Postcard from Bishkek

Over the years that I have been in Kyrgyzstan, people have asked me a lot of questions.  Some of them have been easy to answer, but others have been more difficult.

When I first came to Bishkek I was asked a lot of questions about why I had come here, my life back in the United Kingdom and about the differences I noticed between the two countries.

When we established the Celestial Mountains Tour Company and our two hotels in Bishkek and Naryn, the questions changed, and were mainly about doing business in the Kyrgyz Republic.

For the last three years, while I was President of the Kyrgyz Association of Tour Operators (KATO), the question I received most of all was: “How is it that an Englishman is the President of the KYRGYZ Association of Tour Operators?”

In some ways, this question is one of the easiest to answer: “You should ask the members who elected me.”  When I was asked if I would stand for election I was reluctant.  “Please don’t refuse simply because your passport is a different colour”, I was told.  Although this was an issue, however, my reluctance wasn’t just a question of my nationality.

I was also conscious, for example, that there was language barrier, as I don’t speak Kyrgyz, and my Russian, although adequate for everyday communication, is not fluent.

It is true that the fact that I have a different nationality was sometimes important.  Sometimes it was helpful, whilst at others it was a handicap. As a foreigner, I was born into, and grew up in, a different culture and system, and this, of course, influences the way I think and the decisions I make and the actions I take.

Let me illustrate the point with three examples: The roles of the government, business (the private sector), and the Association (the voluntary sector).

Consider, first of all, the question of the role of the government in the development of tourism.

In Britain, people tend to think that there should be limited (if not minimal) government involvement in daily life.  The government should safeguard the safety and security of society, (protecting the borders, policing the streets to prevent crime and so forth). It should create and maintain a safe environment to enable and encourage people to develop their full potential, in their personal lives, (be it in terms of cultural, religious or social activity) and also in business.  This is usually done by monitoring (collecting and analyzing statistical data), and where necessary introducing regulations and supervising activities.  There is always a certain amount of discussion about exactly what measures should be used and to what extent, and what element of compulsion, should be involved.  On the whole, however, people and businesses are left to manage and control their own destinies, within the framework of the obligations and responsibilities imposed by the system.  Generally, it is considered that the only time that government should be actively involved in anything approaching a business venture is when it can provide goods and services more efficiently than others in the private sector.

In Kyrgyzstan, on the other hand, there is a tendency to expect the government to take an active involvement in almost all aspects of life.  There may be various historical and cultural reasons for this, and it is perfectly understandable in terms of a “central command economy”, as the government is responsible for both deciding the general direction of economic and social policy, and also for the actual implementation of that policy.

In a “market economy”, however, such as the Kyrgyz Republic has embraced since independence, it is the individual entrepreneur and the private sector that provide the engine of prosperity and progress, working within the framework of policy, priorities, and the overall business environment which is set by the government.   In a market economy the role of government is not to “decide” and “command” but rather to enable others to participate and develop in that “market”.

That does not mean, however, that businesses should be given a totally free hand.  One of the purposes of government is to protect its citizens.  It is a complex situation in which the needs of several groups, (for example, the wider community which could be represented as the state, businesses and the consumer), need to balanced.

That brings me to my second example, the role of business.

Business seems to have an unsavoury reputation here.  For example, I remember when I was learning Russian reading in an old, Soviet, textbook the phrase: “Business is the art of removing money from one person’s pocket to another’s without them complaining.”  Whilst I remember with affection the first time I was called “tovarish”, I also remember less affectionately the two occasions I have been called a “capitalist”, and in particular the vehemence, (even the hatred), that seemed to be conveyed.  On another occasion, I was in a meeting where one of the participants complained about a trader buying and selling goods at a profit as “speculation”.

There seems to be a general impression that the business is basically concerned with the “selfish pursuit of profit” and sometimes it appears as if, here in Kyrgyzstan, “profit” is seen here in Kyrgyzstan as a bad thing in itself.  In the United Kingdom, (which, according to Napoleon described as a “nation of shopkeepers”), we only think this if someone is making what appears to be an excessive, or “obscene”, profit out of a deal.

Of course, the entrepreneur wants to make a profit.  It is a powerful motivating force behind his decision to enter into business.

More than this, however, profit is important.  If an enterprise does not make a profit it would become bankrupt and go out of business, which would not be good for anyone: the entrepreneur himself, their employees, their suppliers, the consumers, or the wider community which would lose a resource and tax revenue.

The businessman or entrepreneur makes an investment, (whether financial, in terms of money other material resources, or personal, in time and effort), accepting the risk of failure because they are motivated by the potential rewards of success.

Risk is an important factor.  When thinking about starting a business most people concentrate on the profit that can be made, and they overlook or minimize the risks and consequences of failure.  It is easy to highlight the Strengths and Opportunities of a business proposal while making light of the Weaknesses and Threats that are involved.  It is as if they think that if they have sufficient motivation and drive, then they cannot fail?  Unfortunately, however, the risk of failure is all too real.  In the United Kingdom most of the newly established businesses close within their first year.  A wise entrepreneur prepares himself properly and considers all of these aspects of their business plan.

