The Development of Guanxi Scale - From the Perspective of Individual level and MultidimensionalMeasure

Dauw-Song Zhu Chen-Huan HongAbstract

Guanxi is a special mechanism for interpersonal relationship of Chinese society. The cognition of relationship in Chinese

society is quite different from that of the Western society. Guanxi means treating relational objectives in different ways.

Westerners use transaction cost theory, social exchange theory and interaction theory to analyze the relationship, whereas

Chinese guide their values of collectivism and order by Confucism and guanxi (Buttery & Wong, 1999).

Past research suggested that guanxi is beneficial for doing business in Chinese area or individual career progress. However,

even though we can improve our understanding of Chinese business practices through realizing guanxi, the conceptual

definition of guanxi is not clearly defined yet, and different academic fields have different approaches to this concept.

Besides, there are not only very few studies providing the measurement of guanxi (only 15 from 1989~2007) but the

contents and means of measuring guanxi constructs also fail to reach consensus, for this reasons, the study tries to develop the

guanxi scale by based on integrating past researches to construct a more complete scale for measuring the perceived guanxi of

specific individuals.

This study relies on both the society and management fields to interpret the meanings of guanxi, and take it as a base for the

scale development. We hope to provide the proof that the concept of guanxi could be measured by operating the guanxi

construct and the process of empirical test. Finally this study validates seven guanxi dimensions and demonstrates its

usefulness in predicting interpersonal relationship quality of trust and commitment. By doing so, we can improve the

theoretical construction and development of the guanxi research.

Key Words: guanxi, relationship, scale development

I. Introduction

The development of Chinese culture and society are deeply affected by Confucianism (King, 1991), and Guanxi are the

important concept based on it. Bell (2000), Hwang (1987) and King (1991) take Confucianism as a base to explain the

meanings, categories and behavioral rules of guanxi. Thus, guanxi is a special mechanism for Chinese social operation with

profound cultural meaning. Intrinsically, guanxi is different from relationship, Buttery & Wong (1999) point out that

Westerners use transaction cost theory, social exchange theory and interaction theory to analyze relationship; whereas Chinese

guide their values of collectivism and order by Confucism and guanxi.

First, scholars based on wu-lun structure to interpret guanxi concept. Since Confucius codified the societal rules, values and

hierarchical structures of authority during the sixth century B. C., the Chinese society has been functioning as clan-like

networks (Luo, 1997a). Hereafter, gaunxi concept is emphasized by business and management field, and guanxi becomes and

important basis of societal and business interaction in Chinese, Hong Kong, Japan, Korea, and Taiwan.

Many researches have already highlight the importance of guanxi, and realizing guanxi could improve our understanding

about it, however, the conceptual definition of guanxi isnt easy to clearly define. Scholars from different research fields have

different focus on guanxi research. Sociologists mainly explain the origin and meanings of guanxi from cultural background

and think thatguanxi is helpful for maintaining the harmony of Chinese society (King, 1991; Luo, 1997a), and their research

focus on annotating about the interaction principles with various guanxi categories; and scholars from business fields lay

special emphasis on the application of guanxi concept, and their research focus on discussing the importance, effective scope,

and value of guanxi in business practices. And owing to business research field mostly starting from strategic and business

development viewpoint to study guanxi, basically they are inclined to illustrate the importance of guanxi from instrumental

perspective (Farh, Tsui, Xin, & Cheng, 1998; Fock & Woo, 1998; Luo, 2003; Park & Luo, 2001; Standifird & Marshall, 2000;

Vanhonacker, 2004; Yeung & Tung, 1996). In short, no matter for society or business fields, guanxi is being respected and

worth for further research.

The study review guanxi literatures and think though guanxi is a critical factor for Chinese societal and business operation,

the definition of guanxi arent quite clear. According to literatures, we find that (1) there is in some need to integrate the critical

factors about guanxi; (2) therere rare empirical studies about guanxi due to the lack of a more complete guanxi scale1. For

these reasons, we hope to integrate the past researches to construct a more appropriate scale in order to measure perceived

guanxi intensity between to person.

II. Literature Review

1. The review and analysis about guanxi measurement

Recently guanxi earns lots of respects, but in concerning with guanxi measurement tools, that are mostly developed by

researches and the conceptual definition of guanxi are still not with consensus. This is because guanxi is a more intrinsic,

complex, and multidimensional constructs. Take guanxi and relationship marketing as an example, its said that relationship

marketing is easier to measure than guanxi (Gilbert & Chol, 2003), because in the process of transaction, relationship

marketing is of an economic nature, concerning goods, services, systems of goods and services, financial solutions, material

administration, transfer of information, social contacts and a number of future commitments; otherwise, guanxi is more

complex and go beyond their economic content to include reciprocal personal favors and mutual protection and enhancement

of reputation and social status (Arias, 1998). So, its thought that guanxi is not easy to be operationalized.

