managers in small and medium sized enterprises in Saxony (Alt/Lang 1997) ..... businessmen in Russia have no higher education and don't care for things like.
Rainhart Lang Chemnitz University ofTechnology
Economic, Social and Cultural Resources of Russian and East German Managers
Abstract The transformation process in Central and East European countries is closely connected with a breakdown of the old structures and value systems. As a tendency which is also more and more typical of radical changes in the westem countries, leadership is seen as of high importance for the transformation of enterprises and corporate cultures in the East So, it seems to be interesting to look for changes in the field of leadership. One research topic of general interest is the question of reproduction or change in the social structure of the management elite. The literature suggests that the new management staff are mainly recruited from the old one, but that there are also new careers into the management and within. Tue main questions to be answered in the article are: What are the origins of the new management staff? What are the economic, cultural and social resources of managers, that have allowed them to obtain management positions or to stay in them during the transformation?
167
Are there different patterns of resources with regard to managers of different
countries, leadership is seen as of high importance for the transformation of
countries?
enterprises and corporate cultures in the East (e.g.,
1 will try to answer these questions with respect to the situation in East
Lang/Wald 1992,
Germany in comparison with Russia.
Pohlmann/Schmidt 1995 and 1996, Puffer et al. 1996, Lang 1994, 1996). This
Bourdieu's concept of social, cultural and symbolic capital, habits and practices
notion also implies that the role of managers and their influence is sometimes
(1979, 1983, 1988, 1992) serves as the theoretical background of the analysis.
overestimated in the literature, e.g. in the discussion about charismatic or
The empirical basis of the description is drawn from two studies: a study on
transformational leadership (see Lang 1997).
managers in small and medium sized enterprises in Saxony (Alt/Lang 1997)
interesting to look for changes in the field of leadership. One research topic of
with 45 narrative interviews and a study on Russian managers in the Novgorod
general interest is the question of reproduction or change in the social structure
region (Bilz 1997) with 15 narrative interviews about the work and the biogra
of management. The literature (e.g. Eberwein/Tholen 1994, Lang 1994, 1998,
phies of the managers.
Szomolanyi 1994, Puffer 1996, Todeeva 1996, Glotz/Ladensack 1994, 1996,
The results of the studies will be discussed in the paper using results of other
Kulke 1996, Pohlmann/Gergs 1996, Kutsche 1998, Windolf et al. 1998,
(Marz 1991, Myritz 1993,
Aderhold et
al.
Hentze/Lindert 1992,
1994, Marr 1994,
Kozminski
1995,
Nevertheless it seems to be
Aderhold et al. 1994, von Rosenstiel
Clark/Soulsby 1999) suggests that the new management staff are mainly
1994, Glotz/Ladensack 1994, 1996, Kulke 1996, Pohlmann/Gergs 1996, Lettke
recruited from the old one, but that there are also new careers into the
1996,
management and within. Tue main questions arising from these facts are:
studies as well
Rump
1997
for
Germany
and
Kozminski
1995,
Puffer
1996,
Eberwein/Tholen 1994, Leiulfsrud/Sohlberg 1996 and partly Steinle et al. 1996
What are the origins of the new management staff?
for Russia).
What are the economic, cultural and social resources of managers, that have
1. Introduction: The Problem
allowed them to obtain management positions or to stay in them during the transformation?
The transformation process in Central and East European countries is closely
Are there different patterns of resources with regard to managers of different
connected with a breakdown of the old structures and value systems. As a
countries?
tendency which is also more and more typical of radical changes in the westem
168
169
Tue paper will try to answer these questions with respect to the situation in East
transitional period. This leads to the question of an adequate theoretical basis to
Germany in comparison with Russia.
explain the developments in transformational settings. Traditional theories of
Bourdieu's concept of social, cultural and symbolic capital, habits and practices
modernization or neo-classical economics seem to be too simple for a
(1979, 1983, 1988, 1992) serves as the theoretical basis of the analysis.
transformational development (e.g. Reißig 1994, Müller 1995).
The empirical basis of the description is drawn from two studies: a study on
Despite the general problems, the micro level of transformation, which 1 want to
managers in small and medium sized enterprises in Saxony (Alt/Lang 1997)
deal with there, is also not addressed by modernization theories. Bourdieu's
with 45 narrative interviews and a study on Russian managers in the Novgorod
writings about the forms of capital and the concept of "habitus" (1979, 1983,
region (Bilz 1997) with 15 narrative interviews about the work and biography of
1988, 1992) seems to me very relevant to the research problems in question.
the manager.
This is due to four reasons: Firstly, societal transformations with fundamental
The results of the studies will be discussed in the paper using results of other
social changes seems to be a field for theoretical approaches which include
studies as well (Marz 1991, Myritz 1993, Adethold et al. 1994, von Rosenstiel
economic, cultural and social factors, structures, actions and power relations in
1994, Glotz/Ladensack 1994, 1996, Kulke 1996, Pohlmann/Gergs 1996, Lettke
Puffer 1996,
their explanation of the developments (see Leiulfsrud/Sohlberg 1996 or Ahbe 38 1998) . Secondly, with the concept of habitus, the influence of former
Eberwein/Tholen 1994, Leiulfsrud/Sohlberg 1996 and partly Steinle et al. 1996
processes of enculturation or socialization could be included and tendencies of
for Russia).
stability or reproduction ofvalues and attitudes acquired in the past society could
1996,
Rump 1997 for Germany and Kozminski 1995,
be explained.
2. Theoretical background
Thirdly, the different forms of capital and the structural differences in the
Tue transformation societies are characterized by an "openness" of structures
possibilities to acquire and exchange them, could be used on the one hand to
caused by the breakdown of the old system with its values, mies and practices.
support the argument for a structural stability. On the other hand, changes
At the same time, the "new", system obviously could not just simply be trans
within the given management structure as well as individual differences and
ferred: it had to be, learned. The learning process included an "unlearning" of the old system, a partial preservation of the past as well as the experiences of the .
