Sergei Polukhin

RAIMBEK PEOPLE

Series of interviews with employees of the Raimbek Company dedicated to the 25th anniversary of the company.

THE HARDEST THING TO DO IS TO CONVINCE PEOPLE THAT THEY ARE CAPABLE OF MORE!

Sergei Polukhin is the general manager of the food division and managing partner of the Raimbek Company. One of the founders of the Holding, he took an active part in the development and launching of all company's brands on the market: from Juicy and “Ainalaiyn” to “Petrovich” and Mamma Mia.

- Sergei, you joined the Raimbek Company when it was established. You can understand a lot about business in 25 years ... What is the main factor in the vitality of any business project?

- First of all, there must be a firm base. A group of people sharing same values, who understand and support each other, move you forward. The second factor is moral principles on which the company's philosophy holds. If these factors coincide, then the company will live happily ever after. Of course, it will have its ups and downs, but nevertheless it guarantees viability in the long run. Real, full-fledged vitality.

- Now you are talking about moral principles, but in public perception business and moral principles are rather divided concepts.

- In public perception - yes. But in fact, any normal business functions on moral principles and ethics. We started as an absolutely transparent, "honest" company, from the very first day, obeying laws and paying taxes. We have never been engaged in obtaining additional profits and additional competitive advantages in fraudulent way. The time has shown that even if in some ways we were lagging behind other companies, and these things were their competitive advantage, after a while these companies had vanished, while we continued to go forward. Honesty, openness and decency are very important qualities for a human, as well as for a business.

- Do you remember how you joined the company?

- I remember it well. I was working in “Accept” company at the time, and there I met Raimbek (Batalov, ed.), with whom we got acquainted back at school. He said: “What are you doing here? Come work for me!” I was young, and I craved for new challenges. That is how I got into the Raimbek Company, in 1993.

- What exactly did you do?

- Marketing. I studied at the Journalism department, respectively, was considered a great advertiser and marketer (laughs).

- So all those stories with selling office equipment - it was all you?

- Initially, these were Raimbek’s (Batalov) ideas, considering directions of development. The company was in search, like many others in the 90s. Back then, no one had a clue about the mission, and goals, there was no common understanding of these things. We were doing whatever promised profits... our mission, our goal was to have a strong company, to make money and somehow try to grow. It wasn’t until later, when we realized the need for a more systematic approach to business, for taking distinct niches and sticking to them.

- How did the company move from mediation to production? These are completely different approaches to business, another philosophy...

- As time goes by a company, just like a person, becomes more experienced and wiser. Through our work and by looking around we began to understand certain things. We realized that mediation is good and interesting, but if you’re looking at a long perspective and building a sustainable business, then, of course, you need to gradually move on to production.

- But production means money in a long-run and absolutely new projects. It is completely unclear whether it’s going to pay off...

- It was intimidating! It was scary, it was unclear whether we had to bury such money into it. Will it pay off - will it not pay off? If you remember, there was no juice market in Kazakhstan; everyone was drinking "Yuppi". The same with UHT-milk - there was no long-term storage milk; people were drinking only pasteurized milk.

The fact that we decided to open two plants is a great achievement of our partners. They took us to other markets, showed us examples, told us “you are a developing country, sooner or later everything will come to this”. And we had the nerves and courage to take these risks and launch these projects...

- Many people, with whom we spoke, believe that this desire to experiment and not be afraid to take risks is exactly what distinguishes Raimbek from other companies. Do you agree with this?

- I think that any successful businessman is a person who is not afraid of failures, who understands that they will accompany him throughout his life. The main thing is, what can you learn from this lesson? Can you understand your mistakes; can you improve your approach? To make sure that what hasn’t worked the last time is going to turn out as success the next time.

The final result is important. It is clear that a businessman is a person who is accustomed to periodically lose money. But at the same time he understands where he needs to go, so that in the end everything turns out well. People who are afraid of losing money, afraid of taking risks, will never become successful entrepreneurs because they don’t want to take responsibility. The ability to take responsibility and then carry on with it – is a very important quality. You can lose sleep, you can get insomnia, depression, but you have no right to show it to people. You must stay confident and support yourself and others. And move forward!

 - You are talking about the purpose, about the vision. How do you form a long-term goal in the modern world, which has been so quick to change lately? How to keep up with time and not lose this goal?

- First, you need to be able to adapt to modern life. If you remember how people lived 200 years ago. For example, visiting America - it would take three years. Packed your things, hit the road, got there, spent some time, returned back home – three years had passed already. That was the speed of life then. Now you can fly to America and back in three days. One day to get there, one day of doing whatever you needed to do, and one day for the trip back home. This is it; this is the acceleration of life! I think we should all be ready for this.

After all, we live in an information age. In order to forecast what will be worth doing tomorrow, you need to get, select the right information today, properly analyze it and draw conclusions. And be the first to go there, where the rest will only come tomorrow.

- In your opinion, how did the Raimbek Company change over the past 25 years?

