Preface and Acknowledgements

This research started as an investigation into business ethics in the transforming Russian 'market' system. However, as a westerner going to Russia, the first thing to strike me was the extent to which cultural differences underpinned many of the day-to-day challenges facing western business people working in the country, and their Russian partners. Trust was not initially foreseen as a significant element in the research. But even before the first round of data gathering was complete, it was a word that seemed to recur throughout numerous Russian and western accounts of their business dealings. It seemed to me simply too big an issue to be ignored.

That was back in the early 1990s. Globalisation was then only a word on the lips of those deep in the business world, a glint in their strategic eye; it did not evoke the deep feelings of love or loathing now associated with this representative of our new world order. Hofstede and von Trompenaars had already drawn our attention to the potential cultural aspects of big business spanning national borders, but many were sceptical as to the legitimacy or reality of considering the cultural dimension at all. And as for trust, yes, some academics had recognised it as a potentially rich vein of academic inquiry with relevance to every aspect of society, business and the world at large. But most of us saw it as more of a background factor, perhaps something we reserved for our inner circle of family and friends, not something we postulated theories about or related to the extended environment in all its complexity. Academically, through the 1990s, trust came to suffer as much over-definition as the reverse, and yet little active research was ongoing.

Today much has changed. Conferences, books and academic journals all take the issue of trust very seriously. It has become part of our everyday language, whether in relation to government actions, media behaviour, school exam marking, business brands or hospital treatment. Everyone with anything to gain from it, so it seems, wants to stake their claim on being trustworthy. Globalisation has become one of the big bugbears of our time - discussions of whether or not it is a force for good abound, protestors are demonised or deified, we are not sure if we work for or shop at a local, national or international company any more. Cultural issues mean that international companies face a no-win situation - damned if they respect local conditions too much leading to accusations of slave labour, damned if they do not, finding themselves fielding cries of corporate imperialism.

This book aims to shed light on many of these areas, providing above all an information source on what happens when two worlds really do collide in the cultural melting pot which is the reality of a rational 'financial' partnership in business. It shows, above all, how flawed is the notion of rationality, positioned in a vacuum devoid of all the emotions, feelings, values and behaviours that go to make up a cultural system. On the matter of trust, two things emerge very clearly. First, in the era of globalisation and international business, models of trust which 'assume away' the impact of the external environment on trust relations are no longer appropriate - they are key to understanding the operation and development of trust in very specific ways in different markets. There is no cultural quick fix to this - each nation requires a different understanding, a different approach, a different emphasis. Second, the follow-on from this is that trust at the interpersonal level is tightly linked in a most complex way with the local institutional environment. Interpersonal trust within the business enterprise and the operation of trust at the meso- and macro-levels are not separate, they coexist, they are mutually dependent. Neither of these are novel findings - but the evidence presented here adds further fuel to the fire of their need for recognition.

However, the research findings have contributed a quite new emphasis in and refinement of current thinking on trust. It has refined considerably a trust determinant generally labelled 'competence' in many academic literatures. Competence, it is argued here, is comprised of a number of discrete elements, all of which operate in different ways, requiring different inputs and creating varied outcomes, depending on how they are recognised and implemented. Competence in the local meso-level business systems - such as bureaucracy - is very different from competence in running a marketing campaign or being highly skilled in technology. In this research, 'competence' is divided up into local competence and functional competence; further, functional competence is shown to comprise technical competence and managerial competence. Opposing or mistaken views, abilities and assumptions on this front can cause enormous inter-partner mischief.

Another highly relevant competence in the Russian context turned out to be interpersonal competence - the personal skills and attitudes that tend to be assumed away in a rational business model reliant on calculative bases for trust, but which prove central to developing and maintaining business relationships in Russia, where its specific cultural history has given rise to novel mental models regarding appropriate business customs and behaviours. This book posits such interpersonal skills and approaches at the opposite end of a spectrum which sees monitoring and formalisation as its counterpoint. It is warned that those businesses stressing the formal and legalistic over the informal and interpersonal risk business failure more than those taking the less procedures-based approach. This is not to argue for a full-on, anything-goes approach: with the formal and the informal, the micro and the macro so tightly coupled, this is a cultural balancing act that has no 'catch-all' solution. But what this poses for international business operating in any culture is a major recruitment challenge to get the right individuals for the job possessed of genuine interpersonal skills, and the authority and desire to get on with things.

It is appropriate now to thanks those whose input and support have made this book possible. Professor Vince Edwards first suggested I turn my PhD thesis into a book, and I thank him, and Dr Peter Davies for their confidence in my abilities throughout the doctoral process and beyond. Further, Dr Diana Winstanley was my very thorough external examiner who pushed me those few steps further to make this volume complete and relevant. Dr Brian Clark was enormously helpful for up-to-date information on Russia for the final chapter of this book, and Dr Laura Spence is always my academic and personal stalwart and sounding board. Finally, of course, family count the most - parents and siblings all play their part, but above all it is to my husband Nick and son Luke that I extend my most heartfelt thanks.

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