You are an MBA and You Want to Work in Russia?

Russia is "a riddle, wrapped in a mystery, inside an enigma" - Winston Churchill could not have explained it better.

Up until the 80s Russia was behind the "steel curtain", unavailable for foreign investment. The 90s have seen the frenzying madness of the Western invasion and the radical change of the business practices. Back then to grab a piece of the Russian market was easier than stealing a candy form a child - consider just one example: the Production Sharing Agreement of the Sakhalin II project. As the government was regaining its stake and say in the "free" market in the 2000s, foreign investors (including those who helped the country survive the cash-lean 90s) are being gradually ousted either by giving preferential contractual terms to the national companies, by imposing quotas and restrictions (e.g. visas) or by direct attack as in the case when importing of Georgian wines was completely banned. Yet, it's a BRICS country and the market potential is enormous, and having a Russian location on your CV is well-regarded by the international headhunters. If you are young, ambitious, you are not afraid of challenges and multiple setbacks, you want to learn fast and make your career double-quick, Russia is definitely for you. The question is: are you definitely for Russia?

Let's consider two variants: (1) you are Russian and (2) you are not.

For Variant 1, there are also two options: (a) you have got a Russian MBA, you are a United Russia party member and working in Gazprom is the summit of your career aspirations - Russia needs you! You will have no problems whatsoever to get a job and retire happily from the same company having no need to learn English or any other language whatsoever. Option (b) suggests a bleaker future: let's assume that you went abroad to study, you share basic democratic values and you believe that performance and pay must be somehow related. Forget about the Russian companies (for reasons click here) - unless you are extremely adaptable, a good actor and have thickish skin, the system will manage you out… or throw out offhand… you will be luckier in the latter case. Hence, it is the Western or Western-like companies, i.e. those Russian companies that have accepted the international business practices and at least know what a Conflict of Interest or Anti-Corruption legislation are. Off the top of my head, examples of such companies are Yandex, TMK or Kaspersky Lab. These companies combine both: the satisfaction of getting the adequate reward for your ideas and services and being still unspoiled by the corporate dogmas of the process driven blue chips. When it comes to opting for a Russian branch of a large multinational, you already know what you signing up for… with a Russian twist.

 

Now - suppose you have set your mind on a prospective employer in Russia: it's only a part of the deal. Even though increasingly the workplace flexibility becomes a popular demand item, the Russian labor legislation has not moved an inch yet - read my earlier post on this: the country is not ready. If you are a Gen Y biz whiz expecting to work by your own rules, do spend a could of weeks studying the Labor Code of the country you are potentially going to work in. Add to this a possibility of the authorities not renewing your permit, the cost of living (1st in Europe - check www.numbeo.com), traffic congestion, sky-high salaries, rich cultural life, -35 C in winter, kind but unsmiling people, and boundless business opportunities - and you've got the mix that you need to consider.

 

Keep in mind that the market requirements for top execs and for recent MBAs or mid-level professionals differ significantly. If only a few years ago merely being a foreigner with some corporate experience would have bought you a one-way Aeroflot ticket to Russia, today this privilege is mostly reserved for the CEO -1/-2 level executives. If you are still on the steep curve of your career, the following requirements are essential:

• Speak Russian
• Possess a rare skill (marketing, subsurface engineering and industrial safety are no longer considered rare skills)
• Be humble about your expatriate roots and conceal well your intentions to revolutionize the way business is done in Russia

Having previous work experience in Russia or in one of the Russian-speaking countries is, of course, desirable, just like education in a Russian educational institution. Skolkovo is the most popular business school in Russia today, but be careful whether their offer aligns itself with your career aspirations. Their executive education programs are stellar and provide you with an invaluable network of contacts, Skolkovo MBA still needs to prove its worth. One important point: many Russian top executives choose Skolkovo primarily for the opportunity to gain contacts - while Executive MBAs elsewhere attract mostly mid-level managers aspiring to proceed to the next level of their careers, in Skolkovo you will be studying in one class with CEOs, VPs of huge Russian corporations and self-made extra successful businessmen. I gave a class on Change Management a month ago to an Exec MBA class, and I should say that the level is there.

  How to get to a Russian company - the scheme is pretty much universal:

 

1. Strain your personal connections: even now Russia is more an Aseopian country than Eurasian, so friends and family matter more than rules and papers;
2. Have a strong network of recruiters and headhunters: the market is hot right now and I have never been refused a personal meeting with a recruiter from any well-known agency if I wished to;
3. Shortlist your desired future employers, put on your best suit and start visiting their HR departments (with a little bit of LinkedIn preparation and prior phone calls).

