Ranked #1 in the World
By Frederick Andresen
Author of Walking on Ice, An American Businessman in Russia
“Their starting-point is different, and their courses are not the same; yet each of them seems to be marked out by the will of Heaven to sway the destinies of half the globe.” Alexis de Tocqueville had it right in 1831 about America and Russia. And his perspective is right today. How does the United States interact with its closest neighbor next to Canada and Mexico? Many Americans have worked hard at this. Some have failed and others have succeeded. Based on one of those successes, this nine-part series focuses on the issues and practices that make success happen in Russia today.
Part 5: Tollgates, not roadblocks
There are no road blocks in Russia, only toll gates. The Russians, great chess players, win often by blocking their opponents. The last man to survive wins. It is important that some worthy goal be achieved, but it is sufficient to simply survive. In Russian business it seems no different.
In the absence of laws, not to mention ethics, the way to win may not be by running faster than the competition, but by tripping him along the way. That is the way Russian businessmen sometimes act. Ethics are quite situational.
Barricades have played a central role on the path of Russian history. I have stood on the sidelines and watched this played out several times, especially during the blackening events of October 1993.
Barricades are a passive statement of dissent which often fails, but the discontented may have no other choice. After the steel has clashed and the flimsy barricade is crushed under a tank, the survivors go home, drink to the martyrs, and accept the tribute from their comrades.
In Russian business, they think of the barricade not as a block, but as a tollgate. Which it often is.
Russia is a congenital bureaucracy. Reading Kafka helped me to understand. The more the economy settles down, the stronger the bureaucracy grows. It puts people to work. It is the way they know how to work. In officialdom productivity is not the driving force. It is the security of the collective mind.
The way around the rock in the road, most will admit, is to find who has to be paid to let you through, and it isn’t always money. Sometime the cost is simply an acknowledgement of someone’s existence, gratitude for a job well done, and an expenditure of time and persistence, and maybe a bouquet of flowers — even a smile. If handled with patience and respect, you may also make a friend.
In my personal experience, bribes have not and will not play a role. That was never our company’s ethic. I found that stand was respected. Negotiate in good faith and don’t lose sleep over it. It is the way things work.
Barricades may slow you down, but don’t let them keep you from a worthy goal. You bring your ethic with you and make sure it extends to the least levels. They are just another challenge that has to be managed.
It’s common knowledge that in Russia, the contract is often the beginning, not the end of negotiations.
After all, no one is personally responsible. This is changing, of course. Signatures today do mean something, although it will be a while until the concept of contractual law is as normal and enforceable as in the West.
And to borrow a concept from Kafka’s novel, The Castle: “It is not the official letter, but the unofficial letter that counts.” My first experience with this was with a letter I received from the officials of a major Russian government organization after an initial meeting in the United States. At first, it read like a proper and polite acknowledgement of our meeting and conversation.
But, I intuitively felt there was something else there. There was not a James Bond code between the lines, but a deeper meaning behind the words. After some re-reading I realized what it was. This important international organization was looking for a reliable American partner — not officially, of course.
That started a long personal and mutually beneficial business relationship — unofficially. Yes, read Kafka.
One thing to be understood is that Russia is a political country. Never mind about the Kremlin. That is another ocean you probably won’t have to challenge. But, even at the daily business level, it can be like crossing a big pond in a small boat. It is better to know you may need help on the oars and to prepare by choosing your crew yourself.
In Russia they call it a “roof,” which means political contacts that hopefully will be there to help when you need it. Also you hope they will leave you alone to manage your business and not interfere.
We were fortunate to have connections which did just that. Some roofs leak in a storm; others are overwhelming and starve you of sun to grow in. It’s like getting married. Be careful to pick the right one as you may be with that person a long time.
Again, here is where patience pays. Patience is strength.
>> Read Part 1: Three Sides of the Coin
>> Read Part 2: Walking on Ice
>> Read Part 3: Quest for Global Status
>> Read Part 4: The Burden of ‘Yes’
>> Read Part 6: The Rule of Thumbs
>> Read Part 7: Deciphering the Culture
>> Read Part 8: Power of Human Capital
Title: Walking on Ice: An American Businessman in Russia
Author: Frederick R. Andresen, a 1958 graduate of Thunderbird School of Global Management, specializes in general business management, marketing, entrepreneurship and relationship building in Russia and other emerging markets.
Endorsement: This book “is mandatory reading for all who contemplate a tour of duty whether government or business in Russia or who have worked there … it brings back memories and reality. With insight, understanding, and a rare degree of humor, Fred Andresen tells us about working with the Russians,” Richard Weden, general director, American Express Russia, 1995 to 2004.
ISBN: 978-1432713522
Publisher: Outskirts Press (September 2007)
Information: www.fandresen.com
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