Consumers in Rapid Transition: the Polish Experience

ABSTRACT - This paper examines how the political and economic transformation of Poland, from a socialist to a market economy, is impacting Polish consumers. Emergent themes from participant observation and interviews illustrate key aspects of the transition process. Taken together, these themes highlight the need to understand the role of prior cultural conditioning and the influence of national character on consumption activities.

Citation:

Brian Lofman (1993) ,"Consumers in Rapid Transition: the Polish Experience", in NA - Advances in Consumer Research Volume 20, eds. Leigh McAlister and Michael L. Rothschild, Provo, UT : Association for Consumer Research, Pages: 18-22.

Advances in Consumer Research Volume 20, 1993      Pages 18-22

CONSUMERS IN RAPID TRANSITION: THE POLISH EXPERIENCE

Brian Lofman, Central Connecticut State University

[The author wishes to acknowledge the financial assistance provided by a USIA Grant, and the moral support of the International Business Department in the School of Business, Central Connecticut State University.]

ABSTRACT -

This paper examines how the political and economic transformation of Poland, from a socialist to a market economy, is impacting Polish consumers. Emergent themes from participant observation and interviews illustrate key aspects of the transition process. Taken together, these themes highlight the need to understand the role of prior cultural conditioning and the influence of national character on consumption activities.

CONSUMERS IN TRANSITION

On September 12, 1989, the Solidarity coalition in Poland officially took office and began to move immediately to a market economy by introducing and implementing drastic reforms. These political and economic changes served as the basis for a structural transformation that has already taken on radical dimensions (see Batt 1991). But how do changes at the macro level affect the attitudes, emotions, and behaviors of individual consumers? And how do cultural values shape consumption activities? This line of questioning was initially raised by Nicosia and Mayer (1976), who focused on what they termed "affluent" societies. These questions are directly relevant, however, for all types of societies. In particular, studying consumer behavior in Central and Eastern Europe at this critical juncture in time provides a unique opportunity to understand some of the most fundamental underlying aspects of consumer behavior, and perhaps to challenge certain previously accepted assumptions. This paper reviews the methods undertaken in the study, describes themes emerging from the research, and discusses some conclusions based on these themes.

METHOD

The study used methods of naturalistic inquiry (Belk, Sherry, and Wallendorf 1988) appropriate for accessing the "native point of view" (Davies and Schmidt 1991). Prior to traveling to Poland, the researcher read relevant literature and spoke with various Polish people in the United States to obtain an understanding and a historical sense for the conditions of everyday consumer life in Poland. The research in situ was undertaken for a period of one month in the summer of 1992. By engaging in activities similarly engaged in by many Polish people C such as shopping in various markets and using diverse modes of mass transportation, including trams, trains, and buses C the researcher thoroughly participated in the cultural milieu. The research was conducted in various cities, including Wroclaw, Krakow, Poznan, and Warsaw, and on trains taken between these cities. Most of the research was conducted in Wroclaw, a city of approximately 650,000 people situated on the Odra River in the region of Lower Silesia in southwestern Poland. Toward the end of World War II, seventy-five percent of Wroclaw was destroyed, although much of the city was later rebuilt in an effort to match its prior architectural design.

Primary research methods included participant observation and interviews with consumers and businesspeople. The methods evolved continuously to fit particular situations and to deal with unanticipated problems. Most interviews required the aid of a translator; a notebook computer was used whenever and wherever possible for immediate transcription. The computer was used primarily during interviews with marketing consultants, entrepreneurs, and business managers, and also with consumers interviewed in leisurely settings. A microcassette recorder was used to record some interviews conducted in English, but mostly to record ideas when it was inappropriate or inefficient to work on the computer. Finally, a computerized journal allowed for an ongoing record of evolving ideas grounded in the dynamic nature of the research.

