In some Gulf countries, human talent and capital are almost considered inanimate raw materials. Corporate leaders must realise that unless employees are motivated and cared for financially, and offered a clear career development path, business growth will be stunted. Businesses become great only when employees work with their heads and hearts in the operations. They must identify with the corporate mission and goals for these to be achieved, and a socially responsible corporation will always find higher morale amongst its employees.
Yet, several companies fail to recognise the HR function. Career planning, management development and succession planning are non-existent, surfacing only as occasional clichs at meetings.
There is little thought given to the costs of living, shopping cart inflation, rise in rentals and the impact on employees. But these escalations influence the morale of the employee and therefore his or her contribution to the job. While rising costs of raw materials keep all managements engaged, few worry about the rising living costs of its people. Other globally proven practices like annual reviews, performance appraisals and increments based on contribution to the business are also given the go by. Thus, there is no incentive for managers to improve skills and shoulder additional responsibility. This often means wasting the potential of superior performance within the companys existing HR pool, which smart firms recognise as their most valuable advantage that cannot be easily copied, bought or stolen away.
Smart companies ensure that their employees spend at least 10 days annually on internal or external training programmes. These sharpen skills, ensure exposure to new developments and improve employee performance. Sadly, many Gulf firms seem to consider such training a waste.
I have worked in many parts of the world, and have had managers with varying nationalities, including Europeans, report to me. Salaries were always determined by the tasknot by the market rate the person may have earned back in his or her home country. In the Gulf, however, as Lonely Planet Guide proudly proclaims, a western expatriate could easily be getting thrice the salary of an Indian doing the same job. I think this needs to change for the sake of the principle of equity and the regions own reputation as a market with independent prices.
More than that, Gulf companies need to work on talent development and retention. It is silly to lose an employee and then have to pay twice for a replacement. All over the world, management development entails the fostering of a team of company careerists, and the Gulf has a marvellous opportunity to create teams of astounding diversity and global empathy to operate in a world economy of the 21st century.
First, however, some primary issues need to be addressed. Sheikh Mohammad, the Prime Minister of UAE, for example, has been a tireless champion in advocating professional and humane treatment of labour. Private sector employment is preferred over government jobs in most countries. But in the Gulf, private firms are the laggards on HR practices. It is time they acknowledged human capital as a critical determinant of growth. It matters more than steel, glass and chrome skyscrapers.
The author has worked with Unilever in India, Latin America, Brazil and Africa. He is currently CEO of a manufacturing/retailing foods business in West Asia. These are his personal views