Getting over guanxi

Recent MBA graduates looking for work in China can take heart. In today’s business world, it’s more about what you know than who you know.

Guanxi, the fabled web of social and familial connections, has an almost magical reputation. Credited for everything from successful job hunts to high salaries, those with good guanxi are often objects of envy among their peers.

Don’t believe the hype, says Ashley Steinhauser, CEO of NewChinaCareer, an English-language job website targeting bilingual Chinese mid-senior level management and other professionals.  "A lot of fuss is made about guanxi," he said. Steinhauser believes guanxi is more a tool of politics than of commercial business.

"It’s about as important as being a member of the Rotarians or a golf club at home," he said. "People make a big deal out of guanxi because they want China to be more exotic, but it is the same thing with a different label."

As the Chinese economy continues to become more market-oriented, Steinhauser believes the power of business guanxi is fading. Chinese companies looking to expand internationally and multinationals striving to break into the Chinese market prefer more meritocratic criteria. In today’s economic climate, hiring managers simply can’t afford to take on someone who is less than capable, no matter what his or her connections.

Instead of relying on guanxi, recent graduates from China’s MBA programs need to leverage alumni networks, the internet and internships, much as their fellow graduates do in the West.

The results of a successful MBA job hunt in China are worth it. While the average income of recent graduates in China is about US$2,640 a year, graduates from Tsinghua’s IMBA program can expect to pull in around US$31,000 a year in their first year out of school.

Over the past 15 years, the number of business schools in China has boomed, and a spate of MBA programs have opened up across the country to help train students to fill the growing need for competent managers that can work effectively in both Chinese and multinational environments.

However, the quality of these programs has been uneven. Problems ranged from a lack of cultural understanding to an unrealistic view of the job market. Steinhauser recalled a time when he was asked to encourage a class of MBA students at the China Europe International Business School (CEIBS) in Shanghai to adopt more realistic salary expectations. Most had been sent to CEIBS by their companies to get an MBA. But when management consulting firm McKinsey offered a job to a classmate at a rate of US$60,000 per year, they all demanded the same salary from their own employers.

United front

To combat these problems, many Chinese MBA programs affiliated themselves with Western universities in an effort to teach their students how to swim in the international employment pool instead of sink. This led to an exchange of job-hunting resources. Many schools now share alumni networks and career support programs.

Tsinghua University, the oldest and most respected MBA program on the mainland, is affiliated with the American MIT Sloan School of Management. In addition to job fairs, Tsinghua and MIT Sloan hold joint MIT, MIT Sloan and Tsinghua alumni events in China aimed at helping new graduates find their footing in the job market, said Alan White, director of media relations at the MIT Sloan School of Management.

But the career support on offer is not always up to par, complained Robert Yu, a Tsinghua University International MBA graduate. "My school did try to provide some career support services with reviewing my résumé and dispensing some career advice," he said. "Overall, they were not very effective."

Yu got more leverage out of his internship. After interning at Pfizer China’s Beijing office, he landed a job there. An internship with a multinational company based in China is a great experience, he said, providing on-the-ground experience in local business practice.

"I was quite satisfied with my internship at Pfizer. I received great insight on local practices – even though Pfizer is a multinational – as all of my colleagues were Chinese."

Networking groups can also provide some supplemental support for recent graduates, but attendees are more likely to pick up a new friend than a new job, said Marc van der Chijs, CEO of gaming company Spil Games Asia, and co-founder of website Tudou.com.

"Generally business networks in China are useful for people who are new here and need to build up a network," said the Shanghai-based van der Chijs, who attends local networking events such as those run by NextStep Shanghai or the private shareholders club MINT Shanghai. "But once you are more established, I don’t think it adds a lot of value, although you can occasionally meet interesting people."

Van der Chijs appreciates the opportunity to talk to people informally at events such as those run by chambers of commerce – although he complains that he usually gets inundated by emails afterwards from people who want something from him.

Virtual wine and cheese

If traditional wine and cheese networking events are growing obsolete, the internet is a growing resource for MBA graduates on the job hunt, and increasingly for those who hire them.

When it comes to finding new hires, van der Chijs still turns to headhunting firms or personal recommendations from current employees. But he does most of his business networking on the internet, through sites like Facebook and Twitter.

The biggest internet business networking site in China is Tianji.com, the Middle Kingdom’s answer to the popular American social and business networking website LinkedIn.com. Tianji claims over two million members and focuses on mid- to senior-level management employment for bilingual professionals. 

Those looking for lesser executive positions are likely to use Welink.com, a Shanghai-based site that focuses on a more junior membership.

Whether found through the internet, alumni networks or luck, MBA grads in China still have a fair chance of landing work, even in today’s shrinking global economy. Though down 10% from the same time last year, a recent Reuters report claims 34% of companies in China are still looking to hire for executive positions.