38 Ahbe describes the system change as a change in the modes of transfer to Bourdieu.
170
171
of capital with respect
variations in the individual careers of the managers could probably be better understood. Fourthly, the concept of habitus and capitals not only a theoretical construction but a "concrete tool of analysis at the individual or group level to examine the actions, attitudes, opinions and strategies..." (Leiulfsrud/Sohlberg
1996:36). Bourdieu' s concepts will not be explained in detail here. lnstead, 1 will just give an overview of the main terms and their relations with respect to research questions. Capital is seen as an accumulated, internalized, incorporated, materialized or institutionalized resource which has to be appropriated by the people and allows them to act in a social environment. According to Bourdieu (1983), it is possible to distinguish between economic capital, cultural capital and social capital. Each form of capital can be transformed or converted into the others; with some limitations. This conversion is supported by the symbolic capital. The chances for capital accumulation and exchange depend on structural settings, the specific social environments people belong to. These environments form a special pattern of habits of the actors which allows them to act but, at the same
The pattern of habits as well as the possession of capital is therefore the basis 9 for the actors to develop strategies of reproduction and exchange3 .
The different forms of capital could be described as follows:
Economic capital is the amount of money or items of financial value, e.g. property, objects of value, shares and patents, that the actors have at their disposal. Thus, economic capital is directly convertible into money, and, according to Bourdieu (1983; 1985), it is particularly suitable for institutionali zation in the form of property law. lnstances of a "lucky" birth, i.e. the growing up in a wealthy family, are treated here as well as the collection of values in the course of a life or rare lucky moments of a sudden change of social status, e.g. because of an inheritance or the winning of prizes.
.
Cultural capital denominates available knowledge and competence m general40 This includes human resources (training) as well as academic titles and the abili ty and possibility to invest in education. These investments depend not only on available time but also on the existence of economic capital.41 Cultural capital is frequently connected to a specific personality and is handed down by the way
time, structures in advance the field, the conditions, the access to different forms of capital and chances of their actions to a certain extent. ( 1990) for the special group of managers.
39
See Boltanski
40
Nahapiet and Goshal ( 1998) discuss the issue on the level of organizations with the tenn "intellectual capital" which they see as a capability for action based on knowledge and knowing (pp. 245-250).
41
172
This is an example of the convertibility of the different kinds of capital.
173
of social heredity. In our world, cultural capital is understood as something
legitimization of the different forms of capital. This collective term is frequently
special and thus becomes the basis for further material and symbolic profits.42
synonyrnous with prestige or reputation. lt can be acquired and accumulated
"The social capital is the sum total of actual and potential resources connected to
along with the other forms of capital and is useful as it supports exchange
the possession of a lasting network of more or less institutionalized relations,
processes as well as further accumulation.
mutual acquaintance and recognition, or put differently, it is the resources
In the transformation process, the managers' position depends on the possession
resulting from membership of a group." (Bourdieu, 1983: 190).
lt includes
of different forms of capital closely connected with their biography. An analysis
permanent obligations arising from feelings of gratitude, respect, and friendship
of the biographies of managers in the transfonnation could, therefore, provide
or from institutionally guaranteed rights derived from membership in a family, a
some insight into their survival under difficult social conditions in a changing
class or a school (Bourdieu 1986). In order to clarify the meaning of the term
environment, as it was shown by Lettke (1996) or Kochffhomas (1997) for
"social capital" Napahiet and Goshal (1998) describe three dimensions: a
entrepreneurs in East Germany, by Clark/Soulsby (1999) for manager in Czech
structural dimension (e.g. networks of ties, network configuration), a cognitive
firms, by Puffer (1996) and McCarthy et al. (1997) for Russian managers and by
dimension (shared codes and language, shared narratives) and a relational
Windolf et al. ( 1998), Pohlmann/Gergs ( 1996) and our own studies (Lang 1994,
dimension (e.g. trust, norms, obligations, identification). Therefore, this partic
Alt/Lang 1997) for managers in East Gennany.
ular capital can only be seen in the context of the relationships an actor has with other actors, who also have social, economic and cultural capital at their disposal. In order to reproduce social capital, continuous relationships in the form of exchanges are necessary.
3. Empirical Studies: Methodology and Results
3.1 Methodology ofthe Studies
Tue last term, introduced by Bourdieu, is that of symbolic capita/. lt stands for
Tue empirical data are from two studies, which have used Bourdieu's approach as
the perceived and recognized form of the three kinds of capital, economic, social
a theoretical background.
and cultural capital. lt expresses the level of importance, acceptance and
The German study is on managers in small and medium-sized enterprises in Saxony (Alt/Lang 1997). The main aim of this study was to describe am
42 Bourdieu, P„ Soziale Ungleichheiten (Social lnequalities), (1983) p. 190.
174
175
explain the development ofvalues and attitudes ofmanagers within tbe course of
for tbe German study, results ofthe questionnaire were also included.
transformation.
For the discussion,
Tue empirical basis consists of 45 narrative interviews with mainly top
order to develop a more general view ofthe topic.
1
bave tried to confront the findings with other studies in
management staffon tbeir work biographies and professional careers, on values and attitudes about organization and leadership as well as 236 questionnaires about values and attitudes. lt includes new enterprises as well as frrms whicb already existed before the cbange.
