Three steps forward and two backward!

  “Nothing is impossible in Russia but reform.” Oscar Wilde

I think Oscar Wilde was wrong—but it will take time to know. The efforts to transform Russia into a viable and democratic economy, one that fits comfortably with the rest of the free world, will at best jerk forward over the coming years. But it is happening. Three steps forward and two backward. Still, one residual step in the right direction is something to be grateful for in a land of such immense potential. That is an improvement over Lenin’s assessment of Russian progress, “One step forward and one back.”

History has not been kind to the Russians. Seventy years of cruel rigidity under Communism within the context of a thousand years of autocratic rule has fostered a blind dependence on central authority, as de Tocqueville says “of servitude,” a resulting lack of personal responsibility and self confidence, and a fatalistic distrust of the future.

 Historically, and largely because of their geography, Russians missed out entirely on the pivotal events of Western development. A thread running through their complex political history is the fear of and acceptance of an all-powerful and sometimes arbitrary central authority, the influence of constricting medieval orthodoxy, and the mystical unifying force called the “Russian soul.”

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“Swaying the destinies of half the globe”

There is much rhetoric on the future of Russian/American relations. Often it is to create a reaction, to serve some private or political purpose. But, there are some obvious reasons why the countries should get on the same side of the table, partner, cooperate. This is not a post cold-war obvious fact. The first to articulate this geo-political reality was the French political thinker and historian, Alexis de Tocqueville, whose most famous work, Democracy in America (1835), was published after his travels in the United States. He had something prophetic to say about America and Russia, just as true today, in my opinion, as 175 years ago.

While the 21^st century has stirred the determination of many nations, there still is truth in what de Tocqueville wrote. In part, he wrote:

 “There are, at the present time, two great nations in the world which seem to tend towards the same end, although they started from different points: I allude to the Russians and the Americans. 

The Anglo-American relies upon personal interest to accomplish his ends, and gives free scope to the unguided exertions and common-sense of the citizens; the Russian centres all the authority of society in a single arm: the principal instrument of the former is freedom; of the latter servitude.

Their starting-point is different, and their courses are not the same;  yet each of them seems to be marked out by the will of Heaven to sway the destinies of half the globe.”

Excerpted from Democracy in America 1831 by Alexis de Tocqueville, 1805-1859  ( Book 1 -Chapter XVIII: Future Condition Of Three Races – Part X )

Alexis de Tocqueville’s words still ring true, even in the digital age. So it is in our national interest, the world’s interest, to get it right. As businessmen we have a great opportunity to make a lasting contribution.

Tolstoy on Assurance

Leo Tolstoy left this earth a hundred years ago, but he certainly left with us his great writing and his keen insight into the human psyche of his day. And many see that day is still with us. His “Confessions” and short stories written after his two great novels reveal a pretty clear picture of his own thoughts and observations, not only of the pre-revolutionary world around him, but of civilization’s historic institutions, such as the hierarchal church. I highly recommend the film about his last year, ”The Last Station,” with Helen Mirren. There are so many examples of his thought, often humorous in a typical Russian ironic way. Here  is one about Tolstoy’s view of the European, and the Russian man.

“A Frenchman is self-assured because he regards himself personally both in mind and body as irresistibly attractive to men and women. An Englishman is self-assured as being a citizen of the best-organized state in the world and therefore, as an Englishman, always knows what he should do and knows that all he does as an Englishman is undoubtedly correct. An Italian is self-assured because he is excitable and easily forgets himself and other people. A Russian is self-assured just because he knows nothing and does not want to know anything, since he does not believe that anything can be known. The German’s self-assurance is worst of all, stronger and more repulsive than any other, because he imagines that he knows the truth—science—which he himself has invented but which is for him the absolute truth.”

Leo Tolstoy (1828–1910), Russian novelist philosopher. War and Peace, bk. 9, ch. 10 (1868–69).

St. Petersburg and Moscow ~ Cats and Dogs

These two cities define what most see of Russia, and they are so different, yet in some ways the same. They have forever been in contest with each other, and are today.

 Moscow is a masculine city. It is an exploding powerhouse of opportunity held together by threads of personal energy and ambition. It is a cocoon of lives stacked seven stories high, living all the happiness and sins of people anywhere – only at the extremes Russians are so capable of.  Moscow hardly sleeps. It has a muscular aggressiveness unique in Europe and traffic jams that make Los Angeles look easy. The one word that describes Moscow is power.