The study claims that it is needed to develop a more appropriate guanxi measurement tool. After reviewing guanxi empirical

studies, we found that there are basically two kinds about guanxi measurement from 15 papers: (1) the beliefs or attitude about

guanxi; (2) the perception about guanxi. The former way of measuring guanxi is not concern with guanxi intensity but about

how someone think of guanxi in their business practices really is, such as beliefs (Ang & Leong, 2000; Armstrong & Seng,

2000), attitudes (Chan, Cheng, & Szeto, 2002; Szeto & Wright, 2006) and inclination (Lee, Pae, & Wong, 2001). There are lots

of important contents in these studies such as future benefit consideration, insiders are treated better, reciprocity,

favors, face, mutual benefits, harmonyetc. And this study refers to these contents as basis for scale development.

Besides, the latter way of measuring guanxi is concern with intensity. We category it into three kind of measuring style: (1)

guanxi ties; (2) uni-dimension; (3) multiple-dimension.

Guanxi ties is a very common way to measuring guanxi. Guanxi ties means that if there exists some kind of relationship ties

between two person, then they have guanxi. Past researchers had already point out there are some defects in this kind of

measurement. Guanxi ties based on Blood or common experiences are not necessary for further interpersonal relationship

development (Kiong & Kee, 1998). Law, Wong, Wang, & Wang (2000) have criticized Farh et al. (1998) that guanxi ties could

not tell supervisors how guanxi are built and how to improve their guanxi with employees; Yang[](1999) hold the same

viewpoint that having guanxi ties doesnt mean that there must exist real affections; Dunfee and Warren (2001) also think that

guanxi ties is not sufficient for building strong guanxi, they must work together for a while, frequently interacting and

exchanging favors, and then they could build and maintain guanxi. In this line, we can realize that its insufficient to measuring

guanxi purely by guanxi ties.

The second kind of measuring guanxi, unidimension, view guanxi as one dimension construct (such as Abramson & Ai,

1999; Ambler, Styles, & Wang, 1999; Law et al., 2000; Cheng, Farh, & Chang, 2002; Chen & Tjosvold, 2006; Wong, Ngo, &

1 Chen[] (2000) point out that although we can realize the importance of guanxi for Chinese, most relative studies mostly focus on conceptual analysisor general investigation. There are very rare systemic empirical studies about guanxi topic. The reason is guanxi accompany with various and complexmeanings, so its no easy for researchers to operating and measuring it.

Wong, 2003; Leung, Lai, Chan, & Wong, 2005; Cheung & Gui, 2006). From the definition and contents of most guanxi

literature, guanxi is basically a multiple concept. Besides these researches dont research consensus on how many dimension

should be included to describe the guanxi. Thus, we think its better to view guanxi as a multidimensional construct.

The third kind of guanxi measurement sees guanxi as composed with various dimensions (such as Abramson & Ai, 1999;

Lee & Dawes, 2005). These studies had already point out some critical facets about guanxi but actual we think they still lack of

a more integrated systemic structure to construct guanxi and some measuring items also need to be refined.

As a result of the insufficiencies of guanxi measurement, we plan to integrate past guanxi researches and refined their guanxi

scales. We propose three critical viewpoints of this study: (1) we theoretically assume guanxi is included with instrumental and

affective ingredients but the distinction between them are not our point, so we just sum up these ingredients to present whole

guanxi intensity; (2) its more adequate to measuring guanxi based on multi-dimension perspective due to guanxi itself is with

multiple facets; (3) guanxi intensity can be presented by active or passive ways. Active means the inclinations or behaviors of

someone who has ever done in their relations with somebody, and passive means the beliefs or expectations of someone hold

about how others will treat them. We think both the two ways could present the perceived guanxi intensity.

2. The definitions and dimensions of guanxi

Sociologists propose guanxi concept for relation-oriented Chinese society (Bian, 1994; Hwang, 1987; King, 1991). Guanxi

in literatures has been translated into connection, social networking, or special interpersonal relationship. But there is no

specific English words could define it (Hackley & Dong, 2001). Its different from relationship (Bell, 2000) basically.

