Abstract
This research aims to examine the existence and nature of complex business-social relationships in the Chinese context (Guanxi) and evaluate how these relationships influence the behaviors of managers in State-owned Chinese engineering firms. Research on Guanxi is comprehensive though little work investigates internal influences and how internal relationships may mirror or replicate external Guanxi. This study uses a snowball sample of 66 senior managers across the key functional disciplines in typical large Chinese firms and explores how often strategic level problems in the firm are solved through relationships outside, inside or between the companies. Do Guanxi networks penetrate the organization itself and are there relationships that are unique to internal networks? The research finds that problem solving at strategic levels are often through internal and external networks, rather than internal management structures, but also that different problems complexities typically demonstrate unique problem-solving networks. The research identifies three different forms that these relationships take: Internal, inter-firm and hybrid relationship modes. Implications for this work suggest problem solving in Chinese firms is enhanced through cooperation and mutual respect, and likely to be inhibited by traditional Western approaches to management.
Highlights
The research questions include whether Guanxi is applied internally to the organization and, if it is, how does this influence leadership behaviour? This study adopts a pragmatist, social constructivist position, and uses a pilot study method approach to investigate the interaction between leadership behavior and Guanxi: the internal Guanxi
The pilot study was conducted involving 66 informants through short interviews, electronic mail and telephone in order to test the role of Guanxi inside Chinese companies and construct a more valid research scope for interactions between internal Guanxi and Chinese leadership behaviour
The findings suggest that internal Guanxi is operating and that it extends beyond the boundaries of the company
Summary
Foreign and state-owned firms are less likely to resolve problems through relationships and typically apply more formal structures. This pilot study investigates the existence of Guanxi (literally “relationships” and the network of relationships among various parties that co-operate together and support one another) employed in Chinese enterprises to affect leadership behaviour and to develop a conceptual model for improving leadership performance. This research investigates what the most influential factors on Chinese leadership behaviour are; what Western leaders can learn from Chinese leadership when they operate businesses in the Chinese context; what the implications of Guanxi are on the leadership performance; and, how Guanxi has been employed internally in organizational management
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