In order to examine the changing aspects of consumer life, the primary research sites C a shopping pavilion and a minibrewery C were purposely chosen for their novelty. These sites have recently arisen as a result of the new demand oriented economy and are therefore symbolic of the economic transition. The sites are also of interest because consumption norms have not yet been established in these environments; it was expected that consumers would be willing to speak in great depth about their consumption experiences. Besides the primary sites, other sites included various types of shops, market squares, and busy city streets. Additionally, there was a mix of informal and formal interviews and meetings in households and businesses.

Before reviewing the results of the research, two important limitations regarding this study should be mentioned. First, research was conducted during one period of time; any comparisons made to the socialist government era are based on consumer recollections and are corroborated by various written records. Since the study is not longitudinal, it is possible that consumption activities under the planned economy were actually somewhat different from what this research suggests.

Second, the research was not intended to investigate macroeconomic issues. It can be stated, however, that given the increasing interdependencies among world nations, the nations of Central and Eastern Europe are undoubtedly developing along different paths than those followed by western industrialized nations. Poland's position in the global economy will certainly continue to reflect its unique historical and economic development.

TRANSITION THEMES

The research indicates that Polish consumers must continually make pragmatic and psychological adjustments to their everchanging environment as reflected in the increasing complexities and inconsistencies of everyday life. Several key themes emerge which, in combination, suggest a changing model of consumer behavior, specifically, one that is becoming more similar to the western model, though some important differences between consumer behavior in Poland and in western nations clearly remain. Each theme is discussed separately below, but the themes are interrelated: each theme influences and is influenced by the others.

Changes in Decision Making

To a large extent, prior to the transition, consumers were conditioned by their external environment. Scarcity of many foodstuffs, appliances, and often basic services was evident, although the extent of scarce supply clearly varied over time (Walters 1964, 1975). Under economies of shortage, consumer choices are limited; lacking freedom of choice, consumers may not be able to express real needs and preferences. Relatively speaking, consumers constrained in this way can not truly be autonomous decision makers. Purchase decisions are often simplified, though the process of purchasing tends to be complicated, and time and energy consuming (Gajewski 1992). Key decisions to be made under the socialist government were frequently questions related to process: "Who in the household will wait in line today? Should I purchase an item I don't really need in case it is not available at some future time? Should I purchase an item I don't really want, and use it to barter for a product I desire?" Conversely, for many American and Western European consumers, the purchasing process has been relatively simple, but decisions are frequently very complex due to the large number of existing brand choices and the great deal of information available about many diverse product features (Waldman 1992).

Product decision making in Poland has become particularly relevant to consumers as they have perceived there to be real choices to make in the marketplace. There are more and different types of places in which to shop, from open air markets to major department stores. Although the more expensive items are beyond the economic reach of some consumers, there are several brand choices within an expanding number of product categories, such as toothpastes, laundry detergents, and other household products. Because consumers are facing increasingly complex decisions, some have begun using heuristics to simplify decision making. For example, consumers often expressed that both product prices and quality are lowest in open markets. Furthermore, many consumers noted that open markets are appropriate for the purchase of certain products, but not for other products, due to poor or inconsistent quality. Beyond having to cope with increased complexity, consumers are facing greater risk in decision making. They must attempt to make financially prudent choices in an environment of high inflation, and where the increase in prices may be highly variable from one industry's products to another.

Changing Consumption Activities

Prior to the transition, consumers engaged in several daily ritual activities; sometimes these activities became all-consuming and took precedence over job related functions. Seeking information concerning the availability of various goods was an ongoing activity for most consumers. Unless the black market was affordable to the consumer, waiting in long queues was essential in order to gain access to the potential for goods purchase: consumers did not know what would necessarily be available, if anything, once they made it to the front of the line. If some products were available at the counter, then consumers might purchase whatever was available, within their budget, and sometimes up to the quantity allowed. Hoarding occurred not only due to supply inconsistency, but also due to the fact that prices were usually expected to rise in the near future. Of course, hoarding served to decrease supply and increase prices, thereby compounding an already difficult situation.

