Educated, Ambitious, Essential - Women Will Drive the GCC’s Future

Booz & Company addresses ways in which the GCC’s private sector can address nationalization and unemployment by hiring the region’s highly educated female population.

Private-sector companies in the Gulf Cooperation Council (GCC) have an opportunity to address several pressing issues, including nationalization imperatives and local unemployment, by attracting more national women into their workforce. Booz & Company has developed a framework to help companies in this effort.

Looming Changes in the GCC Workforce

Private and semi-private companies in the GCC are under enormous pressure to nationalize their workforce, owing to a combination of high regional unemployment and a currently outsized proportion of expatriate workers in the region.

Thus far the talent pool of women employees in the region remains largely untapped, due to social, occupational, and legal challenges. Private and semi-private organizations in the GCC do not rely heavily on GCC nationals to fill their employment needs, and they rely even less on women as a group.

GCC governments have taken a number of steps to improve this situation, such as Saudi Arabia’s national policies, including a five-year plan, Human Resources Development Fund (HRDF) programs, and royal decrees, and the women’s leadership center that Qatar is establishing.

However, to achieve the goal of greater employment among national women in the regional workforce, companies will need to implement internal programs to recruit, develop, and retain women employees. This will require solving a number of social, occupational, and legal challenges, with roots in long-standing and sensitive cultural attitudes in the region.

“There are clear benefits to be claimed. The companies that take the lead in this issue will help address the GCC’s unemployment problem among nationals. They will also assume a key role in shaping the future of women in the region,” said Ramez Shehadi, Partner with Booz & Company. “Most significant, they will tap into a base of talented national women that is well-educated and eager to join the workforce, giving these companies a long-term competitive edge.”

A Three-Part Framework for Change

Booz & Company has undertaken substantial research in this area, including a comprehensive survey and client work. We have also developed a framework to address these issues, in order to help GCC companies more successfully introduce national women into their workforce in greater numbers.

Our framework consists of three elements: 1) defining an overall corporate vision for employing women based on a solid case for change; 2) developing a talent management strategy and operating model to source, train, promote, and retain women; and 3) implementing a change management strategy to engage with and secure the support of internal and external stakeholders.

Women’s Employment Vision

One thing is clear from the efforts of companies worldwide to attract and retain talented women: Implementing diversity for diversity’s sake does not work. To begin successfully integrating women into their workforce, GCC companies must have a senior champion who can make a business case for the need to do so.

“Creating such a business case is not without challenges. There is little in the way of objective, broad-based research that clearly establishes the importance of integrating women into the workforce, and none that is specific to the region,” said Dr. Leila Hoteit, Principal with Booz & Company. “However, anecdotal evidence from a multitude of companies shows the value that a strong female talent base can engender. A business case could be based on any of three elements: workforce, customers, or suppliers.”

Workforce: A dedicated effort to recruit and retain women does more than just fill talent gaps. A diverse workforce leads to higher employee engagement across the board. More than 100 studies have demonstrated the correlation between employee engagement and business performance: Engaged employees are far more productive and committed, and they are more likely to make progress toward company goals, as well as the goals of their own group

Customers: Companies in a wide variety of sectors will need to more effectively target women as this key demographic’s spending power continues to grow. To do so, companies need to ensure not only that they have women on staff but that women are in the right positions to enhance the company’s go-to-market strategy with their insights, such as R&D, product development, marketing, and sales.

Suppliers: Companies need women in the right roles to raise awareness about potential new suppliers, use their networks to build these relationships, and maintain the relationships over the long term. One company found annual cost savings of $2 million to $4 million when it focused on women-owned businesses by categorizing all third-party orders and enhancing the competitiveness of each category.

Talent Management

The second element of the framework requires developing a comprehensive approach to hire the most promising women candidates, invest in developing their technical and soft skills, evaluate them objectively, and retain them.

Talent acquisition: Companies should apply a unified process for attracting qualified talent from all available sources. This includes hiring entry-level candidates directly from the ranks of recent graduates of women’s colleges and vocational institutes. Another key channel for young talent is to sponsor students. Still another source, particularly for experienced professionals and managers, is the region’s recruiting firms.

“Companies can partner with leading technology training institutions to establish a pipeline of women professionals with specialized technical experience,” said Dr Kamal Tarazi, Principal with Booz & Company. “For example, the Women in Technology (WIT) program, a collaboration between Microsoft and local women’s organizations, teaches computer skills to women in nine Middle East and North Africa countries. Since its launch in 2005, WIT has trained more than 3,500 women throughout the MENA region.”

