Nikolay Nesterov: “When competition escalates, one must continue to learn”

21 December 2016

                    Nikolay Nesterov: “When competition escalates, one must continue to learn”

Nikolay Nesterov, chairman of the board of directors of the group of companies "Nizhegorodskiy maslo-girovoy kombinat" (NMGK), tells about changing the ways of the competition in the Russian market and how stereotypes of the manager influence the development of business as part of social project “Tverdye znaki”.

— Nikolai Nikolayevich, you are the head of NMGK for decades. Why did you decide to devote yourself to this business?

— Everything happened spontaneously. I came to the conclusion that the majority of people act spontaneously, and do not set any super goals and do not advance to them systematically. And in my opinion, in order to consciously construct your life, you need to get into a very smart and very strong environment from childhood, since the development vector is laid during the first three years of a person's life. I have always been serious and responsible: in the fifth or sixth grade I started running in the morning, poured with cold water, read about Pavel Korchagin enthusiastically. It cannot be formulated why this happened- many factors that shape this or that personality are unknown to us, and this is the subject of special studies.

— Are you satisfied with the results of your work?

— If a person is unsatisfied, and constantly unsatisfied, then the question arises - why live then? So, as far as possible, I am happy with my life, including business and family, and it does not matter, of it turns out brilliantly, does not really shine or does not shine at all. If you do not like anything in your life, then you are doing something wrong or you are not on your place.

I have several approaches to life, and most of them are not new, because the understanding of the universe and a human was formed thousands years ago. One of them is like this: whatever happens in life, good or bad, it depends 50% on the person and 50% on the environment. These are children, spouses, friends, opponents, colleagues at work, passers-by, football teams that cannot play. And if you want to change something in your life, start with your 50%. This approach helps to assess the situation on time and to do everything to change it.

— And what is the indicator of good results in business for you?

— The most inspiring feedback for me is that no one who I started to compete with, when we came to the company in 1996, are not in the industry. Dozens of enterprises died: they were either bought, or they went bankrupt, or closed. Young, talented, evil, somewhere cynical people came, they grabbed, outplayed, outwitted ... Our market segment continues to become more competitive. And I'm proud of what we do. There are no such things that deppress me, irritate me, or discourage me. Despite all the difficulties, there is the realization that the speed of development can be much faster, there is no self-depreciation, as well as self-laudation. Three seconds for joy, three seconds for sadness, as for everything else - move forward.

— What has become the rule for you in business?

— I have two favorite mindsets. First: act wisely, it will be better for you. The main thing is to understand what is wise (laughs – “Ъ”). And the second sounds quite ordinary, but, in my opinion, it has the deepest meaning: a person must constantly develop an open system in himself. It is necessary to understand that we are controlled by stereotypes laid down to three years old and then only accumulated. And you need to figure out when you are controlled by stereotypes, and when you make a conscious decision. Mistakes are inevitable without understanding of own reactions: information will come distorted through the prism of programs.

— Today, in our troubled time even large enterprises are not easy to stay afloat. What "recipe for crisis" you have developed for yourself

— The recipe is very simple: you need to use your brains, they must constantly work. You need to read a lot. Nowadays we have a lot of sources of information, more than we are able to process. This is exactly what we are currently working on. For example, we recruited additional people who are engaged only in analytics and innovations. This allows us to comprehend and implement long-term strategies.

And my main principle in business I conditionally call "from philosophy to sewage," that is, from philosophy to practice. Metaphorically speaking, if the eagle did not fly high, it would not have increased the view area and the opportunity to see the mouse would be much smaller. When the eagle sees the mouse when it is flying high – this is a philosophy, but when the eagle saw the mouse, it is already a "sewage": then the eagle has to take some practical steps to catch it, so, the mouse does not run away, so that something does not happen that will not give the eagle the opportunity to eat it. Most people will fall in one direction or another, and it is important to find this balance.

— What do you think is more effective in such conditions - to reduce costs or invest in the development?

— People say: if you walk tall you will tear your pants, haste makes waste. It all depends on the situation and on the resources that you can accumulate. You need to be resourceful in finding an additional resource, because during crisis much can be done cheaper than when not in crisis. On the other hand, you need to assess risks.
Now, in my opinion, investment in small, understandable projects and optimization is acceptable, where it is possible without damage for the production.

— Much has changed over the past 15 years - both in the industry and in the country. What was most important for you and for business?

— During this time, Vladimir Vladimirovich Putin practically dragged our country out of a sad state. Before that, we had seen a catastrophic drop in state formation, there were all kinds of big businessmen who decided that they rule the country. I saw some in our industry coming to power - planted weapons to someone, imprisoned innocent people. For example, when in 2002 there was an attempt to raid the NMGK, according to the plan of the raiders, I should have been in prison - it became known when the information was later revealed. And so they did more than once, the oligarchs fought with each other even more rigorously. And Vladimir Putin came and made a serious order, the state began to represent itself. At the same time, oil prices were getting higher, lucky for us, and for those who pulled the country out of such a hole.

However, it is now clear that not enough has been to develop the real economy of the country. Now a number of steps are being prepared in this direction, and I'm not just talking about fighting corruption: without the development of the economy, no country will rise, even if no one steals, and special measures are needed to develop economy. I really want to believe that there is a clear understanding of this and that right steps are being prepared.

— So, it is easier for you personally to work now than at the beginning of the century?

— It is difficult to say uniquely. In the 1990s, when I started business, the loan rate was 200%. But we took loans and returned them and at the same time we earned money. It was very complicated, but I built an effective risk management system, and it allowed us to fulfill all the conditions of the banks, although, because of the general disorder, our tanks with vegetable oil were sometimes found in Siberia instead of Nizhny. There were no commodity distribution networks, it was boring to draw up a contract on more than three pages, and some partners did not consider that we should draw up contracts. Courts work was not sufficient, there was no established practice. That was a complete mess.

Much has changed since then: now there is more order in Russia. However, the competition is now increasing. And the most difficult is to continue learning. And when there is competition, the brains are not just used - they need to be recharged all the time, use on a new and new level, and this requires constant development.

— What do you think under what motto food production will be developed in Russia and on what it will?

— I cannot see clearly expressed trends, like health care or something else. Now during crisis, people tighten their belts and buy cheaper products, this is the fact. It is difficult to say how long it will continue and much will depend on two factors: on the development of our own economy and oil prices. Now the price is more than $ 56 per barrel, it is inspiring, and I hope that after "shock therapy" our government will not relax and will come up with something to make the average business a real layer in the economy of the country. The intentions of the authorities are encouraging, but a lot needs to be done from these wishes to specific steps.


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