Opening Asia for Russia

24.12.2017 129 просмотров

Alexey Maslov, Doctor of Historical Sciences, professor at the Higher School of Economics and an orientalist spoke in an interview with our TV channel about the peculiarities of the Asian style of doing business.


The key to succeeding on the Asian continent lies in mastering the peculiarities of the local business mentality, sometimes significantly different from Russian or Western business practices.

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I wanted to talk about what business is in Asia and what a Russian who is going or thinking of opening a business there needs, if not to know, then at least to understand in general and in general in the business practices of this continent. How different is the reality of modern business in Asia from the idea that we have?


- The only and main advice that I always want to give people making their debut with Asia in the business field, this is to carefully study the rules of the local commercial culture and the laws that apply there. Because Asia is different. If you have, for example, experience working with Korea, this does not mean that you will be able to work with China or India, since we are talking about completely different markets and, most importantly, different business cultures.


Business practices vary greatly. Moreover, the European may not notice this. By analogy, if you suddenly decide to develop business with Western Europe or, for example, with the United States, you do not need to separately study the psychology of Western Europe or the psychology of Americans. You, in fact, work in the same conceptual apparatus, imputing to itself the corresponding vision of business, as Western Europe. Of course, we ourselves are part of the Western world.


First, you need to study how real business structures in Asia operate. It doesn't matter what the interested parties write about themselves and post on the websites. The only thing of value is how they act; what is the speed of the project; with whom it is necessary to negotiate; who is the key player after all.


In China, the main thing is to reach the level of state structures that make fundamental decisions. In India, the state plays a less prominent role. In Japan, you can very well work with a private corporation without the approval of the prime minister's cabinet.


local laws. The problem is that formally, of course, many laws have been translated into Chinese or English. However, a lot of things fall out of the frame imperceptibly. Sometimes even the Chinese themselves, who are ready to start serious business with you and give you advice on the implementation of investments, do not themselves know their laws, because they have no experience.


< p> From this point of view, you yourself should study the entire package of documents on the basis of which you have to work.


But there is also a third point: often we rely on intermediary structures. Mediators themselves can be useful because they facilitate communication. But the fact is that if in the West - for example, in the USA, intermediaries are primarily lobbyists who promote the project for money, then in China there are intermediary structures, but lobbying has not developed.

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There are many firms that will help you register your company in China, explain some simple things. But the ultimate responsibility for business activities will rest with you. Unfortunately, too many frankly empty business associations between Russia and other Asian countries have been created, which sometimes simply mislead businessmen. The clients of these structures hope to break through a channel to enter the Chinese or Indian market, but in reality they are simply wasting time. Therefore, to begin with, to enter the Asian market, it is necessary to prepare very well and clearly understand, monitor, even if you spend money. Perhaps these costs will save millions of investments.



- That is, Russia has the wrong approach to the issue of entry in Asian business? And since it is impossible to use the strategy that we use in the West, maybe when working with Asia we should use the Western European experience?


-Indeed, the West has a lot of ideas about how to work with Asia. Moreover, the stage we are now facing, on the one hand, really symbolizes Russia's turn to the East, and on the other hand, has not yet led to a significant effect.


The West realized that just like that, in a rush or through mediation, doing business in China, India or Vietnam will not work. The best impromptu is a well-prepared impromptu.


If we are going to work seriously, we will have to create such structures and move away from the unnecessary hype that often arises today. After all, the problem today is not only how to get to Asia.


Let's pay attention to what many Russian businessmen are doing. They come to China or India; they are well received there; they negotiate, sign a variety of protocols of intent... This may be at the middle level or even in the plane of existence of the largest Russian and regional projects supervised by ministries.


Often, participants in the process from the Russian side are confident in the inviolability of the agreements reached regarding capital investments or the location of production. Sometimes stakeholders have the feeling that the final decision of their business partners has already been made.


Such misconceptions arise quite frankly. However, the behavior of these individuals is contrary to Asian business practice. Moreover, this practice varies greatly in each individual country.


Accordingly, every person who starts working with China goes through the same the same steps. First he has to get over China. He will definitely say: “You didn’t succeed, but I arrived and agreed on everything. Now everything will be different!” Then everything returns to normal.


