Russia - Mayank 09

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Overview & Business Culture.


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One Minute History of RussiaOne Minute History of Russia

Before 1991 - Russia was a communist centrally planned economy.

In December 1991 - The Soviet Union ceased to exist, and the RussianFederation was born, communism was abolished.

1992- 1999 - Radical market reform under Boris Yeltsin, state assets wereprivatized, foreign trade opened up, economy tanked.

2000-2008 - Oil boom and Ruble devaluation of 1998 fuel economicrecovery, President Vladimir Putin lead stabilization effort, renationalizedsome companies, took away some freedoms.

March 2008 Now - Putins protg Dmitri Medvedev, is elected as the newPresident, Putin becomes prime minister.


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Key facts about RussiaKey facts about Russia

Area - 17 million sq km,1.8 times the size of US.

CapitalMoscow.

Population - 140.3 million. Major language - Russian

Life expectancy - 62 years (men), 74 years (women)

Ethnic Groups:Russian, Tatar, Ukrainian.

PurchasingPower Parity (PPP)- $2.088 trillion.

GDP composition

Agriculture 7%, Industry 37%, Services:

56%.

GDPgrowth rate - 8.1% p.a .

GNIper capita: US $9,370.


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Russian GDP GrowthRussian GDP Growth

GDP growth in Russia in the last ten years (1999-

2008)

(6,0)

(4,0)

(2,0)

-

2,0

4,0

6,0

8,0

10,0

12,0

1 2 3 4 5 6 7 8 9 10Annualgrowth,

%

% change


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Rubles vs. DollarsRubles vs. Dollars


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Russian Booming RegionsRussian Booming Regions Moscow Financial Capital

St.PetersburgTransportation and Industrial hub

Sochi 2012 Olympics, $15-20 Billion of FederalInvestment

WesternSiberiaOil, Gas, Timber

SouthernSiberiaMetals, Timber, Construction,

Infrastructure Far EastTimber, Oil, Pipelines, Fishing


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RUSSIAN BUSINESSRUSSIAN BUSINESS

CULTURECULTURE


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Doing business in Russia? YES, butDoing business in Russia? YES, but

neither simple, nor easyneither simple, nor easy

Fierce competition to gain control over rich

resourcesSelection of the Russian partner (especially

in the region)

Normally long-term projects worthy ofdevelopment

Building trust withRussian staff is critical

Special marketing strategy


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First Name orTitle?First Name orTitle?

Very intimate friends or relations - refer to

one another by the first name.

Ensure that you learn the titles of everyoneyou plan to encounter

Russians have three names: the first name

is a given name, the last name is the father'sfamily name, the middle name is a version

of the father's first name.


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GENDERASPECTSGENDERASPECTS

Women usually do not hold high positions in the

Russian Business culture.

There are more women in business education

then in business.

Foreign businesswomen sometimes face

adversity from the male-dominated Russianbusiness culture.


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MEALS AND BUSINESS ETIQUETTEMEALS AND BUSINESS ETIQUETTE

The business breakfast is not a part ofRussianbusiness culture.

Business dining is getting more and more popular-is

generally taken as a time for sealing a deal. The center seats are reserved for the most senior

officials.

Begin eating only after somebody says a toast.

Toasting is a very important part of dining. Russians use the continental style ofholding

utensils.


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SOME GENERAL FEATURESSOME GENERAL FEATURES

The handshake is common.

Eye contact is very important, must be maintained

as long as the individual is addressing you.

Smoking in public places is still a commonoccurrence, although some restrictions are slowly

imposed.

Wearing your coat and/or winter boots in theatres,

office buildings, universities or similar publicspaces is considered unacceptable.


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ATTITUDETOWARDS FOREIGNATTITUDETOWARDS FOREIGN

PARTNERSPARTNERS

The first meeting is usually just a formality-a time to

assess the credibility of you and your company.

Russians can sometimes place a great deal of

confidence in your professional competence and

experience; very high expectations and demands.

Russian business people are open-minded to new

ideas, especially from western business culture Russian negotiators could make minor concessions

and ask for major ones in return.


