The Gulf is at present undergoing a fundamental change. A fast-growing, emerging market shifts character abruptly when it reaches a certain level of maturity. Suddenly, business leaders have to pay much more attention to competing for their market share and margin, rather than simply stretching to keep up with the generally high growth rates.
This is not only to do with the recent financial crisis. The evolution has lead to an uncountable number of international companies approaching the Gulf and many family-owned groups expanding into new industries and neighbouring markets, while e-commerce and outsourcing offerings are today increasingly targeting the region. These all add to the options that customers can choose from and increase the accessible supply.
Each sector – with very few exceptions – is becoming more saturated. Most product and service categories have reached the point of maturity in Dubai. Several infrastructure industries have done so in Abu Dhabi, Kuwait, Qatar and Riyadh.
Most developed economies have lived through this. Far from all companies do, however, master the aftermath. International management literature did not even address the subject, which is popularly referred to as “execution”, to any degree until eleven years ago.
In simplified terms, the challenge concerns putting much more emphasis on the discipline of “doing things the right way”, in contrast to focussing primarily on “doing the right things”. Champions in this are able to give their customers in turn a better experience, lower prices, new innovations or a combination thereof. Their organisations are continuously improving themselves and developing their capabilities for the future.
As a business leader in the region, you should use this as a benchmark, but must also be very careful in how you move forward. The growth leading up to this point has been extraordinarily steep, leaving the last two generations of business people in the region with little experience beyond good times. The private sector is among the most culturally diverse anywhere on earth, with people from all over the world, making it a delicate matter for you to lead effectively. The recently intensified efforts to get nationals in jobs, such as the Nitaqat programme in Saudi, come with new demands.
I have a lot to say about how to execute business in the Gulf and have now written an entire book about the subject – even though the working title “Execution in the Gulf” got skipped in the process.
There is one insight I would like to share here: the ability to truly execute depends on the discipline of the management body – ranging from the executives at the top, down to every line manager. They are the ones who ultimately bring out the best in the entire staff and ensure that decisions are made and required actions are taken effectively at all levels. Something as basic as how managers problem-solve, set the stage, define goals, and follow up with their direct reports strongly influence the extent to which the right things can get done in the right way.
The reality is that most managers are not particularly precise about how they conduct these tasks. My business partner, Stefan Falk, did a survey of hundreds of managers in a major international company with significant presence in the Middle East. One of the many interesting findings was that nine out of ten managers admitted to spending inadequate time on structured follow-ups with their direct reports.
What can you, as a business leader, do to limit this problem in your organisation and thereby increase the ability to execute? Some leading international companies have instituted universal principles for basic management tasks in which new hires are trained. The approach has – in addition to improving general effectiveness – made it easier for these companies to expand across geographies and hire people with very different cultural backgrounds.
This is, however, no quick fix. The necessary techniques are intuitive, but require each individual manager to practise in order for him or her to become accustomed and internalise. The most effective way to let managers develop is by making them use the techniques to pursue real and challenging goals in their actual work environment.
The on-going change in the Gulf requires many companies to adapt or redefine their strategies. A new strategy provides an excellent opportunity for breaking down goals and making managers pursue these through their new way of working.
This is of course a serious matter, wherefore everything must be orchestrated properly. Goals and managers must be selected carefully. Deadlines should be made relatively short to both challenge and install a level of control. Managers must be supported throughout their effort.
Even though the effort at first is focused and only involves a few managers and small teams, this can still create pockets of excellence that set a new standard for the entire organisation and help drive further change.
Nicolai Tillisch is the founder of the consulting and coaching company Dual Impact and the author of Effective Business In The Gulf: Mastering leadership skills for greater success.