DOHA: Amid a 50 percent reduction in oil prices, the GCC countries might be tempted to cut non-critical investment such as spending on human resource (HR) development, but they must continue to invest in HR to achieve sustainable development, according to a statement released by Oxford Strategic Consulting (OSC), an Oxford and GCC-based consultancy.
“Depending on your viewpoint, some people might see investing in people and skills as non-critical. OSC research shows that investing in national talent, a more sustainable resource than oil and gas, can achieve huge returns at relatively low costs and create a stable economic future for the GCC,” it said.
OSC has launched three steps countries and firms can take to quickly and efficiently build human resource capacities.
First, build better HR departments. Research by OSC suggests that world-class HR departments would yield an extra $14bn in GCC-listed company profits per year.
According to OSC’s ‘HRM in the GCC’ report, a world-class HR team adds 12 percent to a firm’s profit or effectiveness. More effective HR departments will also help GCC professionals contribute to the achievement of national and organisational goals.
Second, encourage entrepreneurs who contribute to job growth. Many GCC countries promote entrepreneurism and SME development as part of diversification strategies, but more can be done to identify which entrepreneurs are most likely to succeed. OSC research found, for example, that only 6 percent of entrepreneurs contribute to employment growth. This means that support to high-potential entrepreneurs, known as ‘gazelles’, would be more cost-effective than across the board funding of entrepreneurial projects.
Third, embrace organisational models that work. Family firms, which account for 75 percent of the GCC’s private sector economy, are critical for growth and represent a proven advantage for the GCC. Nearly 50 percent of these firms operate in more than five sectors, which means that they spread risk, are more resilient to downturns in one sector, and can rapidly move into growth markets. Moreover, family firms tend to outperform non-family ones by 15 percent.
The most proactive GCC countries and organisations have made great strides in developing national talent and improving human resource capabilities, yet more can be done.
With natural resources like oil proving less and less valuable, the value of quality human resources is soaring.
The Peninsula
