Mikhail Gorbachev's reforms have brought striking changes to the Soviet Union in the past few years, including the emergence of "Young Tigers" - the Soviet counterpart of yuppies - according to a U.S. business executive who recently returned from a trip there.
These high-flying entrepreneurs would fit at home in any Silicon Valley firm, working 12 to 14 hours a day on computer projects and management consulting, and reaping previously unheard-of revenues.But the Tigers are distinguished from the yuppies by two very important features, said Thomas Horton, chief executive of the American Management Association, who visited the Soviet Union last month. They are not motivated by money, he added, and much of their funding comes from the government.
He visited the Soviet Union four years ago and said he finds the changes in the nation remarkable.
The Moscow-funded Organization of Young Communists now funds over 300 entrepreneurial ventures across the country, senior Soviet economists told Horton, creating the Young Tigers as an entire new social class.
"They don't see any conflict in this," Horton said of the funding. "They don't see Communism conflicting with funding these organizations, which are about as far right as you can get - the absolute free market."
The young executives, often flourishing in collectives called "Centers of Innovation," strive more for independence than wealth, Horton said, especially given the shortage of consumer goods and luxuries in the country.
"It isn't the money that moves these people," Horton said, "even though they are making unheard-of profits. It's the desire to operate outside the ministries and have control over their own business," he added.
Gorbachev and his deputies bless these new capitalistic seedlings, and their operations are sanctioned - and encouraged - by law. Thus the crusty Soviet bureaucrats are forced to let the firms make their own business decisions, the economists said.
For example, take the case of Moscow-based MENETER, a software-maker and general consultant run by Mikhail Hodorkovskij and Julija Skachinskaja. The firm provides contacts, technology and contract labor to solve "any problems of any enterprise," the pair claims.
The firm made 20 million rubles ($33 million) last year, and should double its revenues this year, the pair told Horton. MENETER maintains a rolodex of 4,000 experts to advise clients on everything from chemical-making to chicken-farming.
"We operate outside the ministries. We ignore the ministries," Skachinskaja told Horton. The firm charges clients a percentage of the value it adds to their business, a contingency basis of sorts, making MENETER a less risky investment than a firm charging a flat fee.
Other types of Tiger businesses are flourishing under Gorbachev, such as intra-industry alliances - where several firms in one field join together for five years to swap labor and know-how.
Ten of the 12 chemical machinery-makers in the Leningrad area have so banded together, while a group of 16 nuclear energy firms and 120,000 workers has also been formed.
These groups are funded mainly by their member firms, and the alliance's board reports to its owning members, not a ministry. One battery-making partnership, formed after a year of "violent negotiation," according to Horton, spans five Soviet republics.
While the Young Tigers may be a major feature of Gorbachev's economic reforms, known as perestroika, many leading Soviet economists and businessmen complain of large problems surrounding the reforms.
Older executives do not want to risk taking individual responsibility, an alien concept in a nation of central planning, Horton said. In addition, the Soviet bureaucrats are reluctant to relinquish power, and are accepting the Young Tigers only grudgingly.
The new firms still have a lot to learn, Horton added, as they know "absolutely nothing" about marketing.
"You've got a guy who is just told to make a million shoes every month, period. What does he know about consumer preferences?" Horton said.