Helping Russian Employees Develop Ownership Skills

The Ohio Employee Ownership Center of Kent State University has been working in Russia since 1990. We have piloted our cutting edge ownership training in 16 privatized enterprises, brought 20 Russian general directors on employee ownership study tours to Ohio, introduced the advantages of employee involvement to over 100 middle managers, provided committee effectiveness training for about 200 of their workers, and prepared around 60 Russian trainers to use interactive training methods.

The OEOC's Russian training was developed by Dan Bell, conversant in Russian, and Olga Klepikova, a native Russian. Additional OEOC US-based staff with experience training in Russia include Dr. John Logue and Karen Thomas.

Training modules have been developed and piloted at Russian companies on the following topics:


On the Set: Doing the USIA-funded Russian language
"high performance workplace" video course in
Kent State's studios.

Effective meeting skills

Group consensus decisionmaking

Problem solving techniques

Communication skills - Active listening & Effective feedback

Interactive training skills for teaching adults

Participative leadership skills for middle managers

Employee ownership business game

Introduction to financial statements for non-managerial employees

In development:

Financial analysis for non-managerial employees

Special advanced topics including recession, valuation and marketing

Origins of the OEOC's Work in Russia

The Center's international work was initiated in 1990, when former Governor Richard Celeste invited OEOC Director, Dr. John Logue, on a trade mission to Moscow to explore opportunities for Ohio business. The Soviet hosts, already thinking about economic reform, had requested a US employee ownership expert. Logue made presentations at the Russian Academy of Science (RAS) and also learned about the USSR's own experiments with employee-leased enterprises. A series of reciprocal visits followed and an exchange agreement was signed between KSU and RAS in 1991.

By this time, the OEOC's intellectual curiosity had developed into practical aid. In April 1991, the Center arranged and hosted a two week visit to Ohio employee owned firms by managers of Mosfurnitura, a Moscow-based furniture producer which had been leased (and now owned) by its employees. The firm's director was intent on determining whether employee ownership actually worked, and whether he should stake his career on it. His conclusion was positive, and Mosfurnitura was purchased by its employees in 1992 and is 100% employee owned.

From 1992 to 1994, the OEOC hosted three two week study visits to Ohio for twenty Russian general directors. We were able to follow-up on these visits by testing some of our Ohio employee ownership training programs in two of the firms -- Kazan Electromechanical Plant (KEMZ) in the Tatar Republic and Krasny Proletary in Moscow. Russian managers and workers alike responded enthusiastically to the Center's interactive training methods. This led to a two-year commitment by a senior member of our staff, Dan Bell, to relocate to Moscow in 1994 and 1995, for the purpose of building a Russian employee ownership training capacity -- native trainers and the Russian language training manuals and workshop materials to support them. Bell was succeeded in 1996 by Olga Y. Klepikova as the OEOC's Moscow Office Director.

Since 1991, OEOC staff have worked in fourteen regions of Russia with about thirty firms. This work has varied from one day visits to multi-year programs of training and assistance. The work ranges from introductory presentations for company leadership on the US experience with structuring employee ownership and participation, to training steering committees and in-house trainers to develop ownership education and employee involvement.

The ownership education programs, introduced in ten Russian firms since 1992, is modeled on our program at Republic Engineered Steels where we trained 50 peer trainers to teach their 4500 coworkers about the company's ownership structure, financial statements, and business plan. To be successful, such programs require the involvement of non-managerial peer trainers who are supported jointly by both labor and management. This is coordinated through an ownership education program steering committee, made up of both worker and management representatives, to oversee the process.

The employee involvement training, initiated in twelve Russian firms to date, begins by a presentation and facilitated discussion with company leadership. Next, we run an interactive workshop for middle managers to enlist their buy-in to the new style of management. Those who prove more open to this new way of managing will invite us into their departments to establish and train shop floor teams.

Under funding from the Calvin K. Kazanjian Economics Foundation, the Center developed a 40 hour training program for non-managerial employees which has been run for union leaders organized by the American Center for International Labor Solidarity and for leaders of employee groups challenging the questionable transfer of ownership of their enterprises. The program includes:

A business game to introduce participants to the dynamics of ownership in a market economy;

A workbook to familiarize employees with Russian company financial statements;

An interactive company simulation to introduce basic financial analysis techniques which can help make the numbers more meaningful; and,

Some practice cases with issues like valuation, dealing with recession, and marketing.


OEOC Russian Training Modules

Effective meeting skills (includes trainer manual) Participants discuss past bad experiences with meetings and participate in an exercise that illustrates a poorly run meeting. During the exercise, suggestions are made which can help move the meeting along. Following the "meeting", participants create their own list of ideas and staff introduce tools like agendas, minutes, flip charts, group roles and process.