Whereas information search regarding goods availability, standing in long lines for several hours to purchase goods, and the hoarding of goods were all typical consumption activities under the planned economy, consumers are presently engaging in radically different consumption activities. Presently there is less competition among buyers, and more competition among sellers. Some consumers are involved in extensive exploratory behaviors. Comparison shopping, for instance, has become quite an adventure for many consumers, as they find that prices can vary substantially from one store to another. For some, the large variations in price can be a source of frustration. First, having to make trips from store to store to find the lowest price for an item takes considerable energy. And, second, some consumers question how such wide variations in price can even exist. In general, compared to her American or Western European counterpart, the Polish consumer appears to be more concerned with, although not necessarily more attentive to, the management of scarce resources.

Changing Expectations

Consumer expectations have changed rather dramatically over the last decade. At first, expectations were low or virtually nonexistent: many consumers were resigned to the continuation of the centrally planned economy, and had become immune to the government's largely unfulfilled promises and futile attempts at real reform, especially since such reforms had little impact on the standard of living. Beginning with the early stages of the Solidarity Movement, however, Poles were given hope that the future might bring better economic times. When the political leadership finally changed C although people were at best unsure as to how the government might be reorganized and precisely what changes would lie ahead C many were riding the crest of a wave of overly high expectations understandably related to the intense emotions experienced at that point in time.

Regardless of what the new government might achieve, even in a short period of time, it was inevitable that people would come to experience mixed emotions. The great majority of consumers interviewed indicated that they were glad the political transition occurred, and were clearly happy with certain results of the transition. For the most part, consumers are enjoying their freedom of choice, such as their increasingly greater access to a broader variety of goods and the availability of substitute brands within many product categories.

Still, many consumers are concerned about the present and the future economy in areas where previously there was minimal concern; this is apparently the case in other Eastern European countries as well, such as in Czechoslovakia (Miller 1992). Inflation has become a way of life. Full employment is no longer a priority for the government; indeed, Poles are facing increased unemployment. Although many jobs paid (and often still do pay) low wages, at least they were available and often not demanding. Universal health care has been an important part of socialized life in Poland; in the long run, the transition threatens to change the cost of as well as access to medical treatment.

The Changing Workplace

Under socialism, there was little if any incentive to be effective or efficient in the workplace. Responsibility for accomplishing goals (as opposed to tasks) was infrequently taken, and work was sometimes avoided when it conflicted with social activities or personal affairs. Stealing time for social networking has been a significant reason for employees not working too long or too hard at their official jobs (Clark and Wildavsky 1990, p. 130). Service workers in particular had little to no training and often held poor attitudes toward their work.

Attitudes toward the workplace appear to be related to locus of control (Goodstadt and Hjelle 1973; Rotter 1966), which "influences beliefs about who should solve problems" (Folkes 1988, p. 556). Attitudes of Polish workers have been so deeply ingrained that the employee has often sought "above all to use the resources of the company to improve his personal fortunes, whether it helps the company or not" (Clark and Wildavsky 1990, p. 143). Over the years there have been rampant problems associated with worker absenteeism and sick leave, especially since the loss of jobs in a full employment economy was virtually nonexistent (Lipton and Sachs 1990).

The extent and pace of change in workplace activities presently varies considerably depending on the size and age of the firm. Although many of the newer, small businesses are having problems just making a profit, they appear to be operating relatively efficiently and with at least somewhat of a customer service orientation. Entrepreneurs are still constrained by government regulations and policies that have outlived any usefulness they may have once had, but these businesspeople are making risky decisions and taking responsibility for the outcomes of such decisions. National companies are in the initial stages of privatization; they seem to be changing very gradually, in some cases merely changing superficial aspects of their operations. Within some of these large firms, younger people are being trained how to operate a business in a demand economy.

