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21.11.2014

Article by the chairman of the MAY Supervisory Board Igor Lisinenko published by the news agency “RosBusinessConsulting”


Igor Lisinenko

 

Coercion to trust: why Russia will have to be saved by business


Borders are on fire. Economy is sputtering. Propaganda fills everything instead of truth. At such times, building a society of trust becomes a matter of survival. And it should be built by a business, there is nobody else to do this.


I was deceived many times. I was deceived on a grand scale, fastidiously and often cruelly. That’s how I learned to trust people.
 
I remember I was deceived in a very cool way in case with candies.
 
I had just started my business back then. Candies seemed to be a cool product, perfectly complementing the tea I supplied from Ceylon. They were inexpensive and in good demand in the early nineties.
 
I arranged for the supply of candies with a Polish factory. It was a big contract, which was coordinated by the Polish Chamber of Commerce. We agreed to sign documents at a formal ceremony in the presence of officials, businessmen and journalists.
 
In 1992, flying to Poland, signing a contract at the state level was cool. Of course, I was worried. Finally, having already taken a pen to put a life-changing signature in the cameras’ flashlights, at the last moment I noticed that the price of the contract was significantly higher than the one we agreed on.
 
My partner just wanted to shake me down. Everything was figured out in advance. At the formal ceremony, in front of hundreds of influential people, I simply could not refuse to sign the contract. Because otherwise I’d look like an idiot: it was the signing ceremony I called them all to come for.
 
I couldn’t explain to people that I was cynically deceived, especially considering that I was the guest and not the host. Refusing to put the signature in such circumstances is like getting onto the stage of Grand Opera and saying  “You know, I am not going to dance” at the premiere of the new production of “Swan Lake”.
 
Back then I experienced real shock. But still, I refused to sign. I do not remember what happened next. All just reeled before my eyes. I guess I was in a state close to fainting.
 
After the incident with the candies in the distant 1992, I realized how expensive the confidence cost.
 
In Russia, we have experienced many political, economic and social crises. (And, it seems, we are entering a new one.) But the crisis of confidence has long been the norm for us, and nobody notices it. Nobody pays attention to the symptoms of the running disease of total distrust.
 
In each store, there is a guard for some reason – every dusty corner is under control. Couriers hand parcels in person, and do not leave them in the hallway, which is common in the West. The roads are full with traffic police; as many policemen can be found nowhere else in the civilized countries, although that does not stand in the way of the half of drivers violating the rules.
 
Here no one trusts no one. Buyers don’t trust sellers. Employees don’t trust colleagues. Businessmen don’t trust partners. Government doesn’t trust people. People don’t trust government. Here everyone suspects everyone in the worst intentions – just in case.
 
Soviet government has significantly contributed into this crisis of confidence – it could not be trusted at all. It boasted of producing the largest amounts of shoes per capita, but it was impossible to wear these shoes. It claimed that it did not send people to the moon not to put the life of astronauts at risk, and sent hundreds of thousands to the slaughter in Afghanistan. The fate of the Soviet Union clearly shows that one can’t build a strong building on the fundament of lies.
 
Probably, no one would be surprised if after the story with candies I stopped trusting people at all. However, the opposite thing happened. Back then, I decided that I should force myself to trust – and instill confidence around him. Because only mutual trust brings people, companies and nations to success. And total mistrust leads to collapse and ruins.
 
Trust – is a technology that has to be mastered. In fact, it took me about twenty years in order to learn to trust correctly. My mistake in case in Poland was that I trusted one partner. And we must trust all. It’s counterintuitive, but if you think about that, it is logical. When there is a lot of people that you trust, the risks are greatly reduced. They all just can’t deceive you at once.
 
So, there will be no great disaster, if someone does not live up to the confidence. I began to start all the relationships by talking about my values. And I built them on the principles of full disclosure and transparency. For example, when it came to choosing suppliers, I not only started a tender with completely transparent criteria for evaluating the participants, but also gave them feedback, why their offer is better than others, and why it cedes.
 
It seems not that difficult. But in Russia, many companies, especially pertaining to the state, remain a “black box” to the suppliers, because they do not disclose the principles that brought them to this or that decision.
 
Being open with the suppliers, you are gaining their trust, because it is no longer possible to take an unfair decision and pass the contract to a friend you go to the sauna with. What’s more important, you are giving your partners the opportunity to become better. They will make sure that in a year, by correcting defects that prevented them from winning, they will get a contract. And they correct them.
 
The next time they will come clean and honestly tell you about some of their shortcomings, which they were not able to overcome. You want, of course, to support such suppliers, because it’s profitable: after working with them, you can be sure that there will be no surprises. As a result, this approach benefits all – the company, suppliers, customers.
 
At the same time confidence should not be blind. You need to be realistic: not all people are honest – there are always ten percent of crooks. Forcing people to trust, you should not forget to build a system that would monitor those who abuse the trust. In my company, for example, all key employees are tested on a polygraph. And I do not see any contradiction. We trust each other, our rules are transparent, procedures are unchanged and they are applied to everyone equally. Why should anyone be against the test?
 
I believe that it is a decision to trust partners, employees and people in general that allowed me to succeed in life. Demonstrating confidence to all without discrimination, you will eventually find people who really deserve it.
Many people in  Russia consider only material categories as country’s assets: natural resources, manufacturing, and infrastructure. But this approach is very outdated. The level of trust in society is the most important intangible asset, an economic resource, without which the country will never be rich. We seem to want to get rid of the resource curse; we invest in startups and nanotechnologies. It’s all pointless without trust in society.
 
Today, when the economy, and political system as well, are in serious turmoil, Russia can be saved from total distrust only by private business, which must systemically approach the creation of a society of trust. Who else? Certainly, it’s not the government, or the inactive society.
And there is no other way – besides coercing to trust – that corporate Russia survives. Because it is impossible to make a successful business, trusting no one.
 
As practice shows, you can not buy even candies without trust.

Posted on 11.21.2014; RBC-daily, section “Opinion”