Developing a Multi Skilled People Management Approach in the Middle East - Essay Example

? Developing a Multi-Skilled, Focused People Management Approach in the Middle East through Reducing Dependence on Foreign Workers Module Tutor Name of University Submission Date Not like the trends of development elsewhere, the transition of the economy of the Middle East or the Gulf Cooperation Council (GCC) has been largely driven by the trading in of expatriate foreign employees. This pattern will not cease for the near future, although at a slower rate, but the involvement of foreign employees in the course of transforming political and economic institutions will demand, inevitably, multi-skilled and customer-oriented people management techniques (Kavoosi 2000). Large corporations and government bodies in the Middle East, as well as international agencies, are vaguely informed of such regional trends, but the implications of such developments for human resource management (HRM) is not widely recognized or understood (Abdallah 2001). By conducting an appropriate evaluation of the factors and patterns influencing development, this paper tries to contribute to the knowledge required by large corporations in the Middle East to create a more systematic, multi-skilled, and customer-oriented workforce management approach. Changing economic progress and lessening reliance on foreign employees are the key tasks confronting the Middle East. Not like elsewhere, the Middle East has too little literature on HRM. A detailed review of available literature reveals the lack of any methodical assessment that might give a broad image of the HRM mechanisms in the Middle East (Budhwar & Mellahi 2006). In fact, there is hardly any trustworthy country-specific research that has surfaced with the economic progress of a specific Middle Eastern country. For instance, management and HRM approaches in Saudi Arabia, people management in Turkey, organizational and HRD success in Israel, international business and management problems in Jordan, and workforce management in the GCC (Peterson 1993). Moreover, the available literature emphasizes several studies associated with development and training in the Middle East. Ali (1996 as cited in Budhwar & Mellahi 2006), for instance, focuses on the inadequacy of attempts exerted by professionals to make sense of Arab management approaches and their effect on the success of organizational development programs and cross-cultural cooperation in the region. Likewise, a number of researchers talk about the success of management training and its effect on managerial competency in various Middle Eastern societies (Scullion & Collings 2010). As stated by Briscoe and Schuler (2004), several academics have stressed the need for and processes of multi-focused, customer-oriented workforce management approaches in the Arab world. A large portion of related literature on the Middle East is about the effect of Arab values and culture on management dynamics (Budhwar & Debrah 2001). Likewise, Kabasakal and Bodur (2002 as cited in Budhwar & Mellahi 2006), based on socio-cultural comparisons, classified an Arabic group, composed of Qatar, Kuwait, Turkey, Morocco, and Egypt. Countries in this group are emphasized to be very masculine, structural/hierarchical, group-driven, and weak on future direction. In contrast, Ali (1995 as cited in Budhwar & Mellahi 2006) argues that multi-focused, customer-oriented organizations and management approaches in the Middle East can merely be built by taking proper account of the Arab context. He further argues that the foreign aspect is partly not favorable to the creation of multi-focused, customer-oriented management approaches in the oil rich Gulf States. Researchers have also explored the subject of management flow from the Western countries to the Arab world. Yavas (1998 as cited in Aswathappa & Dash 2007), for instance, studied the subjective value given to a cluster of management competencies by Saudi managers who had gained their business diploma in the United States. Yavas (1998) emphasizes several macro- and micro-forces that could function as hindrances to the acceptance of this Western-rooted expertise in the Middle East (Aswathappa & Dash 2007). Other scholars, according to Denison (2001), in the same way, put emphasis on several differences between Arabian and Western culture and how the latter’s management principles and practices in Western multinational corporations (MNEs) based in the GCC are adjusted to fit the cultural environment of the Middle Eastern countries. Other studies reveal related findings, specifically, if Western MNEs would like to be booming in the GCC, they must possess an accurate knowledge of the region’s people, political realities, and culture. Some scholars emphasize the difficulties of relocating technologies developed and manufactured in developed nations to the GCC (Lee 2003). According to Hill and colleagues (1998 as cited in Budhwar & Mellahi 2006), because these technologies are culturally influenced by developed nations, relocating them to developing nations generates social and cultural hindrances. As regards to the adoption of workforce management approaches as well, the outcomes are comparable. Elmuti and Kathawala (1991 as cited in Budhwar & Mellahi 2006), for instance, studied the degree to which Japanese people management models can be adopted in their subordinates in the Middle East. Their study showed that either a new management model made up of components of Japanese or local management traditions or a purely Japanese management approach were productive in the particular setting. Scullion and Collings (2010), likewise, argues that because of the continuous reliance of the GCC on foreign workers, in spite of numerous programs of the governments to lower their number, it is greatly advisable to focus more on helping foreign workers attain a better and multiple