Gulf-based businesses need to be more transparent, open to change and allow staff to grow, forum told

Panelists at the Top CEO 2018 conference said Gulf businesses needed to learn to adapt (Ghazi Mehdi)
Updated 12 April 2018

Gulf-based businesses need to be more transparent, open to change and allow staff to grow, forum told

  • Businesses in the region need to learn to be more transparent, trusting of staff and open to change, forum told
  • Research found that the need of people to be able to be honest with their bosses outweighed their need to be technically capable

JEDDAH: There is a plentiful supply of big businesses and mega projects in the region, but they are often hindered by a lack of accountability and transparency, poor communication and an unwillingness to adapt to change, delegates were told at the Top CEO Conference.

But the problems that often impede business in the region are not just with the management, the conference at the Bay La Sun Hotel in King Abdullah Economic City heard.

There is also a reluctance among individuals lower down the ranks to ask questions, or come forward and say “I don’t know,” or admit to having made a mistake.

Miguel Sousa Lobo, a professor in decision sciences, currently based in Abu Dhabi, said that a recent Google study found that influences over an individual’s performance were not just about their ability.

“They (Google) were surprised to find that psychological safety was more important factor for their performance than the technical skills,” Lobo explained.

Staff need to feel confident, he said, to be able to come forward when they needed support without fearing repercussions.

Having the right people is key

In 2009 Iyad Malas was brought in as the CEO of the Majid Al-Futaim group, which has a number of shopping malls in the Gulf and also holds the franchise for Carrefour, after the financial crisis.

He remained with the company until April 2015. He is now a partner at the equity firm Gateway Partners.

For him the key to success was to think strategically, assess the priorities and admit there are problems.

“A big problem that big companies have,” Malas said, “is that they are in self-denial.”

He said managers needed to look at the grass roots of the company, reassess the team and exploit the opportunities that came with the crisis.

“Execution is about having the right people.” Malas added. 

The key to good management, he said, was enabling staff to own tasks.

“(Managers need to) delegate the responsibilities to the people at a lower level of the company who can make the decision,” Malas explained. “Because if you want to grow, you can’t have everything going up.” 

But when the company that is being expected to make these changes is family owned, then convincing the managers/owners to adapt to change becomes the challenge, Malas explained.

Where the owner is involved, Malas said, there was often a reluctance to accept people from different backgrounds into the organization. They own the business and risk making the job of running the business personal.

“You need to professionalize the business.” He said 

One-size doesn't fit all - local knowledge matters

And with bigger companies, that have multiple branches, there is also a need for the top end management to allow each branch’s managers to take control.

“The larger the organization, the larger is the responsibility and accountability on employees in senior and junior positions,” Malas said, adding: “Each store manager operates as the owner of that store.”

He said the locally-based managers would have a greater understanding of the needs of their customers – adding that “the consumers are different in each city.”

And it was this local knowledge, he said, that placed more responsibility on the people on the ground.

Of course, the success of a business is not based on the people alone. Companies need to be flexible in their approach.

This means that the initial vision for a project, however big or small, is not necessarily what comes into being when the project is complete.

At the Top CEO 2018 conference Fahd Al-Rasheed, CEO and managing director of the King Abdullah Economic City project, admitted that the initial plan for the city had changed dramatically.

Mega projects can only succeed if they adapt

He told delegates during his opening remarks of the day-long conference, that there were critics who had opposed the decision to allocate vast plots of the site to arts, leisure and entertainment.

“Mega projects are based on a master plan,” Al-Rasheed said. “Master plans must be flexible, we changed it (the King Abdullah Economic City project) four times during the last 12 years to adapt to the changes we have seen socially and economically.”

And he added: “For example, since we are in an age of entertainment, we took 10 million square meters out of the masterplan and designed an integrated a theme park-based development.”

The Gulf region has an abundance of mega-projects. But Al-Rasheed said several problems often hindered managing such projects.

He said the costs were often underestimated, while the perceived benefits were oversold and there was often a shortfall in the efforts at the design phase, as well as a lack of organization.

“20 percent of the cost can be saved buy spending more time in the design phase,” he said. 

The discussion concluded that business in the region could be improved if they gave more focus on accountability, managed expectations, were more transparent and learned to listen more.