3.2 Main Results ofthe two Studies
rces 3.2.l Tue Origins oftbe Management Staffandforms ofResou
Tbe Russian study is on top and middle managers m the Nizhni Novgorod
In tbe Gennan study, it could be sbown tbat around 85% bad been in
region (Bilz 1997). Tbe empirical basis includes 15 narrative interviews about
management functions even before the cbange. Tbe "new", old staff bad been in
the biographies ofmanagers, their careers, their values and their experiences witb tbe transformation process. Tue interviews were conducted in Russian and
recorded
ment, in tbe past. Tbe cbanges in top management were mainly made througb an excbange ofparts ofthe old "nomenclature ". Tbey were replaced by managers
translated by the interviewer. All the interviews were
positions in tbe lower or middle management, sometimes in the top manage
and tbe German transcripts were used for a
from the West as well as by second level staff. In the study, around
content analysis in order to fmd typical pattems. In a first step, the biographies
1O % of tbe managers came from tbe West, and these were mainly in top
were classified very rougbly according to the main resources accumulated and
management pos1hons .
used in tbe transformation. In a second step, typical biograpbies were selected.
Tbe main resource of the managers of East German origin were their
On tbe basis ofthe analysis ofthe studies' authors (Bilz 1997, Alt/Lang 1997),
technological knowledge resulting from tbeir studies and other professional
bave tried to re-construct
education, the special (tacit) knowledge about the production processes as well as
the third step includes two activities: on tbe one band
1
tbe biograpbies of the selected managers to find specific combinations of
. .
43
their familiarity with tbe culture oftbe firm.
resources, strategies or pattems of action. On tbe other band, tbe managers' perception oftheir careers, tbe way they talk about their special abilities whicb bave made them successful, bas been a focus ofthe analysis.
43 One
has to take into account the structure of the sample. In bigger enterprises with a stronger
westem influence the percentage of management staff from the West is higher, especially at the top.
176
177
attitudes seem to have proved valuable during the transformation (Alt/Lang
public or even friends. Taking into account the fonner colleagues, partners that the e Seilschaften"), it seems understandable discussion about "ropes" ("alt personal d dow n by the managers when asked for role of social capital was playe see tioned personal contacts (Alt/Lang l997:XIX success factors: only 11% men
1997:40, 43). At the same time their formal qualification often became obsolete.
also 60).
These factors were accompanied by a relatively stable set of values and attitudes throughout the transformation process such as discipline, diligence, orientation towards results, order, rule setting and responsibility. These culturally acquired
coincides with the perception of the managers themselves. The following factors
tives, the people's movement, a little bit, and "...and we used the people's initia and to get rid of the old combine ("Kombinat") the employees ask us to do so...
were mentioned first:
the old company X..."
Nevertheless, cultural capital seems to have had an important influence. Tuis
technological knowledge and competence
(61 %),
familiarity with the firm (50%) and management experience as well as orientation towards results (each 43% Alt/Lang 1997:XIX). "I studied civil engineering more than 6 years at the university, worked as project engineer, project manager, manager of more complex projects, worked as an executive in the production management,... and before the change, I was the head of a separate part of the company. 1 known the firm inside out... I was never in the party, at no time... "(G7) "Knowledge about the topic is absolutely necessary, nothing is more stupid than a manager with no idea of the process ... without this, it is impossible to give detailed instructions... "(G10) A second important resource were the relationships. The study shows the importance of this factor, too. The East German managers tried to establish new relationships with managers from the West, used the relations to westem
.... the West!R.L.) was sacked by his firm "...if we observed that Dr. X (from we both try to borrow the money and now and he knows us very well, then we firm." are the owners and executives of our n s to economic capital is difficult, as show for East German managers the acces them had the chance to accumulate enough by the example above. Only a few of hand" in a management buy out, or get money to buy the firm from the "Treu ution act. The salary of managers before their old firm back as a part of the restit of their co-workers and after the change, the turn was not much more than that the increase was often moderate.
a lot of bureaucratic problems to be "When I had got my firm back, there were place, due to environmental protection, solved... They asked me to go to another h 1 did not have...all 1 had was invested it would be around 8 million DM, whic to modemize the firm a bit... (G20)
managers and firms established before the change or networks of relations to
178
179
For the managers from West Germany it could be stated that their cultural
with the East Germans. But this group is more focused on the control of social
capital consists of knowledge in marketing and finance as well as experience in
relations and networks. They see themselves often as "social technologist'',
running a business under market conditions. This includes also the cultural
"teacher" or as "the doctor, who comes to eure" (G8).
knowledge about the creation of profitable relationships with different partners.
Social capital played a decisive role for the group of westem managers. They
"We have around ten West German managers here, in a few selected positions,
were frequently included in social networks in the West before getting their
where it seems to be unavoidable, for example the executive for commercial
current position in East Germany and they could profit from these connections
activities, finance and controlling, the personnel manager, and in general
and ties on the basis of their shared codes. Especially their relations to the new
administration... due to a lot of new and difficult things, where one needs
owners, the managers from the "Treuhand" (mainly also from the West) strongly
someone with experience in market economy.. .I don't know exactly but 1 think
supported their positions in the enterprises.
around 6 5 % of the managers stayed in their posts. A few departments were
Asking for the factors of their personal success, a lot of them pointed out that
newly established. We had no controlling...the new manager came from the
they had a unique chance of a fast career, due to the networks and their special
West, the distribution department was reorganized, with a manager from the
knowledge.
West...." (G 17)
"I have to say, in a West German company 1 would have got this position after
"I studied business administration in Austria at an Academy of Commerce, and
x
then at the University in Vienna. 1 started in a textile firm where 1 worked first
years ... and in 1990, I saw an offer for lecturers in business administration... and
in the department of marketing. All the age of 29, 1 was export manager and
so 1 am here..." (G l2).
later on marketing manager and 1 have worked for different companies as senior
"One day, I was asked by a supervisory board of an East German textile firm to
executive." (G l 9)
analyse the finn and to evaluate the potentials and chances of a reconstruction...