level of focus. Studies by other scholars communicate the same message for MNEs planning to do business in the GCC. In order to do well, they have to be customer-oriented and sensitive to the local stakeholders’ needs. Other researchers also verify the same attitudes towards marketing technique implemented by US MNEs in the Middle East. To prevent negative reactions to the West, antipathy, and mockery, promotional materials should take into account the intricate, rigid social norms, prohibitions and sentiments influencing media use in the Middle East (Roukis & Montana 1986). Based on these findings, the point is obvious, local acculturation is an ‘obligation’ for large corporations to thrive in the Middle East. Putting emphasis on the lack of empirical works in the discipline and the conflicting idea about what management style is used in Arab companies scholars stress the importance of studying the key attributes of Arab management, to build up Arab management and to improve its structure (Peterson 1993). According to Abdallah (2001), Arab management is mostly conventional, which is shown in particular attributes that are narrow in future direction and absence of power transfer. Yucelt (1984 as cited in Budhwar & Mellahi 2006) also discovered that the management in Turkey’s public institutions is predisposed to implement an authoritarian model and to disfavor participative practices. He suggested bringing in multi-focused, participative managerial styles to prepare potential managers. Other scholars, according to Chalhoub (2009), recognizing the cultural assortment of foreign personnel in the GCC, stress that site managers who identify and appreciate the cultural individualities of workers and merge employee and job orientation are more likely to succeed than others. Based on the few existing empirical findings, the ideas arising suggest that the Middle East possibly has management styles that are akin to many other developing nations, which stress understanding of the local cultural standards and limited participation in making decisions (Denison 2001). Several researchers put emphasis on the huge effect of Islamic philosophy, Islamic work principles, and Islamic ideals on people management in Middle East. In order to gain accurate knowledge of the context-specific feature of workforce management, there is at present an important task to underline the key forces that establish management approaches and standards in the GCC in the current global setting (Roukis & Montana 1993).This form of analysis will enhance the creation of workforce management theories and applicable strategies in creating multi-skilled, customer-oriented HRM practices. Both scholars and professionals are trying to understand the people management styles applicable to the Arab world. It is certainly apparent that the available HRM literature in the Arab setting is scarce and perhaps not carried out in a methodical way with a definite structure, as well as potential countries that could facilitate a decisive and complete picture of the situation to be identified. Consequently, the available literature does not give comprehensive idea into fundamental dynamics and improve theory expansion (Budhwar & Debra 2001). Thus the question is how to determine the possibility of adopting multi-skilled and customer-oriented HRM models? This essay hence reviews the available literature on the subject matter. A number of countries in the Middle East confront the dilemma of sufficient workforce more severely than elsewhere. The comparatively strong economy of Israel mainly depends on a first-rate workforce, disposable expertise, and education (Sims 2007). According to Roukis and Montana (1986), with their abundant oil reserves providing for quasi-rent, and helped by foreign skills, Saudi Arabia, Kuwait, Iran, and Iraq can at least temporarily, somewhat more simply ignore the workforce problem than Syria, Egypt, or Turkey, for whom the populace is the major economic asset and their output the primary force of economic development. Despite of the fairly fast progress in secondary education, the percentage of vocational and technical students dropped from 15 per cent to 11 per cent at some point in the 1960s (Hershlag 1975, 19). Although this drop can be accounted for by a change from lower to upper stages of such education, the overall development is not positive. As expected, HRM and educational planning has grown to be one of the most vital features of thorough planning in the field (Hershlag 1975). According to Ehnert (2009), among its major priorities are elimination of inequalities between educational progress, and overall workforce and economic demands, more emphasis on scientific and technical disciplines, more concern for sufficient educational employees, and better adaptation between employment and education prospects. The current workforce problems stemming from the educational system comprise the continuing elevated illiteracy and dropout rate, the unduly elevated teacher-students proportion, and the considerable irreconcilability of contemporary education and customary or religious sentiments (Hershlag 1975). These problems are aggravated by the inequality between urban and rural areas in terms of access to education, the poor relationship between the technical and common education and the industrial sector, and incompetent educational strategies stemming from the quality of educators and the curricula policies (Budhwar & Debrah 2001). Comparatively, according to Budhwar and Debrah (2001), a great deal of attention has been paid to the quantification of education, and not enough on excellence, somewhat despite of a great inclination to raise formally publicized enrolment statistics in several nations. The problem of brain drain is of specific consequence in countries where in the deficiency or maladjustment of skilled workforce comprises a blockage in the course of