Local talent vs expat expertise: Striking the right balance in middle eastern firms
“Is the cost of international expertise justified by its value?” This question resonates across boardrooms in the Middle East as firms grapple with the intricacies of hiring local talent versus expatriate expertise. The balance between the two can significantly impact a company’s competitive edge, cultural cohesion, and financial health.
The Middle Eastern financial sector has long been a melting pot of local and global talents. The allure of international banks and financial institutions has historically attracted expatriates with the promise of lucrative packages and a unique professional experience. However, the landscape is shifting. International banks now recognize the importance of incorporating local talent to stay competitive in a complex marketplace (Warner Scott).
The Cost Implications
Cost is a significant factor when considering the recruitment of expatriates. Hiring an expat can cost up to two to three times more than hiring a local candidate. This includes not just the salary but also relocation expenses, language, and cultural training – and these are not limited to the expatriate alone but extend to their family as well (HR Exchange Network). In contrast, local hires eliminate these additional costs, presenting a more economical option for firms.
The Expat Dominance Dilemma
The dominance of expats in certain firms can lead to a skewed distribution of the personnel budget. For instance, a major European FMCG company reported that 70% of its Asia-Pac personnel budget was allocated to just 7% of its workforce—the expat employees. This disparity can trigger internal debates and dissatisfaction, as it raises questions about pay equity and the value placed on local versus expat employees (AGS Relocation).
Achieving the Balance
The key lies in striking a balance. Heather Travis, Director APAC at Armstrong Craven, highlights the importance of this balance at business events. It is crucial to weigh the benefits of expat expertise, such as global perspectives and specialized skills, against the advantages of local knowledge, cultural alignment, and cost-effectiveness (Heather Travis on LinkedIn).
The Unique Segment of Global Talent
Middle Eastern individuals who have settled overseas for work or education represent a distinct talent segment. They possess bilingual skills, a blend of local and international work ethics, and an understanding of both Middle Eastern culture and international business practices. This group can bridge the gap between local and global expertise, offering the best of both worlds (Mark Williams).
Conclusion
In conclusion, Middle Eastern firms must weigh the cost implications and cultural impact of hiring expats against the economic and social benefits of employing local talent. While expatriates bring valuable global perspectives and specialized knowledge, local talent offers cultural alignment, cost savings, and a deep understanding of regional markets. The ideal strategy involves a judicious mix of both, leveraging the unique strengths of expatriates and local professionals to foster a diverse, dynamic, and competitive workforce.
The decision should be guided by the strategic objectives of the organization, the specific expertise required, and the long-term vision for growth. Companies should also consider the potential of the unique segment of Middle Eastern talent that has gained international experience, as they can serve as a bridge between local traditions and global business practices.
Ultimately, striking the right balance between local talent and expat expertise is not just a matter of cost or capability—it is about creating a sustainable and harmonious work environment that respects and leverages diversity to achieve corporate excellence.
About
In the realm of Banking and Investments, Warner Scott excels with international and regional banks and investment houses across London and the Middle East. They specialize in areas such as Private Equity, Asset Management, Investment Banking, Treasury & Global Markets, Wholesale Banking, Digital & Technology, and Risk Management & Compliance, including senior C-suite appointments.
In Accounting and Finance, they collaborate with The Big 4, Top 50 accounting firms, and global consultancies, offering expertise in Audit, Risk & Compliance, Taxation (Private Client, Expatriate, Corporate Tax), Corporate Finance, Transaction Advisory, Restructuring, Turnaround, Insolvency, Forensic Accounting, Disputes & Investigations, Forensic Technology, eDiscovery, Cyber Security, and Management Consultancy.
Their Digital & Fintech practice supports large banks, digital startups, and innovative Fintech companies. They specialize in FinTech innovations such as AI, Blockchain, Cloud Computing, Big Data, InfoSec/Cybersecurity across Application, Infrastructure, Network, Cloud, IoT securities, Digital Leadership, Transformation, Software Development, and Data Science & Analytics, Privacy, and Architecture.
References
– Warner Scott. “Local Talent vs Global Expertise: Striking the Right Mix in International Banks.” 25 July 2024. https://www.warnerscott.com/local-talent-vs-global-expertise-striking-the-right-mix-in-international-banks/
– HR Exchange Network. “The Pros and Cons of Hiring Locals Over Expats.” 25 July 2024. https://www.hrexchangenetwork.com/hr-talent-management/articles/the-pros-and-cons-of-hiring-locals-over-expats
– AGS Relocation. “Pay Equity: Bridging the Gap Between Local and Expat Pay.” 25 July 2024. https://www.ags-relocation.com/news/pay-equity-bridging-the-gap-between-local-and-expat-pay/
– Travis, Heather. “Expat vs Local: Achieving the Right Balance.” LinkedIn, 25 July 2024. https://www.linkedin.com/pulse/expat-v-local-achieving-right-balance-heather-travis
– Mark Williams. “Attracting Global Talent to the Middle East: An Insight into Methodologies and Challenges.” 25 July 2024. https://www.markwilliams.ae/attracting-global-talent-to-the-middle-east-an-insight-into-methodologies-and-challenges/