,
lnstead of traditional values, participation, democracy and seif actualization
are
years...with Daimler probably in 10 years, in smaller enterprises in 3 or 4
and after having presented my plan, 1 was asked to join
as a top
more important for this group than for managers from the East. Bureaucratic or
executive..."(G 19).
tayloristic attitudes are less important for the West German managers, the same
The access to economic capital was also much better than for managers from the
applies to the integration into and the commitrnent to the firm in comparison
East.
180
181
And finally, at least in the first period of transformation, the western origins,
anyone in school how well we were doing. But I was always warned never to tell
western titles and habits were seen as symbols of success. This led to an easier
every two years and owned a large everyone knew that we had a new car
access to other resources and contributed to the exchange process.
In school, no teacher would have dared "Dats cha" and a six-room flat in the city.
In the Russian study, a very homogeneous childhood of the managers, influenced
my father might call and complain." (R9) to reprimand me; they all feared that
by school and mass organizations was found. Military toughness for the male
took a crate of vodka. As the "When my father needed something, he always
and an attempt at emancipation for the female led to the development of different
pleasure good factory of Nizhni leader of the goods storage of the state
genderroles (Bilz 1997:20-22).
no problem for him; and literally Novgorod, access to high quality spirits was
Despite an orientation towards modesty economic capital played an important
vodka as a gift. Later, 1 simply took every door opened for him with that crate of
and increasing role for the Russian managers. Three types were identified:
1 did not enter with a gift of over this tradition, and there was no office that
persons grew up wealthy and want to retain this standard, persons who now want
some sort for those who were working there."
to make up for lost time at any cost and persons who still live a modest life
the sample, from less wealthy The second and third group, only a few in
despite their new wealth (1997:25).
experienced a lack of economic families or with working class background, have
The first group consists of former party "nomenclature" ("apparatchiks") and
capital.
their families, and of "owners of exchange goods" with an excellent access to
part in my childhood; it "I remember that money always played an important
economic capital. Tue "owners of exchange goods" are people who had access to
was something one did not have or had to be very careful with. A rouble was a
scarce goods during the time of the Soviet Union, branch managers, managers of
lot of money, pocket money was always exactly rationed and many desires were
food companies, car repair services etc. They were in a position to exchange
left unfulfilled. But that was not as bad as it sounds now
scarce goods for other goods or advantages.
that yet!" was a rather common advice, and for me it was only natural that I
"My father was the manager of the largest armament company in the region of
would work for everything myself later on." (R3)
N.N.; he was also a member of the Party Control Board. For us, the family, it
"My parents were always an example of modesty and this modest behaviour has
was understood that everything was brought into the house for us. There was
stayed with me to the piesent day..." (R5)
nothing that lacked; 1 only heard of scarce goods, 1 never experienced a lack. But .
182
183
(R2)
-
"You have to eam
Especially with the new possibilities since the mid-80s a positive evaluation of "money making" seems to have gained ground. "... now it finally makes sense to earn money ... if you earn a lot of money
really important whole university education is far away from the real world. The 4) things can only be learnt in daily life in business." (R l and successful "... of course it is true that many of the new managers
Only a fey are more critical:
things like businessmen in Russia have no higher education and don't care for if not primitive. But art, literature and music. Their attitude is often simple,
"Where money grows, everything grows" (e.g., criminality /R.L.) (R5).
surprisingly these people
Regarding cultural capital, the study shows a relatively high educational standard
longer important...." (R l 5)
due to the free access to education in the past.
But not all parts of cultural capital were devaluated: While foreign language
"My parents
both simple workers, however, they reacted positively to the
skills were not seen as very important in the past, they now developed more and
suggestion that 1 should do my A-levels. They were also in favour of me parti
more into a key resource. Foreign languages were seen as "opening the gate" to
cipating in several cultural groups, after all it did not cost them anything and
the West:
they somehow regretted that they hardly bad any time for culture anymore." (R8)
"... it was also very important that 1 studied at the linguistic faculty in N.N.
Up to the mid-80s it was nearly impossible to get a job in higher management
There were no teething problems with my American partners, somehow an
without a university degree (Bilz 1997:31).
atmosphere oftrust dominated immediately.... " (R8)
But with the transformation, the traditional degrees lost their symbolic value and
"Ifyou apply for ajob at a bank with a good knowledge of German or English,
became more and more obsolete. For the occupation of management positions,
your chances are quite good, particularly since the bosses, if they
social and economic capital seems to be of more importance.
don't have that knowledge... " (Rl )
"lt has long since ceased to be important whether you were at university or not;
"... after all, it is no langer a secret that the former members of the Russian
what counts is courage and talent for business only. An academic title today is
forces, who were stationed in the former GDR or in Poland and learnt the
met with a pitying smile rather than respected. The time needed to achieve a
language of those countries while they were there, today belong to the leaders of
PhD might be used much more profitably. What does a doctor earn anyway? Tue
the Russian Mafia. After the great reforms they simply used their experience and
today, you finally are somebody"(R7).
are
184
are
often very successful in business; but
185
how
are
is no
old cadres,
relations in order to reproduce their social capital and to reinforce their
First, there is no official body "To apply for a job in Russia is almost pointless. irnportant posts are always which informs you of vacant jobs and secondly who will get the job..." (R7) allott ed 'non-officially'. lt is clear long in advance and one has plenty of course one does not get these positions just like that sible for one's career. Don't of obligations towards the people who are respon d accepting certaill people's think those people are forgetful. 1 have often regrette
reputation. But at the same time, especially for the group of older managers, the
help...." (RIO)
traditional system of nepotism based on strong family connections seems to be
comparison of the groups Another interesting result of the study comes from a management level, a lot of of lower, middle and top managers. At the l�wer 44 of them profited from their younger executives are found . The great majority
connections to build a network of legal and illegal actions abroad. The money they made from that was often the beginning of their incredible wealth..." (R2) On the basis of accumulated economic capital and financial reputation, a system of obligation among the new Russian managers developed, which rested only partly on family relations. They try to preserve this system of social exchange
still functioning (1997:37). The results support to the assumption that the symbolic capital was of special importance for Russian managers.