Relationship is more visible and open than guanxi, and Western relationships emphasize equality but guanxi often come with

the obligation of more reciprocity (Hackley & Dong, 2001).

According to past researches, there are three kinds of relationship types: business relationship, leader-member relationship

and general social relationship. The definition of Guanxi in business relationship category is narrower. They often view guanxi

as a kind of medium to capturing resources (Wall, 1990; Davies, Leung, Luk, & Wong, 1995), take favors, mutual benefits,

trust and dependence as key guanxi elements, and rely on network to gain resources and build competitive advantages

(Abramson & Ai, 1997; Luo, 1997ab). Besides, Guanxi in leader-member relationship category often be defined through

guanxi ties and interactive basis. Guanxi ties means common backgrounds, such as relatives, classmates, and coworkers, and

interactive basis means the relations come from the experience of interaction. Finally, the definition of guanxi in general social

relationship is with more extensive meanings. According to Yang (1993), guanxi could be classified as family relationship,

familiar relationship, and acquaintance relationship. Or from the point of resource distribution, guanxi could be classified as

instrumental, affective, and mix relationships.

The study focuses on mix relationship. And in order to fit the research scope of business field, we choose coworker

relationship as the basis of guanxi research to develop and construct informal, societal, and cultural meaningful guanxi scale.

In this study, we define guanxi as special treatment between persons which is built based on interactive experience and

follow by specific rules included mutual benefits, reciprocity, emphasis of favors and face.

3. The critical factors and contents of guanxi

Guanxi has been illustrated and discussed in many fields such as anthropology, psychology, business administration. Bell

(2000) claims the development of Chinese culture and society is based on Confucianism. Guanxi is used to expand other

supports beyond family. And its supposed that we must follow some specific rules in order to maintain the social harmony.

This study refer to the perspectives on guanxi of these different research fields to induce 6 important dimensions of guanxi,

including ren-quin (favors), mutual benefits, reciprocity, harmony, face, differentiation. Theirs meanings and

connotation are described as follows:

(1) Ren-qing (favors): Social psychologists consider thatren-qingis hard to be concrete presented but a powerful obligation

(Kim[], 1988). When someone have done something meaningful to the other, then the other one might owe to the

person (Hwang[], 1998). In sum, the word ren-gingindicating individual emotional responses of daily life,

means a resource allocated to another person as a gift and also connotes a set of social norms to guide an individual to get

along well with other people. In this study, we think that because Chinese emphasize the ren-gingso much so that any

kind of favor-giving might raise the accumulated favors and then create some kinds of obligation or affections. Thus, we

think that the more the ren-qing, the higher the guanxi.

(2) Mutual benefits: Guanxi often means the social connection which is base on mutual benefits. Transactional partners bonds

together through the obligation of reciprocal favor exchange (Alston, 1989; Luo, 1997b; Lee et al., 2001). We think that

when someone is in need and the other voluntarily give him/her a hand, then the reciprocal behaviors between them will

increase and also improve their guanxi.

(3) Reciprocity: Westerners think that reciprocity is for maintain the beneficial equality with each other, but Chinese think

that reciprocity might be detained and unequal. Liu[] (1993) indicates that Chinese baois quite different from

social exchange theory. Bao means when Chinese feel he/she owe someone favors, then, he/she will respond the favors

for a more big one. Thus, we think that when someone follows the rule of Chinesebaowhen interacting with somebody,

then the guanxi intensity between them will increase. Instead, if someone doesnt follow the bao rule, then the guanxi will

become harder to maintain.

(4) Harmony: The reason why Chinese emphasize the hierarchy comes from the Confucian wu-lunstructure. It means that

everyone in the Chinese society will keep to the prescribed roles, and follow the hierarchy and status to decide their acts in

order to research social harmony. Harmony implies that Chinese are inclined to prevent conflict and directed to the system

of group-oriented social relationship (Buttery & Leung, 1998). In other words, .the Confucian school develops wu-lun

as the basis of guanxi to research social harmony (King, 1991; Luo, 1997a). Thus, its thought that harmony and hierarchy

are important factors of guanxi (Wang, Wang, Ruona, & Rojewski, 2005).

(5) Face: Faceis not exclusive to Chinese but westerners seldom value faceas high as Chinese (Kim[]1988).

Chinese very emphasize the importance of face(Park & Luo, 2001). Face is an important ingredient of guanxi

something like social status (Lockett, 1988), prestige and identification (Ang & Leong, 2000) recognized by others. Thus

we think that the more theface is valued, the more the guanxi is.