The company should ensure the same clear objectives and criteria are used in recruiting women as in its usual recruiting process, and avoid making subjective judgments about, for example, a female candidate’s age or number of children. It should also seek to have strong female representation in recruiting to project an image of a company that fully embraces and values diversity.

Learning and development: In addition to recruiting and hiring female candidates, companies must implement a training program to develop women employees in technical areas and soft skills. Companies should consider a mentorship program that pairs less experienced staffers with more experienced women. In addition to serving as role models, the mentors would offer junior women an opportunity to share their concerns and issues.

Performance management: To support the integration of women into the workforce, companies must establish an objective system for evaluating their performance. This process needs to be clearly communicated and strictly implemented to ensure fairness. All scores should be objective and measurable, based on specific outcomes (such as turnover and employee satisfaction in the HR function, or sales numbers for the sales department), and the evaluation process should include multiple sources of input—e.g., managers, colleagues, and subordinates. Although this is good practice for all employees, recent experience has shown that it is difficult to implement when evaluating women employees in a male-dominated environment. For example, in some job appraisals, women receive references to personality traits—they are “shy” or “emotional”—rather than specific descriptions of behaviors or quantitative assessments of their job impact. At other times appraisals may reflect an inherent, though unconscious, bias regarding women employees’ long-term commitment to the company in the context of family obligations.

Retention: Once the company has taken these measures to recruit, hire, develop, and evaluate the women in its workforce, it should devote equal effort to retaining women employees and ensure that they stay professionally fulfilled and motivated. This is critical, given the scarcity of skilled resources in the market and the investment that would be needed to hire and develop a new employee. We advocate a balance of traditional incentives and “pride builders,” or less quantifiable and concrete benefits. The first category, incentives, consists of fairly traditional HR levers: rewards such as compensation and benefits, opportunities for career advancement, and a work–life balance that offers sufficient flexibility to attend to personal obligations while also pursuing a career. The introduction of resources such as family-friendly policies would go a long way in helping retain talent: For example, employees may seek part-time work, or the opportunity to telecommute certain days or for a finite period of time, as long as the job’s requirements allow for it.

Change Management

“Because increasing women’s participation is a complex initiative with potential ramifications for the entire organization, companies will require an extensive change management strategy in order to succeed,” said Shehadi. “At the outset, all relevant stakeholders, both internal and external, must understand the program and its objectives. This may require overcoming misguided but still prevalent perceptions among some about the roles of women in society, or their ability to succeed in the private-sector workplace.”

Because these perceptions can be stubborn, changing them within companies must start from the top. Companies must line up support and commitment from the board and executive vice presidents (EVPs), who must lead by example. Senior management should actively monitor key metrics through dashboards or score cards that track turnover, the number of women in senior positions, and other relevant indicators.

At lower levels, the company should identify middle management champions for the program. These champions can begin spreading awareness of the program in advance, along with motivating their staff to embrace the change. They can overcome unforeseen obstacles at that level—through a performance-driven approach—and identify and communicate challenges up the chain of command.

Finally, companies will need to add a diversity-management component to the slate of mandatory training required of all employees. It is not sufficient to simply prepare women to join the labor force; management must prepare the rest of the employees to make the integration of women a company-wide success as well.

The entire company should build on small successes, potentially through recognition via in-house communications such as internal magazines or newsletters, or through awards given to the department that has the greatest proportion of women employees, or the largest number of women in leadership roles.

“Introducing women into the GCC private-sector workforce will not be easy, and there is a risk of moving too fast. Even those companies that are most aggressively pursuing nationalization cannot simply replace one skilled and experienced expat worker with one national woman,” said Dr Hoteit. “In the longer term, this change is inevitable. Attitudes in the region are changing, and many companies are now actively working to define their strategic vision for how women will fit into their workforce. Women have the education and—more important—the desire to play a more central role in the region’s labor market.”

Reaping the Rewards

The entrance of more women into the regional economy will serve as an economic multiplier, creating benefits for each nation as a whole.

“Booz & Company’s research on the “Third Billion”—the billion women worldwide who are poised to have an impact on the global economy as workers and consumers—shows that these new engines of economic activity create vast markets and increase the size and quality of the talent pool,” concluded Tarazi. “In periods of relative prosperity, their aspirations and persistence are engines for growth. In slower periods, they represent pockets of economic activity that ameliorate the impact of decline.”

For private and semi-private organizations in the region, nationalization and regional unemployment provide an opportunity to tap an underused talent pool. Defining a strategic vision to better integrate women, developing a comprehensive talent strategy to do so, and carefully managing the transition will be critical for companies that want to capitalize on this opportunity. Companies that adopt an intelligent strategy to manage this transition will gain a competitive edge, through a workforce that is more engaged and better reflects the GCC population at large.