11
•••
parties and receptions of the economical elite of the former Soviet Union, which
in economics and educational ( cultural) capital: university degrees, often This allows them to business administration as well as foreign language skills. four tirnes of the average eam far about the average income in Russia, up to ment of the middle (1997:55,56). Their prospects seem to depend on the develop
remained inaccessible to other, ordinary, Russians. 1 grew up feeling that our
managers.
family was respected, 'that's the Wolga constructor's son' is something 1 often
who thought they were better and showed it to all the world." (R3)
ment in Russia in This group started their careers with the new economic develop organizations. Investments the 80s and they now occupy influential positions in is interesting to note that in educational capital were the basis of their success. lt or business, but they this group often bad no special knowledge in economics
Tue importance of a network of relations based on family connections was also
economic change. Tue profited from a management vacuum in the early years of
The irnportance of social capital obviously was also understood in the past: "My father was chief constructor in the Wolga-automotive factory, which was quite a high position. So we had access to a lot of festivities, parties, hunting
heard. But sometirnes 1 was amazed that the party, which constantly propagated the equality of everyone, would tolerate a group or maybe even class of people
experienced by the interviewed managers when starting their career: 44 lt should be taken into account that the Russian study started with the idea to deal ofyoung Russian managers. The field was widened a little bit later on.
186
187
with the group
managers in this homogeneous group have a very strong elitist thinking along
Mrs. Adler, 54, works as a senior executive, responsible for economic questions,
the line of castes.
in a print-office. The enterprise with around 100 employees was resituated to
The group of top managers among the interviewees consists of very different
private owners in 1993. Mrs. Adler has worked in the firm for 20 years. Before
characters. The main difference with respect to the other groups is that
the "change" in 1989, she was senior accountant for many years.
investments in cultural capital or cultural capital itself does not play a role in
"I have always seen myself as the economist of the firm, to get the economic
their managerial career ( 1997:63,64). Instead of the cultural resources, based on
figures balanced and not as a supervisor of the state„.that was very difficult
education, they have the ability to adapt quickly to new situations. Another
because there was no orientation of the production towards economic aspects.
decisive strength is their social capital: a complex of network relations with
The fulfilment of the plan was in the centre and the costs were, at the end, of no
local governments, new party leaders or the local Mafia give approval and
importance."
support. Reputation within these circles is very important for the managers. Due
After her school Mrs. Adler starts a commercial apprenticeship, in a small firm
to the social networks, and partly the former positions, they accumulated
at the age of 14. Her father was also a shop-keeper; so she follows the tradition.
economic wealth, thereby stabilizing their network positions. Symbols of
Then she changes to a bigger enterprise, where she works as an accountant. For
wealth (Mercedes, western fashion etc.) demonstrate their power.
three years she stays at home with her children and then goes back into her last
3.2.2
firm. She works in different jobs in the commercial and economic field of the
Biographically embedded Resource Patterns: Four examples of Russian
firm. Then she experiences the importance of formal qualification.
and German Managerial Careers
"I remember this situation very well. A lot of mainly younger women came into In the following part, the biographical context of resource patterns will be
the firm. The bad a qualification from a business school and they have got
shown with two examples from Germany as weil as two from Russia. They
higher posts. They did not know more than me but they had these studies.„and
stand for typical careers of managers in the transformation process and show also
so they could direct me. That was the first time that 1 feit myself imperfect and
how the resources were acquired, accumulated and combined for use.
with the little children, 1 saw no chance to change this situation."
Mrs. Adler (G): "! always have been an economic expert!"
In the 60s she takes the opportunity of a special study progr arnme for women in business and she continues her studies with a correspondence course at a
188
189
university. She finishes her studies in the 70s and joins the print-office, where
1972 within a combine ("Kombinat"). 40% of the products before the change
she works as a senior accountant.
were produced for military purposes. Therefore the firm had a relatively modern
In her work today, she looks at every detail and she also works with the
technical equipment.
computer if necessary.
After his school, the military service and 3 years of studies in engineering at a
"If noen of the accounting staff are in the office, I also use the opportunity to
technical college, Mr. Salamander starts 'his work in the finn in 1976.
work with the computer. You can see a lot. But I leam from this and see it as an
He asked for ajob "because I knew that they wanted to invest".
exercise... and I enjoy it too ... "
"The job was not in line with my qualification, but I thought that it is just for
If important tasks are on the agenda, she is in the office trying to supervise the
the start. They will need me as an engineer later on... but the time was really
ongoing work. And she also tries to instruct and prepare a young employee for
nice. I remember, that we had a lot of fun. lt was a very good team and we did
her job. He was to leam everything right from the beginning, as she did in the
much together and the supervisors were often included. lt reminded me of the
past ("There must be no chaos once I leave. ")
time of my studies."
After the change she was able to stay in the finn. Her perception is that this was
In 1979, Mr. Salamander obtains a higher managerial post.
due to her economic knowledge and competence and her willingness to take
"There was only a small problem, I had to join the party, and I was asked to cb
responsibility. At the same time she neglects the fact that her second husband is
so. But I was not aware of the trouble with the new job. Everyone, the top
the top executive of her enterprise.
executives from the firm, from the combine ("Kombinat") as well as party
Mr. Salamander (G): "! am really an obstinate, in many things conscientious cori
leaders from different levels, wanted answers if the plan was not fulfilled . . and
ambitious human!"
everyone had different ideas and orders what I should do."
Mr Salamander is one of the two senior executives of an enterprise with 77
In order to develop his economic knowledge, "Mr. Salamander studies economics
employees. The finn produces plastic foils for the construction industry. He is
and business administration in a correspondence course at a University.
