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Subscribe to this list via RSS Blog posts tagged in Management Style

Posted by on in Stories From The Field
You have two cows...

We've all heard the classic economics analogy jokes about cows my favorites are these:

Communism: You have two cows. You give them to the government, and the government then gives you some milk.

Fascism: You have two cows. You give them to the government, and the government then sells you some milk.

Capitalism: You have two cows. You sell one and buy a bull.

Nazism: You have two cows. The government takes both and shoots you.

 

To add to this list though is one I heard for Moldova when I first got here over 2 years ago. It goes something like...

Moldova: You have two cows. The government steals one and you give the other to your illiterate cousin to neglect. You buy a sport-coat and call yourself a "businessman."

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in case that wasn't bleak enough enjoy this picture (source)

 

The reason we're talking about cows, as some people with experience in Moldova might have guessed, is because today we're going to talk a bit about management and employees in Moldova. Keep in mind that as an entrepreneur starting out in my first venture my personal experience with managing a team is very limited. This article is more about observations from living and working in Moldova that my mind tied together based on reactions people have to how we are running our company here. That will get clearer in time so bear with me. 

 

I have a few anecdotes to describe how this works here.

At an NGO

Firstly, there was an NGO I worked with where the director go sick and was out for a few months. She would come in once at the end of each month and, in a frenzy, try and keep the ship from sinking. We had a full time accountant, a full time lawyer and a full time social worker but without the director the bills didn't get paid, legal complaints against beneficiaries didn't move forward and the social worker's case files didn't get forwarded to the appropriate state bodies. Mostly everyone watched wedding videos that winter. Don't get me wrong here, this isn't just about employees being lazy or needing constant oversight. The other problem is that without the Director wielding their all powerful stamp none of those functions could be accomplished. Either way you can see what it does to staff initiative. 

 

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"Initiative is Punished" but sending pictures of cats to my boss
during the work day makes her like me more
(picture source is a hilarious article btw)

 

What About Businesses? 

From our cow analogy though you can see that the main perception of Moldovan businessmen is that they are simply absent. There is a business a block away from the location of my future restaurant in Chisinau. It's a pretzel and donut bakery that, like every other one in the city, somehow manages to make something that looks relatively like a pretzel but tastes like a sweet role (not in a positive way). Anyhow, a few weeks ago I walked in their for the first time. Outside there was a fold out street sign identifying the place but the door, down a flight of stairs from the street, gave me pause as it's sign said "pawnshop." I decided to go in anyhow and discovered that while there was a small pawnshop there the little bakery was open and much larger than I had thought. It had a number of tables and lots and lots of goods on display (no customers however). I ordered 3 pretzels. The woman working there told me "no we don't have any." I looked around in confusion since they not only had a display area with 3 baskets of pretzels behind glass but they had 2 more baskets on the counter top in the "right out of the oven" fresh baked goods area. I asked, "what do you mean you don't have any?! look at all these pretzels!" She responded "they are all very old and cannot be eaten, we have a few donuts if you want some." I bought 2 jelly donuts of which 1 had any jelly in it.

Another similar story was at a kebab stand by the university in Balti that I would sometimes go to. At 2pm I went in and asked for a kebab. They told me no because they have no lavash (like tortilla bread) and they will have more tomorrow. This was required for every dish they sold. I was confused because they had the option of walking 3 blocks to the supermarket, restocking and continuing work. Instead, they cooked all the fillings for the kebabs that they couldn't sell and sat there turning down every single customer until the place closed at 6pm.

Anyone living in Moldova knows countless versions of these. Bars that close at 10 pm friday night and throw out paying customers against their marked hours since no management was present. Loan officers playing around on facebook instead of trying to figure out how to help a customer. Kitchen suppliers refusing to quote a price for an oven and instead insisting on giving a package quote with lots of stuff we'll never need or buy (update on suppliers and buying kitchen goods coming soon) etc etc etc. 

 

What's the point of these stories? well basically these employees had zero interest in selling me anything. So what is the interest? Why even come to work?!

 

Basically the goal structure is messed up. Management cares much more about appearances and authority than money so employees care much more about staying out from underfoot than sales. From the loan officers who could be giving loans if they wanted but instead surf facebook to the restaurant employees who make sure they have a clean "prepared looking" workspace even if it can't make any sales, no one is working to make their companies money. Admittedly there are a whole lot of cultural leftovers from the Soviet Union here (more than possible to address in this post) but one key attitude to understanding all of this is the following:

In America a good team leader is someone who brings together a diverse set of skill-sets to solve problems more efficiently than the sum of it's parts. In Moldova a good team leader is one that retains absolute control over their teams doings and is necessarily smarter at their specialty than any member of the team in order to maintain that control. In America an outstanding employee reflects well on their manager. In Moldova an outstanding employee is a threat to the manager. In America employees are expected to go above and beyond to get "the job" done. In Moldova all worries about "the job" or goals is reserved for the manager and initiative on behalf of employees is punished. 

 

So how do people see us? Batshit crazy Americans

What inspired me to write this post is the insane looks I get constantly as I go to work, pick up a hammer and remodel my restaurant. One contractor coming in asked if I was the electrician and how I came to have such a job in Moldova as an American. I told him I was the owner of the business and he laughed and said, seriously, how did an American Electrician come to be here. I reiterated my ownership of the business and he went back to work thinking that Americans have a very odd sense of humor (absolutely not believing me). This came up before when we were appealing our visa denial and the bureaucrats we dealt with could not fathom why we wanted to work in our own business. They kept saying "give the money to your partner who will hire people and you will go back to America." There is a strong attitude here that businesspeople do not involve themselves in business (except perhaps to stamp things and yell at people). For sure this isn't true of all business here (I promise a hopeful upcoming post about good businesses here). It is a fact that this is how MANY people here understand the notion of business. You have a cow and it (magically) makes you money. It's also an excuse to employ an underserving relative or friend.

