Building Effective Business Relationships in China | MIT Sloan Management Review

Building Effective Business Relationships in China | MIT Sloan Management Review

Many Western companies are familiar with the idea of guanxi, or the importance of relationships in doing business. But developing trust between Chinese and Western executives takes time. The author and his colleagues identified two foundational types of trust.

The first they term “trust from the head” or cognitive trust. That emanates from the confidence one has in another’s accomplishments, skills and reliability. The second type is trust from the heart (affective trust), which arises from feelings of emotional closeness, empathy and rapport and is more complex to develop.

Western executives who have mastered the art of building affective trust do so by developing a deep cultural knowledge, one that goes beyond the mastery of social customs and etiquette. This deep knowledge can help bridge the trust deficit by approximating the basis of common ties and values that individuals from the same culture enjoy.
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