Chapter 10
Outgroup

The outgroup determinant directly concerns matters of differences in social norms, cultural background, values, expectations etc - another way to describe it is perhaps as the need to be an 'insider'. Brewer (1979) found that individuals are more likely to perceive outgroup members as dishonest, untrustworthy and uncooperative than they are to so perceive ingroup members. Differences in social norms, cultural background, values, expectations etc are a key element of cross-cultural business ventures, and the effects of these differences were almost painful to observe on the Moose joint venture.

Getting On the Next Flight Home

The frustrations felt by many westerners implementing the business change process in Russia during the 'wild east' days of the 1990s was tangible in the next quotation from an expatriate country manager. He could be described as an actively pro-Russian individual, who had learnt Russian and spent time in the country before being given a by-chance secondment to Russia from his western headquarters company. He was most positive generally about his experience of working in the country, but finally could not resist admitting: 'It's swings and roundabouts. You go through mood changes when you're dealing with the Russians - one day everything is wonderful, and the next day they're the most difficult bastards in the world, and you want to get on the next flight home' (expatriate deputy general director).

'The next flight home' - this was a significant background assumption. Russia was not viewed as home for the vast majority of expatriates working there.¹ When something went wrong, when obstacles were put in the way, it was only too easy to blame it on the 'difficult bastards' who were the westerners' Russian partners and colleagues, or who appeared as members of the wider, very difficult Russian business environment. It was only too easy to imagine 'home' as the place where the problems that were commonplace in Russia did not happen, as a place where business ran smoothly and where the people, assumptions and institutions were the same as you, or at least familiar. The frustrations of not only the internal workplace environment, but also the external one, were clear.

At the end of the previous chapter (Chapter 9), the Russian deputy of the Moose joint venture had criticised the western party for its failure to provide appropriately trained personnel - indeed, he accused Mammoth of deliberately sending poorly qualified staff to the venture to get them trained up at Moose's expense. This is an excellent example of the cross-over between trust determinants - functional competence criticisms form the basis for negative motives ascriptions. This is taken one step further below, when these same functional competence criticisms form a point of example in the Russian deputy's comments about the westerners failing to integrate with their Russian partners - ie functional competence criticisms also led to highly damaging outgroup perceptions.

Unfavourable Comparisons Between Partners

The functional competence criticisms levelled at the British partners by the Russians were in large part based on comparisons with the previous American partners. The Americans, according to the argument put forward by a number of Russians, were viewed as much better able to do their jobs in Russia due to geographical and operational similarities of experience between the two sides, ie the Americans' functional competence was similar to that of the Russians, and higher than that of the British. Such an interpretation of the perfect fit of the Americans' experience with the Russians', compared to no such fit with the British, resulted in significant outgroup perceptions being directed towards the Mammoth partners.

As Mikhail, the Russian deputy director, put it: 'All those similarities, climatic or mentality similarities, we are so close, we are so equal to each other that sometimes, when in America, I was bewildered by the similarities. Because when I go out of an American camp, I could easily take it for Russia, the same forest, same landscape and whatever. When the Americans came here they saw the same. It wasn't difficult for them to realise that people living here should be very similar to those living in America in such conditions and doing the same work, the same job. And that is why when they came here, they just accommodated here and started to work here.

'So a few words about the British people... Historically Great Britain is a very large and powerful empire, and all these stages that the British society went through in its development, they made a certain imprint on the mentality. It's a sort of arrogance - it's not a secret of course - and a lack of willingness or goodwill to share your knowledge, your experience... Besides, there is no on-land oil operations in Great Britain. Due to that very fact that most oil operations of Great Britain are performed offshore, on the platforms, it also makes a certain difference in the character and the mentality of the drillers, oil men.'

So, the Russian perception was that the Americans shared similar experiences with the Russians, which gave them a common functional competence. The British had no such background, they did not share common experiences with the Russians and so could not claim to bring the appropriate skills sets.

