Cultural Issues and Business in the Russian Federation - Research Paper Example

Section/# Cultural Issues and Business in the Russian Federation Contents: Introduction Issues and Analysis Conclusion Introduction: According to Hofstede, Russia ranks at disproportionate levels in terms of the 6-D analysis of culture. Likewise, the distribution is illustrated below in figure 1 and shows how all of these cultural dynamics help to define the way in which the Russian culture is exhibited and how individuals relate with one another; as well as with outsiders. Figure 1: Quite obviously, Russian serves as the predominant language within the culture of the Russian Federation. Written in a 33 character Cyrillic alphabet that dates back to the times of early Christianity, the alphabet itself is relatively simple to understand after a bit of study; however, the grammar and syntax requires nearly a lifetime of practice prior to one being able to speak it without error. Accordingly, the following is a list of how one might say hello, goodbye, thank you, you’re welcome, yes and no respectively (Lubimov et al., 2013): Zdrastvyuite Do svidanja Scpacibo Pazhalsta Da Nyet Issues and Analysis: An additional factor that must be appreciated has to do with the fact that means do not follow the same convention as they might in the Western world. For instance, within the United States, France, Germany, or a litany of other nations, it is common that a given name is followed by the family name. However, within Russian, a given name is preceded by a patronymic and familiar name. For instance, if an individual is named Ivan and their father is named Stephen, their naming convention would be Ivan Stephanovich + last name. This is confusing to many outsiders as the interchangeability of how these individuals are called by friends and associates differentiates as well. For instance, if a woman is named Anastasia, she may be called in a diminutive sense as Nastya. This is not expected or even appropriate for business interactions as these diminutives are reserved for those that have a close personal or intimate relation with the person in question. In terms of social protocol, there are not many differences between Russian culture and Western culture. However, specific cuisine, and the custom of first-time meeting and gift exchange is common. For instance, if an individual business associate is invited to the home of another, it is expected that they should bring a gift, either for the family as a whole, or at the very least – for children that might be exhibited within the household. As far as taboos, it is expected that individuals will remove their shoes once entering someone else’s place of residence. Traditionally, male and female interactions do not differ greatly as compared to other Western European nations and gestures and body language remain ultimately the same as well. Furthermore, with respect to monetary system, the Russian Federation, as well as the Soviet Union before it, has operated on the monetary unit of the ruble for centuries. The ruble of course fluctuates with respect to its overall strength against the dollar; however, at the current time, the ruble is approximately 29:1 USD (Aleksandrovich, 2014). Compared to the United States, wages paid to workers are of course quite low. For instance, the average salary within the Russian Federation per year does not yet approached $20,000. The greatest expense with respect to doing business has to do with the long wait times and difficult to navigate bureaucracy defined so much of the Russian Federation. For instance, many firms have found themselves waiting up to one year for a permit as simple as gaining access to existing public water (Antonenko et al., 2013). In terms of geography, it must be understood that the Russian Federation is the largest country on earth; encompassing over a different time zones. As a direct result of this, the difficulty of doing business would necessarily require the businessman to be keenly aware of the fact that the time zone in Moscow does not necessarily equate to what time zone elsewhere within the Russian Federation might be. Traveling within the country is oftentimes most effective via the use of light rail. As the Soviet Union developed a robust system of transportation, real travel remains the most efficient and effective means of transporting oneself from one place to another (Aleksandrovich & Vyacheslavovna, 2013). However, as compared to the United States, the system of roads and infrastructure connected with this leaves much to be desired. This not only has to do with the fact that the Russian Federation is not sufficient resources to updating this structure, it also has to do with the fact that extreme cold temperatures degrade the infrastructure to a much higher degree as compared to the United States and requires nearly continual maintenance. In terms of differentials with respect to ethical differences between the Russian Federation the United States, it must be understood that bribery ranks as one of the most profound issues that the Russian Federation currently faces. As a function of an extraordinarily inefficient Soviet bureaucracy that existed for nearly 80 years, the Russian Federation currently struggles with a culture of bribery that saps much-needed economic strength from all aspects of the economy. Even a simple process of