According to PriceWaterhouseCoopers, Russia's hunger for management talent has raised executive remuneration levels above the US, Canada and Western Europe. High pay, a booming economy, bigger responsibilities - what else does a professional executive from outside Russia need to encourage them to pack up their bags and fly to Moscow? And indeed, many do.
However, not everyone returns home with sacks of cash and a great résumé. They don't all manage to navigate the very different commercial and business environment that exists in Russia. And these differences may not be immediately apparent to foreign executives when they fly to Moscow in a Western-built plane, ride to town in a foreign car, stay in a Western hotel with English speaking staff and later move to an apartment, which looks like one in Manhattan or London.
There are many frustrated expatriates, who have either left or are thinking about leaving, because their corporate life has become unbearable. The main reason for a foreign executive's frustration is usually his inability to get things done, because of the inadequate resources and support available. Although he may have discussed his requirements before signing the contract, repeated them again after arriving in Russia and received comforting reassurances, he may find the resources lacking when he starts his new job.
Naturally enough the foreign executive will try to hold the company to its original commitment. After making a fuss with his managers, the ex-pat might quickly find that he has ended up isolating himself within the organisation. It is also common for expatriate managers to find that they get the blame for other people's mistakes. Although this can be a widespread practice in highly politicised Russian organizations, foreigners naturally take it very personally and feel deeply hurt.
The same is true about being criticized by the boss over matters of style rather than the results themselves. And, finally, some expatriates manage to get into difficulties with external actors such as suppliers, customers or government officials. This may happen because they are being too rigid and applying existing laws and regulations in too literal a sense or by assuming that they have understood the system and relaxing the rules too much.
Although there is no single formula for working in Russian organizations, there are a number of strategies expatriates can use to avoid or overcome some of the problems they may encounter.
Establish professional credibility
Russians are suspicious towards all outsiders - foreigners, new hires or migrants. One has to prove one's good intentions; no credit is given to anybody. The best way for an ex-pat to gain legitimacy is by doing what he is really good at, doing it on his own without asking for resources, quickly and producing tangible results.
Ideally it would be something that local people could not accomplish alone. A senior executive from BP won hearts and minds by finding an elegant solution to a problem with an oil well they had been struggling with for months. The faster the credibility is established the better are the chances for getting adequate material and emotional support from Russian colleagues.
Respect the boss
The Russian organization is a pyramid consisting of many other pyramids. The role of any boss at any level could hardly be overestimated - he or she is a central figure and the organisation revolves around them as the earth moves around the sun. Any expatriate with a Russian boss has to keep this fact in his mind throughout his tenure in a Russian company.
A foreigner needs to do a number of simple things to keep their Russian boss happy and supportive. Never get between the boss and the sun - his or her own boss. Give credit to the boss for everything that happens in his or her galaxy. Keep a distance and emphasize your respect during all public meetings (this does not mean you cannot become close friends and do wild things with your boss far from the public eye), do not call the boss by his first name or slap him on the back - even if he does it. Demonstrate that you are not a threat to you boss - share information, talk about your plans (you do not have plans to take his job, do you?), help him or her whenever you can.
Treat people with dignity
In hierarchical Russian companies people react very positively to a respectful leadership style, and furthermore they expect it from foreigners. The worst thing an expatriate manager could do is to emulate the yelling and fist-thumping style of some Russian business leaders.
Find Russian mentors
Every newcomer needs help in making sense out of the complex web of relationships in Russian organisations. They should actively probe and find some like-minded Russian colleagues and turn them into mentors and advisors. It is usually quite easy to do since many Russian managers, especially younger ones are eager to learn more about the West, its management methods, culture, etc. The relationship should be informal and work both ways.
Demonstrate interest in Russian culture
Russians usually do not expect their foreign colleagues to be fluent in their mother tongue. However, they very much appreciate expatriates' efforts to understand Russia and its culture. Demonstrating respect for the local way of life by learning some simple Russian phrases, reading literature, visiting historical sites and sharing your impressions will soften the hearts of Russians in the office and in private life and give an expatriate manager a few extra points.
Stay away from murky areas
At one of my CEO jobs in Russia I had to clean a mess created by my expatriate predecessor who had engaged "specialists" (criminals) from a region to resolve a dispute with a minority shareholder of one of the joint ventures. The Mafioso did not solve the problem, but kept coming back with requests for more money. It is very easy for an expatriate to get himself and his business in trouble after entering numerous not-so-transparent areas of modern Russian business life such as customs clearing, dealing with power agencies and ministries, tax or fire inspectorates, etc.
This tricky business can be learned, but at a high cost both to the individual and the company. It is better that expatriates leave such matters to trusted Russian colleagues and concentrate on their core skills.
Stanislav Shekshnia is an affiliated professor of entrepreneurship at INSEAD and a partner in Zest Leadership.