September 2006 Archives

As Russia's economy supported by high oil and gas prices continues to expand at one of the highest rates in Europe and its needs for management talent increases proportionally, more Western executives turn their eyes towards the North-West- making a change from China, India and Dubai - would you consider an interim management assignment in Russia?

"According to PriceWaterhouseCoopers, Russia's hunger for management talent has raised executive remuneration levels above the US, Canada and Western Europe. High pay, a booming economy, bigger responsibilities - what else does a professional executive from outside Russia need to encourage them to pack up their bags and fly to Moscow? And indeed, many do.

However, not everyone returns home with sacks of cash and a great sum. They don't all manage to navigate the very different commercial and business environment that exists in Russia. And these differences may not be immediately apparent to foreign executives when they fly to Moscow in a Western-built plane, ride to town in a foreign car, stay in a Western hotel with English speaking staff and later move to an apartment, which looks like one in Manhattan or London.

There are many frustrated expatriates, who have either left or are thinking about leaving, because their corporate life has become unbearable. The main reason for a foreign executive's frustration is usually his inability to get things done, because of the inadequate resources and support available. Although he may have discussed his requirements before signing the contract, repeated them again after arriving in Russia and received comforting reassurances, he may find the resources lacking when he starts his new job.

Naturally enough the foreign executive will try to hold the company to its original commitment. After making a fuss with his managers, the ex-pat might quickly find that he has ended up isolating himself within the organisation. It is also common for expatriate managers to find that they get the blame for other people's mistakes. Although this can be a widespread practice in highly politicised Russian organizations, foreigners naturally take it very personally and feel deeply hurt.

The same is true about being criticized by the boss over matters of style rather than the results themselves. And, finally, some expatriates manage to get into difficulties with external actors such as suppliers, customers or government officials. This may happen because they are being too rigid and applying existing laws and regulations in too literal a sense or by assuming that they have understood the system and relaxing the rules too much.

Although there is no single formula for working in Russian organizations, there are a number of strategies expatriates can use to avoid or overcome some of the problems they may encounter.

Establish professional credibility
Russians are suspicious towards all outsiders - foreigners, new hires or migrants. One has to prove one's good intentions; no credit is given to anybody. The best way for an ex-pat to gain legitimacy is by doing what he is really good at, doing it on his own without asking for resources, quickly and producing tangible results.

Ideally it would be something that local people could not accomplish alone. A senior executive from BP won hearts and minds by finding an elegant solution to a problem with an oil well they had been struggling with for months. The faster the credibility is established the better are the chances for getting adequate material and emotional support from Russian colleagues.

Respect the boss
The Russian organization is a pyramid consisting of many other pyramids. The role of any boss at any level could hardly be overestimated - he or she is a central figure and the organisation revolves around them as the earth moves around the sun. Any expatriate with a Russian boss has to keep this fact in his mind throughout his tenure in a Russian company.

A foreigner needs to do a number of simple things to keep their Russian boss happy and supportive. Never get between the boss and the sun - his or her own boss. Give credit to the boss for everything that happens in his or her galaxy. Keep a distance and emphasize your respect during all public meetings (this does not mean you cannot become close friends and do wild things with your boss far from the public eye), do not call the boss by his first name or slap him on the back - even if he does it. Demonstrate that you are not a threat to you boss - share information, talk about your plans (you do not have plans to take his job, do you?), help him or her whenever you can.

Treat people with dignity
In hierarchical Russian companies people react very positively to a respectful leadership style, and furthermore they expect it from foreigners. The worst thing an expatriate manager could do is to emulate the yelling and fist-thumping style of some Russian business leaders.

Find Russian mentors
Every newcomer needs help in making sense out of the complex web of relationships in Russian organisations. They should actively probe and find some like-minded Russian colleagues and turn them into mentors and advisors. It is usually quite easy to do since many Russian managers, especially younger ones are eager to learn more about the West, its management methods, culture, etc. The relationship should be informal and work both ways.

Demonstrate interest in Russian culture
Russians usually do not expect their foreign colleagues to be fluent in their mother tongue. However, they very much appreciate expatriates' efforts to understand Russia and its culture. Demonstrating respect for the local way of life by learning some simple Russian phrases, reading literature, visiting historical sites and sharing your impressions will soften the hearts of Russians in the office and in private life and give an expatriate manager a few extra points.

Stay away from murky areas
At one of my CEO jobs in Russia I had to clean a mess created by my expatriate predecessor who had engaged "specialists" (criminals) from a region to resolve a dispute with a minority shareholder of one of the joint ventures. The Mafioso did not solve the problem, but kept coming back with requests for more money. It is very easy for an expatriate to get himself and his business in trouble after entering numerous not-so-transparent areas of modern Russian business life such as customs clearing, dealing with power agencies and ministries, tax or fire inspectorates, etc.