seeking to get a driver’s license can oftentimes involved the need to pay a substantial bride as a function of ensuring that the process will be expedited and not language within bureaucratic channels for a period of several years. Furthermore, as compared to the United States, there is little or no protection for individual property rights. In the event that a government entity wishes to utilize the property of another private citizen, a series of forms and papers can immediately be filed with the local jurisdiction and property can shift hands relatively simply. Compounded by the issue of bribery, this drastically reduces the overall potential for business to be interested in the country and scares me investors away. Additionally, issues pertaining to intellectual property rights are also far less than they are within the United States. Whereas it is illegal within the United States to download or pirate intellectual property, the same practice is illegal within the Russian Federation; however, the legal system does not extend any effort whatsoever in seeking to stop this practice. Furthermore, wholesale piracy on a corporate level sees movies, games, and other proprietary goods sold on open markets throughout the Russian Federation. One must not ignore the history and cultural heritage that the Russian Federation reflects. Many individuals that have sought to perform business within the Russian Federation have done so at their own peril (ONeal, 2014). Ultimately, the hardships, unique realities, and sense of identity and the Soviet era represented have been impactful with regard to the way in which relationships are formed, understanding is engaged, and business is conducted. Even though the current political system is not communist and origin, it is still totalitarian. The current president, Vladimir Putin, acts as a strongman that seeks to manage almost each and every aspect of the nation’s development; up to and including its economic growth. Other issues that must be discussed are with regard to health and restricted spaces within the nation. Whereas it is true that the Russian Federation has come a long way in promoting the overall health of its populace, current mortality rate among men are extraordinarily high; due in part to the fact that strong levels of drinking and alcoholism, not to mention smoking, define the way in which many individuals live their lives. After the Soviet system class, there was of course little money to invest with regard to the hospital complex or the nation’s health infrastructure. As a result of this, it languished for years with virtually no investment and virtually no improvement in the overall prospects of health and the general population. However, in recent years, has a direct result back to the Russian Federation started to make a great deal of money based upon oil and natural gas sales, further monies have been directed towards improving the nation’s health infrastructure. However, the overall life expectancy of man stands at a scant 63 years and women fare somewhat better with an average life expectancy of 71 (Damdinov, 2013). However, by means of comparison to the rest of the developed world, it is clear and apparent Russian Federation exhibits an extraordinarily low expectancy. Businesses might also faced difficulty with respect to the fact that many places within the Russian Federation are becoming “restricted places” yet again. During periods of the Soviet Union, there were entire cities that were considered as “closed” to outsiders. The underlying reason for this has to do with the fact is responsible for the production of sensitive military hardware. Once again, as the Russian Federation begins to close itself off from the rest of the outside world, they are developing spheres of restricted areas that foreigners and businesses cannot do business with them. Conclusion: From the information that has thus far been engaged, it is clear and apparent that the Russian Federation offers many challenges to individuals or institutions that would seek to promote their business within its borders. However, changes slowly taking place and it is expected by this analyst that within the next 15 to 20 years a further level of democracy will be represented within the Russian Federation and indicate a situation in which an improved business environment will be possible. References Aleksandrovich, P., & Vyacheslavovna, B. (2014). OPTIMIZATION OF FINANCIAL SUPPORT MECHANISM FOR SMALL AND MEDIUM SIZE BUSINESSES IN RUSSIA. (English). Society: Politics, Economics, Law, (2), 1-8. Aleksandrovich, K. (2013). BUSINESS-INCUBATION AS A PERSPECTIVE FORM OF SMALL BUSINESS SUPPORT AND DEVELOPMENT IN RUSSIA. (English). Society: Politics, Economics, Law, (1), 1-4. ANTONENKO, N., GALUKHINA, Y., & PAPPE, Y. (2013). Main Trends in Russian Big Business in the 2000s. Social Sciences, 44(4), 3-24. Damdinov, D. D. (2013). SMALL BUSINESS DEVELOPMENT IN RUSSIA. (English). Bulletin Of The East Siberian State University Of Technology / Vestnik VSGTU, 41(2), 112-118. Lubimov, L. L., Vidishcheva, E. V., & Ransberger, M. (2013). Problems and Perspectives of Doing Business in Post-crisis Russia.European Researcher, 39(1-2), 157-163. ONeal, M. (2014). Invisible and slow: small business and the "civic-ness" of Russias regions, 1991-2009. Post-Soviet Affairs,30(4), 324-340. doi:10.1080/1060586X.2013.843897 Read More