“Grappling With Soviet Symbolism,” New York Times

In the May 15, 2010 edition of The New York Times, was an article by Andrei Zolotov, Jr. “Grappling With Soviet Symbolism. This paralleled well with the sentiments in my book  “Walking on Ice, An American Businessman in Russia.” So, I wrote a letter to the New York Times and they, surprisedly, answered at once telling me it was going to be published in the International Herald Tribune. I expect to see a copy of that soon. Here is what I wrote:

 “What a welcome account of the obvious change happening in Russia today. It has been happening, but slowly and often unnoticed by the press. Lenin said Russia progressed one step forward and one step back. I say today it is three steps forward and two back, but we must acknowledge that residual step and help build on it. Zolotov covered it all well. Indeed, it is often the “blink” of events that help turn the head and then the body in a new and better direction. The Smolensk fatal crash killing the Polish leadership on the anniversary of the Katyn massacre may well have been that unexpected moment that turned the Russian heads. In my seventeen years in Russian business, it has been so obvious that the country was inching toward a reality first foreseen by Peter the Great, now led by the world-conscious young as they lead Russia out of the historic dark past into the light of the new world.”

Buy the book here  “Walking on Ice, An American Businessman in Russia”

All Economists are Wrong, Right?

 On my first tour of Russia in 1991, the tour director told a joke which still rings true today.

“President Mitterrand has one hundred mistresses. One of them has AIDS, and he doesn’t know which one. President Bush has one hundred body guards. One of them is a terrorist, and he doesn’t know which one. President Yeltsin has a hundred economic advisors. One of them is right, but he doesn’t know which one.”

Economists seldom agree and it seems that a country’s leader, especially if he is a dictator or autocrat, always has the pleasure of choosing economists who agree with him. This is so in Russia. The Soviet Union was a country of statistics. From top to bottom, statistics were created and recorded to prove a point. The point could be that the economic plan was working, or failing, that the factory was producing or not producing, or that a certain Comrade should be given a medal or shot—or both.

 One Economist was Right

 “The economic system of Russia has undergone such rapid changes that it is impossible to obtain a precise and accurate account of it…. Almost everything one can say about the country is true and false at the same time.”

John Maynard Keynes

The famous economist, John Maynard Keynes said the above, in 1925, It is true today. When Keynes made that observation, Russia was nearing the completion of the cruelest and most senseless civil war ever to ruin a promising country. It was Lenin’s twisted dream, his untried political theory which he perpetrated on a people he did not love, in order to satisfy a selfish penchant for proving himself right. It was like trying to balance a pencil on its point. It took seventy years, covering much of my life span, for its wrongness to become evident to all. Such a waste of human potential the world has never seen!

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

Immortal Words

To the orders of God or muse be obedient.                                                     
Don’t be afraid of insult,
don’t demand the laurel wreath.
Slander and praise receive with equal indifference.

And never argue with a fool.

Alexander Pushkin 1836

From a poem Pushkin wrote in 1836.
The epigraph is from Horace –
“Exegi Monumentum”

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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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?

The Banya

Even after eleven years in Russia, I had never enjoyed the pleasures (?) of the banya. It is an institution in that country. As we collected our sandals, sheets, and bunches of birch twigs the Russian in our group said, “Citizens of The United States, prepare to suffer.”

 The process was this: First into a room with walls and seats of hot wooden planks, too hot to touch. With a long handled cup, water was thrown on the walls to increase the temperature which was already, they said, at 200 degrees Fahrenheit. After about twenty minutes, the birch branches, soaked in water with oil of eucalyptus, were beaten on our white and frail bodies. We either did it to each other, one man standing covering his essentials and beaten by the other, or like Penitentes, we beat ourselves. Slap, slap, slap. If it were babushkas doing the beating, it might have been fatal. Some men wore felt caps, supposedly to protect the ears, making one look like a peasant in a Brueghel painting.

 The skin a beaten red, the next step was into the pool of ice cold water. The manly way was to climb up the slippery ladder (everything was slippery) and jump into it, a pool eight by fourteen feet and five feet deep.  When the body starts to shake, it’s into the private locker room, large enough for ten or so—we were five, and down a tall mug of kvass. Kvass is the Russian tea-totaler’s substitute for beer. It is made from black bread. Not bad. Some talk and gossip about poets and writers, then back to the hot room. The eucalyptus aroma soothes the insides. Soon some Russians joined us. Thin and fat, young and old. It was quitting time, we figured.

 This masochistic routine was repeated four times over two hours. By then the twigs had lost all their leaves and were switches. They hurt more. The body sways a bit, and it wasn’t just me. Sitting is better. Then a shower, drying off, and taking to the street for the long walk back to the hotel.

 Now, among Russians, I can claim some degree of legitimacy. The girls in the office said I looked healthy. So it must have been a good idea.

There is another role for the banya. A  tough business decision was to be made affecting my company by our Russian partners. At about six one evening, I was told we would hear by ten the next morning–and we did. I learned that they (the important men) got together in the banya before going home, and decided in our favor. It was explaned that is where vital decisions are made.

The secret…

 Of course, there are no secrets to success in Russia. Everyone has his different experience and his own road to walk. But everyone wants “secrets” and best if they are numbered. So here are mine. Progress has to be built on a basis of personal trust and honest relationships. However, if I have to list my guiding principles, there are five “Ps” that make the point:

Patience: Things take time. Russia is a thousand years old. Things will not work out always to your schedule. It is an Asian, not a Western country. Patience pays off.

Perseverance: According to some dictionaries, “perseverance” is persistence toward a worthy goal. By itself, persistence may be like knocking your head against the wall, when the solution may be to go around it. Keep the goal in your sights, but be prepared for an unplanned course to reach it.

Perspicacity: It’s about understanding and discernment. It may require you to not accept what is said, but understand what is meant. You may be surprised.

Professionalism: So important. Character and standards must be clear and consistent. Know your business and be open to the thoughts and solutions of others. Russians are resourceful. Give them opportunity to make their point.

Perspiration: There are no forty-hour weeks in Russia, not from my experience. Set a standard. Work hard. And enjoy it. But these secrets are nothing new, they are simple, and no different from what works anywhere else. Some foreigners seem to forget that in Russia, when they think they can take short cuts and slip around the rules of the road, they actually have to try harder.

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