Long-Term Orientation in Chinese Business Markets Literature review

Long-Term Orientation in Chinese Business Markets - Literature review Example According to the authors, guanxi behaviour consists of three elements: affect (emotions), reciprocal favour, face preserving. In Chinese culture, trust is an outcome of guanxi behaviour. The authors emphasise that in China, affection and business go together unlike the UK or USA. Affect denotes human feelings or emotional commitments that are central to intimate social bonding in several kinds of relationships such as between teachers and students, parents and children, or between close friends. In Chinese culture, the reciprocal favour stems from certain social behaviour evoking emotional responses and feeling by one of the group member to another. As such, reciprocity is a universal behaviour that can be traced even to animal kingdom. Similarly, the importance of face preserving for any Chinese in personal and professional life is tremendous. Face preserving behaviour plays a crucial role in constructing interpersonal relationships. It is important to note that in the Chinese cultu re, any disloyal person in the group is a faceless person. Society associates a great value when members of the group go to any extent to honour their obligations. Thus, it can be said that guanxi is a fulcrum of most activities in China that fall into the purview of political, economic and social order. However, to gain more clarity, researchers interviewed over a dozen sales managers in China and Hong Kong to find out how they view guanxi in the business world. ... As replied by the sales managers, guanxi is the first step of a salesperson to establish his or her intention to do the business; however, guanxi behaviour takes considerable time to develop to the point where unfamiliarity with the buyer ceases to exist. According to the sales managers interviewed, most Chinese firms respect guanxi style of relationships while doing any business transactions. That means the higher the salesperson interacts with a buyer, the greater the trust the buyer reposes in the salesperson. Surprisingly, business transactions are done on the basis of trust at personal level rather than at the organisational level. That is why many transactions with overseas firms are done on the basis of personal contacts. People are more loyal to their superiors rather than their organisation. A buying firm's trust on the salesperson is due to his or her expertise on the subject and ability to deliver. Similarly, the higher the status or position of the salesperson, the higher the trust the buying firm will repose on the selling firm. This is so because higher status of the salesperson signifies greater control on the firm's resources to fulfil agreed obligations. The researchers formulated various hypotheses to understand how a buying firm develops trust on the seller firm including the factors such as salesperson expertise and his or her status responsible for generating this trust. In the process to measure all the three elements of guanxi as mentioned above, the authors served the questionnaire to 250 respondents; however, only 51.2% respondents returned the questionnaire. Those who responded were in their current positions for last 4 years and in relationship with