Everything You Always Wanted to Know About...

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Everything You Always Wanted to Know About Russia But Were Afraid to Ask

Transcript of Everything You Always Wanted to Know About...

Page 1: Everything You Always Wanted to Know About Russiaphilosoft-services.com/content/en/downloads/tekom2011/russia.pdf · Outsourcing to Russia 5. Culture-related Aspects. 1. Some Key

Everything

You Always Wanted

to Know

About Russia

But Were Afraid to Ask

Page 2: Everything You Always Wanted to Know About Russiaphilosoft-services.com/content/en/downloads/tekom2011/russia.pdf · Outsourcing to Russia 5. Culture-related Aspects. 1. Some Key

Agenda

1. Some Key Facts about Russia

2. Where are the Money?

3. Business with Russians

4. Outsourcing to Russia

5. Culture-related Aspects

Page 3: Everything You Always Wanted to Know About Russiaphilosoft-services.com/content/en/downloads/tekom2011/russia.pdf · Outsourcing to Russia 5. Culture-related Aspects. 1. Some Key

1. Some Key Facts

about Russia

Geographical Summary

Page 4: Everything You Always Wanted to Know About Russiaphilosoft-services.com/content/en/downloads/tekom2011/russia.pdf · Outsourcing to Russia 5. Culture-related Aspects. 1. Some Key

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Nikolay Dekhtyarenko

Partisans

Legendary Russia

Page 5: Everything You Always Wanted to Know About Russiaphilosoft-services.com/content/en/downloads/tekom2011/russia.pdf · Outsourcing to Russia 5. Culture-related Aspects. 1. Some Key

Real Russia

Area: 17,075,400 km2

Population: 145,000,000

Brazil, Russia, India, China:

countries of growing economics.

Page 6: Everything You Always Wanted to Know About Russiaphilosoft-services.com/content/en/downloads/tekom2011/russia.pdf · Outsourcing to Russia 5. Culture-related Aspects. 1. Some Key

History (simplified)

• Up to 1547: Feudal dominions.

• 1547–1721: Feudal Kingdom (old school).

• 1721–1917: Russian Empire (European).

• 1917–1922: Red Russia.

• 1922–1991: Soviet Russia = USSR.

• 1991–today: Russia (as we see it today).

Page 7: Everything You Always Wanted to Know About Russiaphilosoft-services.com/content/en/downloads/tekom2011/russia.pdf · Outsourcing to Russia 5. Culture-related Aspects. 1. Some Key

Russian Cyrillic Alphabet

Cyrillic LatinА а U (but)

Б б B

В в V

Г г G

Д д D

Е е YE (year)

Ж ж ZH

З з Z

И и I

Й й Y (way)

К к K

Л л L

М м M

Н н N

О о O

П п P

Cyrillic LatinР р R

С с S

Т т T

У у U (cool)

Ф ф F

Х х H

Ц ц TS (zurück)

Ч ч CH

Ш ш SH (push)

Щ щ SH (ship)

Ъ ъ no sound

Ы ы E (we)

Ь ь no sound

Э э E (letter)

Ю ю YU (you)

Я я YA (yard)

Поезд (“poyezd”)

Собака (“sabaka”)

Кошка (“koshka”)

Page 8: Everything You Always Wanted to Know About Russiaphilosoft-services.com/content/en/downloads/tekom2011/russia.pdf · Outsourcing to Russia 5. Culture-related Aspects. 1. Some Key

Russian Language

Good news:

• No articles

• No auxiliary verbs (like be and are in English)

• Word sequence in a sentence is not fixed

Bad news:

• Grammar features three genders

• Plural of nouns is often irregular

• 12 forms for a noun (2 numbers, 6 cases)

• 1000…0 forms for a verb (gender, tense, person, number, mood, etc.)

• Verb’s form depends on the gender of the corresponding noun or person

• Punctuation rules are strict and complicated

Page 9: Everything You Always Wanted to Know About Russiaphilosoft-services.com/content/en/downloads/tekom2011/russia.pdf · Outsourcing to Russia 5. Culture-related Aspects. 1. Some Key

Currency: Ruble

Abbreviation: RUR

Symbol: (informal), р. or руб.

$1 ≈ 32 р.