Mikhail extended these differences in attitude beyond the matter of operations to more general attitudes: 'When we have at last got rid of our socialist ideology, we started to develop so fast that in these five years we covered 60 years' difference. For us, for the Russian people, it's quite natural to have such a speed of development. But that very fact is very much suspicious for our western partners, because the Brits up to now they are not ready to believe that we can develop that fast. The proof can be found here in Moose. For example, one of the western managers still believes that I am an ardent adherent of socialist ways of management and ways of work, and I'm fully in a socialist system of management of industry. And I have long ago forgotten what this socialist system could be. Americans were very quick in understanding that. They didn't have any doubt with our speed of development, they weren't bothered or confused by that, they just accepted this as a fact and they just facilitated us in here. The Brits they are too much conservative in this question... they did not fully believe us.'

As far as the Russian side was concerned, the British contingent had low technical skills in the operational aspects of running an onshore oil field, and had little or nothing to teach the Russians in terms of business skills, as the Russians were already up to speed, and yet the British partners did not respect the fact that Russia had developed so fast in such a short space of time. In fact, those skills that the Mammoth personnel did have, they were perceived as being reluctant to transfer. However, Mikhail was able to draw this out as a point of similarity between the Russian and western partners, putting it down to the competition of the market system, and commenting that the Russian side too was guilty of this type of behaviour.² 'it's difficult to manage with the western personnel, one of the reasons is quite often it may be explained by the fact that the Russian specialist, Russian manager for example, does not want to transfer his knowledge or his experience to his colleague, to his assistant, or to his supervisor who is just his subordinate, just because he is afraid to lose his position, it's sort of competition. The same with the western personnel because they are afraid to be the first to leave the company earlier than it might have been.'³

Another Russian interviewee made a similar point: 'the feeling of responsibility of westerners was much higher than with Russians, because the western specialists, they were sort of afraid to lose their job and it would be difficult for them to find another job. Now, the situation changes, the situation in Russia changes, it's very easy for a Russian to lose the job and not be able to find another one.'

The foregoing accounts of perceived differences between the UK partners and the original American ones betrayed outgroup assumptions on the part of the Russians towards the Mammoth personnel. The story was of a perfect American-Russian match based on similarities of experience and geography, and a total UK-Russian mismatch, due to the complete absence of such similarities.

The American View

A good deal of Americans had stayed on at the joint venture in various capacities after the withdrawal of the American partner, and they were able to provide some balance to the above description. First, it is helpful to reproduce the following account of one of the original American pioneers on the subject of the shock he felt when he first arrived in Russia in 1990.

'Generally there was nothing in the town, except they had some kiosks, very little kiosks and you could buy beer, cashew nuts. I remember we were going to the apartment at night and saying "well what do we have to eat for dinner?"... because we were working long hours, up to 9-10 o'clock at night, we were skipping lunch/dinner. So we were going in the apartment, trying to find some things to buy in the kiosk, and there was nothing but vodka. We ate a lot of spaghetti... It was quite an experience, you move from the western world into those apartments ... and you cannot believe that people are living in those conditions, because you are so used to your nice little house, and everything you can get, you can just take the car and get whatever you want. Over here you have to fight for it, if you just see it in the kiosk and you don't buy it, you won't get it.... But after a period of time you get used to it, and you go back to America and it's like black and white.

'The security was the main problem, some of the people had a problem with local people, they kept knocking on the door trying to sell anything you want, from ivory to beer, to army suit, you name it, and yes I bought an army suit, I bought vodka... For us it was totally new because you accessed a world that you were told they were the enemy, it's true, we were seeing the Russian people as the enemy... and as soon as we came over here we said, gee that was only a bluff, and I can't believe that they bluffed the Americans so long.'

Despite this obvious case of culture shock, the interviewee described his years living in the town as the happiest of his working life. However, his description suggests anything but the Russian deputy's assertion that '[w]hen the Americans came here they saw the same'. In fact, the former Americans seemed to enjoy telling 'horror' stories of how it used to be, often saying that, if anything, things had calmed down since earlier meetings in the venture - before a noticeable Mammoth presence - where 'the fur used to fly'. Also, when the Americans finally pulled out of the venture, the remaining Americans claimed there was a sense of disbelief among the Russians - 'we pissed them off that much?' - as one American described it. One observed that for around nine months after the American withdrawal, the Russians were trying very hard to be nice to their western partners 'and then the novelty wore off and it became business as usual'.