  The decision is yours just like choosing the way how you are going to build your career in Russia. Working here is like walking on thin ice: exciting but dangerous. Make sure that you are familiar with Russian history, culture and political life (even if you are a Russian!).

 

Having started with a British politician, I would like to finish with a verse by a famous Russian poet Fyodor Tuytchev - you decide which you like better… but only after you have really come to know this vast and passionately cold country:

You won't perceive the Russian Land,
You'll fail to measure it with measures.
From common way apart it stands -
You can but trust in Russian treasures.

  

Russia, Business and Two-Headed Eagles

If you feel like an Asian in the West and like a European in Asia, then you must be a Russian.

Today at work I had a discussion with a colleague of mine on the subject of sustainability of using the natural resources to keep the Russian economy afloat. My argument was that fossil fuels is not the answer, while he maintained that Russia can afford for good many years not invest into its science and technology, because we can buy whatever we want with the money flowing from the ground. Oil, gas, diamonds, gold - we are hostages of our own wealth.

Surely, I stuck to my guns maintaining that the only competitive advantage a country might have is its flexibility and ability to learn. Nobody knows what will happen tomorrow. For the sake of an argument let's assume that very soon a new source of energy will be discovered that could be available anywhere and cost less than water.  The cost of oil & gas will plummet and all the OPEC nations together with Russia will go around the world with a beggar's cup jingling it periodically to squeeze morsels of pity from the richer neighbors for old days' sake. State hospitals are in ruinous conditions, children at school have problems reciting classical 18th century poems (the Golden Age of Russian poetry!!!) and all brains have been drained back in the 90s. The government are doing everything to ensure that the remainder of those who can make a difference leave the country as well... I don't know why Russian science is stifled - maybe to ensure that nothing is invented that might distort the natural (stagnant) way of modern Russian history. Even though I do not believe in the conspiracy theory, it is difficult to explain why the Michelin No Air Tires are not still in production, unless the major tire and automotive producers block any innovation as they need to recover their sunk costs invested in current production facilities.  At the same time, what is the probability of the improbable? I hope you have read the Black Swan to know the answer... In short, should the proverbial mass hit the fan, what will Russia do to compete with other countries?

To explain how things are, I'll give just two examples that were shared with me by a friend who recently started his new job with a large energy company, 100% Russian-owned and controlled.

Example 1: The first story is about initiative and silos. My friend discovered very soon that such a tool as Outlook Calendar is not used in the company at all. Naturally, he inquired with his colleagues why they did not use it - it is so convenient. The colleagues looked at him with bewilderment,
"Why would we need it?"
"Well", reasoned my friend, "what if you would like to book some time to discuss an issue with your boss?"
The colleagues got seriously concerned with my friend's mental health,
"If our boss wants to talk to us, he will ORDER us to come, it does not work the other way around."
My friend was insistent. After all, he is hopelessly spoiled by the Western management practices,
"And in case you want to arrange a meeting with your co-workers from other teams".
The colleagues recoiled in shock,
"If our bosses want us to meet, then my boss will talk to your boss, and they will arrange for us to meet."

Example 2: The second story is about unsubstantiated arrogance and close-mindedness. Since this Russian company is desperate for money, it has to set up JVs and deal with foreign companies. Cash is still king, whether you are a Russian energy company or a Chinese lemonade stand. The Finance Director of a foreign JV sent an email to the Chief Accountant of our Russian company. After waiting for the answer for a month, he forwarded the message to his counterpart asking to chase up. This message eventually landed in the hands of my friend, who went to the Chief Accountant lady to set things straight. She blankly negated the very fact of receiving such email. When my friend showed the email to her (where she was copied), she exclaimed:
"But of course! It's in English! Since I don't speak it, I deleted the message".

Is the message clear yet? Come tomorrow and that tomorrow is not about fossil fuels, what does Russia has to offer? Its imperial ambitions? Its 98% literacy rate? Its nuclear arsenal. I'm afraid all that is already in the past, and the future is too smeared to see clearly through the political mud. We see Russia all beautiful and powerful, but aren't we looking in the rear view mirror?

Generation Y: Russia is Not Ready

Today I was a guest speaker at Moscow School of Management Skolkovo, trying to convey the Executive MBA students the importance of Change Management and why it should or should not belong to the area of responsibility of HR. One thing struck me as hard to believe: those heads of large departments and directors of companies have never heard about the Generations Theory, do not know anything about the Millennials, Boomers or that they belong to Generation X, and they give no cognisance to the fact that the nature of their workforce is changing.

