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 Building Capitalism and Ending Communism in East European Business Culture
 Michael D. Kennedy
Sessions
Session 3
Session 2Session 4

The Challenge of Transition and Specific Skills

Managing the transition firm is very difficult, but transition culture expects that if you have the right skills and right attitude, you should succeed. But even the most accomplished manager cannot always be assured of success. One Western-educated but East European born manager recalled,

... it's so overwhelming, and so frustrating. Because those very basic, fundamental things that should be easy to accomplish don't happen. And you get frustrated. Because it puts you in the position where you feel sometimes professionally embarrassed.... You know, you--your boss comes, says: "Right, you know, two months ago we talked about the fact that perhaps in those, supermarkets, when we sell chips in big shipping cases we should put labels on them so that people, you know, like in club stores here--So people can see what's inside..." Pretty basic. You still don't have it. Two months later. You, you would just take this and glue it on, right? It's pretty simple. And you feel stupid. Because you've been trying for the last two months [begins to laugh] to put it into the system. And everything possible on the way--failed. And it's a daily occurrence.

With this as a point of departure, one might argue that no manager is likely to be up to the task of managing a transition firm. Every manager, before the foreign observer with limited experience in transition, is likely to be found wanting, and to be found "socialist" in some particular fashion. Hence, a socialist "infection" might not be limited to the middle-aged and elder East European, but rather, to those who become too embedded in local practices, or responsible for how things work locally.

Thinking Point

For an East European manager to demonstrate membership in transition culture, what skill sets must he or she possess?

In the face of this difficulty, East Europeans and Westerners can collaborate in producing the imagery of an East European manager who has left the socialist past behind. This imagery depends on elevating particular kinds of skills as indicators of membership in transition culture. Those who possess these skills might be recognized as part of the radiant future of transition even if solving the problems of the firm is beyond everyone. And to claim that another lacks those skills might consign them to the past beyond redemption. However, people in different locations have different claims to competence, and are likely to assign to others different kinds of limitations.

Americans were more likely to emphasize communications and presentation skills as their own special competence and the specific inadequacy of East Europeans. After praising the common sense of her East European manager, one American expert emphasized a fundamental flaw: they didn't know how to work in a team, and failed to communicate between departments and levels of management. "Lack of communication, besides lack of money, that's the biggest problem at the company, and it's really really bad, almost zero communication." Communication was indeed a problem other outsiders mentioned, although no East Europeans among those I interviewed mentioned it as a major issue.

Both Americans and East Europeans used expertise in personnel management as an indicator of membership in transition culture, but in a fairly limited set of ways. A good manager figures out how to provide the right compensation to motivate his employees. They know how to stimulate individual responsibility for company success. They are also willing to fire unnecessary or irresponsible personnel. Only two East European managers emphasized that they would do more than fire the redundant worker. They might retrain them or encourage them to set up privatized firms, but otherwise, the East European manager demonstrated their membership in transition culture by their readiness to dismiss employees.

Thinking Point

Create a list of particular skills that Western advisors value and that East European managers value. How might actors within transition culture draw from both skill sets?

Good human resource management skills are an especially powerful way for marking the difference between transition culture and the socialist culture that is to be left behind. No American advisor emphasized the inadequacies of East European management when it came to personnel management, however. By contrast, East European managers used this as a way to mark their difference from their own colleagues or subordinates. For instance, one East European manager recalled the surprise of his employees when he announced that he was closing down one department of the firm. I asked him, with intentional naiveté, why they expected him to defend that department. He said,

They felt that they, they knew me from the past time (when he was a director 30 years earlier). That I was, let's say, a patriot of this company, (but) they badly understand what is pat--local patriotism. For me local patriotism is to earn money. For those who want to work, and not to defend those groups and machines which are worthless from the technological point of view. They are good for a museum. They (the employees) are too sentimental. I am not sentimental anymore.

Beyond personnel management, marketing is the other commonly identified lack of managerial skills in transition culture. The compelling general story around which more specific stories are typically inserted is organized around two elements. Transition is about the move from the production-centered to the market-driven company. This transformation of the firm typically takes place within uncertain or difficult markets. Several respondents in our interviews used marketing to speak of how well they are doing, or how their managers are quite good. They spoke of their firm's success in doing market research or in their focus on a particular market segment useful for their product. They talked about becoming more customer-oriented. They introduced special advertisements and special slogans directed toward their upper-end clientele. In the most high-minded of these accounts, one person said that he sold ideas and not just goods. Only East European managers invoked marketing as a claim to their own distinction. It was also used, however, to indicate the limitations of other East Europeans.

One East European CEO complained about how his marketing department kept sending out 'socialist style letters.' The same East European managers who praised their own accomplishments in marketing could still point to others in their own firms who continued in a socialist style of sales, just leaving goods on the shelves expecting them to sell themselves for their own qualities.

Occasionally, East Europeans might invoke other markers of professional competence to distinguish the good manager from managers with socialist mindsets or corrupt practices. One manager, for instance, emphasized his abilities in making projections, and the unwillingness of his former boss to pay attention to those data. The specifics are interesting, but the more important point here is that the focus on specific competencies is another, more refined layer, of transition culture.

At the crudest level, transition culture presumes East European inferiority to globalized business practice. But because transition culture requires East European success, it must provide a means for the globalization of East European management practices and the assimilation of East Europeans. Because East Europeans are not assumed to be part of transition culture, as Americans and other foreigners are, East Europeans must have a means by which they can demonstrate their acquisition of transition culture. Because transition economies are so complicated and difficult, however, East European managers can rarely demonstrate their membership in transition culture in holistic terms, as Americans and other Westerners presume to do themselves. Westerners and East Europeans can identify those East Europeans with specific skill sets associated with marketing, personnel management or communications as belonging to transition culture. One might refine the set of oppositions used to identify the structure of transition culture with an additional list of qualities associated with socialist, or capitalist, management in transition:

The refined set of oppositions used to identify the structure of transition culture.

This refinement of transition culture--the identification of specific inadequacies and the identification of particular professional skills they might acquire--reproduces transition culture. It continues to identify the solutions to rest outside Eastern Europe, and the inadequacies to reside within it. Thus, transition culture provides the means, the identification of specific skill sets that East Europeans can acquire, for them to look like they are "normal," Western, global. It allows the East European to leave socialist culture behind, and enter a transition culture dominated by those outside the country. But over time, the national ownership of this transition culture could come into doubt.



Session 3
Session 2Session 4