US, China in feisty clash on trade, influence at APEC

Updated 17 November 2018

US, China in feisty clash on trade, influence at APEC

  • The world’s top two economies have been embroiled in a spiralling trade war, imposing tit-for-tat tariffs on each other’s goods
  • The APEC summit of leaders from 21 countries across the region has developed into a tussle for influence between an increasingly assertive China and a more withdrawn US

PORT MORESBY: China and the United States traded heated barbs Saturday ahead of an APEC summit, lashing out at each other over protectionism, trade tariffs and “chequebook diplomacy” in the region.
In duelling back-to-back speeches at a pre-APEC business forum, China’s President Xi Jinping and US Vice President Mike Pence pulled few punches, laying out sharply contrasting visions for the region of 21 countries.
Xi lashed out at “America First” trade protectionism and in a thinly veiled swipe at Washington stressed that global trade rules should not be applied “with double standards or selfish agendas.”
The world’s top two economies have been embroiled in a spiralling trade war, imposing tit-for-tat tariffs on each other’s goods in a confrontation that experts warn could torpedo the global economy.
Xi urged the world to “say no to protectionism and unilateralism,” warning it was a “short-sighted approach and it is doomed to failure.”
For his part, a combative Pence warned that US tariffs would remain in place unless Beijing “changes its ways.”
“We’ve put tariffs on $250 billion in Chinese goods and that number could more than double,” he told CEOs from around the region.
“We hope for better, but the United States will not change course until China changes its ways.”
President Donald Trump decided to skip the summit in Papua New Guinea, leaving the door open for Xi who arrived two days earlier for a state visit and has been the undoubted star of the show.
The APEC summit of leaders from 21 countries across the region has developed into a tussle for influence between an increasingly assertive China and a more withdrawn US.
In contrast to Trump, Xi arrived before the summit, opening a new road and a school in Port Moresby and holding talks with Pacific Island leaders.
Papua New Guinea rolled out the red carpet for the Chinese leader, with dozens of people from various tribes serenading him sporting parrot feathers, possum pelts and seashell necklaces.
In his speech, Pence lashed out in unusually strong terms at China’s Belt-and-Road initiative that sees China offering loans to poorer countries in the region to improve infrastructure.
The vice president encouraged Pacific nations to embrace the United States, which, he said, did not offer a “constricting belt or a one-way road.”
He said the terms of China’s loans were “opaque at best” and “too often, they come with strings attached and lead to staggering debt.”
As if pre-empting the criticism, Xi defended the plan amid attacks that it is akin to “chequebook diplomacy” to further Chinese interests in the region.
He denied there was a “hidden geopolitical agenda... nor is it a trap as some people have labelled it.”
And the Chinese leader warned that no one would gain from heightened tensions between the US and his emerging superpower.
“History has shown that confrontation — whether in the form of a cold war, hot war or trade war — will produce no winners,” he said.
Pence too stressed that Washington wanted a “better relationship” with Beijing.
“China has an honored place in our vision of a free and open Indo-Pacific, if it chooses to respect its neighbors’ sovereignty, embrace free, fair, and reciprocal trade, and uphold human rights and religious freedom,” he said.
He added that the United States would join forces with Australia in the development of a new naval base to be built in PNG’s Lombrum Naval Base on Manus island, in what is seen as a move to curb China’s influence in the Pacific.
Officially, the 21 leaders will discuss improving regional economic cooperation under the theme of “embracing the digital future” but the punchy speeches laid the ground for a tense gathering.
Foreign ministers meeting ahead of the summit were unable to publish a joint statement, apparently due to differences over language on World Trade Organization reform.
In the absence of Trump and Russian President Vladimir Putin, the summit itself has been relatively low-key and the focus has turned to the venue Port Moresby.
The capital of Papua New Guinea has been ranked as one of the least liveable cities for expatriates, with a high level of crime, often perpetrated by feared street gangs known as “raskols.”
Delegates have been advised not to venture out alone — especially after dark — and officials and journalists have been hosted on massive cruise ships moored in the harbor due to safety issues and a dearth of hotel rooms.
The run-up to the summit was also overshadowed by the purchase of 40 luxury Maserati cars that sparked anger in the poverty-hit country, which suffers from chronic health care and social problems.