ENTREPRENEURSHIP / OCT. 28, 2014
version 4, draft 4

How to Do Business in Russia

Moscow
istock

Russia is a land of contradictions. While the culture was formed by years of communism and Soviet control, many Russians are enthusiastically embracing capitalism, and there are some fantastic business opportunities. In fact, Russia is the UK’s fastest-growing export market as well as being the third largest, trailing only Europe and North America. But it’s important to remember that the USSR and its way of doing things left an indelible mark on Russian culture. The country is going through massive changes at the most fundamental levels, and it’s critical to remember that the past is still a major player in the present. Here are some of the most important things you need to know about doing business in Russia:

  • Hire a translator.

While many people do speak English, especially in Moscow and St. Petersburg, it’s a good idea to hire a translator. For one thing, it’s a sign of consideration for your Russian hosts; for another, it helps ward off problems that can be caused by misunderstandings.

  • Russians trust people more than process.

Thanks to the strictures of Soviet rule, Russians tend to distrust laws and (especially) government. Therefore, contracts are given far less weight than spoken agreement. It also means that there’s an ingrained mistrust that makes relationships extremely important. These relationships can take time to develop, but they’re critical to doing business in Russia.

  • Business structure reflects the command-and-control model of the nation’s past.

Most companies are headed by an individual who makes the decisions and tells everyone else what to do (usually with very little input from subordinates). That’s an important distinction, because meeting with anyone other than the decision-maker can be a waste of time, especially if the subordinate has little access to the boss. It’s also important for people who are managing Russian teams: They’ll expect to be told what to do and may be uneasy with more inclusive western management styles.

  • Meetings are for information, not debate.

Don’t expect to discuss and weigh options at a meeting; meetings are for announcing decisions that have already been made. If the decision-maker solicited input, it would have been during informal meetings with key advisors.

  • Meetings are formal.

Russians tend to see meetings as serious affairs, and that belief is reflected in meeting etiquette. Small talk, if any, is saved for the end, after business has been finished. Russians also tend to be quite stoic during meetings and may show little reaction to what’s being said, whether physically or verbally. That doesn’t mean they’re not engaged. It’s also common for Russians to stop and think before responding, so be sure to allow your colleagues time to do so.

  • Entertaining is often a big production.

Business meals in Russia tend to involve lavish food and lots of alcohol. Try to show appreciation by eating hardily and complimenting the food.

  • The focus is on the short term.

With conditions changing so rapidly in Russia, most businesspeople focus on short-term benefits rather than long-term benefits. You’ll do better if your proposal will benefit them right now instead of being something that won’t have a payoff for several years.

  • “Dress for success” is an important mantra.

Since many Russians are used to centralized decision-making, you won’t be given much credence if you don’t dress like you’re the boss. If you look like an “underling,” they’ll assume you have no power and will therefore be unlikely to invest any time in you.

Russia is a fascinating mix of new and old. As innate cultural beliefs and traditions mingle with new business attitudes and prosperity, there are tremendous opportunities for people who know how to navigate the business climate. Do your homework and try your best to see things through Russian cultural lenses, and you should do just fine.

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