Nobody likes to fail, and the fear of failure can be as powerful a motivating factor as the desire for success.

If businessmen are to accept the risks, and the responsibility entailed, then it suggests that they must be allowed to make their own decisions about the conduct of their business.  That does not mean that they should be given “carte blanche”.  The chaos and anarchy that would result would be to nobody ’s benefit.  Hence there is need for a balance between the role and responsibilities of both, the state and of the private sector.

This brings me to my third example: the role of the Association.

A business does not exist in isolation, it is part of a wider community and it has responsibilities and obligations to that wider community.  Some of these are formally encoded in the legislation of the country, (such as obeying the law, following procedures and paying taxes), whereas others are more nebulous and of a moral character, like being a good neighbour or supporting local good causes.

An example of participating in the wider community is joining an Association.  A number of such organizations have appeared in Kyrgyzstan in the recent past, one of them being KATO.

My father served as a trade union official and, in my turn, so did I.  The experience that I gained during this time taught me several valuable lessons about working in, and for, a “voluntary” organization.

The first lesson was that an association is exactly that, a voluntary organization.  No-one is forced to belong.  Membership is not compulsory.  There are many reasons why members decide to join.

One reason might be the status that membership brings.  One organization in the West used to run an advertising campaign with the slogan: “Membership says something about you”.  It helps, of course, if the Association is a strong and respected body, then membership really can have value, but that value is limited when the Association is recognized as being little more than a small pressure group.

Another, similar, slogan was: “Membership has its benefits”, which is often a reason for deciding to join an Association.  Of course, membership should bring benefits.  This may be the main reason why members decide to join an Association.  Some benefits may be material, such as discounts or access to information and marketing opportunities, but others are more abstract.  One of those benefits is the promotion, lobbying and protection of common, shared, interests.

That sounds like “self interest”, but it is not that simple.

One of the common interests shared by members of an Association such as KATO is ensuring that Kyrgyzstan is a strong and vibrant country, with a strong and thriving economy and, (for KATO in particular), a strong and successful Tourism sector.  For example, as a tour operator I need to have access to good accommodation for my clients throughout the country, a range of activities and outlets which I can offer them.  This is the reason the first aim of the Association is to make tourism a leading element in the economy and life of the Kyrgyz Republic.

Every tourist is different.  Every group is different.  They all have different objectives and different expectations when they decide to visit Kyrgyzstan.  Some want to simply relax on a beach at Lake Issyk Kul, whilst others seek a more active holiday.  Some request five star the luxury of the Hyatt Regency, whilst others prefer the traditional hospitality of nomadic yurt.  Some want to “get away from it all” and welcome the time spent trekking or riding in the isolated mountainous landscapes whereas others need internet access and mobile telephone coverage wherever they go.   An organized tour in a comfortable, air-conditioned coach is appropriate for one group, but others prefer the freedom of “independent” travel, taking shared taxis and deciding on the details of their itinerary as they go.

As a result, in Kyrgyzstan we need to have a range of facilities offering a diversity of opportunities within the country.  This can, of course, lead to problems.  Although this variety increases the range of facilities and service, increasing the pool of potential clients and offering them a choice, choice also means competition.

Competition, like profit, is not a bad thing in itself.  For one thing, competition acts as a spur which motivates businesses to respond to changes in the market and improve their range and standards of facilities and service.   Like many species, a failure to adapt to changes in the environment can lead to death and extinction.

Also, although the service providers, (for example: hotels, guesthouses, resorts on Issyk Kul, a ski-base in the Kyrgyz Krebet, a Homestay in a rural village or a yurt in a remote jailoo), are all competitors in one respect, (in this case a night spent in one cannot be spent in another), they are also colleagues with common interests and problems. In order to overcome pursue, promote and protect these interests and solve their common problems they need join together in a spirit of collective partnership and cooperation.

An Association is a collective, a combination of a number of different members, each with their own specific interests and point of view.  An Association cannot, and should not, pursue the interest of just one member, or even of a small specific group of members.  This illustrates another lesson that I learned as a trade union official: the representative of the Association has to present the collective view of the membership to the best of their ability, even if, sometimes, that means that they have to put to one side their own views and opinions.  The Chairman (President) of an Association, the Committees and the Executive organs of the Association have to represent the membership as a whole.  This is difficult to achieve, because there is no single viewpoint.

For the Association to have a view it needs to canvass the opinions of its members.  There needs to be a debate or discussion of the issues.  Discussion means that every member should have the opportunity to present their own view.  Decisions should be based on logic, not on who speaks loudest or longest.

It is also necessary for members to understand that, sometimes they will win the debate but that at other times a different view will prevail, and that the Association cannot do everything.  It is necessary to decide what it is possible to achieve, what issues are worth pursuing within the limited resources that are available.  Priorities have to be allocated.

For the individual member this can create problems.  They feel that their interests, (or their point of view), are not being promoted as strongly as others or, worse, are being ignored.

Originally published in Tourism in Kyrgyzstan: Practice, Problems and Perspectives.

Tags: Articles, Business, Cultural_Differences, Government, KATO, Marketing, Me, Nationality, Tourism