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Russian style of business

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To understand the characteristic features of Russian businessmen and officials, it is necessary to consider Russia's history. For instance, the impact of the old administrative style on Russian industry and trade is still very strong. The consequences of century-old traditions are easily recognised in many aspects of the Russian business culture, the most important of which are described below.
Business styles are changing as many Russians gain work experience in other parts of the world or are running their own businesses. However, the further you move away from the big cities such as Moscow and St Petersburg into the regions and the state-owned industries, the more likely you are to find that the older tradi-tions still apply. There also tends to be a difference in business style between the old and the young, as younger people are able to travel more widely or to receive management and business training.
If you are going to work in the Russian Federation, be prepared to encounter bureaucracy at all levels and in all spheres. As in any bureaucracy, a Russian official has the opportunity to influence both the speed and success of certain procedures connected to your busi-ness practice. This can lead to bureaucratic procrasti-nation as a decision to be taken by an official body must pass through several levels of approval, and it can be difficult to track the status of the decision.
The Russian business environment is generally formal. Business questions are rarely discussed over the phone; but are handled during face-to-face meetings. Even a meeting to discuss straightforward business issues can be called 'negotiations' ('peregovory' in Russian). These meetings are characterised by a whole series of formali-ties - the ceremonial exchange of business cards, greeting speeches, tea/coffee with biscuits, vodka - and are usually conducted with a very serious and almost ' ceremonial tone.
The other problem with these meetings is that they can be unproductive in a practical sense. Russian businessmen, particularly the older ones, can be sceptical of new or innovative ideas and it can take time to persuade them to accept a new approach. There is also the tradition that Russian businessmen consider negotiations an occasion for intrigue and manoeuvring. Contrary to western business practice, where a decision can be made to benefit all parties, the assumption of most Russian businessmen is that one cannot achieve success in negotiations without putting the other party at a disadvantage. The Russians are a proud people and there is therefore a strong desire to avoid any loss of face.
The 'old boy network' functions in the Russian Federation just as it does in any other country in Europe. It can be very difficult to do business success-fully in the Russian Federation at the present time without good relations with high-ranking officials, upon whose goodwill many issues relating to the business environment continue to depend. Experts will find it helpful to make contacts in the Russian administration at either national, regional or local level, depending on what is appropriate to the nature of their project.

Business etiquette

To prepare you for personal contact with the Russians you will be working with, you may find the following customs and rules worth adhering to:
  • If you want to write to a Russian colleague, do not rely on the postal service but use Fax or telex. If you want to send materials or documents to them, use an express mail or courier service so that you can be sure they will arrive swiftly.
  • Since it is not customary in the Russian Federation to discuss serious questions by telephone, it is advis-able to write a letter or discuss these issues during a face-to-face meeting.
  • There is a ritual exchange of business cards at any business meeting, of course if you have any.
  • Do not be surprised if the Russians you meet with do not take notes.
  • You should not assume that all Russians speak English, or your native language, especially in provincial cities.
  • Make sure that you use the polite form when addressing a business colleague "Ty" and "Vy" - rather like the 'tu' and 'vous' in French.
  • Do not be surprised if the Russian you are meeting arrives late or starts the meeting after the agreed time. It is still advisable for you to be on time, however.
  • There is a Russian proverb which says, 'people meet you by the way you dress, and see you off by your intellect' Russians usually have high expectations of the way people should dress and sometimes tend to Judge you immediately on the basis of this. It is best to try and dress conservatively and smartly. This may vary depending on the work situation. Blue jeans should not be worn to work. "Casual Fridays" are something that is practiced among some multinationals, but should be checked additionally.
  • When you greet the Russians you are meeting with, shake everyone's hand firmly and look straight into their eyes.
  • If you wish to smoke it is advisable to ask the Russians' permission (like if it's your boss or colleague) and always remember to offer them a cigarette.
  • If a Russian colleague invites you to his or her home, to a restaurant or to a reception, be aware that Russians are well informed on a vast range of non-business topics - an airline pilot will be able to tell you about Pushkin, for example. They will expect you to be able to reciprocate so be prepared to show your interest in and knowledge of the Russian Federation since this will please your host. Try not to focus your attention solely on the problems of the Russian Federation even if the Russians do this themselves. You should expect alcohol to be served as a matter of course. If you try and refuse, you risk offending your colleague.
  • Not only the business etiquette: In restaurants or cafes it is traditional for the man to pay - not always but very often, so some people might expect this from you.
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"... Money!!!

Currency? This is very important. Since the collapse of the Russian monetary system in 1998 the ruble was devalued from 6rubles/US$ to 29ruble/US$ as of January 2000. Inflation is also running at 40% a year. So guess what? Everyone holds US$, since you need rubles to by goods everywhere you go there are moneychangers:legitimate and the not so legitimate.
One bright Sunday morning I had run out of rubles and needed some money so I went with my American friend/translator/babysitter Cindy to the local shopping mall to change some currency. In front of the currency exchange booth I found a man who offered to change my currency. Being very careful I slowly proceeded to count my cash. All the while this annoying hand was poking me in the back telling me to hurry. Only after we left the building did Cindy tell me that I was dealing with a black market trader...because all legitimate traders were closed on Sundays. Of course illegal money changing can get you prison time; on the upside I got the best exchange rate of my whole trip..."