Group consensus decisionmaking (includes trainer manual) Participants are presented with the definition of consensus and some key rules for reaching consensus. They then go through an exercise which illustrates how group decisionmaking often leads to solutions which are technically better and supported more fully. A discussion on when consensus does and does not make sense follows.

Problem solving techniques (includes trainer manual) Participants learn techniques like brainstorming, nominal group technique, root cause analysis, force field analysis and implementation planning, as they go through a multi-step problem solving model to identify and solve a real work problem from their workplace.

Communication skills - Active listening & Effective feedback (includes trainer manual) Participants go through a short "telephone game" exercise to see how messages get lost after they are passed on by several people. A discussion of the obstacles to good listening follows and then a model for active listening is presented. Participants practice active listening in small groups. Next the elements of effective feedback are presented, staff model good examples of feedback giving and receiving, and the group practices.

Interactive training skills for teaching adults (includes trainer manual). Participants recall the rules they followed in grade school. They then go through a simulated "class" and discuss the problems with treating adults like children in training situations. More appropriate trainee-centered concepts are presented. The group also is introduced to good discussion facilitation skills like attending, observing, listening and questioning, and they watch a presentation about making presentations. At the end, in pairs, they make a brief presentation and lead the group in a discussion.

Participative leadership skills for middle managers (includes trainer manual) Participants are divided into work teams. Each team selects a manager who is instructed to use a management style which is either democratic, pseudo-democratic, autocratic or laissez-faire. After a 20 minute production shift, the results of the work are compared and discussed. Next, the group explores the concerns they have about the introduction of employee involvement at their company -- how they feel it will make their job more difficult. Having been listened to, the group is then ready to explore ways in which employee involvement might actually be helpful. Finally, staff present a model of leadership which targets different styles to appropriate supervision situations.

Employee ownership business game (workshop materials in draft form) Participants role play the board of directors of a pencil company which has been privatized by the employees. They calculate their sales, expenses and profit and then discuss decisions about what to do with the money -- raise wages, buy new technology, pay dividends. Based on their decisions, their stock is valued after each round (representing one business year). After several rounds, the results of different groups are compared and discussed and a facilitated discussion draws new learnings about the dynamics of business in a market economy from the participants.

Introduction to financial statements for non-managerial employees (workshop materials available, currently preparing draft of trainer manual) Participants are led by staff through a workbook as they create the balance sheet and profit and loss statement for a simple simulated company which makes wooden boxes. Discussion around each line item compares the case example with examples from participants real company. By the end of the workshop, the vocabulary and concepts found on these Russian financial statements are clear.

Financial analysis for non-managerial employees (workshop materials in draft form) Participants are led by staff through calculations of financial indicators based on a simulated financial statement for four years. Trends are considered and questions formulated to create hypotheses about what is going on with the company. Participants learn that the numbers do not usually give answers, but help focus attention on the key financial issues which need to be studied further. A financial analysis worksheet is filled out and in the end, the staff explain the story behind the numbers.

The OEOC has also developed a ten unit video-enhanced course on High Performance Organizations. The course includes much of the training material described above as well as live footage from Russian and U.S. companies which are putting high performance methods into practice.

OEOC's Russian Work Not Limited to Training . . .

Center staff have participated in numerous conferences and workshops organized by national and regional organizations since 1991. Thousands of company personnel, government officials and trade union leaders have learned of the successful US employee ownership experience from OEOC staff. Most visits have also involved newspaper or television interviews.

We have prepared a variety of materials in Russian on employee ownership, including a translation of our handbook on ESOPs (Bringing Your Employees into the Business, Daniel Bell, Kent Popular Press, 1988, Russian translation published in 1995) and publication of a book highlighting several Russian enterprises which privatized through employee ownership early on (Transforming Russian Enterprises, Edited by John Logue, Sergey Plekhanov, John Simmons, Greenwood Press, 1995, Russian translation published in 1997), and written a dozen or more articles that have appeared in Russian journals and papers.

Russians working closely with the State Duma and regional Dumas in Tver, Kaluga and Ryazan have sought our input on drafting proposals for legislation which would support the development of employee ownership.

Since 1998, the Center has partnered with Kent State University's Graduate School of Management and KSU's New Media Services to facilitate a growing exchange of researchers with Russian state universities in Tver, Volgograd and Voronezh.

Under subcontract with the World Bank Institute since 2000 and in partnership with Participation Associates, OEOC staff have been developing and implementing a program to expose Russian enterprises to international high performance practices and assist them in integrating these practices into their own operations.


For more information on the OEOC's Russian Programs contact:

Olga Klepikova
Russian Program Coordinator
Ohio Employee Ownership Center
113 McGilvrey Hall
Kent State University
Kent, OH 44242-0001
Phone: 330.672.0339
Fax: 330.672.4063