Srdjan Janicijevic is one of our rare people with considerable experience at the leading multinational companies. He started his career at a tobacco giant Philip Morris and worked in Switzerland, Russia, Kazakhstan, as well as in most of the countries of Central and East Europe. His expertise is in management, marketing, sales and business development.
Having spent fifteen years abroad, he has come back to Belgrade. For a time he was the director of the Coca Cola Co. for Serbia and Montenegro and Macedonia, only to form KOMOH CEHC, a company for business development and improvement of existing businesses. In his interview for Nedeljni Telegraf (Weekly Telegraph), Mr. Janicijevic comments on the importance of international companies and their presence in our country, on reasons why there is resistance to this idea, why we are missing from the international business map, and what local entrepreneurs bring in the privatization process of the state capital.
What made you decide, after a decade and a half, to return to Serbia?
I haven't met a Serbian man living abroad who is indifferent to his country. Some naively exaggerate issues, others emotionally criticize, but no one is indifferent. Serbia has gone through great changes and has joined normal countries. Even though we are at the end of the queue, it is the right queue. That is an achievement. For me personally, that was a sign that a man can live and build his career in his own country. I am used to moving from city to city, country to country, I followed my career. That was the case when I return home, I got an interesting offer. It wasn't hard to make that decision.
You have worked for largest world companies which, despite the existing resistance, will come to Serbia and Montenegro. What is the greatest benefit a country in transition, like Serbia, can have from the multinational companies' local presence?
First, I'd like to clarify the term "country in transition". In the context of Central and East Europe, countries in transition are those of the ex-Warsaw pact. "Transition", or a change from one system to another, is a mild term. Creation of a new system is more appropriate. That means that one is not merely going from point "a" to point "b", but much, much more. It's basically a switch to a whole new alphabet. If we look at any of the countries from this group, e.g. Hungary or Rumania, it is obvious that the change is not simple. To be more precise, everything changes except the national and cultural uniqueness. We do not know and cannot do that by ourselves. We need to want the change and advancement and the help would come from those more developed than us, their requirement being a normal and rational return on investment.
Where are the multinationals in all this?
Their presence in a country is a sign that business is o.k. It's almost a stamp of normalcy. The multinationals are excellent stimuli for healthy competition. It is like a coach leading his team. Every leader is a navigator of the whole industry. It introduces new technologies, improves competition, resulting in a better product for the end user, the consumer. If such logic is good for sports, why do we resist it in economy? When NBA purchases one of our basketball stars, we exclaim: "Way to go!" for that means that he is worth something and has proven himself at home. It's a healthy approach. It is the same when an international company shows interest in buying one of our local firms. That is, among other things, a sign of recognition.
Why then do we resist international companies? That does not sound like the anti-globalization movement in the world; it seems more like "economic patriotism."
In our country, there is resistance towards anything "foreign." That is mostly fear from the unknown, fear from change. That is the essence of resistance. The multinationals are just one example. "Economic patriotism" is just a mask for those who are aware of their ignorance. They know that in the open market they would loose their place due to their incompetence. Recently, at a meeting of our leading entrepreneurs, it was publicly admitted the lack of knowledge and power to compete with foreign competitors. Protectionism is not a solution. That is just a show of our weakness. Positive examples are firms who have fearlessly embraced those better and bigger for the good of their companies, their employees and their market. Luckily, such examples exist. It gives us all hope.
Why don't be learn from the experience of other countries, most of all the Check Republic and Hungary, why do we ignore their track record with international companies?
In essence, due to our isolation, we do not know what changes have occurred in the East European countries. That has not been a topic for our government nor the media. All could be much clearer if the media took a number of everyday needs and problems and presented how they have been dealt with in the Check Republic, Poland, Hungary, Romania, Russia, Ukraine, and Kazakhstan in the last 15 years. That would be a picture of change.
What do we actually need more: money or know-how?
Bankers claim that they have no one to give the money to. People do not know how to create a business plan, they lack experience in value creation, and they have no background in conducting a business. We keep hearing from our companies that we have the local know-how, we just need the money. Any bank will invest its money in a rational and viable project in accordance with local market rules. That is what banks do, that's their product. The problem is in business organizations. Ask yourself what is wrong with your organization if a bank will not lend you money. Look for a partner whom the bank trusts. It's all know-how.
