Question

Give a brief summary of human resources and human resource issues you would run into if you were to set up a new Best Buy in Saudi Arabia.

Answer 1

Human Resources in Saudi Arabia follows the following Strategy:

1. Quotas: According to this clause, organizations are required to hire the fixed number for Saudi National as human resources for their organizations coupled with immigrations restrictions in order to control the excessive immigration in the country.
2. Government Sponsored Training: Dedicated Human Resource Fund which is utilized to train the Saudi workforce on latest technologies and vocational skills to make them employee ready. Half of the training cost born by the government of Saudi Arabia.
3. Work Visa system: Cumbersome lengthy visa system with a lot of paperwork makes it difficult for foreign workers to apply easily for the work permit in Saudi Arabia. This has created a big gap between the demand of skilled human resources and its supply.

Human Resource issues you would run into if you were to set up a new Best Buy in Saudi Arabia:

1. Skilled workforce in limited in number in Saudi Arabia. It will be difficult to find the highly skilled technology workforce to work for a consumer electronics giant.
2. Most of the skilled people working in Saudi Arabia are from foreign countries (developing nations from south East Asia), which constitutes the 70 percent of the workforce in total workforce employed. This makes it difficult for the majority of the workforce to adjust to the cross cultural environment prevailing in Gulf countries.
3. Since majority of the work force it outsourced from developing countries (10 million out of 30 million Saudi population), local Saudi Human Resources are expansive in comparison to the foreign workforce. It makes the cost of acquisition of local Saudi Manager much expensive.
4. No legal employee protection plan exist for older human resources. It makes them vulnerable for discrimation against young candidates. This is supported by the reason that it gets difficult to get the work visa after a certain age.
5. Lack of resources with the organizations to train the local Saudi people for managerial and leadership positions as most of it is done by contractual workers hired for fixed period of time.
6. Different salaries for different individuals for the same level of position in the organizations. Local people are paid high in comparison to contractual workers.
7. Problems with work visas for foreign workers. Processing the work visa for foreign worker is too lengthy and cumbersome. It sometimes acts to dissuade people from applying for the work permit due to so many formalities and paper work involved.
8. Recruiting women resources in the organization is very much difficult due to their cultural sentiments for gender segregation at work place. Saudi University do not enroll women into the courses from science and technology background which becomes the major reason for the unemployment for women as they lack skills to be employee ready in technology firms.
9. There are strict labor laws in place to protect the rights of employees which makes it difficult for the management to control the organizational workforce.
10. Changing economics dynamics in Saudi Arabia due to change in international crude oil prices increases the volatility in the business operating there.
11. Laws of land in Saudi Arabia are so strict and punitive punishments are in place for minor crimes as well, which reinstates fear in the mind of human resources.
12. Large amount of payouts are given in order to terminate the employment of a human resource which makes it expensive cost of employee.