To Russia with love

The 2005 MiB Forum took Russia as its theme yesterday, building on a history of contact and trade with Norway that goes back over 1000 years.

28.10.2005 - James Hosea

The first clear message from the MIB Forum was that Russia is changing fast.

In contrast to the older generations, young Russians are well travelled, well educated, technologically sophisticated, interested in the internet, and they speak good English.

"Russia is becoming more European, but deep down it still has a Russian soul that will never change", said Irina Roddvik of Telenor

The message from Roddvik was clear. Understanding this Russian soul is the key to doing business there.

The more you know about Russian film, literature, humour, history and its people, the more you will understand its culture and the easier it is to do business with them.

Demanding consumers
Russia holds a huge potential market for fast moving consumer goods (FMCGs). As they become more wealthy, Russians are demanding higher quality products.

Svein Ruud of Troika Seafood illustrated this point with an example from one of the top hotels in Moscow. When asked about using Norwegian salmon in the hotel restaurant, the French head chief replied,

"No way could I use Norwegian fish. It would damage my reputation"

Rudd and others emphasised the point that Russian consumers are becoming more demanding, largely as a result of higher disposable incomes. The traditional Norwegian model of selling products by volume, instead of focusing on the quality of the product now seems a short sighted strategy for the Russian market.

Not difficult, just different
Per Anders Hem from the Moscow office of Innovasjon Norge was clear from the start with his thoughts on Russia.

"Its not a difficult market", he said "Its just different. Imagine coming to Norway as a foreigner and trying to start a business without knowing the language"

Hem emphasised the need to try and think about things from a Russian perspective, and not just to follow blindly what the media say.

Several speakers commented on the negative image of Russia that is often shown in the media. At the same time China, a communist state with a poor human rights record, is portrayed as a land of plenty for the Norwegian business community.

Local partners important
Corruption was a theme taken up by many of the speakers. Reidar Karlsen of A-pressen gave an account of his company's experience in Russia.

Since first entering the Russian market in 1999, A-pressen has reached its initial target of payback in 5 years and now has a 22% profit margin for its operations there.

Karlsen went on to give a set of golden rules, based on A-pressen's experience in the country. Amongst these he stressed the important of developing sincere personal relations with Russian business partners.

"Personal relations are the best thing to protect business in Russia", said Karlsen

"Always invest with Russian partners and make sure they put their money on the table first."

Another successful MIB Forum
This was the third year that the MIB students at NHH have organised the MIB Forum, and it was very well received by both delegates and speakers.

"I would have been a MiB student if I had had the opportunity in my day. Instead I had to learn about International Business the hard way", commented Jan Thomson of the Norwegian Embassy in Moscow and NHH Alumni from 1972.