Scott C. Hammond
Utah Valley State College, USA
Lowell M. Glenn
Utah Valley State College, USA
The Chinese concept of Guanxi is a form of social network theory that defines one’s place in the social structure and provides security, trust and a prescribed role. This essay argues that Eastern Guanxi and recently popularized Western Social Network Theory (SNT) overlap in three ways. First, both imply that information is essential to sustain a social system by prescribing a set of behaviors that regulate the flow of information and that define insider and outsider relationships (Guanxi), or strong ties and weak ties (SNT). Second, both offer a theory of change coupled with an ethic of sustainability where order is created by trust as a local, relative phenomena. Finally, both Guanxi and SNT characterize randomness and order as essential, though Guanxi favors certainty and trust over chaos. The implications of the comparison undermine the claims of ‘newness’ and primacy often associated with recent SNT literature. Furthermore, they suggest that Western network theorists can gain significant insight from traditional Eastern thought.
Many western scholars have watched a family of complexity theories bloom in the academy, infecting traditional scientific knowledge claims with uncertainty. In the latter half of the 20th century broader, more holistic, theories emerged, not only in the physical sciences, but in culture studies (Hayles, 1990), communication (Weerdt, 1999), economics (Arthur, 1994), psychology (Calvin, 1990) and organizational management (Lissack, 1999; McKelvey, 1999; Tasaka, 1999). Recently, those who study social interaction in sociology, communication, management and marketing have made progress in understanding group behaviors by using social network theory (SNT). SNT explains how information and relationships develop in the context of active social groups in self organizational communities. While not always characterized as such by those who support it, SNT falls into the family of complexity theory because it seeks to explain nonlinear phenomena by focusing on the flow of information through relationships. Traditional sociology focused on the traits or characteristics of the participants or the content of the messages. SNT also acknowledges that message meaning is underdetermined and that meaning generation is the motive for social interaction and the basis of social relationships. It characterizes meaning, and the relationships generated by meaning generation as emergent, and thus self-organizing (Hammond & Houston, 2001).
Recently, three popular business books have advocated SNT as a means for better understanding social and business organizations (Watts, 2003; Buchanan, 2002; Barabási, 2002). As a result, SNT has a newness and popularity that is compelling to scholars in diverse fields. Applications of SNT to the literature of management theory have been somewhat rare (see Business Week’s “The 21st Century Corporation,” August 21-28, 2001), however, Haythornthwaite, (1999) has applied SNT to media use and network construction.
While many Western scholars are excited about the complexity-based social network theory and see it as something new, Eastern intellectual traditions have long understood the importance of social networking. The Chinese concept of Guanxi is an older form of social network theory that contextualizes individuals within a highly collectivist society (Hampden-Turner & Trompenaars, 2000). Guanxi defines one’s place in the social structure and provides security, trust and a prescribed role.
In this essay, we argue that SNT and Guanxi share three overlapping conceptualizations of social systems.
It is clear that the Chinese conceptualization of social networks through Guanxi practices adds to our understanding of the behavior of social networks using SNT. Of course, it is an over simplification to suggest that there is agreement on both these terms. Both SNT and Guanxi are complex concepts with profound and emergent meanings. In the first section, we will provide working definitions of these idea sets. We will then discuss similar notions of information and sustainability, change and emergence, and order and chaos found in SNT and Guanxi. Finally, we will examine the implications of this comparison.
Prior to the emergence of the World Wide Web, our understanding of real social networks was limited to theory supported by simplistic models. Early ideas were based on simple observations, such as the work of Sociologist Stanley Milgram (1967, 1974) who conducted a creative and unusual experiment. Milgram sent a series of letters to people living in the rural areas of the United States and asked them to forward the letter to a specific person living in Boston. No address was given for the person, so letter recipients were told that if they did not know the person in Boston that they should send the letter to someone who was more likely to know the recipient. A surprising number of letters were eventually received in Boston. On average, each letter was forwarded about six times before it arrived. Milgram’s experiment and further research led to ‘small world theory’, which suggests that there are on average no more than six degrees of separation between you and any other person on the planet. To-be-sure, not everyone is within six steps of every other person, but it takes a relatively small number of steps to connect people at the individual level (Barabási, 2002).