44 and has held managerial positions in the finn, for 15 years. The second
After the change he is very active to adapt the firm to the new conditions. He
executive and main owner of the company is from West Germany. The firm was
uses the "people's movement" for this, and he survives after some problems.
founded in 1948, and was a state owned enterprise from 1952 to 1989; since
The combine is blamed, and the strategy to regain autonomy is successful. He
190
.
191
tries to develop new products with the help of "old connections" to universities
Wasilij Klemjen, 30 years old, is general manager of International Trading LTD
and to find new a owner.
Nizhni Novgorod. When he was born in 1967, nobody would have thought that
Despite these activities, massive reductions of employees are necessary. He tries
the son of a simple worker and a boxing coach would in a relatively short time
to keep the "best".
advance to be one of the most influential people in Nizhni Novgorod and lead an
In 1994, he finds a small family enterprise, who buy 50%, the other 50% are
empire of approximately 34 companies, all subordinate to International Trading.
bought by a private person. After some trouble in the firm of the buyer, and
Grown up in rather moderate circumstances, bis main interest were sports. He
their "draw back", Mr. Salamander asks the former top executive of the family
soon developed a feeling for strength and superiority:
enterprise from the West, to buy the free part of the firm with him and to act as
"I always found school and learning a burden. Not that it was hard for me - to
executive.
my parents' surprise 1 stood out rather soon because of my quickness and some
Mr. Salamander considers good relations with the employees very important. He
kind of aptness or let's call it cleverness. But 1 just preferred boxing with m y
mentions that he always used a eo-operative style, also in the GDR.
father. Somehow 1 found i t more important then t o become stronger than
" ... we need the identification with the firm, today more than in the past. ..
cleverer. The strong always make it in the world... "
Before the change, one had to have good relations because of the influence of the
Although he is not one of the best at school and has only very limited financial
party or the security service„. now it is more honest, because one really needs
means at his disposal, he soon succeeds in fighting for and winning a respected
good results and therefore 1 need many satisfied people„. and people who are
position for himself.
against this, do not fit in."
" „.
of course one somehow felt unimportant in a country where education was
The workers should participate with their ideas, but they should respect "the
preached all day long,
rules"
"Learning, leaming, and leaming again!". But 1 trained my body, became the
and the workers should "subordinate themselves
to
the
structures
saying
best sportsman of the school, won every school and county championship. I
introduced by the management".
Mr.
where Lenin was always quoted with his
Klemjen (R): "Jf you don't risk
anything,
you
won't
be drinldng
realized very soon that physical superiority in connection with a self-assured appearance leads to a different distribution of positions in negotiations of various
Champanskoje!"
kinds."
192
193
Klemjen wins recognition with his sportive successes. To win these, a high
problem in a certain way. 1 just had the right friends who always solved my
amount of ambition is necessary. Youths with a talent for sports are especially
problems with a call at the Municipal Ministry for Interna! Affairs ... "
supported in the Soviet Union. In addition, he earns money by working in his
At the age of 18 Klemjen is drafted to Afghanistan. There he is only confinned
free time as doorman in what used to be called a dance club and is now called a
in bis view of life.
disco. There he comes into contact with the demi-monde of bar managers and
11 • • •
in Afghanistan only the strongest survived. If you were frightened or
black marketers and the illegal Russian red light milieu. Tue zealous claimsof
hesitant to kill your enemy, you didn't live long. 1 am not saying that I liked i t
the communist leaders in Russia that there was no organized crime in the
there, but I had n o problems and thank God stayed alive."
Soviet Union were renounced during the Gorbatchev era and organized crime
When he comes back, reintegration measures of the state for people returning
was fought.
home from Afghanistan provide him with an apprenticeship for car mechanics,
"lt was a completely new world that I stumbled into. Money was all that
which was particularly sought after during the Soviet Union. Again he contacts
counted there, and I never would have thought that there was something like that in the Soviet Union. 1 don't think it is surprising that a youth is interested in this world." 11 •• •
his former friends from the demi-monde. In several comments his two-fold relationship to the Soviet Union becomes apparent: "This country bad done far too little for me for me to have to be grateful to the
maybe they liked my way of solving problems quickly. Mostly
my
appearance was enough to gain me respect. Who would argue with a man of 6
state in any way..." 11
• • •
of course I feit secure, everything was clear and not as chaotic and dangerous
foot 6 and 120 kilograms?"
as it is now. We very quickly found out then who was a friend and who was an
Several fights with the police lead to problems with the school and the
enemy. Now a new competitor emerges every day and nobody knows where
authorities; but they have no further consequences:
these people and their money come from...
11 •••
11
1 understood even then that there were two kinds of justice in Russia, the
Gorbatchev's appeals to everyone's own initiative also confirm Klemjen in his
paper justice and the telephone justice. Telephone justice is to call an influential
views, so he begins building up .an automobile trade network and a spare parts
person with whom you have good connections and ask or order them to handle a
trade. lt is the advantage of many business activists of the time that they have the opportunity to lead the way to a completely new field.
194
195
"1 came at exactly the right time. Tue foreign car trade was booming. lt was all
"
very simple. We commissioned officers who were stationed in the fonner GDR
face, on the nose, fight back! "
to buy cars and they transported them to Moscow with military vehicles. There
"Of course i t i s dangerous t o d o business i n Russia today and you may b e found
we received them and sorted things out with the official bodies."
face down very quickly. But 1 think 1 have the right influential friends and we
Interviewer: "What do you mean by 'sorting things out'?"
still on top in N.N.. If you have no courage it's no use starting in business; if
K. : "Well, 300-500$ of bribes were usually paid out to the customs people, and
you don't risk anything, you won't be drinking Champanskoje!"
the police on the way to N.N. also got a few hundred dollars. lf you remember
His understanding of management and income may be called simple; it shows a
that in the beginning our profit was 30% for every car, you can calculate our
pragmatic attitude which is typical for the Russian situation:
profits for a few hundred cars during the first three years."