Generally speaking, workplace attitudes are resistant to change. Workers are still reluctant to make decisions and take responsibility for them. Poles have not been "empowered to take their lives into their own hands and experience that they can create a reality of their own choice" (Davies and Schmidt 1991, p. 27). This may represent a fairly long lasting legacy of the former socialist system, but it is also related to a strong trade union tradition. Without managerial direction, little to no initiative is taken to increase sales and to improve operations. For example, a considerable portion of floor space in shops may go unused or may be inefficiently configured, making customer self-service difficult at best, and suggesting a need for product merchandising. Also, service providers still seem to have little concept of customer service (Davies and Schmidt 1991). Employees frequently do not see the need to maintain a pleasant demeanor, nor to be outwardly helpful. Rather than greeting the customer and offering assistance, waitresses and sales clerks tend to wait for the customer to request assistance. They often seem unsure how to establish a rapport with customers, instead focusing solely on the steps required to complete the transaction at hand.

Change in Temporal Orientation

Orientation to time is an important cultural value, perhaps crucial in understanding consumption. Each culture possesses its "own unique set of temporal fingerprints. To know a people is to know the time values they live by" (Rifkin 1987, p. 1). The most critical aspect of the transition process in Poland may relate to changes required in the temporal orientation of the Polish people.

Under socialism, activities frequently tended to be procedure driven: following established procedures was often the key to consumer and worker success. At least in some ways, the Polish consumer has apparently been following the procedural-traditional model of time perception, by which activities must be done correctly as opposed to on time or efficiently (Graham 1981). In this model, time and money are basically disjoint concepts, essentially unrelated to one another. As opposed to active behavior, this implies very passive behavior where procedure dictates actions. Activities were often engaged in when the time was right, such as doing shopping during work hours, and buying products immediately rather than waiting for a future time when they might not be available C it thus made little sense to plan a budget. Instead of solving problems to achieve enhanced outcomes, Polish workers have tended to follow the procedures of the organization regardless of the needs of the particular customer or situation. They have seen rules as beyond their control, and thus flexibility was essentially not in the behavioral repertoire of Polish people in the workplace.

To a large extent, Poles became desensitized to concerns about the long-term future. Central planners worked assiduously on five year growth plans, prepared meticulously to meet procedural requirements as ends in themselves C yet rarely were goals achieved. Growth plans focused specifically on production objectives, but obsolete equipment has seldom been replaced (Fallenbuchl 1988). Managers have been known to pay much more attention to tactical decisions than to strategic decisions (Domanski 1986), although management historically has not had the autonomy to make even operational decisions (Walters 1964).

The transition from a command to a market economy may very well require a shift in the perception of time to allow for long-term economic growth and stability. Polish people are apparently adopting the linear-separable model of time perception. In capitalist nations, this has implied a future orientation with consumption activities indicative of means to ends, where such activities are driven by a strong connection between time and money, and where the spending of time is planned and budgeted (Graham 1981). Polish people are increasingly planning for the long-term; successful entrepreneurs are on the forefront of this trend, but consumers are also becoming keenly aware of the need to save and invest for their future consumption.

Still, orientation to time is a fundamental value orientation (McGrath and Kelly 1986), and cultural values are slow to change. The change in temporal orientation is slowed considerably by certain everyday aspects of life. Polish consumers do not have much disposable income, hence little need to consider alternative investments. Presently more than fifty percent of families do not plan expenses, instead tending to buy on impulse or relatively immediate desire (Bogucka 1992). One of the reasons for this is that prices jumped following the introduction of the demand market, and announcements concerning large increases in prices were often made only a few days in advance of such increases. Having become accustomed to rapidly increasing prices at a moment's notice, consumers have continued to buy rather quickly.