What is our reputation in the business world? Has it improved in the last three years or are we still perceived as irresponsible and even dishonest?
Our reputation in the business world, optimistically viewed, does not exist. Going back in time to our export marvel celebrated in the '80s, "Yugo America" is, to this day, the butt of all jokes in the States regarding the poor quality of East European products. On the other hand, our people who find their place in the business system abroad show enviable results. There are many of our people abroad who represent us better than the whole diplomatic core.
Even though we are thought to be agile and creative people, there are only a 1000 enterprises started per year. Why not more?
There are four main reasons that keep us from actively embracing entrepreneurship. First, in the last ten years, private business bore a connotation of something dishonest, or at least "game for anything." The general climate did not encourage regular people to take that step. Second, self-management and collective decision-making had produced fear from making individual decisions. The ability to make valid and thought-through decisions is not highly developed here. Third, the self-confidence of our people has been shaken. It has been a long time since our people have felt successful and rewarded for their work. It addition, it's our mentality not to celebrate success and look up to positive examples. Our people still believe it's better to be employed by the state, and they rarely leave such jobs.
We have mentioned "economic patriotism." One of its segments is "patriotic privatization": resistance to foreign partners and handing over the local firms to incompetent people whose only advantage is that they are ours. How do you explain such self-sufficiency in such a poor economy?
The main reason is cultural: I don't know those foreigners, it's easier with our people. Knowledge and experience are secondary here. Except for the auction privatizations, only several international firms have taken part in the privatization process. The reason is the complexity of internal affairs, which the foreigners like to avoid. The new generation of domestic proprietors will seek partners who have experience and can advance their business, regardless of their nationality.
What improvements do local entrepreneurs privatizing state capital bring except the change of ownership?
The greatest benefit is that they will protect their capital. They will do away with the obvious anomalies of the state capital, e.g. theft, disorganization, irresponsibility, disorder and inefficiency. For the beginning, that is sufficient. In the next phase they will need to improve their business, their product and services. They will search for the best partners on the market. Naturally, there will be those who initially thought that they have gotten something very cheap, but when the second payment is due, and there are no profits, such business endeavor can prove very expensive.
What awaits us?
We'll see many changes in ownership, bankruptcies, but also successful and creative models. It's all very natural.
LET'S BE HAPPY IF SOMEONE WANTS TO BUY US
The mantra of "economic patriotism" is that by letting the multinationals into Serbia, we would loose our "independence" and "sell ourselves." Why do people consider such transactions bad?
The moment we become dependent on foreign help, donations and other forms of assistance usually given to countries under "patronage," that is the moment we loose our independence. The international community, in economic sense, is offering us to gaining our independence. That process includes accepting the applied in all successful economies. And, it has been proven, that our model of "independence" did not provide people with a better life. The interest of our foreign foes/allies is to get us off their back, to earn a status that the country of our size, work ethics, and business smarts, deserves. Since we are not Russia or China, we have to respect the efforts of the international community. The better we do, the less trouble we are. We should be happy if there are buyers, since we are neither an easy economy nor an ideal environment for capital return.
AN UNAVOIDABLE CONCEPT: HOW MUCH DO I GET?
Verbally, our largest companies have noting against foreign capital, but they are doing their best to keep it out. How long could this schizophrenia hold up?
There are two basic patterns the local companies adopt in regard to the foreign capital. The first is a primitive approach were the main idea is "Let them come and beg" since I'm incredibly interesting. We have witnessed that model persist from the late "80s to the present. The second approach would be formal cooperation and conceptual agreement on the importance of the international economic activities, while the true stand would be boycott. Those adhering to this model hope that the light will not go on in the next second, day or month, and that they would be able to hang on without changing a thing. This approach has an appendix well known in the economic practice as "How much do I get?" This appendix entails commission or other material benefits in order to close the deal. If the firm in question were privately owned, all this would not be an issue.
ROMANIA: FIVE YEARS AHEAD OF US
How interesting is our market to the international corporations?
Our market is small and complex. We gain our importance only within the concept of South East Europe where the customs zone includes all the countries of ex-Yugoslavia plus Romania, Bulgaria and Albania. Whether a company will be present in Serbia, Croatia, Romania or Bulgaria largely depends on the ability to create a regionally attractive environment. We have to bear in mind that Romania has surpassed us in that respect. At least 5 years.
