Product details

This is the first of a two-case series. Direct foreign investment in Russia was only 1% of GDP in 1999, and Russian industry was only half as productive in that year as in 1992. Not surprisingly, the prevailing opinion is that privatisation has only aggravated Russia's economic problems, and that foreign firms should avoid investing in Russia for the time being. This case study argues on the contrary; Russian companies can be successfully integrated within a multi-national organisation. It shows that an Anglo-Saxon-style revolutionary change process is not always the best way to proceed in Eastern European organisations; that the commonly accepted goals of rapid change, employee empowerment and a flatter hierarchy are not necessarily appropriate in these organisations in the short-term; and that even the definitions of trust, strategy and leadership can differ according to cultural context. The challenge lies in understanding the complexities - the lingering influence of the Soviet planned central economy, as well as the Russian culture and management systems. This case describes the process of transforming a Russian organisation, still run as if it were part of the Soviet-era planned economy, to one with leadership and mentality to operate as part of a global organisation in an open market.