"l
Entrepreneurial long-tenn planning or simply an instinct for new situations
Every day I look after the concems of over 30 stores and more than 200
soon lead Klemjen to re-orient himself.
employees, argue with our rather slow official bodies; and no day passes with
" ... even then I had a feeling that this would not work very long; more and more
less than 15 hours of work."
people mingled in the business and spoilt the prices. So we took on other items
" . . . 1'11 be honest and say that 1 think the relationship westem managers have to
in our commissions, such as HiFi technology and kitchen machinery, food and
the subject of salary is insincere and ridiculous. 1 think that income is a just
clothes and we opened a few shops in N.N."
participation in success. lf you have earned a lot, you have worked a lot, why
" ... the International Trading Ltd. today comprises about 12 food stores, 2
shouldn't you be proud of that and tell everyone how much you eam. So, a
discotheques, 4 car stores, 3 garages, 7 stores for audio-video technology and 6
month where I eam less than 20.000 US-dollars is a bad month for me."
clothes stores... "
The attitude that money can buy everything is continually present. Social
Mr Klemjen can hardly be seen as averse to risk. The dangers of everyday
relations, such as marriage, friendship and recognition, are reduced to a purely
Russian economy are not denied, but the personal risk is played down or
financial basis.
justified by the "magnificent" opportunities one gets if one shows only a little
"... one of my friends is the Gubemator (govemor) of the town, and 1 play tennis
courage to risk something:
with the chief of police. There is no broadcast on economics on local
196
my father always said, if somebody threatens you, hit him directly in the
are
rightly call myself a manager because 1 make decisions and solve problems.
197
TV
stations where my name is not mentioned at least once. But you shouldn't think
career has been astonishingly straightforward; and exactly for this reason it is
that this is so because I'm so clever or popular; it is just because 1 have money
representative for the biographies of many Russian managers who resist a world
11
of crime and fast dirty money and nevertheless do not want or have to do without
and money in Russia means influence . . . 11 •••
all this could be over tomorrow and nobody will remember me. 1 have to be
financially secure by then.
11
a career and success. Even though bis working life begins in an atmosphere already intluenced by Gorbatchev's reforms, his socialist upbringing and views
Tue uncertain political and economic conditions force many people in Russia to
cannot be denied.
keep their money on foreign accounts in foreign currencies in order to avoid
Mr. Grinitschkin was born in 1968 as the third child of a car constructor and a
inflation . . . also Mr. Klemjin:
taylor in Nizhni Novgorod. After his A-levels he was registered for the
11 •••
Economics faculty of the State University N.N. with top results for the entrance
I am not afraid of the situation changing again. I am used to fighting my
way; I am not to be subjected so easily. And if they think I have my money here
exam.
in Russia, they would be quite wrong. My money is in a Swiss bank, my
"I myself see it that way: ever since 1 can remember I have worked towards a
daughter attends a school in London and 1 spend a few weeks in Paris and in
goal. First it was good results at school which made me learn, then the entrance
Switzerland every year. At some point I want to buy a house in Florida, and if
exam for the university; I knew quite soon what 1 wanted to be - an accountant,
everything breaks down here, I will be gone very quickly. This country has done
working with numbers, comprehensible and exact. . . .
too little for me; so 1 would not fight for Russia in order to be able to stay here.
1
I can smell changes very quickly . . .
11
1
• • •
11
ambition is probably innate, together with constancy and purposefulness i t
enables everybody t o achieve a lot. . . . 1
1
/ot to the Soviet Union! "
Mr Grinitschkin is always careful to point out his childhood in the socialist
Michael Jurewitsch Grinitschkin, 29 years old, is Deputy General Manager of
Soviet Union and to mention those parts of the system which he thinks were
1 1 the largest private TV station in Russia, 1 SETI NN 1 • Despite his youth he
positive .
occupies one of the most influential posts within the Russian media. As finance
11The security that socialism offered had many good sides. You grew up securely,
manager he is responsible for over 400 employees and his annual budget is 30
without social need. There was no kind of competition at school and at
Mr. Grinitschkin
-
"! owe
a
million US $. Mr. Grinitschkin is married and has a 4-year-old daughter. His
198
199
university. You could concentrate completely on the most important thing, your
"I worked as chief accountant in three different firms; there 1 had to watch the
studies, without worrying about your future."
management enriching themselves, numbers being forged, taxes being evaded
"Our generation is still quite fresh and unburdened. When 1 see how early young
And I was the only one who worried about these things. After that 1 knew that
people today are confronted with existential problems, 1 have my doubts whether
this new kind of business was not for me."
they will start their working life with quite the same motivation and drive as we
He sees the only chance for serious business and proper management in
did. This is where socialism had its advantages and 1 owe a lot to the Soviet
companies that work with western participation or are led by foreign specialists.
Union."
In 1992 he obtains a post as chief accountant in the newly founded private 1V
After graduation, Grinitschkin is drafted into the army for three years. Quickly
station SETI NN where he is still working today.
he becomes an officer and a group commander.
