hr nationalization challenges in mena
TRANSCRIPT
Nationalization Strategies
The Human FactorPublic And Private Corporations
Zafar Aziz Osmani
Chief Executive Officer
Excelerate Private Limited
Objectives of Presentation
Evaluate and review ratio of foreign employees in GCC
Countries
Identify key factors and challenges
Suggest options and alternates for enhancing locals employment ratio
Important Considerations
• This is not a research analysis presentation
• Data used in this presentation has been acquired from
different sources where variations have been noticed
• Purpose of using the statistical data is to get a big
picture perspective which can throw some insights from
HR point of view
Source - Forstenlechner, 2013
GCC Demographics
Country 2012 Population Workforce
Nationals Non-Nationals Nationals Non-Nationals
Bahrain 510,000 540,000 36% 64%
Kuwait 1 mill 2.4 mill 17% 83%
Oman 2.4 mill 1 mill 29% 71%
Qatar 220,000 1.1 mill 5% 95%
Saudi Arabia 21 mill 7.8 mill 51% 49%
UAE 950,000 4.3 mill 6% 94%
GCC 26 mill 17.1 mill 24% 76%
GCC Workforce Ratio
Source - Forstenlechner, 2013
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
UAE
Qatar
Kuwait
Oman
Bahrain
Saudi Arabia
Nationals Non-Nationals
GCC
Population / Workforce Ratio
60%
40%
Nationals Non-Nationals
Source - Forstenlechner, 2013
38%
62%
Nationals Non-Nationals
61%
39%
Nationals Foreign
European Union GCC Ratios
Source – Eurostat migr_pop1ctz
38%
62%
Nationals Non-NationalsE U GCC
Reasons for Employment
Imbalance in GCC
• Phenomenal economic growth in a very short time
• With high levels of real GDP growth, developments took
place in infrastructure, education, health and other social
sectors which necessitated immense workforce
• Local working populations was not ready to cope up with
the challenge due to:
– Inadequate numbers
– Lack of specialized skills
Real GDP Growth 1970 – 2013 US $ Billion
Source - IFS DATA
Y 1
97
0
Y 1
97
3
Y 1
97
6
Y 1
97
9
Y 1
98
2
Y 1
98
5
Y 1
98
8
Y 1
99
1
Y 1
99
4
Y 1
99
7
Y 2
00
0
Y 2
00
3
Y 2
00
6
Y 2
00
9
Y 2
01
2
KSA
Y 1
97
5
Y 1
97
8
Y 1
98
1
Y 1
98
4
Y 1
98
7
Y 1
99
0
Y 1
99
3
Y 1
99
6
Y 1
99
9
Y 2
00
2
Y 2
00
5
Y 2
00
8
Y 2
01
1
UAE
Y19
80
Y19
83
Y19
86
Y19
89
Y19
92
Y19
95
Y19
98
Y19
96
Y19
99
Y20
02
Y20
00
Y20
03
Y20
06
Y20
09
Y20
12
QATAR
Y1
97
5
Y19
77
Y19
80
Y19
83
Y19
85
Y19
88
Y19
91
Y19
94
Y19
97
Y20
00
Y20
03
Y20
06
Y20
06
Y20
09
Y20
12
OMAN
Y19
75
Y19
79
Y19
83
Y19
86
Y19
90
Y19
94
Y19
98
Y20
02
Y20
05
Y20
09
Y20
02
Y20
06
Y20
10
BAHRAIN
Y19
70
Y19
73
Y19
76
Y19
79
Y19
82
Y19
85
Y19
88
Y19
91
Y19
94
Y19
97
Y20
00
Y20
03
Y20
06
Y20
09
KUWAIT
GCC GDP GrowthIn Billions of US $
-
200
400
600
800
1,000
1,200
1,400
Y 1
97
0
Y 1
97
1
Y 1
97
2
Y 1
97
3
Y 1
97
4
Y 1
97
5
Y 1
97
6
Y 1
97
7
Y 1
97
8
Y 1
97
9
Y 1
98
0
Y 1
98
1
Y 1
98
2
Y 1
98
3
Y 1
98
4
Y 1
98
5
Y 1
98
6
Y 1
98
7
Y 1
98
8
Y 1
98
9
Y 1
99
0
Y 1
99
1
Y 1
99
2
Y 1
99
3
Y 1
99
4
Y 1
99
5
Y 1
99
6
Y 1
99
7
Y 1
99
8
Y 1
99
9
Y 2
00
0
Y 2
00
1
Y 2
00
2
Y 2
00
3
Y 2
00
4
Y 2
00
5
Y 2
00
6
Y 2
00
7
Y 2
00
8
Y 2
00
9
Y 2
01
0
Y 2
01
1
Y 2
01
2
Y 2
01
3
SAUDIA UAE QATAR OMAN KUWAIT BAHRAIN
Inferences Drawn
• The unprecedented growth in a very short span of time in recorded
history
• There was no way GCC countries could have achieved the required
development without engaging large numbers of foreign workforce
/skills
• The ratio cannot be reversed in near to mid term of time due to the
population growth and required pace of skills development
constraints
• Only structured and sustained planning will improve the ratio over a
period of time
Public And Private Sector
Realities & Challenges
Go
vern
men
t se
cto
r jo
bs
seen
fav
ora
ble
Compared to private
sector
Salaries are generally higher
Non monetary benefits are better
Hours of work tend to be shorter
Private Sector Employers Perceptions
Perc
epti
on
s ab
ou
t N
atio
nal
s
Less productive than expats
Legislated higher salaries than expats
Reluctant to work in private sector
Need greater flexibility in work hours
GCC HR Priorities
• Develop and grow the nationals workforce– In numbers and
– In skills
• Widening employees database by enhancing the male : female ratio in workforce
• Focus on behavior competencies relevant to employee engagement and motivation
Continued Dependence on
Foreign Labour Po
licie
s so
far
no
t fu
lly
succ
essf
ul i
n a
chie
vin
g d
esir
ed g
oal
s
In managing unemployment
Creating jobs for the increasing numbers of nationals after education
Decreasing dependence on foreign labor
Classical Initiatives
Subsidize salaries to
private firms
Enforce Nationalization
strategies through
regulatory controls
Enhance private sector benefits for compliance
with Nationalization
Allow for Nationals to be dismissed for
non-performance
Recognizing HR program for
Nationals
Performance Growth Model
Clarity in Performance Benchmark
Linkage to rewards and
growth
Developing technical and
behavior Competencies
Engagement & Motivation
Strategy for
The Employers
Define HR requirements based on business strategy
Develop organizations core
competencies matrix
Assess employees readiness in core
competencies
Develop and implement strategy
for bridging gaps
Ensure Engagement and motivation
stays critical to HR strategy
Example:
IT Career Paths
Job Level
1
Job Level
2
Job Level
5
Job Level
3
Job Level
4
Job Level
4
Job Level
3
1
Core Path 2 4
6
73
5
Programmer path
Analyst path
Special Skills path
Special Skills path
Management path
Management path
Conclusion
For successful nationalization there is a need for shift:
• From Conventional strategy
• to a “Human Factor Based Strategy”
Strategists need to:
• Align their approach with human resource modern approach
• Matching people competencies with organization needs
• Engaging nationals and adopt a learn & grow approach
WEBSITE:
http://www.excelerateca.com
HEAD OFFICE:
Office # 6, 3rd Floor, Plot # 36-C,
5th Bukhari Commercial Lane, Phase 6 DHA,
Karachi, Pakistan.
PHONE:
+92 -21-35245722
EMAIL:
Zafar Aziz Osmani
Chief Executive Officer
Excelerate Private Limited
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