ECONOMY
4. INNOVATION AT RUSSIAN ENTERPRISES
SOURCE. I. B. Gurkov, "Geroi i zhertvy nevidimoi bitvy -- institutsional'nyi i organizatsionnyi aspekty innovatsionnoi deiatel'nosti rossiiskikh predpriiatii" [Heroes and Victims of an Unseen Struggle: Institutional and Organizational Aspects of Innovation at Russian Enterprises." In Kto i kuda stremitsia vesti Rossiiu?.. [Who Strives to Lead Russia and Whither?]. Moscow: Moskovskaia vysshaia shkola sotsial'nykh i ekonomicheskikh nauk, Intertsentr [Moscow Higher School of Social and Economic Sciences, Intercenter], 2001, pp. 231-236.
Resistance to innovation at the enterprise level was considered one of the main deficiencies of the Soviet economic system. How innovatory are managers at Russian enterprises nowadays? The author, a researcher at Moscow's Higher School of Economics, conducted an interview survey on this subject between October 2000 and January 2001. His respondents were 123 young managers (21-49 years of age) who were attending retraining courses at five Moscow business schools. While this can hardly be a representative sample of Russian industrial managers, the results may be taken as indicative of new trends in the more dynamic part of Russian industry. (1)
The percentages of respondents who reported various forms of innovation at their enterprises were as follows (2):
|
new products |
47 |
| new forms of organizational structure | 43 |
|
new forms of sales and marketing |
34 |
| new ways of handling and motivating workforce | 29 |
| new production technology | 26 |
| new methods of quality control | 24 |
| new financial practices | 22 |
| new practices concerning payment of taxes | 12 |
16 percent of respondents said that there had been no effective innovation at their enterprises.
Gurkov comments that new approaches to marketing and managerial organization were typically unaccompanied by any serious efforts to improve technology or product quality. No significant statistical correlation was found between innovation in marketing and innovation in production technology! Thus technological innovation remains the weak link, as it was in Soviet times (albeit for different reasons).
What motives impelled managers to take the risks associated with innovation? The percentages of respondents who mentioned various motives were as follows:
| a desire to get ahead of competitors | 65 |
|
pressure from owners |
29 |
| pressure from consumers | 24 |
| pressure from enterprise staff | 16 |
|
pressure from foreign partners |
11 |
| a passion for experimentation | 10 |
| pressure from suppliers | 5 |
The author draws attention to a new phenomenon at a sizeable minority of enterprises: the active influence of "energetic owners" upon middle-level managers. (3) The greatest impact of this factor was on marketing methods, product quality, organizational structure, and financial and tax-related practices.
Where did the managers get their ideas for innovations? Here are the percentages of respondents who gave various answers:
|
We think ideas up ourselves. |
50 |
| We observe firms producing similar products. | 47 |
|
We borrow ideas from foreign partners. |
31 |
| We use experience gained by staff at other places of work. | 26 |
|
We get ideas from consumers. |
25 |
| We use information from fairs and exhibitions. | 25 |
| We study specialist literature, surveys of patents, and prospectuses. | 25 |
| We observe producers in other branches. | 13 |
| We get ideas from suppliers. | 8 |
The respondents were also asked what were the main obstacles to innovation at their enterprises. The most popular answer, chosen by about three quarters of the managers, was that they were overburdened by day-to-day problems and had very little time to think about innovation. (4) Other answers were lack of ability to present ideas well and resistance at all levels -- from top managers, from colleagues in middle management, and from the workforce. Besides "traditional Russian methods of passive resistance," used in over 70 percent of innovating enterprises, about a quarter of such enterprises witnessed open clashes between workers and management. "Energetic owners" overcame resistance to innovation by "purging" their firms (that is, by firing those hostile to innovation).
NOTES
(1) The author remarks that the study of what is really going on at Russian industrial enterprises "remains quite a closed field of research." It is even possible that Soviet society was more open in this particular area.
(2) In this and the following distributions the total comes to over 100 percent because respondents were allowed to give two or more answers.
(3) It would be interesting to know what types of owners are and are not "energetic." Unfortunately this question is not discussed.
(4) This was the biggest obstacle to innovation in the Soviet period too. No doubt it is the main obstacle under any economic system.
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