Equally, however, at least one Russian interviewee claimed things had been different before the British partners arrived - a different atmosphere that she missed: 'I notice some changes. And I still don't know the reason why it happened. Maybe because it was a new company during the first two years, it was something. Sometimes it seems to me that it is a real large family, so friendly everybody was to each other, but now, I really don't know, maybe it was another company... Before, when it was 90-91, there were very few foreigners in the town, very few of them, and that's why it was very interesting for us, for the Russians, to communicate. We had many friends who visited our apartments, we went together, celebrated the different holidays, went out to barbecue, to the swimming pool, some things like this. But now, maybe now there are a lot of foreigners and the interest is not so high from my friends, from my relatives, I don't know. But something changed.'

The foregoing Russian described how the novelty of the American partners caused great interest in the town - interest that was reciprocated through local contact. She is backed up in this regard by Americans who had stayed on at the venture. For example, one American was very proud of the fact that he knew many local people in the town. Following his 28-day stint at the venture, he would meet Russian friends to go drinking; indeed, he claimed to know more Russians than some of his Russian friends. Before returning to America, he would get a shopping list of items from locals - jeans and other items that they could not get in the isolated town - and bring them back from America upon his return.

Whatever the real reasons for this breach in relationships, there is no doubt that in March 1997, the expatriate experience of working at the Moose joint venture bore no resemblance to the bleak description given by the American above, although the town remained the same. Mammoth, by the time they were active participants in Moose, found a relatively stable set-up, and were not faced with the considerable difficulties of the original Americans - no living in old Soviet apartments and scrabbling around for spaghetti at kiosks for a small group of Mammoth expatriates. Instead, Mammoth staff found themselves working in a purpose-built enclosed complex, all accommodation, offices, restaurant, health facilities etc provided on-site. Other than the permanent echo of the floors of the nissen huts that make up the complex, once inside one could have been in any office anywhere else in the world. Other than to go to the local bars or do a bit of novelty shopping, the British for their everyday life had little need for either contact or relationships with the local town.⁴

Keeping Each Side Informed and Involved

The accounts above suggest that the Russians and the UK sides of the venture saw themselves as exactly that - different (and possibly opposing) sides. In such a situation, keeping a feeling of involvement going between the partners can become a difficult issue. This is a fact identified by Mammoth, and resulted in incidents that led to a downward spiral of bad feeling. This extract of notes from a meeting that the western contractors had with the expatriate deputy director on a weekly basis to air any difficulties, and which took place in the wake of the crucial meeting between the two deputies, describes the situation very well:⁵

[The meeting was discussing the allocation of computers] [John] 'please get dual signatures for things to demonstrate to the Russian side that we are working cooperatively.' He went on to state that there existed a definite feeling on the Russian side that in some areas there was a lack of integration, a perception that they were being more and more excluded.

However, there was a feeling that not all Russian and UK partners were willing to get on board in matters of increased cooperation. The following batting backwards and forwards during one meeting clearly betrayed tensions between the two sides:⁸

After the meeting, it was explained that: 'Boris does not like the American contractors in the field. To get electric hot water, a signature is required, and Boris obstructs this. He is supposed to be a service and is being obstructive. The previous week there was a problem with the sewerage system - no chemicals, and it did not meet requirements. Boris created a fuss - said it was a major problem, would never be solved, and it would be necessary to get rid of the whole camp as a result. Such behaviour seriously affects morale. He is obstructing the movement of a spare satellite dish that could go to the contractors far out in the field by saying the Russians need it, but it sits around still doing nothing. He looks for a problem and makes it worse.'

