By John Helmer, Moscow
Does he or doesn’t he? Is S&M best practice in his management thinking — cutting-edge in the literal sense?
Mikhail Prokhorov has a funny way of answering questions about his tastes, and ingratiating himself with reporters at the same time. When interviewed recently by a special reporter for the New York Times – the Times editors were reluctant to commit one of their regular byliners to the job – Prokhorov showed how he is able to break a man’s leg in just three furtive moves.
“You could have broken my leg,” reported the Times.
“Yes,” he said, “but in a very soft manner.”
So what is Prokhorov planning to do to the Russian worker — and is he planning a soft or a hard break? At the Russian Union of Industrialists and Entrepreneurs (RUIE) – Russia’s big-capital lobby – Prokhorov has been serving as the chairman of a committee on the reform of the labor market and the Russian Labor Code. About what he had in mind to achieve, Prokhorov kicked off his committee work in April by saying: “The current labor law hinders innovation development.”
What has happened in the bowels of Prokhorov’s committee since then surfaced this week when a draft document was leaked to a Moscow newspaper. His principal recommendations include an extension of the legal work week to 60 hours; elimination of social security cover for workers on study leave; substitution of unlimited-tenure employment contracts with fixed terms; introduction of commercial and profitability reasons for employee sackings; and authorization for employers to modify labor contracts unilaterally.
When Prokhorov was asked to confirm whether he is backing these measures, and his reasons, his spokesman replied that “the RUIE suggestions have not been prepared yet, so there is no topic for discussion.” As far as Prokhorov’s views on labor reform, the spokesman cited two articles.
One of them is a report [1] from something called the Independent Institute of Social Policy. This explains that allowing the 60-hour week applies only to part-time workers who have more than one job. It is “detestable”, the report claims, that Prokhorov and the RUIE committee should be castigated already for something they have not intended – raising the work week for all Russian workers.
Making it easier to fire workers is one of the proposals in the Prokhorov committee plan, the source suggests. “I can only say one thing: the Russian Labor Code [is] extremely severe. The result is the following: employees are harder to dismiss, but it is more difficult for them to get to work. Therefore, employers are reluctant to recruit new workers. This is a defect in our Labour Code. In Europe, it is the same as ours, and exactly the same problem. The Americans follow another way: the code does not limit the employer – it is easy to dismiss. But also it is easy to recruit. Therefore, make a decision – what do you want?”
Prokhorov’s spokesman also endorses this statement of the unilateral employer right to modify work contracts: “With regard to increasing the flexibility of the employment contract, that is also a subject that was discussed [on the Prokhorov committee]. If you want the European model, there will be huge youth unemployment. It will be impossible to fire poor-quality employees, and impossible to take high-quality ones…Do you want the American-style? – that will be an effective labor market, but then the security will be significantly lower. You have to choose one way or another. It is impossible to reconcile…”
In his presentation of his career and personal qualities to the New York newspaper, it was reported, apparently with his approval, that Prokhorov doesn’t read books. A former business advisor claims his attention span is short, and he does not like to listen for long to project and financial presentations. A Moscow newspaper claims there is no computer on his desk; his spokesman declines to explain why this is so. Asked if Prokhorov can count, another source with access to his personal life and managerial style says: “my understanding is that he can count, but only in increments of ten million dollars. This allows him to keep his business simple and his staff lean.”
Would Prokhorov make the cut if he was assessed on his own measures of worker performance and productivity? In an interview referred to by his spokesman, Prokhorov admits that success may be a case of a combination of good luck, ill will, and psychopathology. “Success, failure… there is the subjective factor…It is one thing to have talent as a businessman. There is a set of luck, intuition, which distinguishes a successful person from a genuine leader…It is not always the positive qualities that are the engine of success. Psychologists say that one of the most powerful of these engines [is] deep personal complexes. So, of course, it is not always the good, clean and bright people who contribute to success, and business is no exception.”
As for himself and his own reputation, Prokhorov says he doesn’t give a fig. “I didn’t care then, nor do I now. I like business – for me it is an action game, the meaning of life.”