"I think two important things account for the fact that 1 still work for the station
"Everybody who had studied became an officer. 1 don't mean to play down the
and have had an unprecedented career. First, my perseverance and my ambition to
hardships of the army, but still the army service was special for me. 1 realized
put all my power into my work for the station and not to be discouraged by
that 1 had this talent to lead others, to make decisions
initial failures. Secondly, my clear idea of what 1 wanted to achieve. 1 am and
and
to
handle
responsibility. You could even say 1 enjoyed commanding people . . . " Conscious of his talents for mathematics and leadership he looks for work
have always been in favour of a slow but constant rising as opposed to ups and downs on the career ladder."
purposefully after his army service. But he meets with the typical problems of
"lt is with a certain relief that 1 always discover anew how good it is to work
the Russian economy in the transition process:
with new young cadres and managers. Tue old leaders also call themselves
" Shockingly 1 found that there were hardly any serious businesses in our country
managers today, rather promisingly, but they have no idea what it means to
at that time. Either the individual companies were only interested in making a lot of money as soon as possible and then disappearing again or you found a system of incapable old cadres who ruined their companies more than they reformed them . . . . "
work in a market economy. Even worse, they are incapable of making decisions quickly and responsibly. The party used to take every responsibility out of your hands, and if you have lived like that for 20 years or more, you don't change overnight. Anyway, 1 think these old granite heads won't ever change. Their time is simply over."
200
20 1
Today, Mr. Grinitschkin is Deputy General Manager and General Finance
While special sources in Russia were connected with the old party authorities,
Manager with an average annual salary of 30.000 US $.
this group was mainly excluded in East Germany45. Instead westem managers
"Of course 1 know that many managers in Russia today are earning a lot more
play an important role, not only temporarily. But a dominance of westem
money and laughing at me. But 1 have the compensation of a job that will be
managers is often limited to the few large companies, while in the smaller ones
secure for quite some time yet and of working for a rising company. 1 have a
the typical pattem is a mixed on with one top executive from the West and one
clean conscience because 1 earn honest money. This is saying a lot in Russia
from the
today. 1 wouldn't know how to face my parents otherwise. 1 say again: 1 owe a
Pohlmann/Gergs (1996) and Windolf at al. ( 1998). Tue phenomenon of an easier
lot to this country and would like to keep some of the socialist morals and
access of non-economists to management posts could be observed in both
ethics . . . "
countries, but seems to have created a more influential group in Russia, while in
4. Discussion: Different Patterns in Russia and East Germany
East46.
Similar
results
have been reported by
Kulke ( 1996),
East Germany and especially in small and medium-sized companies some economic knowledge was of special importance in order to adapt to market
The results of the studies and the different biographies show that different
economy, so that the exclusion of this group of "old system economists" did not
pattems in Russia and East Germany of management careers have emerged. I
work that well. In Russia as well as in other East European countries (Kutsche
will now shortly discuss the differences with regard to the research questions.
1998: 1 12), a higher mobility of the managers between the enterprises and firms
Origin ofthe "New" Management Staf f: Reproduction and Conversion instead of
could be observed. In East Germany, a decreasing number of posts as a result of
Circulation
deindustrialization and downsizing of the firms leading to a limited mobility
In Russia as well as in East Germany it seems that the "new" management staff
must be mentioned (Glotz/Ladensack 1994, 1996). Another important difference
is the "old". As in other East European countries (Todeva, 1996, for Bulgaria, Kutsche, 1998, in a comparison for Hungary, Czech Republic and Slovakia, Clark/Soulsby for the Czech Republic), a lot of the new managers had at least
4s
Windolf et al. shows that membership in the party was not an obstacle for a management c areer after the change, especially in combination with a move to another enterprise, but the chances
some management background, often in first and second level posts.
were lower than for non-party-members.
46
But one has to take into consideration that the firrns are mainly owned by West Gerrnan companies.
202
203
seems to be that in East Germany the privatization process finished with the
been combined with cultural capital. In East Germany, cultural capital in
result of more or less clear patterns of ownership and control. In Russia, the
connection with social capital seems to be a typical structure.
managers seem to have had more chances to become the owner themselves.
These findings are also supported by the literature. The importance of language
Forms of Resources: The Jmportance ofSocial and Cultural Capita/
knowledge as a key to western skills in business can be seen in the analysis of
The analysis has shown that there are striking differences between Russia and
McCarthy et al. ( 1 997). The Russian entrepreneur and manager Kirova grew up
East Germany with respect to the access to the different forms of capital, the
in Russia, but had been living in the U . S . for a long time and studied there.
accumulation and the chances for an exchange. While the position of Russian
This knowledge along with her connections provides her a lot of opportunities
managers rest on social capital and an easier access to economic capital for the
(for similar cases see Puffer et al. 1 996, e.g. 56, 57). The easier access to
top management and cultural/educational capital for the younger, including
economic capital for those who occupied a strong position in the old system was
language skills, the managers from East Germany have to rely on their cultural
reported by Leiulfsrud/Sohlberg ( 1 990: 46f). For Germany, the studies of
capital
Pohlmann and Schmidt ( 1 996) as well as Windolf et al. ( 1 998) lend some
as
the
dominant resource:
technological
competence
as
weil
as
experiences within the firm have to be mentioned first. But it must be noticed
support to the findings.
too, that in the very special East German transformation, social capital should
Strategies: The Use of Capital in the Political Arena of Transformation
not be underestimated in its influence on the career of the manager. Those East
The findings in both studies make it clear that there have been typical exchange
Germans who were able to build up relationships to owners from the West or to
modes or even ways in which one form of capital was converted into another or
the incoming management staff, or who were actively searching for partners,
could be used to get access and to accumulate another form, giving the actor
have often survived in the companies.
more room to develop strategies of action. Typical patterns are the use of
Tue Russian culture and the completely different transformation process in
cultural capital to build up a network of relationships as shown by Mr.
comparison with East Germany, have obviously led to a different structural
Salamander for East Germany, or the use of an existing basis of social relations
pattern of capital. In Russia, networks of relationships are closely connected
and its development to accumulate economic capital, as shown in the case of
with the access and accumulation or even possession of economic capital for one
Mr. Klemjen. But it could be also shown that the main differences in the
important group of managers. For a second group, especially intellectuals, it has
transformation process, also result in different chances for the actors: In East
204
205
Germany, with the transfer of westem institutions, the room for managers seems to be pre-structured or even more limited, whereas in Russia there are more
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