That's how business "works" in Moldova. 

 

 

For anyone who enjoys this blog AND remembers this post about how hard it is to get a loan in Moldova AND thought at that time, "wow I really wish I could give these guys like a few bucks and get a t-shirt or something cool back" then I have a solution for you!! We are running an Indiegogo to help cover the startup costs of our business! You can click here to take a look at our page. Watch our pathetic attempt at a promotional video and support us in return for some cool perks!

If none of that applies to you just click on the following picture. There's candy there: 

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"How much does it cost?" - The Process of Hiring Moldovan Services

If you're the type of person who scans to the end I'll save you the trouble. The answer to the title question is "No One Knows"
...or perhaps "I won't ever tell!" (which is also the name of a rather unfortunate song from Fat Joe). 

Ok, what are we actually talking about here? Let's start at the beginning. Ever business needs services. Some of these are easier to farm out than to do internally - often legal and accounting fall into this category. This post is about our experience trying to hire an accountant. This process has turned out to be rather difficult in Moldova. Partly this is because most accountants are uninterested in working with a restaurant due to the high numbers of transactions but it is also because of meetings like the following. 

So, we go to meet the senior accountant at a small firm. She came highly recommended to us by a friend who's parent's company contracts with her and she speaks English Russian and Romanian well. Seems perfect. When we arrive we are ushered into a room with her and her firm's Director. It is possible I have mentioned the status of directors in Moldova in the past. In short their importance in an enterprise is only surpassed by their self importance. 

 

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"Why yes I am the director of the village kindergarden"

 

This woman did not speak English and promptly suggested we all learn "Moldovan" so that we may communicate together. Leading any business meeting with a highly political joke never failed right?

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...right?

 

Ok, I'm being overly critical. The reality was that over the next hour and a half we got a lot of great information about how accounting in Moldova works and what their services are. Yes, it is true that since they had no information about this in writing we had to haphazardly circle around in the hopes of finding the right question. Yes a brochure would have been nicer. Yes we spent an absurd about of time bickering about silly things totally unrelated to accounting (e.g. Vlad explains that we will all be company directors when our documents finish. The "director" explains this is impossible because there is only one "director." We explain that it is very possible under Moldovan Law. Bickering ensues... and this is totally unrelated to accounting). Nonetheless it was pretty good information. Until this happened, (paraphrased - it took MUCH longer than this with a lot of repetition from all sides)Me: wonderful. Thank you for the information. What are your prices?

The Director: Well, you see that is very complicated... [much information here about all the papers the will (presumably) need to stamp 4+ times]

Me: Ok, I understand. That sounds like quite a lot. What are your prices?

The Director: It's complicated, you see we need to go to this and that office for approvals... etc etc etc

Me: What are your prices?

The Director: [more about complications] well it will cost you 2000 lei (about $140) for a 3 month startup period

Me: Great. Thank you for that. How much will it cost monthly after that

The Director: Well that is terribly complicated. Every business is different after all!! [more about complicated documents]

Me: so you can't tell us what it will cost to hire you?

The Director: well it won't just be one cost but based on a number of factors!

Me: ok, what are they?

The Director: it's often based on number of transations [more verbal vomiting about complications]

Me: I understand. What would a sample cost be per transaction and how many such transactions can we expect per month?

The Director: [more verbal vomiting about complications]

Matt: Please, can you just tell us what a normal price is for a small cafe similar to us? (during this time Matt and Vlad have also spoken a lot - Vlad translating everything - but this is all the gist)

The Director: [more verbal vomiting about complications]

Me: I'm confused. Are you telling us that you are unable to give us any information about how much it costs to hire you?

The Director: [more verbal vomiting about complications]

Me: Is it a mystery? (this elicited a chuckle from the accountant but had no effect on the director)

The Director: [more verbal vomiting about complications]

Me: I'm confused...

The Director: [more verbal vomiting about complications]

Me: WAIT!! let me get this straight. We hire you for 3 months at 2000 lei and after that. After signing the contract. You tell us how much your services will cost us ongoing. Furthermore you are 100% unable to provide the slightest glimpse as to what this price might be until we have signed that contract?!?

The Director: Yes.

The Director: [more verbal vomiting about complications]

The Director: [more verbal vomiting about complications]

The Director: [more verbal vomiting about complications]

triple facepalm

Lacking the Nazi uniforms this is exactly how we looked.

 

Any Peace Corps Volunteer can tell you how difficult it can be to get a real answer from someone in a meeting here. What I realized in this process is how much different it feels when I'm talking about my money. Which is when it clicked. 

This is about grants

This woman made multiple attempts throughout the conversation to figure out what our "budget" was. Now it isn't that we don't have a budget, just that it's most aptly described as "small and shrinking." In Moldova however when you see a foreigner 9 times in 10 they are not here for business but for international development. This is the crux of the problem. Like I said above (in bold) we're talking about my money here. If I were working off a development grant it would be someone else's money. Moldova is very used to people with the later. Furthermore, the economy practically spins around on trying to find out what price a bureaucrat in a grant giving country decided a service might be worth in Moldova. By figuring out the budgeted price they can charge "exactly that' and they get their maximum price while not technically disappointing a grand giving entity. In fact anyone who has ever worked to spend grant money knows that you get mega points for spending it all exactly as promised and exactly zero points and occasional animosity for saving the granting agency's money

So is this a concrete example of the culture (*cough* addiction) to international aid interfering in the Moldovan services market? I won't go that far but it's made me think for sure.

 

 

 

 

 

 

 

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