The role of Guanxi on Chinese leadership innovation: the pilot study on the electric motor sector

This research aims to examine the existence and nature of complex business-social relationships in the Chinese context (Guanxi) and evaluate how these relationships influence the behaviors of managers in State-owned Chinese engineering firms. Research on Guanxi is comprehensive though little work investigates internal influences and how internal relationships may mirror or replicate external Guanxi. This study uses a snowball sample of 66 senior managers across the key functional disciplines in typical large Chinese firms and explores how often strategic level problems in the firm are solved through relationships outside, inside or between the companies. Do Guanxi networks penetrate the organization itself and are there relationships that are unique to internal networks? The research finds that problem solving at strategic levels are often through internal and external networks, rather than internal management structures, but also that different problems complexities typically demonstrate unique problem-solving networks. The research identifies three different forms that these relationships take: Internal, inter-firm and hybrid relationship modes. Implications for this work suggest problem solving in Chinese firms is enhanced through cooperation and mutual respect, and likely to be inhibited by traditional Western approaches to management.