1 € ≈ 43 р.

How much we

earn and pay in Russia

Some Common Costs

Ticket to a subway: 0.65 €

Average bill in a decent restaurant: 30 €

Two bedroom flat in Moscow: 700 € monthly

My laptop: 850 €

Core Taxes

Individual income tax: 13%

Corporate wages tax: 34.2%

Corporate VAT: 18%

Corporate profit tax: 25%

Average Wages in IT*

Team leader: 3,500 €

Senior developer: 2,800 €

Developer: 1,800 €

*data for Moscow, monthly(!)

Р

Page 10: Everything You Always Wanted to Know About Russiaphilosoft-services.com/content/en/downloads/tekom2011/russia.pdf · Outsourcing to Russia 5. Culture-related Aspects. 1. Some Key

How hard we work

in Russia

• Working week: 5 days (Mon–Fri)

• Working day: 8–10 hours

• Vacations: 20 business days per year

• Holidays:– Dec 31– Jan 11

– Feb 23

– Mar 8

– May 1, 2, and 8, 9

– Jun 12

– Nov 4

We

work

We

don’t

Page 11: Everything You Always Wanted to Know About Russiaphilosoft-services.com/content/en/downloads/tekom2011/russia.pdf · Outsourcing to Russia 5. Culture-related Aspects. 1. Some Key

2. Where are the Money

Why it’s a good idea to do Business with Russians

Page 12: Everything You Always Wanted to Know About Russiaphilosoft-services.com/content/en/downloads/tekom2011/russia.pdf · Outsourcing to Russia 5. Culture-related Aspects. 1. Some Key

We have Much Money Now

The Main Customers are:

• Gas, Oil, and Minerals Companies

• The Russian Government

• Retail as B2B customer

• Retail as Channel of Sales

• Banking and Insurance

• Telecom

…and we use it or lose it.

Just do right things and they’ll share their profit with you.

Page 13: Everything You Always Wanted to Know About Russiaphilosoft-services.com/content/en/downloads/tekom2011/russia.pdf · Outsourcing to Russia 5. Culture-related Aspects. 1. Some Key

We still have Good

Engineers and Researches

The main branches are:

• Software Development

• Security and Cryptography

• Aviation and Space

• Weapons

• Medicine

• Specific Technical Branches

…and we use it or lose it.

Just do right things and they’ll share their profit with you.

Page 14: Everything You Always Wanted to Know About Russiaphilosoft-services.com/content/en/downloads/tekom2011/russia.pdf · Outsourcing to Russia 5. Culture-related Aspects. 1. Some Key

Get Ready

for the Russian Business

In Russia you can quickly make

a lot of money but you have

to render very strange activities

in order to achieve that.

Page 15: Everything You Always Wanted to Know About Russiaphilosoft-services.com/content/en/downloads/tekom2011/russia.pdf · Outsourcing to Russia 5. Culture-related Aspects. 1. Some Key

Doing Business

with Russians

Understanding Strategies of Your Russian Partners-to-be

Page 16: Everything You Always Wanted to Know About Russiaphilosoft-services.com/content/en/downloads/tekom2011/russia.pdf · Outsourcing to Russia 5. Culture-related Aspects. 1. Some Key

Reasonable Approach

to the Russian Market

You

The MainCustomers

Russian

IT-related Companies

Russian

Engineering Companies

The BestEngineers

Help them bringtheir solutions

to the worldwidemarket

Give them new buzzwords and products

Page 17: Everything You Always Wanted to Know About Russiaphilosoft-services.com/content/en/downloads/tekom2011/russia.pdf · Outsourcing to Russia 5. Culture-related Aspects. 1. Some Key

Strategy 1: Help the Big Guys

to spend money

1. Fast: Informal agreement: subject and budget.Be ready to send your datasheets and prices ASAP.

2. Slow: Wait for OK from the customer.Don’t worry. Feel free to call your Russian friends.

3. Fast: Do entire work in a draft mode.Start work promptly but insist on signing a contract.

4. Slow: Set up a formal contract with customer.Don’t do anything before they sign a contract with the customer.

5. Normal: Finalize or even remake the draft.Be ready for numerous changes and corrections.

E. g. implementation of some technology or product.

Page 18: Everything You Always Wanted to Know About Russiaphilosoft-services.com/content/en/downloads/tekom2011/russia.pdf · Outsourcing to Russia 5. Culture-related Aspects. 1. Some Key