Tom of the above meeting, in common with the sentiments of the expatriate deputy's meeting with westerners described above, was working at getting full communication amongst the various members - Russian and western - of the team working on his particular project. Meetings regularly typified this process, with one backwards and forwards of clarification and discussion ending in this wry comment from the Russian side: 'don't worry, we won't do anything without letting you know!' In another example, following the crucial meeting between the two deputies, they both went on a 'team building' visit out into the field together to show public support. The expatriate deputy, when telling a meeting that he would not be around that day, said that if anyone wanted to see him and Mikhail during the visit to the field to let him know - quickly followed by Mikhail adding also to contact him!

As can be seen, when the two sides view each other as different, this can quickly spiral downwards into a situation almost of taking up enemy positions, or at least a somewhat hostile stance during encounters. In everyday reality, petty practical obstacles were commonly thrown up as an act of power play. As one western respondent described it: 'the difficulty has been overcoming obstacles, really I suppose, put up for various reasons by various people at various times, these are not inevitable obstacles.'

These small, petty political issues are common across all organisations, but in the boiling pot of cross-cultural exchanges and mistrust that was the Moose joint ventures, they also were telling indicators of high levels of outgroup perceptions. But there were on occasions heartening signs of convergence to be round. On the wall in one office there was a picture board full of photographs of staff and their pets. The Russian interpreter who proudly showed off the picture of her and her dog said that it was a perfect example of Russians integrating western practices into their workplace!

On the issue of small things, while the Russians would tend to socialise in the smoking room, the westerners would tend to do this more in the billiards room. This was highlighted during a meeting with the expatriate deputy when the Russian interpreters said they wanted more chairs for the smoking room, and that they planned to take some from the billiard room. The expatriate deputy suggested that they ask the westerners who use it first, as it would affect them.

Different Social Habits

These small things counted for a lot, and could evolve into a whole that was much bigger - particularly in matters of east-west integration. It has already been commented that the original American 'pioneers' to the venture were perceived to be less of an outgroup by their Russian partners on account of their integration into the local community. By spending time socially with their Russian colleagues, they bridged what became a divide for the later UK partners.

The 'typical' habits of the western staff taken up by the British partners seemed to enhance outgroup perceptions. The local Russian staff did a nine to five, and then went home for their meals, shopped in the local markets etc. By contrast, the Mammoth personnel went to bars with westerners, ate at 'western' tables in the canteen for all of their meals, joined in on western social groups in the venture - eg watching the nightly film in the video room, going to get-togethers in expatriate bungalows, etc.

Amongst westerners during their social activities, drinking stories were the most popular material, along with tales of the dangers of the local bars and hints about 'scandal' stories of infidelity and the like. At parties, participants would be regaled with stories of shootings, beatings up, firebombs, fist fights at bars followed by the police arriving with machine guns, and so on. As described in Chapter 3, at most of the bars visited, the same young Russian would be present - a very young-looking male, thin and pale, wearing a black beret and black leather jacket, usually accompanied by two girls, one of whom was his girlfriend. The scene was almost a pastiche of a 1920s gangster movie, complete with gangster's moll! The westerners pointed him out as the local 'mafia person', and seemed to expect to see him wherever they went.⁹

Such differences in social habits reinforced outgroup perceptions on each side. Some Russian interviewees claimed: 'there is a very good team spirit here between Russian and western specialists, there is no division... we all feel as one company.' But according to expatriate accounts, although holidays, leaving parties, birthdays, and flowers on international women's day were observed, when it came to the venture's informal social life, the situation was more likely to be like the one described by a westerner in which 'there's two teams, the Russian team and the western team'.

It may be easier to cross the social divide, however, if one possesses Russian language skills. Some Russians were anxious to say that there was no barrier, there were interpreters, most expatriates knew basic phrases etc, while others would suggest, one quite outright, that there was a language barrier and the westerners should try harder.¹⁰

However, the new expatriate deputy director, arriving from a number of years in Kazakhstan, impressed his Russian colleagues and staff with his knowledge of Russian. This is something that stood him in good stead at a leaving party attended by the entire venture, when he made great efforts to talk to all the Russian staff present, and finished the evening philosophising with the Russian interpreters about the best way forward for Moose.

Through such means, the expatriate deputy was able to lessen outgroup perceptions by actually communicating with the Russian partners on their own terms. This may well be construed as an act of interpersonal competence - another example of trust determinant cross-over.

