Guanxi or the Bamboo Network refers
to the network of relationships capitalized on by mobility of enterprise of
people, capital, information affecting the internationalization of Chinese
family businesses around the world. The use of personal influence
is the essence of Guanxi. The Chinese, both at home and overseas, have
always traded on relationships. The concept that business should grow
from friendship is a fundamentally Chinese concept. Don't repeat the short-sighted
mistake by bypassing a middleman for increased gain.
In the West, the prescribed roadmaps are
encompassed in 'The System' including all levels of government and society.
For Asians expanding abroad, learning 'The System' in the west involving
unions, lobby groups etc. prove a major obstacle. Long term relationships
reduce risks and are mutually beneficial. For westerners, that means
respecting the Asian logic and practice that the bureaucrat issuing permits
might also be the inspector! Have respect for Asian flexibility as
fiscally responsible dealmakers.
The concept of Guanxi still
continues in modern day business. In my professional career, the fact
that I was good enough for billionaires Li's, Kwok's or Woo meant that I also was referred
positively to their friends (ensured steady flow of work).
THE SYSTEM
The hierarchy of Confucian relationships
is the order system for the Chinese society. It is the fundamental value
for which "Face" is based. Staying within concentric influences
of family and elders allows for access to information more efficiently while
preserving confidentiality. The network, known as the Bamboo Wire, is
based on Guanxi to allow business opportunities to flourish.
The network Richard Li set up
internationally by selling STAR-TV to Rupert Murdoch allowed the Pacific
Century Group to be the cowboys at the frontier of the "Anything's
possible" corporate culture. I was one of the ones from the
School of Hard Knocks despite the fact that there seemed to be a lot of
Harvard, Yale, Cambridge, Stanford, INSEAD degrees at the office. Our
ability to generate "interesting" deals was based on the access to a
valuable network. We were restricted only by our imaginations. And can you
believe? The CFO, head of Legal, Real Estate and Business Development
were women, all under 40, amongst the world's most capable professional
managers. That Richard Li has am amazing ability to attract
talent. I am talking about the first team at Pacific Century when
the group was formed in 1993. -
by
Andrea Eng
OTHER
ARTICLES:
- You
Say Guanxi, I Say Scmoozing
- "A lot of people don't
understand that everything is a human-to-human relationship. It's
not who knows who, it's how you build the relationship. And its
not how long you've known each other; its how you deal with each
other. That is the highest technique." -
K.Y. Ho, founder of ATI Technologies - on page 49 of December 25 - January 14,
2007 CANADIAN BUSINESS MAGAZINE
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