CHINESE BUSINESS. THE MINDSET.
Any person or company who wishes to do business in China must become accustomed to the concept of Mian Zi (面子), or “face” and Guānxi (关), or “relations”. On a fundamental level, it denotes a person or a family’s reputation or prestige and also the kind of reliability you or your company has in order to have fructiferous connections. There is plenty to know and develop about this concept as it rules social, love and business. These concepts are complicated and quite difficult to explain in words.
Lu Xun, one of China’s most influential writers of the 20th century, once described “face” as the “guiding principle of the Chinese mind” (中國精神的綱領). “Face” (面子), he remarked, is “a word we [Chinese] hear often and understand intuitively, so we don’t think too much about it.” But Westerners seemed to struggle to grasp it. “Recently foreigners have begun using this word, too,” Lu Xun wrote, “but apparently they’re still studying its meaning.
To understand the concept of Mianzi, one must know what is Guanxi as well. Guanxi is the concept of relationships. How these two terms play in the lives of the Chinese is imperative to understand before beginning to work with a Chinese company or starting a business in China. It is important because without understanding this very important part of the culture, you could either insult someone or end up disgracing yourself. Both of which would be bad for business or relationships.
“Face” is a sociological term that describes a phenomenon which exists not only in China but in every human society. We should therefore first understand the general idea of “face” before we analyze the characteristics that make “face” in China unique.
“Face” is a fundamental part of human interaction. It is the way we present ourselves to others, it determines how we are judged and how we want to be perceived by others (P. Christopher Earley – Organizational Behavior across Cultures).
“Face” is a fundamental part of human interaction.
While “face” exists in many cultures all over the world, in China this concept has its own specific characteristics. “Face” in China is more pervasive and more nuanced than in other societies. The reason is that Chinese society values hierarchy, social roles and interpersonal relationships to a high degree. Therefore, “face” plays a key role in more social contexts than in other cultures. As Chin Hu put it, “while the desire for prestige exists in every human society, the value placed upon it and the means for attaining it vary considerably” (Chin Hu: The Chinese Concepts of “Face”).
However, the first difficulty in defining the Chinese concept of “face” is that the Chinese language uses two different words: lian (臉/脸) and mianzi (面子). Each of them has a distinct, though somewhat overlapping connotation.
“Guanxi” comes from the personal bond first. Then the business relationship comes in.
Broadly speaking, lian means “sense of shame in relation to social standards of morality and bbehavior, while mianzi means “status, prestige, social position”. A person may have mianzi and yet have no lian. For example, a corrupt person who disregards social and moral standards has no lian; however, if he has status and prestige, he or she has mianzi, despite having achieved his success by immoral means.
Guanxi comes from the personal bond first. Then the business relationship comes in. Guanxi starts with people making friends, even though there may be no instrumental benefits in it. When a foreign company goes into China, the first thing you need to do is start to network, meet people, and build good guanxi. And then, when the personal relationship is strong enough, you can trust what other parties say and start to use contracts, almost to secure promises.
In China, the legal systems are still not well-developed. Many contracts haven’t been well-enforced, either by the companies in the relationship or by legal powers. In that regard, relying on legal protection is a business risk for companies operating in China. Strong relationships between business partners, between managers and employees, between exporters and importers, are important.
Guanxi has become a means of building trust.
For years, China has lacked a strong rule of law. Because the law has not often been able to provide the legal protections which it does in the west, Chinese people needed to develop another means of ensuring trust amongst themselves in personal and business matters. Maintaining face, or reputation, among people within one’s own network, is also an important characteristic of Chinese culture.
Because of the importance of maintaining face, Chinese people will usually not take advantage of a person with whom they have guanxi. This is true because if they develop guanxi with them and they were to take advantage of them, all of the people in their network would know what they had done and they would lose face with this network. By losing face they would also lose the respect of others in the group and potentially lose their connection with their network. Therefore guanxi has become a means of building trust that law cannot always provide for Chinese people in personal and business matters.