As computer networks became available in modern society, email and information exchanges became trackable, revealing the larger patterns of communication. Computer modeling of both content and frequency has changed our understanding of how social networks and relationships emerge (Monge & Contractor, 2001). Buchanan, (2002) said, “Social networks turn out to be identical in their architecture to the World Wide Web. Each of these networks shares deep structural properties with the food webs of any ecosystem and with the networks of business links underlying any nation’s activity” (p. 15).
Computer mediated interaction in social networks has allowed social scientists to see the characteristics of emergent social networks, to track the kinds of information that flows within those networks, and to define the relationships that exist between the various parts of those networks. But these issues were also accounted for by Chinese, whose ancient culture has rules for dealing with a similar hyper social environment. To understand this, imagine a marketplace we visited in a Chinese village a few months ago. It is a scene that has not changed significantly in several thousand years. Farmers, artisans, craftsmen and merchants sell their wares and services in a highly interactive environment that changes from moment to moment. People seem to be shouting into the air, broadcasting their desire to do business. Bargaining is everywhere. Regular customers receive a better price. Friends gossip, giving important information about political or economic trends. Money is exchanged, but barter is preferred because the delivery of value is more certain, and the relationship is more likely to be sustained. The marketplace is a place of exchange, where trust is created and lost and where trade relationship skills correlate with the ability to provide for a family.
The marketplace environment is the primordial soup from which the Chinese notion of Guanxi arose. Just as the emergence of computer networks helped us see and conceptualize social networks, it was the Chinese marketplace that gave rise to the idea of Guanxi. In an environment where some degree of relational and economic certainty was essential for survival, rules and traditions for social engagement arose that allowed for individual role definition, relational ethics, and social and economic sustainability (Gao & Ting-Toomey, 1998).
Guanxi is defined by Mei-hui (1994) as a gift economy, but it is much more. Luo (1997) say, “The Chinese word Guanxi refers to the concept of drawing on connections in order to secure favors in personal relations. It is an intimate and pervasive relational network in which Chinese culture energetically, subtly, and imaginatively engage” (p. 2). But for our purposes, perhaps Bell’s (2000) definition is most helpful. He defines Guanxi as more than connections; it is a “mechanism by which individuals are able to achieve personal, family, or business objectives.” Bell’s definition focuses on a process by which we achieve collective goals. He says that the emphasis in Guanxi is on relationships, but that the term ‘relationship’ means something more in Chinese. He says, “Hence Guanxi refers to relationship in the most profound sense of the term, with implications that are beyond the customary English usage” (p. 133).
Guanxi has many of the superficial characteristics of social networks. Guanxi is transferable. If person A knows person B and C, then B and C are socially obligated because they are part of the same network, even if they only have a common friend in person A. Thus, Guanxi is the individual’s connection to the whole; the micro connection to the macro social order. Luo (1997) says Guanxi gives social status and defines how the individual should operate, related to the larger social system. Redding and Ng (1982) argue that Guanxi is emergent and dynamically changing.
Today, there are Chinese terms that clarify different Guanxi functions. La Guanxi means ‘pull Guanxi’, and implies that you are getting on the good side of someone who is more powerful. Guanxi quo giang means that the relationship has gone bad. Li shun guanxi means to make the relationship right. Guanxi wang is the noun describing the Guanxi network, indicating that the network is beyond the conceptual, providing benefits that are real and material. Graham and Lam (2003) argue that good Guanxi is tied to a Chinese style of reciprocity (hui bao). Favors are always remembered and returned, but not always quickly. People who don’t return favors are seen as poisoning the well.
In the short sections that follow, we will further develop three important similarities between Guanxi and social networking theory (SNT). The first similarity is the foundation of the others, and is based on information and sustainability.
