When conducting business with a foreign country, a clear understanding of cultural differences should be evident, allowing both parties to achieve a beneficial agreement. Understanding the culture of the business is important, however understanding the culture of the country is also a requirement for a smooth transaction. According to Karabell (2018) Russia’s market transformation has presented opportunities and challenges for business cooperation. Success in US-Russian business ventures requires understanding of cultural similarities and differences between partners.
When business mixes between the US and Russia, a conflict of Western style management and and Russian business operations can lead to misunderstandings. There are significant differences which remain between US and Russian managers in such functions as planning and organizing (Karabell, 2018). On the other hand, a convergence effect is noticeable in the behavior-oriented managerial function of leadership. While the monolithic organizational structure is not easy to dismantle, behavioral aspects popular in US management are generally easy to adopt for Russian managers.
It has been said that Russian management tends to be centralized and directive (Warburton, 2018). In Russia, the boss – especially the big boss – is expected to issue direct instructions for subordinates to follow with very little room for interpretation. Likewise, consultation will be minimal from associates lower down the company hierarchy. In Russian businesses, too much consultation from a senior manager could be seen as a sign of weakness and lack of decisiveness (Warburton, 2018).
In most US companies, mid-level management has decision making powers over operations and strategy which directly impact their departments. This is not the case in Russian companies. According to Warburton (2018) middle managers have little power over strategy or input in significant strategic decisions. The most powerful middle managers are the ones who have the most immediate connection to the decision-maker at the top of the organization. Ultimately, debating with middle managers with no real decision making abilities proves to be a waste of time. Decisions are made at the top in Russian businesses, and their word holds clout. The most significant reason for delay in reaching a decision in Russia is that the decision has not been put in front of the real decision-maker (Warburton, 2018).
Another area of business lies in delegation. Managers of all levels in US businesses can be found delegating duties to their subordinates. Russian delegation within business is usually in terms of managers giving precise instructions to subordinates who are expected to perform their allocated tasks with little or no discussion (Warburton, 2018). Many westerners complain of a lack of initiative from local Russian staff, while Russian staff will often lament over the lack of clear, unambiguous advice from foreign managers. Russian workers want to be told what to do and when to do it from those who supervise them.
With all aspects of business, it is crucial to take age into consideration. According to Warburton (2018), younger managers, who have developed in the post-Soviet era, may be much more heavily influenced by western management theory than their older counterparts. Match this new Russian management style with the US Millenials, and the need for greater understanding between the two partners becomes all the more evident.
Karabell, S. 2018. Leadership in Russia: The Putin Paradigm. Retrieved on November 19, 2018
from https://www.forbes.com/sites/shelliekarabell/2014/12/15/leadership-in-russia-the-putin-
Warburton, K. 2018. Russian Management Style. Retrieved on November 19, 2018 from
https://www.worldbusinessculture.com/country-profiles/russia/culture/
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