Workforce localisation and business competitiveness in the Gulf countries: case study of a multinational bank in the United Arab Emirates

Companies in the United Arab Emirates (UAE) must employ a specific percentage of Emirati nationals in certain positions and industries. This is referred to as Emiratisation, and studies have shown that firms in the UAE face challenges in meeting this legal obligation. Emiratisation laws provided the researcher with a unique opportunity to study this complex phenomenon in a real-life situation, as it forces companies to hire Emirati nationals, thereby requiring them to acquire new resources. This thesis aims to examine Emiratisation through the lens of the resource-based view (RBV) of strategy, which seems appropriate because companies use resources to produce business outcomes. The thesis investigates how Emirati nationals can be seen as a tangible resource that companies can utilise and explores the extent to which human resource management strategies can be seen as intangible resources that firms can use to address some of the challenges of Emiratisation. The main aim of this thesis is to study a multinational bank in the UAE as a case study of a multinational corporation (MNC) that must hire, develop and train nationals for specific or specialised roles in order to gain insight into the motivation, rationale, perceived benefits and challenges of doing so. The thesis is designed to answer three primary questions by discovering why and how the case study organisation is implementing Emiratisation: 1. How might an RBV of strategy help an organisation pursue Emiratisation? 2. What are the barriers to and facilitators of following an RBV of strategy in this context? 3. Which human resource (HR) policies and practices might help to overcome the challenges identified, and how do MNCs address the challenges of Emiratisation? In designing the thesis, the researcher reviewed the extant literature to help develop an initial conceptual framework to illustrate the connections between the themes in the literature. The data were collected from primary sources. Semi-structured interviews were conducted with 35 participants working in roles relating to setting and implementing localisation strategies and practices. This thesis concluded that by implementing an RBV in which Emirati employees are managed as an internal resource/asset to the firm, it is possible to achieve a better understanding of Emiratisation. The MNC used for the case study faces numerous challenges in implementing Emiratisation and utilising Emirati employees in an effective manner to enable them to contribute to business outcomes. First, Emiratis represent a small percentage of the population. Second, new Emirati recruits often lack the required skills for the job. Finally, it is difficult to retain highly skilled Emiratis, as they are extremely attractive to other companies in the UAE. The main contribution of this study to the literature can be summarised as clarifying the different paths that Penrose’s original work took in rethinking managers as masters and re-bundling resources in a way that meets the needs of the corporation while simultaneously adapting to reality (Penrose 1959). It also illustrates how the RBV can be used to analyse a company’s use of its tangible assets (HR) and intangible assets (HR processes) to overcome the challenges created by the introduction of a national localisation policy. The case study will help to demonstrate how an MNC can overcome the challenges created by the localisation policy in this unique part of the world by using HR policies and processes in areas such as sourcing, training, employee integration and retention. The results of the current study showed that the level of compensation is equal, there are no differences in the training programmes or promotions offered and there is no difference in the policies related to awarding bonuses between local employees and expatriates. In order to validate the findings of the current research, future research projects could use mixed-method qualitative and quantitative analyses to support a multiplicity of empirical analyses