Strategy 2: Help the Smart Guys

move to the West

1. Making a prototype that looks like a real product.

2. Checking if anybody out of Russia wants to pay for it.

3. Setting up contracts with foreign customers or partners.

4. Producing a final version of the product (from the start).

5. Starting product sales via Internet or foreign partners.

6. Client’s company branch out of Russia.

E. g. developing a product for the worldwide market.

Page 19: Everything You Always Wanted to Know About Russiaphilosoft-services.com/content/en/downloads/tekom2011/russia.pdf · Outsourcing to Russia 5. Culture-related Aspects. 1. Some Key

2. Outsourcing to Russia

What, When, How

Page 20: Everything You Always Wanted to Know About Russiaphilosoft-services.com/content/en/downloads/tekom2011/russia.pdf · Outsourcing to Russia 5. Culture-related Aspects. 1. Some Key

What and When Outsource

to Russia?

Extremely complicated task:No one wants to do it.

Problem solution needed:It’s not just product making.

You need it fast!

Or even yesterday.

Page 21: Everything You Always Wanted to Know About Russiaphilosoft-services.com/content/en/downloads/tekom2011/russia.pdf · Outsourcing to Russia 5. Culture-related Aspects. 1. Some Key

Economy of Outsourcing

to Russia

Price = Wages + Taxes + Profit = Wages • 3.5

How an outsourcer bids you:

300–500 € for a developer’s work daily

If it is much more:

• They can’t calculate

• They are too big

• They are really greedy

If it is Less:

• They can’t calculate

• Their skills are poor

• They will re-outsource your task

• It is not a legal company

• They don’t understand your task

Page 22: Everything You Always Wanted to Know About Russiaphilosoft-services.com/content/en/downloads/tekom2011/russia.pdf · Outsourcing to Russia 5. Culture-related Aspects. 1. Some Key

How to Negotiate

with Russian Outsourcer

• Must have an English website

• Must react rapidly

• Make presale estimations for free

• Let them know the entire budget

• Give them time to consider your task

• Write and reconcile detailed requirements

• Request a fixed price

• Always sign written contracts

• Reconcile the payment method

THEM:

YOU:

Page 23: Everything You Always Wanted to Know About Russiaphilosoft-services.com/content/en/downloads/tekom2011/russia.pdf · Outsourcing to Russia 5. Culture-related Aspects. 1. Some Key

5. Culture-specific

Aspects

Dos and Donts

Page 24: Everything You Always Wanted to Know About Russiaphilosoft-services.com/content/en/downloads/tekom2011/russia.pdf · Outsourcing to Russia 5. Culture-related Aspects. 1. Some Key

Don’t Be Confused by the

Following Behavior

We might:

• Try to prove your task doesn’t make sense

• Delay (up to forever) calling or writing back

• Come up on the deadline point with an

announcement of ‘not having enough time’

• Come up on the deadline point with a ‘much

better idea how to implement all that’

• … and so on.

Page 25: Everything You Always Wanted to Know About Russiaphilosoft-services.com/content/en/downloads/tekom2011/russia.pdf · Outsourcing to Russia 5. Culture-related Aspects. 1. Some Key

But there is a bright side

We will survive with:

• Deadline shifted to the day after tomorrow

• Requirements modified on the fly

• Exotic technology needed to be grasped in a wink

Page 26: Everything You Always Wanted to Know About Russiaphilosoft-services.com/content/en/downloads/tekom2011/russia.pdf · Outsourcing to Russia 5. Culture-related Aspects. 1. Some Key

You don’t want to try these…

• Run a project in absence of a specific manager in charge.

• Report the other party to their boss without any war declaration.

• Make general answers to specific questions.

Page 27: Everything You Always Wanted to Know About Russiaphilosoft-services.com/content/en/downloads/tekom2011/russia.pdf · Outsourcing to Russia 5. Culture-related Aspects. 1. Some Key

You are always welcome

with your questions

[email protected]

Mikhail Ostrogorskij