I shared just a couple of slides to rest my case on changing demographics and Russia's total unpreparedness for that shift. Let's begin with some numbers. These are the projections of the State Committee of Statistics for the demographic picture of Russia 10 years from now - in 2012. The chasm (words fail me to come up with a better definition for what's looming in a very near future) cannot be negated: in 10 years the number of 20-24 year olds who form the core of the future potential of a company or of the entire nation will be half of what it is now. Given that we are already struggling to resource the business and the war for talent is rampant, I fear to imagine what it is going to become in the years coming. Should there be no strategy for talent import in place pretty soon, the business will be facing a collapse situation. A basket case of a country...

But that gap will become everyone's headache in a couple of years. Right now everyone seems to be relaxed and laid back, watching listlessly the revenues from the natural resources Russia is so lucky (or unlucky) to possess. We are so content with the situation that no heed is taken that the workforce is changing and that Generation Y is voluminous enough to make its statement in the world of business. The European businesses have recognized the needs of the new generations and have taken the necessary steps to make sure that they are able to attract and retain the top performers by providing the so-much-valued flexibility and the opportunities for self-actualization that characterize Generation Y. Below is a slide from Top Employers research done last year across Europe:

What do we see in Russia? The business (nor the Government) could care less what type of people will be shaping the nation's economy or are shaping already. Why? Let's take a simple example of working from home. Across the world, it's a reality. In Russia,

• if you don't come to the office, according to the Labor Legislation it is an absence;
• there are provisions for home work, but if you decide to go that way, the employer will have to attest the working conditions and certify that your apartment is fit for working - can you imagine conducting an exercise like that?
• if you work from home and an accident occurs, is that an industrial injury and the company is liable?
• etc, etc, etc.

The legal hurdles to such a seemingly simple issue are tremendous, and everyone is keeping silent: the unions (which is a joke in Russia right now, really), the business, the government, the civil society (which is maybe even a bigger joke than the unions).

Thus, what I left the students with were questions and problems. Hopefully, they left the classroom with more questions than they had come with because that definitely was my intention. Skolkovo is supposed to nurture crème de la crème of the Russian busines elite, so if they don't start asking the right questions at the highest levels, who will?

Making Recruitment Fun

Just like most children want to know if something is an animal, vegetable or mineral, most employers want to know what type of people come into their organizations. For those purposes they invent a wide variety of instruments ranging from online assessment tools to elaborate assessment center techniques. The recruiters and assessors will carefully observe everything you have said and done, classify it accordingly in immaculately looking recording forms and will pass their judgment according to the company's assessment methodology whether you are a suitable candidate for them or not. Nowadays that nearly everyone is following the same route of such evaluations and assessments, it has become somewhat trite and hackneyed.

So it was a gush of fresh air when a few weeks ago a friend of mine shared an informal (but none the less comprehensive) candidate assessment scale used by one of her senior managers. I cannot look at it without tears and at the same time admiration for the boundless creativity that is inane in the Russian culture.

According to that fine high-ranked specimen of a huge monopoly, all candidates fall into the following categories (I am trying to convey the manager's attitude as close as possible here):

• GHOUL. These have no place in the company and should be escorted (ideally with security) out of the interview venue. Serious self-esteem issues. Can be entertaining but only in retrospect and solely because of masochistically morbid curiosity.

• VEGETABLE. These fall into two subcategories: sad vegetables and happy vegetables. Sad vegetables make you yawn and ponder over Karen Walker's categories of why people choose to be poor or tax evasion being a victimless crime. Happy vegetables do become amusing with their eagerness or rosy idealistic categories of democracy and human rights. Both types are OK for hiring and will form the "solid citizen" pool of the company. Dispensable at will.

• STAR. Enough said. Should hire if the salary ambitions are adequate. Top score for females.

• ALPHA-MALE. Does not apply to women. The highest grade one can get. Issues like moral turpitude or harassment are foreign concepts for them, Machiavelli is a kin, and Joseph Stalin School of Management is the preferred academic institution. Hire by all means and costs: an invaluable asset but will eat you alive at the first opportunity. 

It makes me sad to think that this manager is up there at the senior level, that his approach and comments are tolerated and even made into urban myths, perpetuating the stereotypes of Russian management. Suppose I were to disclose the name of the company or even the name of the manager - nothing would change, as that is what others expect. It might only make that company more desirable for new entrants: to see how charismatic its leaders are, just like Boris Yeltsin's ratings went up after he got drunk and fell from the bridge.

At moments like this I can only quote a famous Russian poet Fyodor Tyutchev:

You can't perceive the Russian land,

 You'll fail to measure it with measures,

From common way apart it stands,

You can but trust in Russian treasures.