Innovations From The Village To The Whole Country
In 2020, a person from Moscow disappeared. Moreover, he disappeared somewhere far beyond the Moscow Ring Road, 600 km from the capital, in Alekseevka. As it became known later, people from other Russian cities with a population of over one million regularly disappear in Alekseevka and a nearby town Biryuch. I decided to go there and find out what was happening in those places…
Alekseevka is the administrative center of the Alekseevsky district, Belgorod region, 40 thousand inhabitants live there, it is the 407th city in Russia in terms of population that was founded 335 years ago.
EFKO is in apple-pie order: everything shines both at the Biryuch innovation center and at the plant in Alekseevka itself. Generally, in food processing, some mess is usually considered to be normal, but in EFKO you will not face it at all. Entering the workshops, we not only put on dressing gowns, hats and shoe covers, but also disinfect our hands, removing all jewelry and leaving them in a special cabinet. EFKO is always scrupulous in everything that concerns order, safety and cleanliness.
But more than about the cleanliness of the floors, EFKO cares about the correct selection, development and mental health of its employees, especially key and promising ones.
EFKO is a Russian company, the largest producer of special fats and margarine, butter and dairy products under the Sloboda and Altero brands, as well as healthy innovation burgers. The company employs 17,000 people, EFKO is one of the three largest companies in the Russian agro-industry with annual revenue of about $2 billion.
Hypochondria 55, hysteroid 64, hypomania 62, conscious and unconscious assessments are well correlated, sanity 71, empathy 2nd level 54! Welcome to the psychological test for top managers, which lasts 4 hours. If you read negative reviews from former EFKO employees, mainly workers and line office staff, then EFKO is most criticized for the difficult and long process of getting a job, as well as for the need to work hard and often overwork due to high requirements and ambitious tasks. This is all true. For example, it is not a big deal for the company management to work on Saturdays. ”It happens by itself, no force involved! Let’s consider it our established tradition”, — they say. That reminded me of a joke about a McKinsey employee who, without coming to work on Saturday, caused severe obstruction of colleagues, but in fact he was on vacation and therefore went to work only during official working hours on weekdays.
Let’s dive a little deeper into the company’s history — EFKO was founded almost 30 years ago by twelve people from Alekseevka. By that time, they were already in trade business, but made a fateful decision and started their own fat and oil production in Alekseevka. Shortly after it became clear to the founders that the company should not produce fat and oil products only, but also prepare qualified and caring employees for the future of the company. They approached this more than thoroughly. Not only the scientific and educational center “Biryuch” was founded, but also the professor of psychology Nikolai Konyukhov, the former chief psychologist of the GRU, who previously was engaged in research and work in psychology in the interests of intelligence, was also invited. Nikolai Konyukhov (who at EFKO was simply called “professor”) laid down many practical approaches to testing employees and their selection.
To put it simply, as a result of deep testing, EFKO can determine the psychological profile of a person and his dominant emotional centers. This allows the company to understand the future compatibility of the employee with the corporate values and areas of work. Some candidates will not fit in principle, and some will receive a recommendation for further career development, based on the characteristics of the psychotype. EFKO believes that they have no right to change the outlook of their employees, but at the same time should hire employees who can make EFCO’s values the basis of their personality over time and sincerely and deeply share them. Moreover, employees usually receive the results of psychological testing in order to be aware of the peculiarities of their psychological traits and try to correct them based on the needs of personality development.
Every employee who has settled down in EFKO can notify HR about his desire to go for a promotion. This applies to all employees without exception, including all the workers in factories. Candidate undergoes professional and psychological certification and, in case of success, starts attending the training center. There he will study a lot according to a strict daily routine for a year and a half, but afterwards the company guarantees him a promotion with a significant increase in income. Moreover, if the company cannot immediately provide a suitable position, then it begins to pay already increased salaries till employee can get a position. Hundreds of coworkers in the company have already gone this way.