development. Large local populations in the Middle East benefit from premium Western universities, yet a sizeable portion choose to avoid their own countries and work for organizations abroad (Kavoosi 2000). For example, in Syria, a special working group formed to look into the economic effect and scale of the brain drain discovered that between 1956 and 1969 57 per cent of the total number of academic experts moved abroad, with especially increased proportions of doctors, engineers, and scientist (Hershlag 1975, 20). Hence, the need for large corporations in the Middle East to adopt a multi-skilled people management model. For particular nations, like Egypt, several explanations are given for the irony of deficiency in supply in comparison to demand, and a corresponding underemployment of learned and qualified workforce (Kavoosi 2000). Several of these are: inadequate attention being paid to better potential efficiency; organizational incompetence and employer unwillingness to employ more expensive labor; inadequate modification of job conditions to existing skills; and disproportionate sectoral and regional allocation of technological workforce (Peterson 1993). Other aspects of poor adjustment between economic and workforce needs must be mentioned: poor health standards and inadequate nutrition; too many holidays; the low variety and low quality of manual industrial workers; the inferior standing of blue-collar occupations and high esteem given to managerial and political occupations; and the enduring pervasive illiteracy (Tayeb 2005). Hence, according to Varma and colleagues (2008), for now, the increase in the actual number of available professionals and experts barely copes with the expanding demands of contemporary workforce, whereas sizeable numbers, particularly of industrially educated people, are still jobless. Workforce planning for improved use of human resources is probable to endure more than material resource planning, because of the randomness of human actions (Mcgovern 1998). If the human aspect is unsuccessful, serious blockages hinder the course of development. One main hindrance to a sufficient venture in human resources is the complexity of envisioning and calculating its productivity. Skills are intangible resources. The Leontief framework of the productivity of an employee arising from accrued sizeable venture in human resources, even though drawing the attention of developed countries, has not until now provoked adequate reaction as regards to their level of importance (Abdallah 2001). According to Ehnert (2009), this poor response is proof of the fragile connection between economic factors and socio-institutional systems. As stated by Abdallah (2001), some scholars have tried, with much success, to create frameworks of the economic worth of education and venture in workforce management and human resources in general. The national states in the Arab Middle East share a common culture, language, and faith which give a standard cultural structure (Roukis & Montana 1986). Diversities are present in resource availability, income standing, size of population, and the extent of technical and administrative skills growth that, necessarily, demand thorough HR planning. There is a pressing demand for more precise information addressing education policies, participation of local workers, employee relocation, and population forecasts so that employees and occupations are more efficiently coordinated (Roukis & Montana 1986). In the smaller Gulf States, the workforce is largely composed of ample foreign workers, younger local people, and inadequate employment opportunities for women in the developing sector of the private economy. This unevenness is aggravated by the lack of skilled technological and managerial local staff (Peterson 1993). According to Chalhoub (2009), the system of education unsuitably adds to this problem by its distinct focus on educating local population for administrative positions in government agencies. Taking into consideration the comparatively huge number of foreign employees in the Middle East, large corporations in the region should deal with this limiting aspect. Vocational, business, and technological training should be improved to satisfy the growing demands of an expanded service and industrial economy (Kavoosi 2000). In fact, this implies an adjustment of established work ethics. Young locals should be egged on to take courses that focus on technical preparation, and additional on-the-job exercise should be carried out at actual workplaces (Kavoosi 2000). Apparently, on-the-job exercise courses will be hard to put into practice, where locals are psychologically unsympathetic to blue-collar occupations, but jobs can be readjusted and organized to efficiently match with culturally oriented work values. Even dividing jobs into units and delegating this job on a cottage-like way to women might alleviate the cultural aversion against hiring females in private institutions (Scullion & Collings 2010). Without a doubt, the government has augmented educational budgets, yet the national curriculum remains incongruent to intended economic progress (Scullion & Cullings 2010). According to Wilkinson and colleagues (2009), dependence on foreign workers will persist, even if the source of such labor reserve will be gradually more Asian. Cultural aspects greatly influence who is employed, who will be promoted in the company, and to what position. Asian and Western MNEs based in the Middle East implement the HRM styles in their native soil. In family-owned businesses or joint enterprises where family members are vigorously engaged in management, the highest echelons are customarily restricted to proprietors and individuals with family relations (Budhwar & Debrah 2001). However, according to Budhwar and Debrah (2001), workers in middle-level management are assumed to have acquired the competencies to perform the