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Apr 26

Top Tips for Doing Business in Russia

As the largest country in the world, Russia offers immense business opportunities for willing investors. The Russian Federation spans 10 time zones and has approximately 142 million people, giving it the ninth largest population in the world. Greater political stability and the diversification of Russia’s economy, combined with increased foreign investment flows, higher domestic consumption and rising oil prices have contributed to the superpower’s continuous economic growth over the last years.

Business Meeting 12LajosRepasi i2 Top Tips for Doing Business in Russia

Russia’s work ethic is increasingly influenced by western culture, but the Russians also have a unique set of values and attitudes and a different approach to communication, negotiation and decision-making which could affect anyone doing business in Russia. The following tips will help you ensure make the most of your experience doing business in Russia:

Address colleagues by using their ‘patronymic’ name, based on the first name of the father. Always try to find out the best way to greet your counterparts before any meeting in Russia and be aware that addressing new contacts with their Christian name is considered impolite.
Since personal and informal contact is crucial when doing business in Russia, be ready to spend some time establishing rapport before discussing business. Getting past the initial formality and reticence you may experience with your Russian colleagues might take time but it will result in stronger relationships and improved business interactions.
Russians are very patriotic. Avoid criticising any aspects of Russian history, culture or politics. Good neutral discussion topics are sports (especially winter sports) and family.
In meetings, Russians prefer a direct approach. You should be well prepared and your presentations should be straightforward and comprehensible.
Many Russians are increasingly fashion conscious, particularly in Moscow. Looking very professional and polished will help you make a positive impression on your Russian counterparts.
Compromise is seen as a sign of weakness in business negotiations. Always come with a strong argument and know where your limits are.
Russians are very status conscious and prefer to have meetings with those of equal status. Decisions tend to be made by the most senior person.
Avoid praising or rewarding anyone in public as this may be viewed with suspicion and can cause envy and jealousy. Any praise or criticism will be much better received in private.
Never shake hands across a doorway or threshold as Russians believe this will bring very bad luck.
Remember that Russia is an immense country spanning 10 time zones. Always research the location where you are doing business to ensure you do not schedule meetings at a bad time.

Considering and respecting the top tips for doing business in Russia above is the first step towards building effective relationships with your Russian counterparts. Participating in a cross cultural awareness training course such as Doing Business in Russia will give you a deeper insight to the cultural differences you may find in Russia and the ability to anticipate and manage them effectively.

© Communicaid Group Ltd. 2011

Tagged with: Russian business culture • Russian business etiquette • top tips for doing business in Russia • Working in Russia

Mar 08

Challenges of Doing Business in Russia

Cross Cultural Training, Culture, Culture training for Business & Management, Culture training for Human Resources No Comments »

A huge country richly endowed with natural resources, Russia continues to develop both politically and economically. Russia’s cultural identity has been influenced by a mixture of ethnicities and a diverse history.

The largest country in the world, with the ninth largest population, Russia has recently established a consumer economy which is increasing business and investor confidence in Russia’s economic prospects.

While there are some clear benefits to doing business in Russia, an understanding of Russian business and social culture is essential to an international company’s success.

Punctuality – Russia is a polychronic culture, in other words, people tend to be flexible in the organisation of their priorities and attitudes towards punctuality are relaxed. Polychronic cultures also often feel it is more efficient to do several things at once; therefore meetings may not follow a linear agenda and may be interrupted by phone calls or people coming in. As a foreigner, you are expected to be on time to all business appointments, however social events are more relaxed and being up to 30 minutes late is acceptable. Patience is highly valued in the Russian society, try not to be mad when a colleague arrives late and do not expect an apology, they may simply be testing your patience.

Collectivism – Historically a country rooted in agricultural communes, Russia has maintained a collectivist spirit that pervades many sectors of society. The Russian affinity for the group can be seen in every day life, for example, Russians will often choose to join strangers in a restaurant, recreation is commonly arranged in groups and advice can sometimes be given to you by a complete stranger. This sense of co-operation and togetherness must be considered when doing business in Russia, especially when communicating. For example, it is important to remember to address the group rather than the individual.

Hierarchy – Hierarchy is an important aspect of Russian business culture with status being linked to age and position. It is important to be aware of the fact that usually meetings are held with people of equal status. Decision making is commonly done by the most senior employees in the company. Showing respect for seniority is essential for maintaining strong business relationships when doing business in Russia.

Personal relationships – Relationships start out quite formal within Russia but maintaining trust and a good working relationship from the beginning is invaluable for future business. When meeting someone for the first time, it is wise to address them by their patronymic name. This name is based on the name of the person’s father with the suffix “ovich” (son of) for men and either “ovna” or “evna” (daughter of) for women. The Russian language also has two forms of the word “you” distinguishing between the formal “vy” used to denote respect and the more casual “ty” used between friends.

Communication style – Russians tend to have a high context communication style. A high context preference translates to placing emphasis on relationships, emotions and body language and expecting the listener to read between the lines. Differing communication styles can often pose one of the most significant challenges for businesses working cross-culturally. When doing business in Russia remember that Russians are patient and will expect the same patience from you.

Negotiating – In negotiating, Russians often take their time and will not rush to make a decision. Russians tend to avoid compromise, which they see as a weakness and expect to either win or lose a negotiation. Therefore, expect negotiations to be tough and occasionally theatrical. Do not be surprised if you witness the occasional loss of temper, people leaving the room and threats to call off the deal, this is all part of the process of driving a hard bargain.

Russian woman dmbaker i 300x199 Challenges of Doing Business in Russia

Although recognising that cultural differences exist is an important first step when doing business in Russia, international organisations must also understand the reasons and implications of these differences in order to develop effective strategies for coping with these challenges.

A Doing Business in Russia cross cultural training programme will help organisations maximise the benefits and opportunities of doing business in Russia. Cross cultural training programmes also create a workforce with a high level of intercultural competence which is a huge asset to any organisation working in a competitive global environment.