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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 6: The rule of thumbs
I call it the “The rule of thumbs.” For more than a thousand years in Russia, the rule of law was whatever the ruler ordered. The interpretation of his decisions depended on those down the line. Everyone had a thumb to put on top of another to extend that power from top to bottom.
Sometimes I think nothing has changed. It is what happens in a “top down” bureaucracy. Politicians talk about “the rule of law,” but what is understood by one party may not be the same as it means to another.
Indeed, laws today are being made, and step-by-step they are coming closer to the universal meaning. In a democracy the laws are made by duly elected representatives of the people. Russia is not there yet.
In many ways it is still “the rule of thumbs.” Everyone seems to have his thumb on someone else. Even the lowest guy on the totem pole looks for someone lower on whom he can put his thumb, maybe a parking attendant. As de Tocqueville says, “The American struggles against the natural obstacles which oppose him; the adversaries of the Russian are men.”
These men, in particular those who operated and learned in the Soviet Era, often prefer tactics to strategy. Winning is a matter of short-term success.
The tactic is to get the opponent at a disadvantage and then use force to press him down, to cut him out.
What to do next is often a question often not even considered. Just being in control, having others under the thumb, is measured as success. Like the bandit who jumps on the passing carriage and pushes the carriage driver off into the snow, he now has the reins, and the horses can be whipped into control.
But, what now to do with the carriage? Where to go? That is the question. Today, those horses may have their own ideas and break away.
The word “mafia” is a loose term. Yes, there is organized crime run by dangerous professionals, and it has emigrated into America. In Russia, if you make responsible relationships, work with them to steer you around the problems.
Some say “When in Rome, do as the Romans do.” I can’t comment on the intents and actions of others, but in my case the Mafia did not enter into my business plan or operations. We stayed clear.
Then there is “disorganized crime.” I met a young Russian tending bar in a respectable California restaurant. When I asked my usual questions, he said he had been in America eight years. He had left Russia because he had started two businesses, and as soon as they were up and running well, some guys congratulated him on his good work and told him they were taking over.
I have seen this happen to Americans and others in Russia, even Russians like my bartender example. It is stealing. That is a crime. But it is unorganized crime. Be sure you have responsible relationships to lean on if “guys” come to congratulate you.
Then there is “the mafia” which is more like relationships anywhere among school friends, family or other personal relationships. This is unavoidable, of course. But again, be alert.
The need for protection falls more under the “ounce of prevention” category.
And about corruption. Yes, it is everywhere. It is one of Russia’s biggest problems, as it is in much of the world according to my friend at the World Bank. Greed governs many. It happens at all levels.
The most depressing example is the local police. For one who grew up respecting the uniform, it is an insult to me to see this corruption in Russia on the citizen level. My best advice to the businessman for staying out of that malicious trap is to be alert and do that — stay out.
You end up losing in the end. We never suffered by avoiding it, meaning payoffs, bribes, etc. You can manage in Russia when you have “guys,” as in “our guys will talk to your guys.”
Sergei’s grip was cold as ice. Out of his black turtleneck protruded a pocked face with the lively expression of a gravestone. The lapel pin in his navy blazer was a gold Colt .45.
Valery was the tall one, gray hair, a blue suit shiny from many pressings with a heavy iron. If I watched old news reels, I was told, I would see him just behind a well-known leader I will not identify here, and before that, with “someone from the past” who also remains unnamed.
Oleg wore cropped hair, had no neck and never spoke. None offered name cards. Valery did the talking. Even before the conversation, terse as it was, I was convinced that if trouble came, I would want these guys on my side — and they were.
Recommended by an ex-Soviet minister, these three friendly men were there to be interviewed as potential security, “just in case,” as they said. We had no budget for that sort of thing and never felt the need for it.
After this meeting, I figured if we didn’t hire them, the need would arise. It was insurance. These were ex-presidential bodyguards, ex-Spetznatz, the tough Interior Ministry force. We never needed them, but it was good know we had “guys.”
>> 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 5: Tollgates, Not Roadblocks
>> 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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