 St. Petersburg is a feminine city. Her historic personality is as an elegant and noble woman sitting draped with the jewels of her youth waiting for her prince to return. This “Venice of the North” with its symmetry, architecture, statuary, art museums, performing art, palaces, gardens and languid summers with endless days make it a city never to be forgotten.  St. Petersburg is not Russia; it is the historical myth of Imperial Russia.

 Moscow is a city of dogs. There are two classes. One can be seen in vagabond packs or stalking alone, scheming to survive, begging, much like the city’s underclass inhabitants. The other is the canine elite, who walk their masters, regardless of rank, in the parks each morning and evening. The disenfranchised class lurks around the apartment blocks sniffing the garbage for anything to swallow.

 St. Petersburg is a city of cats. From the streets at night, you can see their shining eyes, peering through the arches from the inner decay of “Dostoevsky’s St. Petersburg,” the faceless blocks of communal flats. The cats hang comfortably in the dead trees, dine elegantly in the overflowing garbage, sit regally on the broken steps. For some reason, the cats always look healthy and fat.

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“You know the fact!”

“You know the fact! I am the best. I wear Levis and Nikes”

                                                                                   An unknown Russian boy

These words were scribbled by a child in small English letters on the yellow brick wall of a residential Moscow building near where I lived in 1994. That says more about the future of Russia than any academic think tank with their computer generated prophesies based on arguable statistics. There is the quest for global status in those scribbles of the young. And in the end (and the end may be down the road a bit) it is the young that count. That is where the promise lies—with those who can wear Levis and Nikes and still be Russian. That is “the fact.”

On one of those early post-Soviet days, walking down the Old Arbat, just after Mayor Luzhkov had banned the street kiosks and the pandering of KGB uniforms and Lenin T-shirts, I was approached by a small boy with a big bag. The boy, about ten, furtively looked over both shoulders to assure no police were watching, and pulled out of his plastic bag a matryoshka doll so badly painted I thought it was done by a dyspeptic. He said in near perfect English, “Look at this beautiful matryoshka doll, only $5.99.”

I said, “This is the ugliest matryoshka doll I have ever seen.”

“Then how about $4.99?” he snapped back.

“No, you could not pay me to take this doll.”

He quickly dropped it back into the bag and pulled out an equally ugly lacquer box, smiling, “Then how about this beautiful box.”

“That is worse than the doll. What is your name?

“Peter.”

“Well, Peter, you tell the guys who sent you out with this trash to give you really good dolls and boxes and you will make them and you rich.” He puffed up with pride and looked over his shoulder again to see if his mentors were watching. I continued, “When you grow up, you come see me, and I will give you a good job, because you are a great salesman.” He stuffed his ugly box into the bag with the ugly doll and ran off to tell his bosses of his promising future. That boy will go far in the new Russia—or anywhere.

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Starting a Business in Russia~How is it Different?

"The Barge Haulers" Ilya Repin

 “Doing business in Russia is like doing business anywhere else…but different.” Business is business, many think. Yes and no. How is doing business in Russia different from, say, the United States? Here are five points I can make—there are others. 

1. Get a partner. You are in a foreign country and you need a good partner as you would a guide to climb a mountain in The Himalayas. This is the hardest thing to do, since this decision may well tell the future for you. So take time. Visit, meet, talk, listen, listen more, get advice from trusted sources, and wait. Even if you have privately decided, let things cool off and don’t jump to conclusions. Often something will surface to add substance to your decision. Check him or her out. Know the family and their connections.
2. Listen to the partner. You must hear the story from the Russian perspective. Ask questions. Listen to the answers. Ask the same question another way. Listen. Patience.
3. Understand the “laws.” In America we have laws and for the most part they are clear and you have a good idea how they may affect you. Not in Russia. Their laws, if there are some pertinent to your purpose, may be there to benefit certain parties, maybe your competitor.
4. Be ready for a commitment. So many have failed in Russia because they thought they could fly in, hire a representative, and fly out again and carry on from outside—as they could, say, in Cincinnati. You have to be there, in person, most of the time. After a few years and you have a dependable team in Russia, sure, you can leave more in their control. But, always be ready to make your presence.
5. Keep it quiet. PR releases are common in America, announcing in advance you great plans. In Russia, I learned that PR releases inform your competitor what you are doing which may well cause problems. In Russia I found that it’s best not to announce you plans, but to work it quietly as possible and enjoy the success. Stories abound of well announced new projects being blocked by some unexpected action. Keep it quiet.