And what happens at the top of EFKO, among the leaders? In Biryuch there is not only a scientific, educational and innovation center. The board of directors of the company, consisting of partner-shareholders, works there as well. Between the White Castle, which houses the scientific and educational center, and the Black Castle, where top management is located, I found an interesting sculpture in the form of black and white wrestling snakes. And I noticed that the white snake’s hands were tied. They explained to me that “good” is always forced to fight with tied hands, because it can’t really use any dirty tricks to win. But let’s continue our way to the Black Castle to meet the leadership.
Since the creation of the company, only one person, Valery Kustov, has remained among the shareholders. The company has a rule that only an active partner who currently makes a considerable contribution to the business can be a shareholder. Shares are redeemed from those shareholders who left the company, and their redemption price is below market. Shares are not inherited. However, these rules are known and accepted by all partners. Valery Kustov has never owned more than 30% of the company’s shares. At the moment, another 40% have been transferred to other top managers and partners for their special contribution to the company performance and the development of key business areas, and 30% are waiting for their owners. Now there are eight partners, but in the future there will be more, since more and more worthy candidates are growing up and will be ready to play a partner role in the company soon.
However, EFKO shares are more than just an asset. Company reinvests most of its large profits into the local region in order to increase the quality of social life. In fact, the second-level empathy is considered to be the most important feature of an EFKO top manager, when, roughly speaking, a person is ready to take off his “last shirt” for the sake of others. It is known that in most successful commercial companies, rather cynical managers of the “nothing personal” category grow into top managers. Moreover, this is also the case for top universities and the whole educational system. I have been in business for a long time and know very well how cruel morals prevail in the top management of international corporations, which outwardly preach social responsibility, sustainability, etc.
This is probably the whole point of EFKO. Empathy is a quality that is much more inherent to a countryman. It is extremely important that the villages aren’t used to rely less on rational, selfish decisions. They just think about the local fellowship more. Frankly speaking, I guess in Russia there are 60–70% of such empathic people. We believe that this is a disaster for the country, because they have a high level of intelligence, but these are depressed, vulnerable people who suffer from the fact that they cannot realize themselves in a cruel modern society. For the sake of self-realization they have to go over people’s heads, but it turns out that contrary-to-morality acts are unacceptable for them. These are the kind of people EFKO tries to engage into the business in order to make them best top managers for their corporate culture. By the way, despite all the empathy and awareness, the level of salaries of top managers is still quite high. There are even employees with salaries of more than 1 million rubles per month. And partners also receive dividends that however cannot be compared with the net profit.
An innovative countryside company for a country-village. Maybe this is EFKO’s historical mission? Company’s long-term strategy is to develop food products and unique caring employees that will enable the human body to serve for 100–120 years. Sweet protein instead of sugar, innovative fats without calories, vegetable meat (sorry, “healthy innovation burger”) and many other beneficial nutrition products available to the mass consumer.
The planning horizon of EFKO’s R&D is 20–30 years; only few commercial companies think of such terms. EFKO uncompromisingly invests millions of dollars in laboratories, pilots and class A offices for the teams. The long-term goal of the board and today’s partners is to build a self-developing corporation that reproduces leaders who become best top managers with well-developed 2nd level empathy and care about the people around. Who knows, maybe EFKO has come up with a new corporate structure which fits Russian reality perfectly.
Many skeptics consider the company’s values insincere, and the products too harmful. I do not undertake to protect anyone, I just went to Alekseevka and Biryuch, took my own look at everything, frankly talked to people out there and decided to share what I saw and heard with you.
The attentive reader will ask whether I found the missing people. I did! They work in modern laboratories and ultra-fashionable offices of Biryuch, spending their free time walking around the picturesque nature or skiing nearby. And they look absolutely happy to live this life at their own pace. By the way, in Biryuch there is a corporate museum dedicated to the period of the Scythian civilization, the center of which was just here, in the Belgorod region. There I learned that the Scythians had a custom of choosing their leaders among many contenders, who was supposed to guard the community and not himself. And if the leader did not cope with his state duties well, he was immediately put to death. Perhaps, knowing the past helps both in business and in everyday life.
Disclaimer:
Let me admit that during my visit I had been bribed with food all the time. Hi-burgers are tastier than real meat burgers, Sloboda yoghurts are superb, and croissants are simply a masterpiece! Sergey Ivanov, EFKO Executive Director, many thanks for the invitation!