The trueing of information is inherently problematic for humans. In a world of ideas, whose information do we trust? Communication scholars suggest that the information exchange is a primary motivation for social relations (Monge, 1977; McGee, 1990). In all contexts and ages, people try to develop sufficient information to sustain their existence. Information allows the individual to adapt to changes in the environment sensed by other parts of the network and thus sustain their existence. There has always been a collective aspect to human existence. Some in the collective are competing for resources, while others are collaborating. Chinese Guanxi traditions name the insiders and the outsiders.
Guanxi teaches a person to identify a competitor (outsider) from a collaborator (insider), and prescribes rules for dealing with each kind of person. Zi ji ren are insiders and are highly trusted, because they are required to give accurate information. Gu (1990) argues that family, colleagues and classmates are automatically considered to be insiders and are offered some degree of automatic trust. Gao and Ting-Toomey (1998) argue that all insider relationships are defined by family and as family, and cannot be severed or changed except under extreme circumstances. These kinds of relationships, according to Gu (1990), are characterized by niceness, trustworthiness, caring, helpfulness and empathy. But the major function of Guanxi relationships, according to Gao and Ting-Toomey (1998), is the sharing of information. In a Guanxi relationship, one is obligated to share important information, even secret information, with those who are considered to be insiders.
Outsiders, called wan ren, are granted an entirely different status. Chu and Ju (1993) suggest that outsider relationships are less worthy of trust and are unstable. Their studies suggest that there is less trust for outsiders. In a variation on Western communitarianism, Hwang, (1987) argues that one is not morally obligated in the same way to those who are outsiders as those who are insiders. Scallon and Scallon (1991) say “discriminating a boundary (between insider and outsider) is not only a localized and descriptive activity, it is a regulative and moral activity… What is outside the boundary is not relevant in any way to what is inside” (p. 471). In other words, one is less obligated to share important information with insiders, nor should one expect to get information from outsiders.
For insiders, Cheng, (1990) suggests that the tradition of honoring those closest to you with information, trust and respect comes from the prescribed roles in Confucianism. Confucius described five critical relationships as ruler-subject, father-son, husband-wife, elder brother-younger brother, and friends. Chinese traditions provide specific rules for each of these relationships with the end that these critical relationships are the threads that weave society together and cannot be damaged.
With terms similar to Guanxi’s insider/outsider relationships, SNT suggests that social networks are made up of strong ties and weak ties. Strong ties are the clusters of people with whom we have regular and direct contact. Like the zi ji ren, they are our closest contacts, our family, our friends, our co-workers. Barabási notes that strong ties are generally people with similar social and economic status. They are also the ones with whom we have regular communication and who are likely to share similar values, beliefs and morals. Strong ties are important in a social network, because they give us security through reliable and trustworthy relationships. While they vary somewhat between individuals, this is why there are strong, socially constructed rules about how to treat friends, family and co-workers that are often centered on truthfulness, loyalty and commitment.
Weak ties are the nodes in our social network that reach out beyond immediate friends and family. They are often random and always distant. Barabási notes, “weak ties play a critical role in our ability to communicate with the outside world” (2002: 43). Granovetter, (1973) argues that weak ties generate new paths of influence, activity and innovation that all us to expand our influence and more importantly our information. He suggests that our strong ties tend to have the same information that we do and, thus, share similar beliefs. It is through weak ties that we gain new and often helpful information and opportunity.
Unlike the Chinese tradition that ascribes the wa ren (outsider) with mistrust, the weak ties in social network theory are seen as critical. Weak ties are the source of new information, new ideas and new market opportunities. But there is a high degree of randomness. For example, a professor who is on a long flight happens to be bumped to first class where he sits next to the CEO of a medium size company. After a long conversation, the pair exchange cards and the professor follows-up providing the company leader with a helpful reference. An email conversation follows that eventually leads to consulting for the professor. To-be-sure, most flights lead to casual, forgettable conversations. New weak ties are often briefly instrumental and do not bind us to the costly obligations that strong ties demand. But Barabási gives us new information that is critical for surviving in complex and dynamic social environments.