And Finally...

The following is one of the researcher's favourite accounts, given by an expatriate director based in Moscow, of what some of the early westerners entering the Russian business environment found themselves faced with. This person is describing the activities of his Russian partners based at the remote location where they have extensive business operations, at the time of the year when the thaw has set in, and the ice breakers can finally make it up the river:

I remember dropping down to the river with these people, we go up in this terrible Aeroflot helicopter, and we were drinking vodka out of paper cups, and of course thank goodness, because they have bottles of this vodka, with actually, it's powdered reindeers horn you know, floating in this thing, mainly for virility reasons. So you're holding these paper cups, and they're pouring this vodka into these paper cups in this helicopter, you are standing on this metal floor, the thing is making a terrible noise, it's completely open, and the vodka's kind of flowing through the paper cup, and you're awash, your feet are kind of awash with vodka, thank goodness because otherwise, well you're only drinking that much rather than that much.

'Suddenly this thing drops down on the river, and it is June, and the icebreakers are just going to come through, which is for them a hugely important period, supplies come along, and they have this 2-3 months window before the river ices up again. And so we drop this helicopter down on the bank, and we're told to go and look at the river. We go and look at the river and see all the icebreakers coming through, and it's quite a sight, really something, and it meant so much to him [business partner]. He actually dug a circle, lit a fire while we were down on the banks, and we've all got suits on, it's quite extraordinary. Suddenly we were watching the icebreakers go through and you get all this 'Whoa -ahh-ahh' (singing), turned around and he was kind of dancing around, he wasn't drunk or anything, he was perfectly normal, and he was dancing round this fire thing, spraying vodka. And we all had to go back and worship whoever it was that had enabled the icebreakers to come through and bring their supplies. Huge shashlik kebabs on the banks of the river like this, massive great things that they bring onto a boat.

'So we find our [Russian] directors dancing round totem poles in a field, drinking 14 day old mare's milk out of large wooden goblets, and these children performing incredible things on the banks of the river. And there's the kind of mystique and folklore surrounding this river, the fact that it ices over, and these are the people we do business with, these are the people we have agreements with. I mean too many experiences like that to recount, out of this world.'

Expatriate general director

¹ Two respondents had married and set up a permanent home in Russia.

² In fact, Russian failure to transfer skills across to their colleagues, Russian or western, was the first problem Mikhail mentioned during the interview.

³ This ties in with the Mammoth agendas mentioned by the expatriate deputy, of contractors keen to keep their contracts going and money coming in for as long as possible.

⁴ Rumour had it that one of the BBC's Russia correspondents reporting from the town described it as the worst old Soviet town he had ever visited.

⁵ As stated previously, meeting notes are of necessity summary in nature. In this extract, phrases appearing within open and closed quotation marks have been recorded verbatim. Otherwise, sentences are paraphrases of what was said. This particular extract records the conversation of three UK staff - named John, Peter and Paul; John is the expatriate deputy, Peter and Paul are self-employed contractors.

⁶ Most of the expatriate staff worked one-month-on, one-month-off, which involved a seven-day week. This meant meetings were held and decisions made over weekends when the Russians were not there.

⁷ The computer issues were ongoing during the case study week. Regarding cars, there had been squabbling in the venture before the case study week about jeep and car allocations for getting to the field. Some staff were having to make the long journey by public transport.

⁸These notes are mostly paraphrased.

⁹ When the westerners went out at night they always did it in pairs, not for security, but in case of falling unconscious in the sub-zero temperatures and snow.

¹⁰ The joint venture as a matter of policy had all its documents translated into both Russian and English, and they employed many interpreters. On the western side, one contractor described how he reduced contracts down to the most economical wording possible, bullet lists rather than paragraphs etc to avoid 'fudge factors': 'the wording has to be in such a way that it gets translated easily. Their terminology is sometimes different to our terminology, so getting the message across you have to be careful.' Another interviewee responded to the suggestion westerners should try harder to learn Russian by pointing out that English is spoken the world over while Russian is not.