Eastern mentality clashes with Western management style

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SOURCE: http://www.baltictimes.com/news/articles/10013/

  • By Elizabeth Celms
RIGA – Latvia is officially a European member. And although there are transitional laws in place regulating the free movement of labor, the doors to the West are now open.

But just how frequently these doors will be used, and for what intent is still under question.
Despite rumored fears of a Latvian brain drain to the West, in which Latvia’s most qualified will leave the country in pursuit of higher wages, the latest trends in human resources show that this may not be the case.
It is true that Latvia is the poorest new member of the union. Yet at the same time the country has one of the fastest growing GDPs. As wages increase and large foreign companies continue to show interest in the Baltics, there seems to be growing reason for Latvians to find work within national boarders.
“I think a certain number of candidates might be interested to move West, but overall I wouldn’t say it would be a massive trend,” says Aiga Arste-Avotina, partner for Amrop Hever Baltics, an international headhunting firm. “If we compare the quality of life – wages, of course, are different – candidates with international experience are better off with the possibilities they can use here.”
According to leading human resource firms, the Latvian market is doing especially well these days. Employment rates are up, and within the last year there has been a steady increase in senior management positions among international firms, says Pauls Berzins, country manager of People Management.
Still, finding qualified Latvian business managers to fill these positions is problematic. Berzins estimates that about 90 percent of international firms are run by Latvians as opposed to expatriates. However, sometimes there aren’t enough specialists in the market to fill the required positions.
“The general impression is that there’s a very big demand for quality people, and they’re still in short supply,” Berzins explains.
The problem doesn’t seem to be in the qualifications of Latvian workers – but rather in their mindset. Often there seems to be a clash in understanding between East and West – between Latvian employees and European corporate structure.
“All Western managers say the same: in the Baltics there are very good employees but very bad candidates,” says Petteri Pasanen, director of Baltic operations for People Management. “They can’t carry themselves out in interviews. This is the problem.”
Pasanen has noticed that Latvian managers seeking jobs in Western-run companies are often overconfident to the point of thinking they’re the best in the market. This creates problems in the interviewing and hiring process.
“They come to the interview thinking, ‘I’m the best. If you need me, here I am,'” Pasanen says. “You can only imagine the tension this creates with Western business leaders. So the interviews don’t go too well.”
When People Management’s headhunters followed candidates into the interviews, they noticed that Latvians weren’t prepared for the questions asked by Western employers. They became intimidated and therefore failed to demonstrate their best qualities in the interview.
Unfortunately, this is a characteristic shared by most qualified Baltic job seekers. And when it comes to obtaining the most desired and profitable corporate positions, this is their biggest obstacle.
Another disparaging factor is that most high-level Baltic managers, particularly in Latvia and Lithuania, still adhere to an outmoded Soviet managing style (lots of ordering around but assuming little responsibility) that conflicts with Western corporate standards. Until this style is thrown out, even the most qualified Baltic managers and specialists will have problems obtaining high-level jobs. Pasanen says that most are too stubborn to change, citing the Soviet “because this is how we’ve always been doing it” rationale.
“This mentality is built so deeply in the three countries that it’s hindering all the progress,” Pasanen says. “In examples where the old mentalities have been ditched, the results are imminent.”
Latvian and Lithuanian managers continue to be the most stubborn in this area. Estonia, on the other hand, has come quite far in Western progress, which is primarily due to its geographical proximity to Finland and thus was first to experience an influx of firms eager to hire locals.
“The progress in Estonia started way before Latvia and Lithuania,” Pasanen says. “Now Estonian management is well educated and a few years ahead of Latvia and Lithuania.”
Yet things are starting to look better for the more southern two Baltic countries as they are learning from Estonia’s example. There is currently a big economic boom in Lithuania, where GDP is highest. According to Pasanen, since financial investing and development started last in Lithuania, they were able to learn from Estonia and Latvia’s mistakes.
Despite relatively technical problems with clashes of business expectations and mentalities, the future of employment opportunities in the Baltics is bright. All three specialists agree that although EU membership won’t have a dramatic effect on the market, it will facilitate growth.
“The market is definitely active, and there is quite a lot of demand,” says Arste-Avotina. “We are clearly doing better than previous years.”
Sooner or later, say Latvia’s human resource specialists, the Baltics will shed their Soviet mentality and adjust to Western standards. It’s just a matter of time.
“All three Baltic states are heading in the right direction,” says Pasanen. “And they should be proud of this.”

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