(6) Differentiation: Chinese often treat others in different ways in according with the relationship between them (Fei[

]1948). Chinese are inclined to care more about the insiders. Its also found that comparing with westerners, Chinese

are more likely to sort others with the types of relationships between them and treat them differently (Butterfield, 1983).

This means that if someone treats the other according the relationship between them, then the guanxi between them will

increase.

III. Preliminary scale construction

1. Definition

The study refers to the scale of past researches to develop and construct a more integrated guanxi intensity scale. On the

other hand, after reviewing 15 studies about guanxi, we find that there are 2 studies (Law et al. (2000) and Chen & Tjosvold

(2006)) measuring guanxi from the interpersonal interaction. For this reason, we add one more guanxi dimension, personal

interaction. Finally, there are total 7 guanxi dimension and the corresponding conceptual definitions and reference are listed in

table 1.

Table 1 Conceptual Definition of Guanxi Dimensions

Factors Definition Reference

Favors Someone bases on accumulated

favors and relationship intensity to

allocate resource, care, and give gift to the

other.

Lee & Dawes (2005); Park

& Luo (2001)

Mutual

Benefits

Someone voluntarily and

wholeheartedly helps and satisfies another.

And suspect the other will also give a hand

when he/she is in need.

Chan et al. (2002);

Abramson & Ai (1999);

Armstrong & Seng (2000);

Wong et al. (2003); Ang &

Leong (2000)

Reciprocity Someone repays favors more than

what he/she has received. And even when

he/she couldnt repay favors

immediately, he/she will repay it someday

in the future for a bigger one.

Ang & Leong (2000); Yau

et al. (2000); Ambler (1995);

Yang (1994)

Personal

Interaction

After work, someone still has

informal interaction frequently with the

other.

Law et al. (2000); Wong et

al. (2003)

Harmony Someone will follow the rules of

orders and codes of ethics and be inclined

to prevent conflicts when interacting with

the other.

Hackley & Dong (2001);

King (1991); Luo (1997a);

Buttery & Leung (1998); Siu

(2003); Leung et al. (2005);

Friedman et al. (2006); Leung et

al. (2005)

Face Someone will respect the others

feelings and thoughts and prevent to

embarrass the other.

Lee & Dawes (2005); Ang

& Leong (2000)

Differentiation Someone will treat the other better,

consider the others benefits.

Armstrong & Seng (2000);

Cheng et al. (2003)

2. Delphi Method

The study executed Delphi method to confirm the adequacy of guanxi dimension and corresponding indicators for the

stability of factor structure and content validity of items.

First, we invited experts who are familiar with this topic to form Delphi panel. The results are built on the experience and

knowledge of these experts, and through this process we can refine the preliminary guanxi scale. The Delphi panel composes 4

professors from business administration field and 6 supervisors from various industries.

The study designed structural questionnaire and sent it by mail or Email to Delphi panel members. The first round processed

about one month, and after one week we execute the second round. The second round processed about one week.

Basically, therere two criteria of Delphi method: (1) consistence, (2) importance. First, according to Faherty (1979) we

judge the consistence is achieved when quartile deviation is less than 0.7. Holden and Wedman (1993) suggest that when

quartile deviation is beyond 1 means that the opinions of Delphi members arent reached consistence. Besides, the criterion of

importance is judged by average, and when average is less than 5.0 well eliminate the factor or indicator.

After the two round of Delphi method, we found that guanxi dimensions all reach the criteria of importance and consistence.

Besides, as to indicators, the results from the first round show that therere 14 items which is not converging, thus we

process the second round to exchange the expertsopinions. After the second round therere still 10 items not reaching

consistent. So we eliminate 10 items and confirm adequate 32 item scale for guanxi measurement.

IV. Conclusion and Suggestions

1. Conclusion

The study mainly focuses on developing and refining measurement of guanxi, and constructs a guanxi intensity scale. We

hope through integrating past researches to develop a more appropriate guanxi measurement.

We think after reviewing literatures, integrating past guanxi measurement tools and contents, we will be able to construct a

more suitable guanxi scale. The study proposed 7 critical guanxi dimensions and corresponding items as a basis for further

examination and test.

2. Suggestions

The study couldnt separate voluntary relationship with restricted one. And we also dont discriminate the weights of three

big important ingredients (affective, instrumental, and obligated) of guanxi. We only sum up these critical dimensions to

present guanxi intensity. Thus, we suggest further researches could make more effort on this part.

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