General Negotiation March 8, 2012

Negotiating with the Chinese: The Quanxi Approach

There are many things we can learn about international negotiations- that is, the process of negotiating with other cultures. When negotiating with the Chinese, there are three well tested approaches you can use. One of them, The Quanxi Approach, is particularly useful.

To understand the Quanxi Approach, we must first understand a bit more about Chinese culture. Friendship in the Chinese culture goes far beyond friendship in Western society. To the Chinese, friendship means helping each other to grow, to become independent and to become prosperous. It means doing more than what is expected or what convention calls for. It means revealing secrets. In business, it means helping with money, manpower, and technology to solve problems that are unanticipated and unbudgeted.

Friendship and “Quanxi” are closely related. The tradition of Quanxi says that once two parties are friends the dominant or stronger partner implicitly agrees to help the weaker partner in times of need. In return, the dependent party implicitly agrees to assist the other and stay loyal in hard times. When a Chinese negotiator is refused information because it is a “trade secret”, he shows his anger openly: “You are not our friend,” he might say. “You are not living up to our agreement in principle, which says that friendship, trust and help are our mutual goals.”

The Quanxi approach goes beyond the written contract itself. It says that if one side or the other is losing money on a deal, or if new circumstances arise which change the original basis for the agreement, either side is free to ask for relief.

Furthermore, each side expects that relief will be granted in the name of friendship and trust. The Quanxi approach helps both parties work together to survive periods of economic uncertainty or change, or times when one or the other is having problems. Each is well aware in advance of its responsibilities to the other.