The Chinese word "guan xi" means "relationship" or "network". It carries an aura of mystique because it describes certain human interactions of high level abstraction. It is elusive because human behaviors are generally complex, delicate and difficult to quantify.
The meaning of the simple word "guan xi" is especially vague because of its associated implications. Take, for example, the following statement on the "guan xi"-
有關係就沒關係，沒關係就有關係
Or, it does not matter if you have gotten the relationship; it does matter if you have not.
Here the Chinese word 關係 has two different meanings, loosely connected. In English, one has to use two words to define the meanings more accurately. Of course, you have to be happy with the double meaning of the English word "matter" here. Therefore, one may be simpler but cloudier; the other may be clearer but clumsier. Take your pick.
But language is just an aspect of culture. To fully appreciate the meaning of the language, one has to understand the culture and the social norm. I shall like to suggest that, in a general sense, "guan xi" means "re-enforcing social network". It is certainly an important aspect for an entrepreneur in pursuing a venture.
In the Chinese society, there are three basic important types of "guan xi." They may be called the 三同：同鄕，同學，同事。In other words, place of origin, schooling, and jobs are the three sources where beneficial social network can be built on for an individual.
Place of Origin-同 鄉
Place of origin refers not only to the place of birth; but more broadly to place of growing up or place that one can call hometown. Those of us, having the experience of traveling to a strange city, will recall, amidst the feeling of insecurity and helplessness, the pleasure of meeting someone who is like ourselves, and, even better, from the same hometown. Immediately, friendship will be fostered and the world becomes more fun and day much brighter.
This was how origin clusters are formed. It is little wonder to see so many Cantonese in the Chinatowns of New York, San Francisco and Los Angeles, Hakkas in Manila and Jakarta, Chao-Zhous in Bangkok and Saigon, and Wen-Zhous in Budapest and Prague. Most Chinese there are typical entrepreneurs who thrives on the supports of many home-town people, 同鄉, in a strange world.
Schooling- 同 學
If one is lucky enough to have been through formal educations of various levels, one can count on the supports of classmates, alumni, faculty or friends of, say, the university. When you leave this campus, you will naturally paid attention to someone, who is a University of Michigan alumna. You will have so much to share in reminiscing about Ann Arbor, be it the Stadium, the football team, the music center or simply the pizza house. This builds affection and confidence which can go a long way in nurturing business. Those of you under the Joint Institute with Shanghai Jiao-tong University will be doubly rewarded.
Likewise, the same emotion is true, perhaps more so, for classmates of high school. Personally I have been blessed by re-uniting with classmates dated back to more than 50 years now living in the Ann Arbor area. Therefore, I can say 同學關係 will be a very important relationship to bank on for all the entrepreneurs in this room. This relationship will flourish when they remember the fun and the value of the alma mater.
Guan xi through schooling has a special place in human relationship. At this period of adolescence, people are full of dreams, high ideals and may even start to pursue their ambitions. Friendship at this time can naturally grow to life time partnership.
Dr. Sun yet-sen started planning revolutionary movements against the corrupt and corroded Qing Empire when he was a medical student in Hong Kong University. With the help of his classmates and childhood friends, the revolution he led had eventually overthrown, not only the Qing Dynasty but also the 4000 years old monarchy political system and turned China into the first democracy in Asia.
Bill Gates fostered his interest in computer software with his childhood friend Paul Allen, classmate at Lakeside School and co-founded Microsoft in 1975. He later recruited Steve Ballmer, a classmate at Harvard University, to succeed him as CEO of Microsoft. All have become pioneers in the IT age and technology entrepreneurship. There are numerous other examples.
Place of Work-同 事
Guan xi through jobs, 同事關係, took many forms. Through work, one learns the ambition, interest, talent and the values of certain workmates. This can lead to lasting partnership in venture or business. Steve Jobs got acquainted with Steve Wozniak while both working on a summer job at Hewlett- Packard. Later, in 1976, they co-founded Apple Computers which has made great impacts to the society. Much of this is now history.
There is one kind of special job relationship that generally lasts through life. This is the service for the country.
Since we have just observed the Veteran's Day in the United States. It should be fitting to say that these men and women, through serving the country at war, have established a special 同事關係. While pledging their allegiance and dedication to the country, they are also driven by the allegiance to their comrades, or buddies. General Colin Powell was quoted to say, "During training and in action, they learn to rely on each other for food, for security and support. They know that they will live and possibly die, together as a squad. It is a form of bonding you can't find anywhere else." Indeed, we should recall the words of Benjamin Franklin, who said during the American Revolution, "If we do not hang together, we most assuredly will be hanged separately."
Extension of Family
Hence, the three basic components: 同鄕，同學，同事，can be viewed as an extension of the family. These are people we know well, have special bonding, and can place trust with. Trust is in the crux of guan xi.
It is interesting to note that the wake of these relationships, 同鄕，同學，同事 can spill over to the next generation. People usually extend the goodwill and kinship to the children of their buddies or someone the buddy care about. They will have their helping hands ready if called upon. They can be the angel, the venture capitalist, the advisor, the mentor, and even partner.
Second tier and third tier network like this are prevalent in the society. For Chinese, it is considered a social norm. In reality, guan xi exists in the U.S.as well as in many other civilizations.
Hence, from this perspective, we can say that there is really nothing curious or mysterious about guan xi. It should also be understandable that guan xi is a re-enforcing network.
For entrepreneurs, guan xi should be treasured as a privilege and be called upon with cautious and in confidence. If one treads the line of trust and loyalty, one will soon stand out as a red flag. Among family members, words will go around soon enough. Therefore, while accepting goodwill and kinship from the network, one has to exercise discretion to deserve the trust under any given circumstance. With this, guan xi can truly become a re-enforcing network for the entrepreneur and can be used as a positive force to promote entrepreneurship and innovations.
During the past twenty years, personal relationship and social network had figured very prominently in China for many entrepreneurs as he/she ventures into a different career path. Good personal guan xi often helped in knocking the door and breaking the ice. As time progresses, the Chinese government has gradually built up business laws and regulations, the importance of personal guan xi decreases. Nowadays, business rules and standard procedures can often be found in the government web sites. However, making effort to build up good communication with the government, the community and the various stake-holders in a business venture remain to be an important management function. Good personal guan xi always has an important role to play in the success of business.
Note: The is the essence of a speech given at the "China Business Conference" organized by the China Entrepreneur Network, at the Ross School of Business, University of Michigan, Ann Arbor, Michigan 48109, on 2011-11-12.
