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„A typical Russian”

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The World's Attitude Towards Russia: Friends and Foes

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Dimensions of cultures How Hofstede evaluates Russia?

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Index Scores of Russia

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High Uncertainty Avoidance „Will it be any better?? No, it had already been better.” (Russian Finance Minister, asked by an investor about the economic future of Russia) Results according to: - Hofstede 95 Globe 98 Noumov 68

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High Uncertainty Avoidance Low tolerance for uncertainty and ambiguity Rule-oriented society, which institutes a lot of laws, rules, regulations, and controls Time is money Emotional need to be busy Suppresession of deviant ideas and behaviour, resistance to innovations Motivation by security and esteem of belongingness Belief in experts and specialization

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Large Power Distance “Subordinate should always look foolish and flimsy. In order not to shame with their wisdom the superior” (Decree of Tsar Peter I) Results according to: - Hofstede 93 Globe 77 Noumov 40

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Large Power Distance Prevailing religions and philosophical systems stress hierarchy and stratification Prevailing political ideologies stress and practice power struggle Hierarchy in organizations reflects the existential inequality between higher- ups and lower-downs Subordinates expect to be told what to do, superior unavailable Powerful people try to look as impressive as possible Centralization is popular

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Factors of Large Power Distance Geographical condition Small number of the social stratum Small number of people with higher education Lack of advanced technology State politics

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Low Individualism “My adress is not a house and the street. My adress is the USSR.” (Words in a famous Russian song) Results according to: - Hofstede 39 - Globe 36 - Noumov 41

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Low Individualism Ideologies of equality prevail over ideologies of individual freedom Collective interests prevail over individual interests Opinions are predetermined by group membership Laws and rights differ by group Press controlled by the state Hiring and promotion decisions take employees' ingroup into account Dominant role of the state in the economic system

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Low Masculinity “How many divisions does the Pope lead? (Joseph Stalin, at Postdam conference) Results according to: - Hofstede 36 Globe 47 Noumov 55

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Low Masculinity Dominant values in society are caring for others and preservation People and warm relationships are important Work in order to live Stress on equality, solidarity and quality of work life Managers use intuition and strive for consensus Resolution of conflicts by compromise and negotiation.

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Russia’s position in Gesteland classification Features of Russian culture: Relationship-oriented Formal Fluid-time , polychronic Expressive

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General business rule "In Russia daily work conditions can be compared to a jungle where you really don't know what can fall on your head in the next minute."

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Legal situation Fiscal obscurities Legal issues Difficult dealings with the Russian public authorities !!! Be careful !!! some licences – especially for export are hard to obtain

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How to prepare to the negotiations? Financial situation must be examined Study the hierarchial structure of the company Mutual friends wanted Professional interpreter necessary

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How to select the appropriate negotiation team? Status of the team members of great importance Same idea of every raised issue Clear leader Desired features of group members - patient, highly tolerant and resistant to provocations “uniform front” Business ethics essential

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First meeting A formality Opportunity to get to know each other well and to outline the proposal at most Calm and formal Be self-confident, patient and simultaneously create the atmosphere of warmth

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Negotiation rules (1) Serious matter and should be treated accordingly Personal relationships are very important in Russia Visualisation Make sure they understand what you are offering! Problems with agreeing to compromises

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Negotiation rules (2) Write down all the results General impression is what counts the most Patience is crucial Direct talk is welcomed Exclusivity When a deal is struck is often sealed off with a glass of vodka – do not refuse

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Specific negotiation tactics with Russian business partners (1) Find out who is who? Describe complex subjects as clearly as possible Be prepared for a long negotiation Distinguish between your behaviour inside and outside the negotiations

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Specific negotiation tactics with Russian business partners (2) Use “white-black” method “lack of competencies” method should not be applied Even if you have strong arguments, do not overemphasise them