In our modern work environment, a good example of this can be found in the difference between intranets and internets. Intranets are the domain of insiders with strong links. They are where confidential information is shared with people who are known and trusted. They are more than an organizational chart because they allow people to interact based on what information is needed. David Weinberger said, “Intranets are enabling your best people to hyperlink themselves together, outside the org chart. They’re incredibly productive and innovative” (Levin, et al., 2001: xxix).
If the intranet is about strong ties with insiders, then the internet is about weak ties with outsiders. The internet is characterized by sometimes random connections that lead to unexpected opportunity. Weinberger says, “Through the Internet, the people in your markets are discovering and inventing new ways to converse. They’re talking about your business” (Levin, et al., 2001: xxix). While Chinese Guanxi traditions do not directly anticipate an internet or intranet environment, one could anticipate a caution and lower levels of trust for the internet while insiders on the intranet would be unquestioned until they violate the social norm. Guanxi places emphasis on the trusted insider, while SNT suggests that the new information and opportunities are critical for your survival.
Because no amount of information at the level of individual experience will allow the individual to thrive in a complex environment, context provided by strong ties and new information provided by weak ties is essential for sustaining individuals because it allows for local adaptations of global problems. The question of change and emergence is the second common concern in our discussion about the similarities between the ancient Chinese traditions of Guanxi and modern social SNT theory. Both Guanxi and SNT see incremental, organic change as inherent and even, at times, advantageous. The role of the Guanxi, or social network, is to manage that change. While SNT describes a phase transition as a radical change that alters the system and changes roles, Guanxi, and a new concept we will call mianzi, give interaction rules that help maintain identity within the system while individuals navigate emergent change.
The concept of mianzi, which Westerners often call ‘face’ or ‘saving face’, provides a layer of defense against social phase transitions that threaten individual identity and role. Ting-Toomey (1988) argues that mianzi is a strategy that protects self-respect and individual identity. Face saving activities are the rites that protect the individual’s role in the Guanxi network, preserving individual identity and social status. Lim and Bowers, (1991) say that humans use face saving strategies to create autonomy, fellowship and assumptions of competence. Gao and Ting-Toomey (1998) suggest that while individualist cultures, such as Western culture, use mianzi to place emphasis on non-inclusion and the creation of individual identity, collectivist cultures focus on inclusion of others and the creation of a collective identity.
Mianzi is an important concept in this paper, because it is a marker of a social strategy that prescribes emergent change by protecting individual identity and maintaining relationships with strong ties. Change within the context of this emergent social order is welcomed as long as identity and role are not threatened. But radical change in the social order that disrupts individual identity and socially constructed roles, resulting in a ‘lose of face’, is not good. Thus, Guanxi social networks serve as a buffer against radical change and a guide for incremental, emergent change and adaptation. The social network serves first to provide context through strong ties.
Redding and Ng (1982) give a clear picture of a Chinese society, where role preservation is even more important than urgent needs. They argue that everyone is vested in maintaining social order, even if others are less privileged. An example of this can be found in a recent Chinese colleague who was awarded a post doctoral research fellowship in Europe. The colleague, who was studying in Taiwan at the time, passed up the prestigious fellowship. He later revealed that his father was unemployed at the time and he thought accepting the fellowship would deepen his father’s shame, disrupt their relationship, and put the family relationships out of balance. “It is important,” he said, “for the first son to be ready to assume the role of head of the family when the father is ready to give it up, not before.”
In this case, the young Chinese scholar never directly shared his feelings with his father who would have been shocked and shamed by his position. But his father implicitly understood what his son was doing, and deeply appreciated his son’s face saving choices. Gao and Ting-Toomey say that context creating communication, such as actions, attitude, body language, etc. are more important than the words spoken in Chinese culture. This can be difficult for Westerners to understand in the context of a real conversation, but when asked a direct question by an American, a Chinese might answer “yes” but act as if they have said “no.” This deliberately ambiguous behavior is designed to let the American know that the answer is “no” but the relationship is worthy of preservation.
