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HR Thought Leadership Series by Dulsco
Mr. Nikhil Shahane, HR Director - Technip spoke to Mr. Indranil Dutta, Director Dulsco Abu Dhabi about HR trends in UAE and the region.
Indranil Dutta: Can you share a brief outline of your company and services
Nikhil Shahane: Technip is multinational organization into Project Management, Engineering and Construction for the Energy sector, headquartered in Paris. Technip employs about 38,000 people globally with presence in almost all the continents. In Middle East, especially in UAE, Technip has had a very long presence. We have been here for the last 35 years in Abu Dhabi. In the Middle East we are around 2,400 people with about 1,400 -1,500 in Abu Dhabi. Other than UAE, we have operating centers in Qatar, Kuwait and Saudi Arabia however we deliver projects in other gulf countries as well like Iraq and Bahrain.
Technip mainly serves the Oil and Gas sector and operates within 3 main business verticals, i.e Onshore, Offshore and Subsea.
Indranil Dutta: As a thought leader in the industry, we would like your thoughts on the key contributions that a HR department provides to the business.
Nikhil Shahane: The main challenge for HR is talent management. It is everything from getting the right talent to managing, retaining and developing the talent. It is the full life cycle support that we provide to the business. The key is to be very closely aligned to the business, anticipating where the business is heading and what the business needs from HR. A lot of things are talked about in HR with new buzz words coming every year. But I firmly believe that the fundamentals have to be very strong. To keep things simple is very important.
In Middle East where over 80% of employees are expats and the industry has around 10 -12% turnover, talent and knowledge retention is always at the core of any HR strategy. At Technip it is relatively lower at about 8-9%. So in that respect I think we are better than the rest of the industry in the Middle East. However, employee turnover is still a problem. People are short term oriented, so retaining people is always key. Every year we are trying to come up with initiatives which will help us retain our employees. Attracting employees is also challenging. Being a technical industry, getting talent with the right technical skills is an issue. There is a shortfall of talent with technical skills. Not only for us, but for everyone in the industry. I think the HR role is in getting and developing the right talent. We did a lot of graduate recruitment in the last few years. We thought the best way was to invest in young graduates. We recruited and invested in graduate programs, from universities in the region and also targeted some specific universities in France and Netherlands imparting engineering specialization in Process and offshore structures, which is our bread and butter. People studying in universities here have a good understanding of the local culture so we have been tapping talent from local universities as well. So HR has been busy with this in the last 2-3 years. Technip has grown a lot in the past few years in the Middle East. We have hired a lot of people. Our headcounts have risen considerably in the last 3 years or so. Having said that, right now the industry is going through many challenges. Technip is trying to come up with different solutions to address these challenges and equip ourselves to overcome any slowdown due to oil prices.
Indranil Dutta: Your role has become even more challenging in these uncertain times.
Nikhil Shahane: Yes. Everybody's role becomes challenging. You have to excel in uncertainty. HR role is important as people are curious to know what is going to happen. We also have the concern of potentially losing good people. We hope to continue to win work in 2015 – 16 as we are looking at new projects in the Middle East. But as we know the Middle East is going through difficult times. Entering new countries in the Middle East is difficult compared to some of the other places in the world. All of this makes it challenging for the business leaders to decide what to do, as well as for HR to align ourselves. HR becomes even more critical because if you have decided to go to a new country, you need to align quickly in terms of nationalization, talent and local rules and regulations. I think this is where HR makes a difference - in doing all this in advance as opposed to just following the business; anticipating and then advising the management on what needs to be done. That differentiates a good HR system from a run of the mill follower HR system.
Indranil Dutta: I wish you success in overcoming these challenging times, Nikhil. What are the challenges in recruiting candidates in UAE?
Nikhil Shahane: There is a dearth of talent in the UAE. In the last few years Universities in the UAE have increased. Earlier we used to rely heavily on going to India, Europe or Far East and getting people from there. It is good that there are universities coming up here. Now you have the ability to hire fresh blood here within UAE. But in general getting experienced talent is one of our challenges recruiting from UAE and with the university program as well. We are also an organization that focuses a lot on diversity. We are present in UAE and we need to increase the local content. By local content in the context of UAE, we mean not only the country nationals but also people who have been here long and know the culture and way of working here. We have struggled because there is lot of restrictions on mobility within Middle East. For instance we have struggled hiring from some countries in the region which historically have supplied good engineering skills to UAE. If you look at 15-20 years back we could hire from these markets. Now everything has stopped because you don't get visas very easily. So you tend to rely only on a few places for talent which is not good for any organization. You need to hire from across the globe, especially if you are in a country like UAE. For us that is also a challenge. There is a shortage of good technical skills and experienced people globally. That is the first challenge; the second is our limited ability to hire from all countries in this region, so your external talent pipeline is limited.
Indranil Dutta: Often temporary staffing / outsourcing is considered to accommodate peaks in business activity, reduce visa & admin hassles, manage fixed costs. Has your company in the UAE used outsourced staff? Tell us a little more about your experience?
Nikhil Shahane: We do use outsourced staff till early this year. Outsourced staff could be anywhere between 8-10% of our total population. It is always good to have outsourced staff because then you have more flexibility. There are lot of projects where you need people for short term, so instead of going for permanent hire, it is good to get it from certain companies who could do the full spectrum of recruitment and hiring for you.
Within Middle East, the concept of off shoring and outsourcing is not as advanced as we find in Europe or US for a variety of reasons. The partners that we deal with have had long term relationships with Technip. We usually had designers and engineers from India and some countries in Far East. Our partners know what our requirements are and what competencies we need in our people. I think it works out well for us and I don't think we will increase the content much. We will leave it at 8-10% only for the reasons I have mentioned earlier. But we need to get it right and we need companies to understand what our requirements are and make sure that they have processes in place to give us the right talent because if we end up having people who are not good, we are wasting our time.
Indranil Dutta: Absolutely correct. Especially in times like these when there is a lot of uncertainty prevailing, in my personal opinion – this is where outsourcing really is considered to meet your requirements. Otherwise you are absolutely right that between outsourcing and recruitment, you may not really find too much of a cost difference but it is in situations like these that outsourcing agencies come into the picture.
Nikhil Shahane: Yes. Certainly they definitely add value. Because if you end up doing everything yourselves you are not able to focus on key HR processes. This is definitely an advantage. But you have to strike the right balance.
Indranil Dutta: What do you think is the next big shift you expect / like to see in the HR function?
Nikhil Shahane: Every time somebody asks me about the next big shift or the next big thing in HR I always say that there doesn't need to be any big thing or big shift every year. Technology is a big driver and a big enabler for sure. Technology is changing by leaps and bounds every year so HR needs to be very well versed with the right technology and use technology as much as possible; whether it is job portals or mobile apps or advanced ERPs. People are applying from mobile phones more than career websites. Are we there and do we have the right technology to tap the right global talent for instance? Do we have the right technology to support the business? Other than that, the HR and business fundamentals still remain the same.
It is all the more important for HR to be seen as a business partner, to know the business well because whenever you are sitting with your management team you need to be able to speak the business language and not just the HR language. I don't mean you need to be technical. But you need to understand what projects we try to win, what are our strengths; How do we execute projects and at each stage of the project life cycle what HR can contribute, because HR contribution differs from one phase to the other.
A lot of times we start preparing HR strategies and road maps for the next 5 years and we sometimes don't involve the line managers and the business people in that. You have a nice looking HR mandate but without any buy in from any one. It is very important that we understand the business road map and we closely collaborate with the business leaders and they find out what HR is going to do. So I think that continues to be the key along with the technology that will be a big enabler going forward.