- A lot has changed. 25 years ago, everyone acted on the whim, intuitively, on some rumors. Now intuition is still an important factor, but you must rely on data and information. You must be able to use the analysis.

25 years ago people were ready to work 24/7! Not thinking about vacation, about anything. Today, in order to create a normal atmosphere in the team, you need to ensure that people do not overwork, so that they have a normal rest, the quality and comfort of life to meet the necessary standards. That is when you get the necessary result from your employees.

25 years ago the Raimbek Company was some kind of hybrid between the Soviet organization and a set of bright eyed boys. Everything was simple. There was a constant struggle between the Soviet past and the commercial future. Everyone had his own vision, understanding. It's clear, the youth lacked knowledge, skills, experience. The elder generation had plenty of it, but they couldn’t comprehend the future.

Today our company is much more homogeneous in this sense. We are, as a substance, more stable, holistic. But at the same time we are always in a state of continuous development. I think the main difference is this.

- Over the years you were releasing new products and brands to the market quite often. Most of them were successful. But there were defeats as well, right? Have you regretted wasting your efforts? The product is like a child – you gave birth, put it on its feet, nurtured, and then it doesn’t go as well as anticipated!

- There is an old saying: if you succeeded - you earned money, if you failed - you earned experience. For me, in many things, experience is equivalent to money. You’re going to use this experience to succeed next time. Taking all past mistakes, obstacles, unforeseen circumstances that always occur into consideration will make the next step much more successful.

People underestimate the value of experience, because after success comes euphoria, and they begin to neglect many things. And when something in your life burns you badly, hurts, flips, beats you - you can sit down, look into your eyes and understand what you’ve done wrong, what you need to change, what you need to improve. I think that this is a great exercise that a person should do from time to time.

- In that case, you would need to create an appropriate atmosphere in your company, so that your employees do such an exercise...

- That’s right. Discipline is crucial, but I believe that you cannot punish people for trying to do something. You can punish only for malicious acts. If you see that a person tried, did everything right, devoted enough time to this issue, put his soul into it, but something just did not work – in that case you need to sit down, analyze what went wrong, together. Draw conclusions and move on. In no case should the initiative be punished, because without initiative there is no innovation, there is no future! The company always stands on several pillars.

It is clear, that there will be a set of goods and services that you provide to people continuously. What you need to understand is that these are becoming outdated. Over time, these products will bring less and less revenue. And if you do not develop this pillar of innovation, which probably won’t bring money right away, but in 10 years it might happen to bring you 80% of your revenue, the company has no future.

- How innovative are the management methods which are used today in the Raimbek Company?

- My stance at all times was that we should get as close as possible to the best examples that exist in the Western corporate world - companies as Procter & Gamble and Pepsico, for instance. If we learn how to properly adapt their business processes, management decisions, it will be wonderful as it is.

I believe that for our company the form of management that we have now is optimal.

We must always look at the size of the business: the larger and more complex the business is, the more structured should the form of management be. And here it is very important not to overdo it. We are not a ministry - creating too many bureaucratic layers can be harmful. This mainly affects the speed of decision-making, launching of certain products to the market. Therefore, we must balance the bureaucratization and flexibility.

- What are your criteria when choosing an employee? What are their key characteristics you’re looking for?

- First of all, it should be a good person, decent, not scandalous, respectful of their colleagues, able to educate their subordinates. This is one side of the coin, an important one. The second - a person should be a professional in what they do. You do not need to have a doctorate degree. But they must have absolute understanding of the sphere they’ll be responsible for.

- How do you motivate people?

- A recent study had revealed that the main driver and motivator for any employee is his love for the work he’s doing and understanding of it. If you have this, then the employee will work productively, efficiently. And put a real effort into it. If it’s not there, there is nothing you can do, you may repress, and motivate with this and that – nothing will ever work! In my understanding, a person should love his work; it should give him pleasure and, of course, bring material benefits.

- What motivates you the most?

- I like working with people, like setting goals that sometimes seem difficult, even incomprehensible ... Reaching them is like climbing Mount Everest! That is, when you rise to the top, you reach the goal – it is such bliss. And this is because I love my job.

- Can you assess your personal contribution to the success of Raimbek?

- Yerlan Shinturinov and I have dedicated ourselves to FMCG for the past 20 years and created the concept of a "liquid selling company". Over time, we were able to form a portfolio, which includes juices, milk, various alcoholic beverages, and water. We continue to develop the company in this direction. It is stable, it is growing, it has a leading position in all our segments.

- What is the most difficult part of your job?

- You know, every year we hold a meeting for our partners. And every year it is the same thing. Every time we set new goals and objectives people say: “The last year was like “eh”, it was so easy and simple! This coming year goals are just “ugh”! It is going to be so hard and painful!” (laughs)

The most difficult thing is to convince people every year, make them believe that the goals, the challenges we face, the economic situation in the country - we can overcome all of these. We can achieve the necessary results.