Luc Jones, author of the book Guide to Successful Hiring in Russia, partner of the International company with branches in dozens countries ANTAL Russia, which is hiring in Russia CEOs for foreign companies operating in this country. He has been working in Russia since early 90th of the last century. Mr.Jones with his extensive experience and invaluable first hand knowledge of the Russian market shares his experience and thoughts on how to work successfully in Russia, which, as he claims, today is a highly potential benefitial market.
How would you evaluate your company experience of operation in Russia?
Hi, my name is Luc Jones I am a Partner with Antal Russia. We are a British Executive Recruitment company focusing on mostly International companies working here in Russia. The company has been here for 19 years already, we employ 120 staff here. We also have a branch office in Kazakhstan and hopefully Ukraine later this year, so we are very positive about the region in general.
The pluses and minuses of working in Russia – obviously my first piece of advice is if you are worried about doing business in Russia, don’t read the Western press. Unfortunately you will very rarely read a positive story about Russia in the International papers. You might hear something about a Russian company doing an IPO in London but other than that it is usually something negative about Oligarchs or Mr. Putin.
Obviously on the plus side, the fact that everybody is so negative about the market means that there isn’t much more competition for the companies that do come here and want to do business. Russia is very open for business. I think the country could PR itself a lot better. Unfortunately compared to say India or China, the image of Russia is this big horrible closed country. The country doesn’t necessarily make a big effort to bring in investors. But as I say those who do come here generally find that business here is not really any more difficult than anywhere else.
One of the biggest advantages here is the huge lack of competition. Partly because the negative image scares people off. So come to Russia, go to a bar where foreigners hang out, and have a chat to people about what is really happening here and you will actually get a much better picture than simply reading some macro-economics statistics in a magazine. On the whole probably thanks to high commodity prices the market is booming at the moment and we don’t expect to change in the nearest future. Let’s say the negative sentiment around the world is not felt here at all. How sustainable that is in the long run is obviously questionable. I would say that unfortunately too many countries who rely on natural resources and don’t diversify are struggling actually because one way or another the natural resources run out. But generally here there are a lot of Russian companies who want to buy foreign products. Russians like quality products and they are ready to spend money on quality products. This results in business opportunities for the companies who come in to Russia.
So obviously there are pluses and minuses here everywhere but as an investor here – Antal has been here a long time, we continue to expand, we are a very good barometer, a good measuring tool for what is happening here in Russia. Obviously we are seeing more and more companies coming in. This might be what people call the de-coupling effect which is when traditional markets are maybe not abandoned, but are flat so companies need to look elsewhere, where are we going to make some money? OK time to start concentrating on some new areas. Russia being one of the key-Brit companies it obviously falls into that category.
So summing up, I would say don’t come to Russia trying to make a fast buck. Do take it seriously. Business in Russia is done face-to-face. Russians do business with people they like and with people they trust rather than looking at a flashy presentation or a pure brand.
Could you please briefly share with us your current Russian market overview?
We have recently seen a number of trends in terms of hiring in Russia. Nearly everybody is hiring. There is a real warp of talent at the moment. The market is growing more quickly than people themselves are developing, which obviously results in a bubble. Again, the statistics for unemployment are somewhat misleading in Russia because in Moscow unemployment is almost zero.
You will just see in Russia that a lot of people are unaware that Russia actually has the second largest amount of immigrants in the world after the United States. So now is a great time to be looking for a new job if you are a good candidate. It’s actually a great time to be looking for a new job even if you are an average candidate. This makes life difficult for employers because generally Russian candidates expect a minimum of a 20% salary increase when they change their jobs.
There are 10s of thousands of foreign companies here in Russia. Some are new entrants with one or two people. Some have been here 20 years and continue to grow and add but the – I would say the majority talk about success in Russia and continue to invest here. It is often a hard sell to their European headquarters but usually the figures speak for themselves, the turnover here rises and companies keep hiring.
As we know hiring in Russia is going North, could you give us any approximations on how many foreign companies operate in Russia?
As you may or may not be aware, Russia has finally joined the WTO, the World Trade Organisation. It took something like 18 years from submitting its original application to becoming accepted which obviously is good news for Russia and the International community – now what does that mean for investors? Well on the whole I don’t think a great deal is going to change overnight. It certainly hasn’t in the years since Russia was actually accepted into it. Big parties might have been held to celebrate that fact but like with most things little happens overnight.
I think for a lot of foreign investors, the actual fact that Russia has been accepted in itself means that whereas they previously wouldn’t even consider coming into Russia, now at least that door has opened and they might start taking a more serious look at it because otherwise it would raise the question of ‘well why not? Do we want to be in the same category as Syria, Iran, North Korea who are not in it and are highly unlikely to be accepted anytime soon. But with Russia being in it, it joins the club of so-called ‘normal’ countries who want to do things let’s say according to International Standards. Now obviously a lot of Russians are lamenting this saying that it is going to render Russian companies less competitive because obviously big foreign companies who can worked to companies of scale and are more competitive will simply have a huge advantage over them. Now yes that probably is the case to begin with but eventually it will be good for Russia. Russia needs to react. Getting rid of 70 years of Communist rule, changing from a planned economy to a Capitalist driven one is not easy. It never happens overnight, but it has to happen eventually and we believe in the long run it will.