task. As stated by Budhwar and Debrah (2001), low-level management is a preparation position for middle- or upper-level management just like elsewhere. Recently, the restricted economy has blurred the employment opportunities of numerous college graduates. The Washington Post stated on the 15th of February 1987 that almost all graduates of King Saud University were having a difficult time getting hired (Peterson 1993, 249). In spite of a governmental rule of reinstating hundreds of thousands of managerial positions currently being occupied by expatriates, the technical and science competencies required for majority of these positions are not being satisfied by local graduates, a sizeable portion of whom take nontechnical courses (Peterson 1993). If the individual being considered for promotion in a state-owned corporation is a prominent and highly esteemed local, his/her chances are much better than an expatriate who may have merely skills and efficiency to support him/her (Budhwar & Debrah 2001). According to Roukis and Montana (1986), merely in special instances do certain competencies and the capacity to deliver determine who will advance to a higher position. Obviously, in the GCC, the focus is on the individual rather than the work. Ali (1989 as stated in Peterson 1993), in his literature review, emphasizes that local managers usually steer clear of risk or accountability, favor permanence over unpredictability, choose stability, prefer a centralized administrative system for it boosts respect, and prioritize personal ties over organizational performance and objectives. Formal evaluations are employed in MNEs, foreign-dominated universities, and banking sector (Kavoosi 2000). However, because of the Arab inclination to view others fully, formal evaluations, just like in Western countries, are burdened with risk for employees and managers. The argument that arises is quite inconsiderate for Arab feelings and quickly weakens its recognized motivating goal. Even in cases where official assessments have been implemented as a bureaucratic necessity, they do not receive much value (Lee 2003). Commonly, according to Marchington and Wilkinson (2005), prompt and optimistic evaluation is the normal kind of motivation and training for workers, in coping with Middle Eastern fine etiquette and paternalism. The situation is distinct with professional staff and managers. They have exceptional abilities, and the agency that endorses the job agreement wants them to train a local as a substitute. Citizens who are under expatriate managers are prone to demand even completely apparent duties and decisions to the expatriate manager with regards to their assumptions of what s/he is expected to carry out (Marchington & Wilkinson 2005). Because the foreign manager is in effect on a yearly job contract, s/he is likely to work diligently or pretend to work diligently if s/he would like to renew his/her contract. Expatriate employees usually find they should perform an unequal portion of the work load (Roukis & Montana 1986). According to Peterson (1993), state-funded companies give their citizens an effective target, and citizens learn to transfer a large portion of their task to foreign coworkers or managers for thorough decisions; hence the need for a multi-skilled workforce management technique. Nowadays, the demands on expatriate managers to work effectively and efficiently have grown. With a smaller number of foreigners to perform the larger portion of work load, locals will be compelled to become multi-skilled and more efficient. These developments make performance evaluation an ever more vital instrument for organizational management (Scullion & Collings 2010). However, when foreigners are drawn in, the course of action assumes a political element. An expatriate who gets a reasonable or low assessment does not get a contract renewal (Scullion & Collings 2010). This puts expatriates at an obvious disadvantage. Official evaluations are a tool of great authority for managers, and in Western countries, managers are presumed to wield this authority in a fair manner (Varma et al. 2008). An expatriate manager in the Middle East who evaluates locals as ‘modest’ invites doubt that s/he lacks the leadership abilities to empower or encourage his employees, for that reason, a basis for rejecting a renewal of his/her job contract. In contrast, positive evaluations given to low performing locals bureaucratically put efficient employees at a disadvantage and generate another root of disgruntlement (Varma et al. 2008). It is hence unsurprising that expatriate managers are likely to avoid getting involved in formal performance evaluations. Therefore, the occupational macro context in the Middle East involves (Chalhoub 2009, 51-52): (1) management approach, work ethics; and (2) technology. On the one hand, adjustment dilemmas as regards to a country’s general management approach, collective and individual work standards, and work ethics may not just seize a large piece of the productive working time, but may have economic effects as well due to related opportunity costs. Adjusting foreign workers to the indigenous style, while giving space to their own style, would lighten the adjustment to the work context. On the other hand, technology policies are country-specific and hence do training (Chalhoub 2009). Determining in advance the skill and knowledge disparities will enable adjustment. The occupational micro context normally involves (Ehnert 2009): (1) human resources norms; (2) organizational culture; (3) job requirements; (4) managerial authority; and (5) performance norms. First, the resources, prospects, and interest granted to personal growth and skills may boost the incentive to adjust. Second, organizations develop their own cultures, which consequently form distinct performance methods and may grow to be a basis of competitive advantage. Adapting recruits into