As a result, there are several stages of preparation. First, if you offer some goods to China or India (and in Russia now there is something to offer - the agricultural industry, some technologies), you need to carefully monitor. It is not just to study whether the Chinese eat sweets, but to find out in which specific regions they eat it, that is, to find out the market demands. How the price of sugar, for example, fluctuates should be studied; how to sell this sugar to grocery chains. You need to delve into a lot of subtleties. And maybe one day, having calculated your operating expenses, you will say: no, I won’t pull it, it’s interesting, but it’s not that. I do not know a single person who would have made a lot of money in China in the first year, but I know dozens, if not hundreds of people who went bankrupt in the first year precisely because they did not calculate these expenses in advance.

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There are a lot of hidden costs in the Asian market. If you still decide to live there with your family and want your children to study there, then be prepared to include these costs in operating expenses. And even if your concept allows you to earn a good profit, you need to take care of the issue of capital repatriation and evaluate the associated costs. This service is far from free and, for example, in the Chinese market, you will lose up to 40% of your profits when you try to transfer funds from China abroad. Are you ready to make such a decision? Asia today is very different. When we work with China or India, we must understand that sometimes it is more profitable to deliver goods through Singapore, and to carry out financial transactions through Hong Kong. That is, it is necessary to cover the whole range of problems. The period of small-scale shuttle retail has already passed. What is needed today is a different approach than endless theorizing. Let's practice!


Undoubtedly, in different countries of Asia, local economic systems developed differently and have different historical backgrounds. Somewhere else recently they tried to build socialism and live according to the rules of a planned economy; somewhere, as in Japan, for example, in fact, under external control in the state, both the economy and the very principles of managing the national economy took shape. In India, the economic system in general arose under the influence of the British. It turns out that each Asian country has gone through its own stages of economic growth. Hence the lack of uniformity. How can a businessman who wants to do this understand this?


I think that it is very difficult to do this, but the walking one will master the road. For example, I would like to point out that there are many large universities, including both Russian and foreign ones, as well as large Singaporean and Hong Kong business schools that conduct courses on local conditions. Many people think that it is not worth spending a lot of money on this. But if you want to work with Asia, then you still have to do it. The main thing is to see that this is not exclusively profanity, as, unfortunately, it often happens in Russia. & nbsp;


You don't need inapplicable theoretical models because Asia is always very practical. I also suggest learning how to invite specialists. They can be Russian or Western. These may be large consulting firms, but at least they will explain what should or should not be done.


At the same time, knowledge of specific things - laws, formal rules - is undoubtedly very important, but there is still such a difficultly perceptible and tangible concept as the general philosophy of doing business . It is believed that there is a Western approach, and there is a purely Asian approach. It is often said about Russia, with a negative connotation, that there is too much Asianness in it. But it is possible that it is this aspect that somehow facilitates our business contacts with Asia. Is it so? Are we really mentally similar to the Asian way of doing business?


I think that what is called Asianism in Russia is actually a purely Russian trait that does not belong to Asia. In that part of the world, there are enough distortions. For example, Russians often work in China according to Western patterns. And according to the canons of the Asian continent, when concluding a deal, a leisurely discussion is required. The first visit to China or India is not made to conclude a contract, but to establish trusting friendly contacts. It may take a second or third visit to reach an understanding. But this stage is necessary, and rough pressure will not lead to the desired result.


For this reason, only after the acquaintance stage has passed, it is possible to proceed to the phase of business negotiations. Often this practice is applicable in India. Suddenly, your partner simply drops out of the correspondence, disappears from the negotiations, as if discarding or forgetting what you have worked together. At this time, he has an internal discussion, which you may not know about. You are not aware of how, through what channels it passes, but then you are given a ready-made solution.


This approach is not typical for Russia. For this reason, in many ways, the Russian business culture has its own characteristics, different from the Western school. Although, in my opinion, in our time, modern Russian business works quite hard and competently, and with a large degree of obligation. For a couple of decades, Russia has gone its own way, a normal business culture has been formed. But in Asia there is a peculiar style. Asian culture is expressed not in how payments or transfers are made (this is an international system), but in how negotiations are conducted. In this field, business etiquette is especially important.


Sometimes the question arises: why should we join this culture? Why should we become more Asian than Asians should become Westerners? This is a good question, and it is usually discussed, but so far, practice shows that a successful business is based on a thorough knowledge of local realities. Do not wait for your partner to study your features.

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