MB Dec | ‘Guanxi’ matters in hospitality careers

Study suggests ‘guanxi’ – a Chinese concept involving a person’s social network – plays an important role in career success in Macau’s hotel sector

‘Guanxi’ should not be considered a taboo, but a critical success factor in hotel career development”. So says a study by IFT scholars Fiona Yang and Virginia Lau Meng Chan. Their research on the role of workplace guanxi in building a successful career in the hospitality sector underlines the use of what they term “off-work-centric ties” to achieve work-related fulfilment, namely in the Chinese context “where guanxi is an important part of the institutional fabric of societies and economies.”

Their paper – titled Does Workplace Guanxi Matter to Hotel Career Success? – was published in the International Journal of Hospitality Management in 2015. It encouraged individuals and organisations in the hospitality sector to foster guanxi in an “open, positive and relaxing” manner, noting that guanxi worked as a mediator regarding the relationship between professional competency and career success.

Guanxi is a Chinese concept that involves the creation of interpersonal ties for “tangible or intangible social exchange, usually in a non-work-centric manner,” Dr. Yang and Ms. Lau explained in their paper, adding that this is a “rich, complex and dynamic concept”.

The term is deeply rooted in Chinese tradition: ‘guan’ translates as ‘a gateway’ and ‘xi’ means ‘to link together’. Guanxi is employed as a metaphor for interpersonal connections in a closed network.

“It instils a relation-centred code in Chinese society: the Chinese prioritise relationships first, and believe transactions and mutual benefits will follow. It reflects a concept of maintaining and capitalising on long-term relationships to assure returned favours, mutual benefit and reciprocity,” Dr. Yang and Ms Lau added.

They noted that guanxi largely resides in activities such as social gatherings, sharing of information and personal gifts. “As for a high calibre employee, good guanxi relationships with co-workers and supervisors may serve as a means of creating a favourable working environment where his/her career competencies unfold,” they said.

Staff retention tool

The researchers said guanxi could help explain why a number of highly skilled professionals struggled to have their talent recognised within a company and to achieve career success.

“The fact that professionally trained and high calibre employees may still fail to achieve career success raises a question: what is the means through which employees can demonstrate and make the most of their competencies to accomplish career goals? This unresolved question . . . may find a viable answer in the East, where the pervasiveness of guanxi . . . and its impact upon career success has been evidenced in different disciplines and social contexts,” the IFT scholars stated.

The researchers suggested in their academic paper that hotel operators should support staff career advancement through guanxi. “Helping employees to advance career prospects and increase satisfaction is essential for staff retention,” they said. “Guanxi practices can create ‘a sense of belonging’ in the workplace beyond formal interpersonal relationships based upon organisational policies.”

In their paper, the researchers said one way to promote supervisor-subordinate guanxi could be by establishing mentorship programmes.

“Affection is cultivated in these programmes through frequent personal exchanges on work and non-work issues (e.g.) caring and understanding of subordinates’ family and work conditions, sharing of thoughts and needs, and social interactions after office hours,” the IFT scholars noted. “Subordinates are encouraged to learn the art of communication derived from Confucian ethics (e.g.) respect for seniority and harmony. These practices can foster Chinese family-like relationships in hotels to facilitate career development.”

Dr. Yang and Ms. Lau mentioned a second type of workplace guanxi affecting career success: co-worker guanxi.

“Co-workers are more than a vital part of work; they literally co-create the social environment in the workplace,” the IFT scholars explained. “Despite the paucity of studies, existing work has evidenced the influence of co-worker support in relieving stress and burnout, promoting employee task performance, and reducing turnover intentions,” they noted.

The researchers highlighted that peer-to-peer interaction was “of particular importance in hotels, where interpersonal connections constitute the core value of the service-based industry.”

They added that co-worker guanxi could be nurtured by social activities such as company-sponsored sports events, team gatherings, leisure trips and birthday celebrations. “These activities can efficaciously close the peer-to-peer distance, which in turn breeds mutual affection and secures long-term reciprocity,” wrote Dr. Yang and Ms. Lau.

Handicap for expat workers

The research conclusions were based upon a survey answered by 381 people working full time in 5-star hotels in Macau. Most of the respondents – 89.5 per cent – were below the age of 34 years and more than half of the total sample worked in entry-level positions. Around 77.7 per cent of the participants in the survey were Macau residents.

The results suggested that the importance of co-worker guanxi was “more prominent” for non-managerial employees or frontline/back-office personnel. Supervisor subordinate guanxi had “a stronger impact upon career advancement for managerial or sales and marketing employees,” the researchers concluded.

“Sales and marketing personnel tend to be rewarded on a commission basis, translating as a competitive relationship with peers but an inclination to please their supervisors,” the IFT scholars explained. “In this sense, it is supervisor-subordinate guanxi that ‘makes the place’.”

By contrast, Dr. Yang and Ms. Lau noted, back-of-the-house employees have fewer interactions with customers, but offer support to frontline employees or department

co-workers. Front desk employees, likewise, work closely with their colleagues to provide face-to-face service to hotel guests.

“Co-operative orientations or positive interdependence arise in this context,” the scholars said, adding “therefore, co-worker guanxi is the most prevalent for back-office employees, followed by frontline ones, and is the least prevalent for sales and marketing staff.”

Dr. Yang and Ms. Lau additionally said that local employees had an advantage over expatriate co-workers in capitalising on guanxi for career development purposes. “Cultural and language barriers impede interpersonal communication and guanxi building for expatriate workers, who may perceive themselves as undervalued and alienated,” the IFT researchers said.

“It would be helpful if they could strive to assimilate into the local life and establish genuine interpersonal relationships,” the scholars suggested. “Hotels can arrange workshops, community activities and local tours for foreign employees to overcome cultural barriers and encourage two-way communication,” concluded Dr. Yang and Ms Lau.

The researchers

IFT Assistant Professor Fiona Yang earned a PhD in supply chain management from the Hong Kong University of Science and Technology. Her research interests include tourism and hospitality, namely organisational behaviour in the hotel industry, tourist behaviour and destination branding. She is also interested in topics related to supply chain management. Dr. Yang has been involved in government-funded research in Mainland China, Hong Kong and Macau.

Virginia Lau Meng Chan is a lecturer at IFT. She has an MBA from Santa Clara University, California, in the United States. Ms. Lau’s past work experience includes spells in the accounting field in the United States, Mainland China and Hong Kong, holding positions in the public and private sectors. Her research interests involve corporate governance, hospitality management and how the image of a destination is fashioned.

The paper

Fiona Yang and Virginia Lau Meng Chan: Does Workplace Guanxi Matter to Hotel Career Success?, International Journal of Hospitality Management, Volume 47, pages 43-53, 2015.