RUSSIAN BUSINESS: IS IT FAR FROM EUROPEAN ONE?
Pomoshch Biznesu (News agency), July 15, 2014
RUSSIAN BUSINESS: IS IT FAR FROM EUROPEAN ONE?
Stockholm School of Economics Russia regularly participates in a conference dedicated to combating of corruption that is organized by the Nordic Council of Ministers with support of the General Consulate of Sweden in St. Petersburg.
We often hear from the entrepreneurs who run their business abroad that local managers are at loss seeing the Russian approach to organization of business. They do not understand how it is possible to work without salary and what motivation by percentage from sales is. Is our approach really so different from the European one?
If we speak about differences between the European and Russian businesses it is necessary to mention a difference not as much in the principles of management as in cultural and ethical foundations of people, difference in values and priorities. In case of comparison of a couple of companies this difference probably will not be as noticeable as a whole but if we compare approaches in many cases the difference becomes obvious.
If we take an example of the Swedish model of business the main value is transparency of affairs. Everything should be clear, on time and in accordance with the achieved agreements. With regard to cooperation with Swedish companies, it is important to be punctual. Working day of Swedes starts at 08:30-09:00 a.m. and ends at 04:30-05:00 and that is why if it is necessary to agree on something by the end of the day it is necessary to start this process ahead of schedule. Family is a priority for many Swedes and that is why going from work on time is a nom. There is also an expression "five Swedish minutes" in our ExecutiveMBA programs. This means that participants are given five minutes sharp for a break and lessons start after their expiry. We do not wait for those who are late.
Which disadvantages are in the Russian approach? Is it possible to go away from them and how?
In some areas of business this is absence of real competition, preferences to selected companies, use of administrative resource and artificial limitations for entrance of new players.
If we set such goal it is possible to change the situation. In our programs we teach people to have a broader look at problems of a company, to look at the situation as a whole, to think on the level of strategy, to foresee these or those events on the markets and to learn to react to them correctly.
Of course, there are separate problems like corruption, bureaucracy etc.
Stockholm School of Economics Russia regularly participates in a conference dedicated to combating of corruption that is organized by the Nordic Council of Ministers with support of the General Consulate of Sweden in St. Petersburg. We are interested in struggle against corruption being efficient, in talking about this problem and in its successful solving on all levels of governance. With regard to the tax system and bureaucracy, participants of our Executive MBA programs are owners of big companies, managers of top and medium levels. In the process of lessons they share their experience of solving of various difficult problems in their companies. All of them cope with these issues this way or the other, which means that this is also a matter of setting of goals and their correct achievement.
In which period is it possible to bring Russian business to a good level in case of proper wish?
It is not clear what can be considered a good level in this aspect. If we speak about the level of profit it is much bigger in many sectors of business in Russia than in the West. The factors that have mentioned earlier like absence of real competition, use of the administrative resource and artificial limitations for entrance of new players help maintaining of profit margin on a good level for selected companies (good examples are construction, state monopolies, everything related to fulfillment of state orders). In some areas where there is real competition and battle for client (for instance, telecom services) the profit margin becomes minimal and this is natural in conditions of strong competition. Companies in these sectors of business start thinking about optimization of costs and improvement of efficiency seriously and study advanced experience and train their staff seriously. That is why the issue of motivation of business for search for new opportunities disappears when business is placed into conditions of more or less honest competition for purse of the client (and for efficient employees too).
What are the main principles of organization of European business?