Experienced vets of Russian business may well have other rules they have learned and those may well be just as important. These are some of mine.

For more read “Walking on Ice, An American Businessman in Russia”

Russian Women

In Chapter 38 of “The Domostroi”, which I jokingly call a sixteenth-century, Ivan the Terrible,  version of Good Housekeeping, the husband is admonished exactly how to discipline his wife and children, “…beat them only with the lash, in a careful and controlled way, albeit painfully and fearsomely.” Progress has been made in Russia, but progress, like all else, is in this case relative.

March eighth is Woman’s Day in Russia. Its history goes back to the 1917 Russian Revolution.  Like most things in Russia today, it is controversial. Some say it is a transparent apology for mistreating women the rest of the year, which is to some degree true. Others say that women have come a long way in Russia and are, or should be, grateful for that step forward¾also true. And I said, about ten years ago when I first wrote the essay on Russian Women which is in my book, “Walking on Ice…,) they still have far to go. But things have changed. Russian women today are increasingly at the forefront of society, business, politics.  The Moscow Times reported a few years ago that sixty percent of the new businesses in Moscow were started by women.

Amongst the over sixty employees in my first Russian company a large percentage were women and they were for the most part capable, determined, technically competent, trustworthy, and loyal. I enjoyed working with them. I could depend on them

There is a lot of various opinions about Russian women, some not too complimentary. But in my book, they are unique and fill a very important place in society—in Russia for sure, but also just about anywhere they decide to be. In my book I list six kinds of Russian women: the beautiful, the babushka, the Barbie, the beaten, the bold, and the bewildered. To understand all this you will have to read “Walking on Ice….” Enjoy.

Partially excerpted from “Walking on Ice, An American Businessman in Russia”

“What Is To Be Done?”

How to succeed in Russian business is the question. While it does not require sleeping on a bed of nails, as the hero did in Nikolai Chernyshevsky’s famous novel What Is To Be Done? to prove his commitment to his Marxist ideals, it does require a clear and serious intent, dedication, perseverance, and many other things. In a land historically devoid of the predictability of law, the cement of society is built on personal relationships. This takes time.

That interwoven matrix is complex. That is why one never makes commitments he cannot deliver. It is deeds, not words that count. Character is more important than contracts. Once that trust develops, I found the Russians reliable, resourceful, dedicated, and hard-working. New leadership is developing out of that growing pool of forward-looking younger men and women. After you understand the system and the relational foundation of Russian society, the pathway is reasonably predictable. You learn in short order how to pick your friends. You may make mistakes, but learn from them and move on.

 Unfortunately, my biggest problem was dealing with Americans who somehow felt the rules that constrained their ambitions at home did not apply in Russia. In the end, most of them learned the hard way. Some returned home posing as experts. Some returned disillusioned and broke. One, at least, is buried there. In Russia, like anywhere else in my experience, honesty, intellgence, reliability, and good hard work are respected and gain the kind of reputation on which solid business is built. Having said all that, in dealing with Russians sometimes it helps to think of two dogs. Remember The Grand Inquisitor’s “authority.” You never want to be in the submissive position. You lose respect. You also don’t want to be the dominant aggressor. You growl a lot but get little done. You must assume the authority to be equal, never submissive. Even if you have to fake it, never be the bottom dog in Russia.

One Soviet joke illustrates this in a different way. Two sailors, one a Russian and the other Ukrainian, were walking down the street in Sevastopol and on the sidewalk they find a ten-dollar bill. The Russian says, “Great, let’s share this like brothers.” The Ukrainian however says, “No, let’s split it 50/50.” Partnership can be subjective.  I don’t belittle the issue. But, I never let it slow me down. You can steer around it.

One of the perplexing answers to “what is to be done,” comes from Victor Chernomyrdin who in 1997, at the end of his stint as premier of The Russian Federation said, “We hoped for the best, but it turned out like always.” Or another of his historical remarks, “If one considers what could have been done, and then what we did do over this long time, one can conclude that something was done.” Really?

