ALKHOBAR, 20 May 2003 — It might seem impossible for a telephone to be barred from import for political reasons, but that’s the truth. This ban put purchasers of E, S and M class Mercedes vehicles in a quandary. You see, some buyers of those vehicles, hoping to increase their safety on Saudi Arabia’s dangerous roads, ordered the optional car kit to make cellular operation hands-free. But when their beautiful new cars arrived, there was a problem. The only mobile phone that worked with the factory installed Mercedes car kit was the Nokia 6310i and the handset didn’t come with the vehicle. The phone’s firmware was politically incorrect in the Kingdom and so the handset was banned.
This situation had normally upstanding citizens engaging in unlawful activity to get hold of a handset. Either they had to pay inflated gray market prices to buy a 6310i handset in the Kingdom, or they had to have one smuggled in. It seemed insane to me that neither DamlierChrysler nor Nokia would be aware of the market sensitivities. This problem became ludicrous, with men getting their mothers and aunts, going on shopping trips to Dubai, to smuggle the 6310i phones into this country.
I asked Nokia Middle East about the problem and they informed me that the 6310i had been banned, but now the software has been amended by Nokia, and the ban has been lifted. Nokia ME stated it was just a matter of dealers getting the product in stock again for it to become available. I keep hearing companies saying that they want to serve this market, but sometimes the reality leaves a lot to be desired.
And while we’re on the subject of service, let’s discuss a company called Country House for Information Technology, a part of the Addar Group. This company offers a wide range of corporate IT consultancy, solutions and services. Their new School Management System (SMS) is attracting attention from private education institutions across Saudi Arabia. Country House is also active in the areas of corporate training and business and IT professional outsourcing.
The latter was very interesting, since the Saudi market always seems to be facing a shortage of IT professionals. Bassam I. ibn Salamah, general manager, Country House for IT, said that the company has an excellent track record of deploying consultants to various ministries, banks, and other organizations.
“We actually find the consultants and bring them to the Kingdom based on the specifications required by our clients,” said ibn Salamah. “Companies don’t want to dedicate resources to finding qualified consultants. They don’t want to deal with contract and visa hassles. That’s why they turn to us.”
Ibn Salamah explained that many companies have decided that in these difficult economic times, they need to focus on their core operations, and IT is often not their core business. Not only are companies turning to Country House for consultants, but some are choosing to outsource entire departments to Country House.
“There are issues, such as cost containment and Saudization,” said Ibn Salamah. “Companies are finding that it’s too expensive to continue in the old methods of employment. High salaries and generous benefits that often even include payment of school fee, are more than local companies can bear. When a department is outsourced, management and administrative costs are brought down and corporate Saudization percentages increase.”
Perhaps it would be assumed that qualified Saudis would be the beneficiaries of this outsourcing trend, but that’s not necessarily true. According to ibn Salamah, Saudis still have high demands in regards to employment packages. In outsourcing operations, the goal is to bring costs down, not increase them. Expatriates might still be hired for the outsourced positions, albeit on more cost-effective terms than those individuals who had formerly held the jobs. Some high-level work would probably be done on an “as needed” basis by consultants, instead of hiring full-time employees.
“It is common now for consultants to come for brief periods and leave. There are differing points of view on how to manage complex tasks and projects. One method is to have a core of full-time staff, supplemented by international specialists as required,” Ibn Salamah commented. “It can be difficult to convince some consultants to stay in the Kingdom for long periods. When we request that they come for a few weeks every 90 days, it is a more manageable proposition. Sometimes it is even possible for the expertise of one consultant to be shared out and benefit several local clients.”
It is hard to criticize companies for making the effort to bring down costs. There are, however, concerns with the concept of outsourcing and consultants. If companies outsource to avoid true compliance with Saudization, then such outsourcing is abhorrent. In addition, it is shortsighted, economically crippling and downright dangerous to continue depending on international expertise, rather than locally developed talent to meet this nation’s increasingly sophisticated IT requirements.
It certainly cannot be denied that the Kingdom’s IT requirements are becoming more complex as projects in e-government, e-business and e-commerce move forward. At “The Future IT 2003 Conference,” which concluded yesterday in Bahrain, noted UK IT consultant and e-government commentator, Dr. Simon Moores, delivered the conference’s keynote speech, “e-Government in the Middle East.” The speech examined the progress toward fully transactional e-government services and an Information Society in the Middle East, and compared what Moores has seen in the Arab world with his own experiences from the UK. A transcript of the address may be downloaded from: egovmonitor.com/reports/arabgov.html. In his speech, Moores asserted that “the era of e-government, which is to say transformative government, is very much here to stay.” But just because it’s here, doesn’t mean all will be well.
“E-government is as much about good management as it is about IT. If the system in question is a poor one, then throwing expensive technology at it will not make it better. Indeed, it can make it worse, with the result that one is left with two bad services running in parallel under a single budget; the old system which doesn’t work and the new system which works sometimes but not very often,” said Moores. “The greatest challenges I see for the Arab world in deploying e-government involve management, customer relationship and service. In many countries in the region, management structures are so hierarchical and inefficient that progress and ambition can only exist on paper and not in reality.”
Over the past two years, Moores has viewed many presentations made by different governments about their online services. Of concern that, he has noticed that few governments have been very clear on what e-government as an instrument of public sector reform and radical social change will mean to an individual society. One thing is certain. Connectivity is key to the success of e-government initiatives. Moores is encouraged by the growth of Internet users in the Middle East, but he emphasized that dial-up connectivity is not the goal.
“A dial-up connection to the Internet lacks the power to drive the e-government agenda in the direction of radical public sector reform,” he said. “Broadband is viewed as the catalyst technology and the statistics, compiled by IDC, indicate that broadband services in this part of the Middle East, constituted just three percent of all connections, but made a 12 percent revenue contribution. This is indicative of the proportionately high cost of broadband access, which in the UK is a cost we have now abolished through competition, with the result that we now have over one million broadband customers paying approximately $42 a month for unlimited access.”
Another hurdle that Moores has identified in the path of regional e-government success, is the top-heavy nature of the public sector workforce in Arab nations. Creating efficiencies removes the need for a large civil service and increases the prospect of unemployment. In the UK, where 30 percent of the population works for government, the loss of 80,000 jobs as a consequence of their e-government program is predicted. As e-government is implemented in the Kingdom, how will we deal with the downsizing of the public sector workforce when unemployment is already so high?
In conclusion, Moores believes that many countries in the Middle East “will have to overcome deep-rooted cultural challenges before they can imagine themselves delivering anything close to the kind of services and relationship that Europe and America would recognize as e-government.”
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