonious leadership matter in the sociocultural integration of Chinese multinational enterprises in the Netherlands? International Journal of Emerging Markets, 18(10), pp.4631-4650.https://g.co/kgs/m4EZdvE
Xu, C., Wei, D., Liu, J. & Zhou, J. (2021). A Tale of Two Capitals: How Task-Oriented and Guanxi-Oriented Psychological Capitals Lead to a Sustainable Workforce in Rural China. Frontiers in Psychology, 12, p.732445.https://www.frontiersin.org/articles/10.3389/fpsyg.2021.732445
Zhang, S., (2023). The ethics of talent management practices in China, exploring the role of Guanxi in talent recruitment and development. International Journal of Business Governance and Ethics, 17(3), 293–309.https://www.inderscience.com/info/inarticle.php?artid=130089
write