a culture is a difficult task for any organization, doubly so for provisional expatriates (Ehnert 2009). Third are job requirements, which may differ even in closely structured organizations and in established sectors; assumptions and how they are addressed will influence adjustment. Fourth, managerial authority and the norms and forms of authority are specific to an industry or country. Lastly, discussing the presumed efficiency levels as regards to benchmarking against the standards of the host country and industry averages may facilitate adjustment (Mcgovern 1998). Every one of these issues should be taken into consideration by HR managers and staff in the Middle East in order to create a multi-skilled, customer-focused HR practices. Training would be a vital task for HRM in the Middle East. The HRM environment in large corporations in the Middle East is itself developing. The management and government continue to pursue innovative techniques to select, recruit, and retain the local labor force successfully. Until now, there is no general agreement on the most appropriate techniques to recruit and manage skilled local employees or how to address the problem of compensation imbalance (Budhwar & Debrah 2001). Taking into consideration the binary character of the workforce, large corporations in the Middle East uses two groups of HRM policies: (1) for foreign employees, and (2) locals (Budhwar & Debrah 2001). According to Peterson (1993), even though the two approaches vary completely in reality, both approaches are not seriously controlled by rules and position: there is no rule controlling minimum wages, job stability, and so on. Traditionally, large corporations in GCC have been greatly reliant on the availability of huge population of quite at risk foreign employees eager to work for very low compensations (Varma et al. 2008). Due to official demands, and the quite pressing possibility of political flux brought about by growing unemployment of nationals, companies have to look at solutions wherein they can slowly progress to a higher wage arrangement (Kavoosi 2000). Nevertheless, according to Varma and colleagues (2008), the vastly interventionist character of the Middle Eastern economy has led to a massive population of nationals having poorer work standards and skills and, perhaps, efficiency, than their comparatively advantaged position would indicate. Primarily, it may be assumed that a high national birth rate alongside the continuous lowering of national employment could lead to widespread starvation inspiring a bigger practicality among this population. In contrast, the GCC still provides a remarkable welfare services for nationals who were gravely affected, whereas the universal likelihood of political disorder in a country governed by quasi-feudal politics renders an extensive downhill regulation in the compensation rates of nationals improbable (Budhwar & Debrah 2001). Ultimately, large corporations in the Middle East have several potential policy alternatives. Foremost would be efforts to support the existing workforce binary. This would require companies actively demanding the government to loosen up affirmative action requirements, emphasizing that economic expansion will, in due course, create sustainable development, and better job opportunities for nationals, than would rejection of the existing framework (Briscoe & Schuler 2004). Nevertheless, due to the unpredictable character of oil prices, the Gulf States cannot consistently depend on its domestic capability to eradicate local unemployment, facing a skyrocketing birth rate (Marchington & Wilkinson 2005). Simply put, according to Sims (2007), although the problems related to rejecting the existing binary workforce framework could have encouraged the Gulf States to ignore those breaking the requirements it is possible that there will be a steady narrowing of the structure in future. Furthermore, the efficiency of nationals could be improved by raising the status of blue-collar jobs and accommodating them cordially in the culturally diverse worksites, slowly wearing down current assumptions about cultural labor differentiation. The extent to which employees with different ethnic affinities are psychologically connected or drawn towards interrelating with one another for the sake of the organization’s goals is integral (D’Annunzio-Green 2004). To a certain extent it relies on the degree of group solidarity, social assimilation and the capacity of these workers to team up. This demands employees to become acquainted with one another, and to switch preconceived notions with more precise understanding of each other, which can lead to lesser conflict and discrimination, and better group solidarity. In conclusion, a failure to appreciate and take advantage of diversity can result in wrong expectations, unhealthy working conditions, prejudice, and poor performance. In other words, the lack of understanding of diversity concern and its challenges and prospects builds an environment that results in unproductive use of human resources and might result in the malfunctioning of the organization with a consequential detrimental effect on its competitive advantage. However, despite of the increasing value of employee diversity, there is still an inadequate availability of empirical works on the subject to evaluate diversity management in the Middle East. The importance of improved HR policies and practices in the region is one of the realities confronting large corporations in the Middle East. As more nationals enter multinational corporations, it will greatly influence the productivity, performance, and even the continued existence of these organizations. References Abdallah, W.M. (2001) Managing multinationals in the Middle East: accounting and tax issues. Westport, CT: Greenwood Publishing Group. Aswathappa, K. & Dash, S. 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