The Russian business culture

Résumé du document

With the collapse of the Soviet Union in 1991, Russia emerged as a nation. A new constitution was adopted in 1993, representing the end of communism. Russia has now a federation style government with a market economy (“CIA”, The World FactBook: Russia, online). Despite important economic concerns (volatile and unpredictable economy with high inflation particularly, modern equipments needed in industries, strong influence of mafia in big cities…), the nation is obviously an attractive destination for business or global investors. Indeed, Russia is famous for its large natural resources (natural gas, timber, mineral reserves, oil fields, coal mines), strong infrastructures and its excellent proximity to Europe, compared to China and India (“Suite101”, online). Though there are universal cultural similarities, for those attracted by this Russian potential, it is essential to learn about the business culture aswell.

Extraits

[...] But most of the time, foreign companies must clearly make adaptations to the Russian business culture. II.C. Implications of the Russian business culture for potential foreign investors Getting the ability to operate in changing conditions According to V. Fetsenko (“Executive Planet”, online), foreigners do not always understand Russian businessmen when they say: will do our best to finish the work on time” or “Maybe, it will work”. Indeed, Russian managers are always ready to work in continually changing conditions whereas Western managers rather have a plan in case of emergency. [...]

[...] The Mafia dominates transportation and retail businesses in the biggest cities. In addition, any business generating a large amount of cash is at risk and, thus, needs protection (John Mole, Mind Your Manners, p. 253). II.D. Some advises to do business in Russia as a foreign investor According to the author Jodie R. Gorrill from “Communicaid Group” (online) and to the “Kwintessential” website, it is necessary to gain some basic insights into the Russian culture and mentality for anyone willing to do business with this country. [...]

[...] Implications of the Russian business culture for domestic management Different ways to deal with problems According to V. Fetsenko (“Executive Planet”, online), Westerners and Russian people have two different ways to deal with business problems. Indeed, people from the West usually talk about a problem with their colleagues only when they have found out possible solutions previously. But in Russia, the approach is different as Russians employees will discuss problems without any concrete solutions with them. “This suggests that the Russian state of mind is based more on the idea that the formulation of a problem is considered at least half the battle, whereas in the West the focus is generally on the solution” according to V. [...]

[...] As a consequence, “when building successful business relationships with Russians you will find that mutual liking and emotion will from a strong basis”. II. The russian business culture and its implications II.A. Russia, a high-context culture Russia is a high-context culture, which means that feelings are not explicitly expressed and communication generally takes place from personal relationship. On the opposite, low-context cultures (Anglo-Saxon countries such as the U.S.A. or Canada for example) are characterised by separated personal and professional relationship and by explicitly formulated feelings notably. [...]

[...] - The very first meeting is generally a way for our Russian counterpart to assess our credibility. The best attitude to adopt is to appear firm, while maintaining an air of approachability. - Negotiations are generally slow, as Russians do not like being rushed. In addition, they usually perceive negotiations as “win-lose”. They do not really believe in scenarios. - Presentations in English are not problematic as many Russian businessmen speak relatively good English. Making effort to present some element in Russian is generally well perceived. [...]