Only the other day someone still labelled Russia ‘the Wild East’ in a business meeting. The fear of ‘corruption demands’ and ‘strong-arm methods’ is deep rooted. But it’s the exception, not the rule. Here are some of the things I have learned about doing business in Russia.
1 RESPECT THE RELATIONSHIP
Like much of the world, Russians like to build personal relationships. Those relationships need to be conducted with transparency and sincerity. Your aim is to build trust. Do this by building strong personal relationships. Show you understand their difficulties and make personal recommendations rather than giving direct orders or invoking rules. Loyalty is everything.
Blat is like ‘guanxi’ in China. It is the exchange of favours between people that builds relationships, creates networks of influence and builds trust. Gifts are often exchanged between visitors – good quality business gifts, often with a logo, books or handicrafts from your country. Stock up at Harrods on the way out but choose carefully. Low value items for the wrong people may mean they and you are not taken seriously.
3 APPRECIATE RUSSIA
Russians are clever and well-educated. They have a strong sense of identity. They know what is good about their country and they also know what’s wrong with it- and they will discuss it. However, as a foreigner it is not your place. Don’t criticise Russia. Russian culture, literature and art, Russian achievements – including the huge development of Moscow itself are good topics of conversation. Avoid Chechnya, human rights, mafia/KGB and Communism. Even if the Russians complain and criticise, don’t join in.
This means ‘uncultured’. Etiquette is quite important in Russia so be sensitive towards it. Swearing, shouting and laughing loudly, hands in pockets, are ‘nyeculturny’. One Russian friend told me, ‘When you are moving on and out of others in a cinema or theatre we don’t turn our backs on them as you often do in the UK. We face them.’ Also if there is a place for leaving coats and scarves always use it. Oh, and by the way, no jokes about the ‘vodka culture’. Russians drink wine more these days.
5 RESPECT AUTHORITY
Russia is a top down management system. They will want to be sure that you have the authority to negotiate and make decisions. Their style might be quite formal. Make sure you have a jacket and tie or women’s suit for meetings. Dress to impress. Your style and accessories will be noticed. The team leader on the Russian side will make all the decisions and will also be well connected with other leaders.
One important point in negotiations. The Russian’ big boss’ may appear on the scene late in the day. Make sure you haven’t given away all your concessions by then.
6 COMMUNICATE SERIOUSLY
You can maintain a warm, relaxed approach but be serious and include technical details and facts. But remember to include emotion. Russians appreciate directness and can be quite blunt themselves. Learn to see this as candour not rudeness. In your own communication avoid extreme words. Use terms like ‘meeting halfway’.
7 NEGOTIATE FIRMLY
Russians can be hard bargainers. One Russian recently claimed that business people who give concessions are weak. Not true. Russians will try a number of gambits, ranging from sitting you out to strong confrontation. You have two weapons – total calm and patience. Be ready to sit them out. On concessions, never concede a concession without getting one back. And remember the personal side, show you understand and sympathise with their position. At the end of a negotiation, Russians may send a written confirmation that agreement has been reached. They will, however, re-negotiate fine print on contracts if appropriate.
I’ve put this last because I’ve never had a problem with Russians regarding time, although people say Russians are more relaxed about time. It is fair to say that completing the business of a meeting takes precedence over the timetable and that meals can be long and service sometimes relaxed. And, if you want an excuse for being late, the Moscow traffic will provide you with one. Leave plenty of time to get to meetings or take the subway!
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