By tapping into these informal groups, Western companies can theoretically improve their understanding of the marketplace, hire the best talent, and find potential business partners.
Guanxi goes back thousands of years and is based on traditional values of loyalty, accountability and obligation - the notion that if somebody does you a favor, you will be expected to repay it one day.
One of Asia's most successful businessmen, Hong Kong billionaire Li Ka - shing, has used his guanxi particularly astutely over the years, in the process winning valuable licenses and permission to build huge real - estate developments.
Playing the guanxi game is still imperative, especially for foreign investors.