At the Crossroads

Under all the turmoil of a thousand years, Russians are yet a colorful and creative people. Sometimes you have to look hard to see it. But the artists, writers, composers, and the brilliant scientists and inventors through the ages have left an indelible mark on the word.

I’ve worked mainly with the younger Russians, those under forty-five today. There is a large mental gap between the young who graduated in the last days of the Soviet Union and the older generations who lived the greater part of their lives under the Communist regime. For the most part, the young are dedicated to a better life as they might imagine it or have personally witnessed it in their frequent travels in the rest of the world. It is an attitude nurtured by their sense of possibility and a growing sense of responsibility. They are often well educated, traveled, cultured, and speak English and other foreign tongues. I don’t think there was a woman (or many men) in our offices in Russia, while being from the top technical institutes,  who could not discuss Rus­sian and Western literature, the stage, music (classical as well as rock and jazz), and dance.

But, Russia is also losing many of best and brightest who cannot wait for the men in power to create a domestic environment for their creativity and energy. So they leave, these young and impatient Russians, although reluctant to leave Mother Russia and families. On the other hand, some come back with their MBAs and become leaders at home.  Russia doesn’t seem to know what to do with these bright young men and women. A recent poll stated that eighty percent of Russians do not want to emigrate. Amazing—so what does that say of the remaining twenty percent? Are these the creative minds that hold the future promise? I know this is a philosophical view, but I am reminded of the famous painting of  A Knight at the Crossroads by Viktor Vasnetsov: (The State Russian Museum, St. Petersburg,seen above) They are all, these young, ambitious and committed like the knight at the crossroad. For the sake of their homeland, I hope they stay.

Excerpted from “Walking on Ice, An American Businessman in Russia”

Moscow Dogs

There has been a lot reported recently about the dogs riding the Moscow Metro in search of food. But some can’t afford that. I have one of those stories.

In the shadow of the Ministry of Foreign affairs, one of those seven giant Stalin buildings that punctuate the Moscow skyline, is a shell of a building that was once an Orthodox church. Under the sagging wooden gate with a sign from that Russian church that someday hopes to return, came the dogs, all mutts. First, a dog sired by a German Shepherd, then a cross between a sheep dog and a cocker spaniel, next a black and white short hair with a limp, and others, all nondescript, eight in all. They hung around the hole under the gate, like gang members waiting for the boss. And then he appeared, slipping under the gate and shaking himself with his authoritative nose in the air. He was the smallest of them all.

He had a square face and a cocky air that reminded me of James Cagney as a Chicago gangster. They all fell in behind Jimmy and wrestled for the favored spot downwind just behind his tail. Within a block they were in the right order, and spreading out on their scavenger hunt. It was not a game, it was survival.

They lived in my neighborhood and were not unfriendly. Like any group of unruly Russians, they made lots of noise, but give them something to eat and drink and they will love you forever. I had nothing to give them, but they didn’t shy from asking. Neither did they take offense, but headed on for more likely targets.

Resourcefulness is a valued Russian trait. Nearby was a building under confused reconstruction, the mess of timbers looking like a pile of pick-up sticks, Mud was everywhere. The workmen, sloshing around in the mud and spilled cement from the hand-cranked mixer, wore knee-length rubber boots. One day, on my way to work, I noticed one of the dogs from Jimmy’s gang, furtively running away from the building site with a leather boot in his mouth, looking side to side over his shoulder like a boy with a stolen candy bar. The thief squiggled under the chain-link fence with his catch and into a neighboring yard of guarded BMWs and Lincolns where his buddies were applauding and laughing the way dogs do. I could only imagine the boot owner, at the end of the day, wearily doffing his rubber boots, but finding only one of his leather ones, and exclaiming to his exhausted buddies, “Which one of you bastards hid my boot?” Surely he had only one pair of boots. Meanwhile the dogs were smiling sickly across the street at having devoured the delicious morsel.

These dogs are the underworld, the bumsh, the homeless, those on their own, having been turned out of warm homes for lack of enough food even for their masters. They are victims of the wrenching change affecting Russian society, like many in this country of promise. But, also like amongst the people, there are others who live in another world of limitless luxury, the Novo Russki dogs.

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