Your company has set some ambitious targets around emiratisation / nationalisation. You’ve been a good Compensation manager. You have integrated Emiratisation into the bonus calculations for your organisation. The idea was : “If it’s in their objectives, then the Directors will focus on it”.
So you sat with the HR Director and the CFO and offered to link part of the Directors bonus to the achievement of a certain quota of Emiratis in the headcount of their Division. Of course, you did not approach it roughly with a blanket number, identical for all, like “x% of Emiratis in the headocunt by year-end”.
No, you did your homework, took into account the percentage of Nationals present in each Division at the beginning of the year, and set an improvement target unique to each organisation, that when compiled, builds up to your overall target quota.
Then you included that in the overall Division or Director target (or both, depending whether your bonus system includes a collective component or not), gave it a weight or priority, and let the system go on as usual for the rest of the objectives.
You did your job, right ? Ensured that an Emiratisation corporate goal has been cascaded in the organisation, while allowing for objective, realistic differences between the Divisions.
Well, I think it’s a first step – but a lot more could be done.
What are the traps of this approach of emiratisation through compensation ?
The first one is that a purely quantitative approach, while easy to define and track, is important but can be easily misleading. It does not give you any background on the human aspects of your emiratisation strategy. Are you hiring the right Emiratis, the ones with the skills sets that are necessary to your company success ? The ones that go the extra mile, adhere to your values, want to learn and have a real future in your organisation ?
The second trap is that, once you set targets in each Division, you run a risk of totally stopping internal mobility of Nationals in your company. In effect, why would any Director allow one of her Nationals to move to another Division ? If she is not able to replace that person by another Emirati, then she will be penalised for having “lost” on emiratisation, while the receiving Director will be seen as having improved on emiratisation.
Yet in the end the company is not winning anything as there is no additional headcount of Nationals in the organisation. And you end up with one unsatisfied Director and one being rewarded for something which is not really what the company was trying to achieve. Eventually, this kind of rigid, mathematical-only approach will lead to reduced career growth opportunities for the very population that you are trying to focus on, the Nationals.
So what should you do ? On the quota target, one simple element is to discount the “winning” or “losing” of UAE Nationals due to internal mobility in the statistics you use. This way, you neutralise the potential negative effects on the development of your Emirati population.
Most importantly, when thinking about incentivising your company on emiratisation-related targets, try to combine quantitative and qualitative targets. The latter will help you drive the focus where it really needs to be, and where the value creation really lies.
So what kind of criteria do you use to link your compensation policies to nationalisation targets in your company ? Please share your best practices in the comments section !
Related posts :
- GCC Nationals pay : a lesson from the Y2K bug
- Remuneration, engagement and the GCC employee
- Emiratisation and Compensation & Benefits – part I
- Emiratisation and Compensation & Benefits – part II
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