To understand this, consider a political crisis observed directly by one of the authors of this article. In 1998, the U.S. bombed the Chinese Embassy in Belgrade, setting off a wave of student protests in China. Americans seemed surprised at the volume of protests coming from China. One astute Chinese scholar told us, “What Americans need to understand is not that the Chinese were worried about the violence of the Embassy bombing. Chinese see a great deal of violence from their own government. What worried the Chinese and triggered the protests was the American violation of the relationship that caused a fear of isolation. Over the nineties, the Chinese had worked hard to develop an important economic relationship with the United States. Now the U.S. was seen as violating that trust and putting the relationship in jeopardy.”
Terrorism is a similar concern that has recently emerged for Western cultures. Disease, auto accidents, and conventional war bring about greater casualties at a higher cost than even the most heinous terrorist act. But these are events that are understood within the context of our economic and social system, while terrorism is random and induces chaos. It has potential for infecting the system with fear. Note that the Chinese fear induced by the embassy bombing is a fear of disrupting the relationship between two important collectives, while the American fear of terrorism is a fear of the individual being attacked within the collective. While Chinese culture wants stable relationships between collectives, Western culture seems to desire a clear relationship between the individual and the collective.
Mianzi functions as a series of social rules designed to protect the social order from macro change, while helping individuals navigate emergent micro change. SNT tells us that Chinese Guanxi and mianzi are simply a series of ‘interaction rules’. Watts, (2003) describes interaction rules as the rules by which relationships are formed and how they function. He suggests that interaction rules are how history is relevant to your future. Interaction rules are the locus of the conflict between structure and agency. While the structure is provided by the social rule, agency is provided by the individual (p. 75).
Watts, whose research is central to SNT, goes on to provide an SNT version of change in his discussion of phase transition. Phase transition, according to Watts, is what happens when an individual moves from a disconnect state (p. 46). Drawing an analogy between magnetization and the creation of social order, Watts says that, “phase transition is driven by the addition of a small number of links right near the critical point that have the effect of connecting many very small clusters into a single giant component, which then proceed to swallow up all the nodes until everything is connected” (p. 46). Watts goes on to argue that if two nodes are not part of the same component, then they cannot communicate.
Certainly, the interaction rules of Guanxi and mianzi are designed not only to maintain roles and relationships. They are also designed to keep the socially hegemonic of a phase transition from overwhelming the family, the village, or the close ties of the individual. They are, in effect, survival strategies for those in complex social networks which would be disrupted if a phase transition such as industrialization, globalization, or democratization, were to threaten their society. Barabási notes that complex systems are not reversible, and thus once that have moved over a threshold and into a new phase, past roles and relationships cannot be recovered (p. 133).
Central to both Guanxi and SNT are key assumptions about order and chaos. While traditional science has seen order and chaos as objective and measurable, and provided laws such as the second law of thermodynamics to support those assumptions, both Guanxi and SNT assume that order and chaos are relative terms. While there is certainly not space in this paper to fully discuss the conceptualization of order and chaos within the Guanxi and SNT paradigms, we can simply define order within these two idea sets as a system that moves into an emergent rhythm that is self-sustaining. Chaos, simply defined, is system-wide change that disrupts the individual by placing them out of context within a social system. Central to the concept of order and disorder in both Guanxi and SNT are information and relationships.
In Guanxi and SNT, order is created by a stable and predictable set of weak tie and strong tie relations, the steady flow of information from those ties which allows for individuals to adapt to incremental change, and unifying rules that lead to some common goals. The chief common goal is preservation of the system.
In other words, both Guanxi and SNT prescribe predictable, stable relationships. That is not to say that relationships will not change, they will just change in stable and predictable ways. Just as the first son in Chinese culture will assume the role as head of the family, relationships within a social network will evolve constrained by the larger social order. While Guanxi is clearly seen as being transferable, Watts points out that if person A knows person B and person B knows person C, then over time it is highly likely that person A will come to know person B. In modern social terms, we might call this ‘networking’. (We might also call it ‘dating’!) These kinds of social evolutions are order building, because we used our strong ties in order to check out weak ties. Once our weak ties provided trustworthy information that is tested, they become strong ties.