During the transition period, Polish people have had to determine the appropriate situations in which to utilize these different models of time perception; clearly, switching from one model to another is a skill in itself. It is important to gain a more precise understanding of the role that time plays in Polish consumer behavior (Bergadaa 1990; Hornik 1982), and to understand in greater depth the timestyle of Polish people, that is, the regularity in the priorities of Polish consumers as related to the limited supply of time, money, space, and personal resources (Feldman and Hornik 1981).

CONCLUSIONS

The transformation of the political and economic system of Poland is clearly impacting individual consumers, households, and businesses, and Polish people appear to be making a rapid transition in many ways. However, at least some attitudes and behaviors appear to be somewhat resistant to change. There may be many reasons for the present pace of the transition process; the emergent themes in this study suggest two plausible explanations.

First, it seems likely that several decades of socialist government have left a legacy that continues to influence Polish people in general and their consumer behavior in particular. Indeed, consumers who have lived under any political and economic system for an extended period of time can be expected to have been conditioned by that system, although the precise conditioning itself would likely differ from one system to another. Governments and their agencies tend to foster particular attitudes and constrain certain types of behavior. In the case of Poland and other Central and Eastern European nations, the socialist legacy reflects the cultural conditioning which occurred during the last several decades. If there exists a socialist legacy, it would be interesting to examine over what period of time the legacy continues to affect consumers, and how intense these effects prove to be over time.

The second explanation for the present pace of the transition process concerns the possibility that certain aspects of consumption in Poland, when contrasted with consumption activities throughout Central and Eastern Europe and the rest of the world, may be unique or idiosyncratic to the Polish people. That is, in keeping with the concept of national character (Clark 1990; Gorer 1953), there may be specific features of the Polish character that differentiate Polish consumers from consumers of other nations. Perhaps national character would be relatively easy to study in Poland because of the fact that the society is relatively homogeneous. Values may be very different from one nation and one culture to another. Interestingly, although Poles are considered to be quite religious (predominately Catholic), their religious practices tend to be more ritualistic than spiritual in nature (Nowak 1981). It may be that Polish people have tended to exhibit procedure driven behavior in both their sacred life and profane existence.

Although the explanations considered were suggested by the exploratory research undertaken, it should be emphasized that these explanations have not been subjected to rigorous test. At least for the time being, cultural conditioning and national character seem to be inextricably interrelated phenomena believed to have significant impact on consumption in Poland. Perhaps the relatively permanent aspects of the Polish national character, if one can be defined, will relate to those features which remain once the new market economy has taken hold in Polish society, and after those features related to the socialist past have worn away with time.

A third explanation not provided above, and not specifically apparent from this research, should be considered in attempting to understand the seeming reluctance of Polish people to make some major changes in their way of life: many Polish consumers may simply not want to make such changes. They might view the structural transformation in a positive light, but they may perceive changes that impact their cultural values in a negative light. Perhaps Polish consumers are basically content with their cultural lifestyles and timestyles. This possibility implies that, beyond examining the impact that the Soviet sphere of influence has had on Polish consumer life, it is necessary to consider the increasing effects of Western European nations and the United States on Polish consumers. To what extent are these nations exporting and imposing their cultures on Polish people? Does this represent a new form of cultural conditioning? In this research, there were Polish people who expressed concern that there is too much influence from the West in terms of cultural values. For example, some Poles felt very strongly that making money has already become too highly valued in Polish society.

The great mix of various hopes and fears of Polish consumers demonstrate the complex nature of the transition process. The present situation regarding consumer expectations can not be represented by one single viewpoint. Many consumers are celebrating new choices, yet they are also somewhat pessimistic about their present economic position, expressing varying expectations for the long-term future. Other consumers wonder whether any political and economic system can truly make long-term changes for the betterment of society. Still others note that lifestyles can not be expected to be as flexible as government policy sometimes can be C attitudes, behaviors, and deeply held values are not easily changed (Davies and Schmidt 1991, p. 26):

It would be a fallacy to assume that all this can easily be overcome through a short transition period and intensive training...it appears to be deeply embedded in the Polish culture.

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