MIAMI TO MINSK
For almost 30 years, there was only one Xerox 914 copier in the Kremlin.
It was kept in a locked room and could only be used by authorised, card-carrying members of the Communist Party. Each document had to be approved, registered and signed. The apparatchik may have been frightened about information sharing, but they certainly looked after their limited resources. Their 914 machine eventually logged over 10 million imprints. The engineering may have kept going, but the political and social system didn’t. Mikhail Gorbachev - former ‘General Secretary of the Communist Party of the Soviet Union’ - accelerated the change through his twin strategies of perestroika (restructuring) and glasnost (openness). First came the end of its Communist Party; then came the collapse of the union of the Soviet. Perhaps its most visible event in the West when the Berlin Wall coming down in 1989. Autocrats were seen to topple, spying cultures implode, separated families reunited. And for business leaders outside, markets were seen to open - although reality wasn’t quite as straightforward as expected. Xerox ran a Executive Board (mostly US) which occasionally met ‘on the road’. So it made sense to meet in Europe in 1990 to learn more about their activity Eastern Europe (“somewhere over there, between Switzerland and India”)and how to exploit the opportunity. In truth, very few employees knew much about the company beyond West Germany. And that wasn’t a Xerox fault; it applied to almost every company in every sector. Doing business in Eastern Europe was the late C20th version of going to the wild west in early C19th. “But now, with the Wall down, it’s going to be a bonanza.” Every business unit leader was getting over-excited. The finance and operations professionals (in London, in New York, in Connecticut) started producing spreadsheets and business plans to show how much growth would come from places they’d never heard of. The European Managing Director wanted to be sure that he didn’t get into an argument about what was and wasn’t possible, when the agenda was going to be set by leaders’ideas based on many years of success. And by the images that had been trumpeted on TV. So a small team sat over coffee one morning and we talked about the most important message that would help both sides of the debate - US and Europe - think clearly. And decided it was the size of the market. Literally, the size. So when the MD leader stood up in front of his most important stakeholders, he put up this slide:
“This, of course, is the USA. And I’m sure that you know that it’s 3100 miles to drive from Miami to San Francisco.” I remember a frisson of “why’s he telling us what we already know?” from the first couple of rows in the audience. Then he put up the next slide:
“This is the Soviet Union. To drive from Minsk in the west to Vladivostok on the eastern shore, it’s 6,080 miles.” And literally I heard a couple of wise-headed execs mumbled “what the..??”. No one from the US had a real conception of the land mass. But the MD hadn’t finished; next slide: “And this is France - which you know is not literally in Russia It’s just here for comparison.
“The total road system in the US is approximately 4 million miles. The road system is France measures 620 thousand miles. The road system in Russia is… the same as France’s.” Now the room was silent. “For all the history of political and military difference, the US-Russia challenge that we face as a company is twice the landmass, one sixth of the road system. “So as we talk product range and sales channels and pricing and brand, in the short term we must keep thinking one thing: logistics.” Which changed the expectations, the timeline, the investment and the resources needed to exploit a new market. When either side of a conversation enters with an expectation of normality, take a step back and ask ‘are we on the same playing field? And if not, how do we get there?"
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