These kinds of additive relationships are also stabilizing because they bring new information into the system without disrupting the system. While information is essential for adaptation, system disruption upsets the ability of the individual to be aligned with their context. Literature is full of examples the ‘stranger in town’ who brings a new religion, democracy, justice or value into an existing system. It is always high conflict when this kind of new information is introduced. Academics also use a strong tie/weak tie system for hiring. When a department needs a new faculty member and a stranger applies, his or her qualifications and publications are rarely sufficient to win the position. The applicant must be certified by a letter of recommendation from someone who is a strong tie.
Clearing the unifying goal of most social systems or organizations is preservation. There seems to be almost an intuitive sense in any organization, from religious organizations to business, that certain kinds of information, if embraced, will change the fundamental values of the organization. Burke (1984/1937) told us that statements of meaning are always declarations of orthodoxy. Orthodoxy is an overt or covert, commonly held belief that preserves any social system, from churches to political organizations. Small pieces of unorthodox information that forms and reforms in pattern can be seen as an example of Lorenz’s sensitive dependence on initial condition and the butterfly effect. Watts, (2003) uses the term information cascade to describe a phase transition where new information takes hold and recontextualizes the social order. He says, “During such an event, individuals in a population essentially stop behaving like individuals and start to act more like a coherent mass” (p. 205). Watts goes on to say that “the seed alone is not enough” to bring about change. The seed must be planted in the right place at the right time (p. 249).
Chaos could then be defined as a disruption of meanings brought about by new information often from a weak tie relationship. When meaning changes, conflict over new meanings with close network ties may occur. Those privileged by the old meanings want to hold on, while those wanting to explore the new meanings engage in dialogic inquiry (Hammond & Sanders, 2003) - meaning that related conflicts can be very disruptive to close tie relationships.
As we have argued, the objective of Guanxi is to provide rules that protect these relationships. For example, in Western cultures, business opportunities come and go and less than half of all families are traditional, nuclear families (Giddens, 1999). But in cultures based on Guanxi, divorce is rare and some business partnerships last a lifetime. It is difficult and unusual for Chinese to enter into long term partnerships, but when they do, the relationship is seen as permanent (Gao & Ting-Toomey, 1998). Guanxi rules protect against chaos by guarding against a disruption of strong tie relationships. As a result, it may also protect the system from information that leads to innovation and opportunity.
Some writing in the business literature on Guanxi have suggested that Guanxi is a cultural remnant of a feudal society that is being washed out as the Chinese culture becomes more Westernized. Western societies are considered to be universalist (rules apply equally to all). Chinese culture is considered to be particularist (relationships are more important that rules) (Hampden-Turner & Trompenhaur, 2000). Triandis, (1995) argues Guanxi is an artifact of particularist cultures. The argument suggests that forces of globalization will eliminate the need for Guanxi.
This is a naïve perspective. To be sure, Guanxi will change with the forces of globalization, but will also remain as a source of order and stability. Guanxi is not simply a series of engagement rules. While the specific rules of Guanxi are specific to Chinese culture, the Western popularization of Social Network tells us that the concept of Guanxi is not. Wherever there are human cultures, particularist or universalist, there are emergent social networks that are partially visible. We are a social network, in our families, communities and academic disciplines, even in this journal. There are interaction rules, such as the Guanxi rules, within those communities designed to preserve the community and the roles within it. We often struggle to see, describe and function within that rule set.
The advocates of SNT are making significant claims about the primacy of their new idea set. They imply that SNT began with the emergence of the World Wide Web. But the practices of social networking, as Chinese traditions have detailed, are much older than the new technologies. Trade economics, genealogies, and Guanxi networks preceded the Web by many generations. In the future, as network societies become more globalized, as relationships are disrupted with emergent new meanings, notions of information and sustainability, change and emergence, and order and chaos will still sustain us. There will always be emergent rules to create coherence in social interaction. We just need to figure them out.
 The name of this scholar has been withheld to protect them from any political liability.
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