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BUSINESS DRESS CODEBUSINESS DRESS CODE

Old Russian proverb--One meets you depending

on how you're dressed and says good bye

depending onhow wise you seem to be

Russian businesspeople pay a lot of attention to

how they are dressed. Russian people in general

probably spend more money from their family

budget on clothing then any other nation in the

world.


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Structure and hierarchy inStructure and hierarchy in

Russian companies

Russian companies

The hierarchical structure in Russianbusiness practices means that thedecision makers higher up have

authority over their subordinates.However, the nature of the collectivegood often encourages a flexible anddemocratic work ethos.

Showing respect for seniority andrecognizing the hierarchical structureis vital for establishing andmaintaining strong business

relationships.


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Working relationships in RussiaWorking relationships in Russia

Personalandinformal contact is acentral part in doing business inRussia.

Physical contact during business

meetings (a simple hand on the armor even embracing) is a positive sign.The notion of social space is close inRussia.

Insituations of conflict - to avoidtaking an official stance andremember that Russians are 'peopleorientated' and will respond to amore personalapproach.


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Working in RussiaWorking in Russia

The Russians attitude to time means that a fewminutes delay on their part is of little importance.However, they will expect you to be punctual.

Faxesand emails are the best way to communicate in

Russia, as the post can often be unreliable. It iscustomary before making a trip to Russia to inform theprospective company of your intended businessproposals and objectives.

Paperworkand putting pen to paper is an essentialpart of all working practices in Russia. In general, theyhave little faith in unsigned documents.


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Business practices inBusiness practices in

RussiaRussia Business cards are essential. If possible,

ensure that one side is printed in Russian and

one side in English. Presentations should be straightforward and

comprehensible.

Although many principal concerns arediscussed in an informal environment, finalnegotiations will be conducted in the office.


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Making appointmentsMaking appointments

Persistence and patience are essential. Once yourappointment is scheduled, do everything you can toavoid cancellation.

Don't schedule your trip to Russia near the end ofJuly or during the month ofAugust- this is the time

of year many people take their vacations.

The Russian day begins early, but it can be difficultto foresee when all other daily activities will beginand end. Schedules are constantly subject to change,

often at the last minute. Allow plenty of time for each appointment.

Business day is usually 9:00 am to 6:00 pm Mondaythrough Friday and some Saturday mornings.


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ConversationConversation

Visitors should try to speak in a calm, moderate, tone ofvoice at all times.

YourRussian colleagues will be delighted if you makethe effort to speak even a few sentences of their

language. Russians are sometimes very careful about what they

say, speaking metaphorically, symbolically, and perhapseven cryptically.

Bringing up the subject ofRussian culture and history isappreciated.

Compliments - with caution, they may cause a feeling ofmisplaced obligation. (admiring a decorative object,

yourhosts may insist that you take it).


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GIFTSGIFTS

Russians take pleasure in giving and receiving

gifts . Russians spend a lot of money on gifts .

Gifts for children are usually opened in private,

gifts for adults are generally opened in the

presence of others.

Gifts are expected for social events, especially as

thank-yous Bringing a bouquet of flowers for women.


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SOME Do'sand Don'tsSOME Do'sand Don'ts


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D O sD O s DO shake hands firmly when greeting and leaving your

partners and make direct eye contact. DO partake in small talk that involves talk of family and

personal matters, before dealing with business.

DO make a gift that symbolizes the stature of your

company, preferably an item characteristic of your localarea or one that displays the company logo.

Knock before entering an office

Close the door behind you, when leaving an office

Supply beverages and snacks during business meetings

Go out and have a drink with your counterparts, it is agood way to break the ice.

Bring small gifts for the children of a home you visit


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Don'tsDon'ts

DON'T be afraid to show some emotion, theRussians won't!

DON'T as the Russian proverb states 'hurry toreply', but 'hurry to listen'.

DON'T praise or reward anyone in public as itmay be viewed with suspicion or cause envyand jealousy. Remember the collective rules

over the individual.Wear lavish clothing or jewelry.

Use a restaurant as a place for doing business--it's for celebration


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Russia - Mayank 09

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