This tricky business can be learned, but at a high cost both to the individual and the company. It is better that expatriates leave such matters to trusted Russian colleagues and concentrate on their core skills."

Thank you to World Business.

The foreign manager's Russian survival guide

Source: Stanislav Shekshnia, World Business web exclusive
Reviewed: 26-Sep-06 -Stanislav Shekshnia is an affiliated professor of entrepreneurship at INSEAD and a partner in Zest Leadership.

Global turnover of CEOs hit a new record in 2005, with more than one in seven of the world's largest companies changing leaders compared with less than 10% a decade ago.

Our average Interim Manager is on assignment for approximately 7/8 months and 80% of assignments are extended. This is against the industry norm amongst IMA (Interim Management Association) providers, which is currently running this year somewhere on average between 98-120 days. So it was interesting to read how the tenure of permanent senior management, specifically CEOs is shortening but also potentially the opportunity for senior Interim Managers to play a role in under performing organisations and also those facing challenges post mergers within large public companies. Good news for Interim Managers, the Interim providers and the Executive Search world-what do you think?

Article: "Four times as many CEOs were forced out last year as in 1995, while overall a half of all CEOs leave because of poor performance or following mergers (rather than through retirement or other planned departure).

Boards of directors and shareholders are increasingly taking action against under performance, according to this annual study of CEO succession at the world's 2,500 largest public companies.

Other findings include an increase in the poaching of CEOs - which feeds into ever higher pay - and a tendency for CEOs brought in from outside to produce much better returns in their first two years than those promoted from within.

It seems they do better at initially shaking up a company, while CEOs promoted from inside companies do better over the longer term. Companies that hire outsiders should plan for their tenure to last about five years: time for transformational improvements to take hold and be recognised, but with a replacement found before performance trails off."

Thank you to the source-World Business:
CEO Succession 2005: the crest of the wave,
Chuck Lucier, Paul Kocourek and Rolf Habbel,
Strategy + Business, Issue 43, summer 2006-Review by Steve Lodge

The NHS is a very large user of Interim Managers and it is widely regarded that they are making a tremendous impact on transforming the health service; this contribution is unlikely to change despite occasional political mutterings. Yesterday evening Impact Executives and our sister company Harvey Nash Executive Search sponsored the HSJ Awards that highlights the people, who right now, have the biggest influence on the policy and practice of the NHS. The full list in the link below provides a unique insight into the individuals and ideas that are shaping not just today's health service but how it will look in the years to come.

The Top 6 included:

1. Professor Paul Corrigan-Health Advisor to the Prime Minister
2. Patricia Hewitt-Secretary of State for Health
3. David Nicholson-NHS Chief Executive
4. Sir Liam Donaldson-Chief Medical Officer
5. Lord Warner-Minister of State for Reform
6. Hugh Taylor-Acting Permanent Secretary, DoH

The two top spots are the most likely to raise eyebrows. What does it mean when the Prime Minister's special advisor for Health, Prof. Paul Corrigan, is viewed as more influential than Health Secretary Patricia Hewitt? What is clear is the deep understanding that Corrigan has of the NHS (he was Reed's special advisor) and the connections he has made between policy and delivery in the corridors of Number 10.

The top 25 is dominated by those connected with the Department of health, both ministerial and policy guru's. There are few surprises in placement, such as the CMO rising above most of his political managers. The list also reflects the rise of several of the new Strategic Health Authority chief executives, though not all feature - yet.

So what skills should the top 50 of tomorrow focus on developing? On the ground at Trust and even SHA level, responding to constant change requires huge capacity to handle pressure and to deliver consistent improvements in performance.

More than ever, individual and organisational accountability and embedded performance management have come to the fore as critical skills for all involved in the NHS. Finally, financial management skills are increasingly seen as the core competence for all existing and aspiring leaders - perhaps this is the watershed between the 'old' and 'new' NHS.

The NHS is widely regarded as the most controversial part of the Public Sector, if you have been an Interim Manager within the NHS, what do you think?

Link:http://www.goodmanagement-hsj.co.uk/hsjsupplements/hsj_top50_supp_140906.pdf

As Summer comes to a close, holidays for many in the Interim Management world are becoming a distant memory and attention is turning back to business travel. I was intrigued to read this month in Director magazine about the fastest growing long-haul routes..the league table was as follows:

1.London>Dubai,

2. London>Chicago,

3.London>Hong Kong,

4.Melbourne>Singapore,

5.Sydney>Singapore,

6. London>Singapore,

7. London>Mumbai,

8.Dubai>Singapore,

9.London>New York,

10.Brisbane>Singapore.

This coincided with seeing an article in The Times stating that Britain has slipped back in the global league of business-friendly economies, as the world enjoys an unprecedented era of market reform, according to a World bank report. The UK was named now as only the sixth-best place in the world to start and run a business, a notch down from the fifth-best place that it achieved last year in the annual study. The league I found interesting is as below: