Effective Partnering with Competitors in China: Guanxi and Conflict Management

Recent studies have documented that competitors can collaborate effectively for themselves and for their customers but there is a need for a framework to understand the conditions that facilitate this collaboration. Findings from 100 pairs of competitors support theorizing that guanxi, defined as close and high quality relationships, can contribute to effective collaboration in inter-organizational relationships in China. However, findings challenge traditional theorizing about guanxi by documenting that it contributes to collaboration by reducing the competitive approach to managing conflicts. The structural equation analysis support the reasoning that guanxi reduces a competitive approach to conflict that in turn results in partnership effectiveness.