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Guanxi In China

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Many studies explained and showed that guanxi is as competitive advantage for Chinese firms.
Tsang (1998) examined whether guanxi can be sustainable competitive advantage for Chinese firms by interviewed 100 managers in China, Hong Kong and Singapore, and analyzed guanxi to prove the guanxi is sustainable competitive advantages for firms in China through using a resource-based view (RBV). This study (Tang 1998) states that it is necessary to meet three elements in order resource to give a sustainable competitive advantage: valuable, rare and imperfectly imitable. The findings showed that guanxi meets the criteria of RBV and guanxi is possible to generate competitive advantage. It indicated that value relies extremely on the partner's social …show more content…

(2013) investigates that guanxi facilitates innovation, develop business performance and venture success within the environment of highly increasing competitiveness in China. Similarly, Chen, Chang & Lee (2015) also examined whether Chinese entrepreneur’s guanxi network affects business success in creativity industry. Arribas et al. (2013) interviewed 105 entrepreneurs in Shanghai. Chen, Chang & Lee (2015) survived 293 entrepreneurs of creative industry in Taiwan. Their studies found that entrepreneurs’ guanxi networks provide resource and information accessibility, especially government ties have a great impacts in availability of resources for entrepreneurs (Wang & Lestari cited in Chen, Chang & Lee 2015). Theses accessibility and availabilities leads to increase venture success (Arribas 2013; Chen,Chang & Lee 2015). Also, these would assist to develop firm’s creativity and create to social reputation (Chen, Chang & Lee 2015).
Similarly, Tang and Cheng (2012) found guanxi can obtain information and resource that can be competitive advantage for Chinese construction SMEs, because guanxi networks help to able to purchase equipment in low cost and share expensive equipment within guanxi …show more content…

Guanxi has features of flexible and it is based on society, thus it allows guanxi network members to cope with unexpected occurrence appearing after contracts are attained, because contracts take priority guanxi relationships rather than any letter of contract. Wiegel & Bamford (2015) supported Standfired and Marshall (2000) findings, Wiegel & Bamford (2015) showed that proper guanxi is able to decrease behaviour of opportunism. SME suppliers in China are also unable to secure their position once the personnel changes at customer companies. Guanxi that has the proper high level was indicated to assist defend an unforeseen loss of business to

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