Saudi Arabia -SAGIA Harvard Case Solution & Analysis

Chapter 2: Case brief

Description of the situation

Al Dabbagh’s Rein

In the year 2004, Saudi Arabia General Investment Authority experiences a significant change as a Saudi capitalist Amr Al Dabbagh is appointed as its head.  This appointment is a result of retirement of Prince Abdullah, which assigns Amr Al Dabbagh the responsibility to carry Saudi Arabia General Investment Authority experiences forward in fulfilling its primary agenda of the economic and political reforms. In such a way that it creates a favourable environment for the foreign investors. Amr Al Dabbagh is a reputed personality because of his experience in the corporate world, but he lacks significant experience in the administrative machinery.

Taking the charge of the Saudi Arabia General Investment Authority Amr Al Dabbagh as amongst the youngest ministers to be appointed in the Saudi Arabian administration, he brought enthusiasm and zeal into the agency. Amr Al Dabbagh was nominated by the World Economic Forum as amongst 100 “global leaders of tomorrow". Amr Al Dabbagh is of the view that in this day and age the central element that the Saudi Kingdom’s economy lacked was globalization. So, in order to globalize Saudi economy, such actions are to be taken to make the Saudi economy more competitive as compared to other available options for the foreign investors.

New head of the agency faced the same situation where the preceding head left, where he had issues related to ambiguous mandate, insufficient financial muscle along with the lack of specialized experience in this particular field. Saudi Arabia General Investment Authority also had stressed relations with other government bodies as the liberation policies were against the traditional and rigid policies of the other government agencies.

To overcome this situation Amr Al Dabbagh came up with a strategy intended to make private-public partnerships in order to help the cause of its organization in this regard. And carry forward this campaign into the next level and indirectly patch their relations with other government bodies by gaining more stake in the country in working towards bringing more business in the Kingdom.

Redefining Saudi Arabia General Investment Authority

Al Dabbagh more specifically redefined the vision and mission of Saudi Arabia General Investment Authority. An extensive research was also conducted in order to get insights regarding the action plan for their organization. Further, prioritizing of the projects is also defined on the basis of greatest economic influence, best complements current strategies and exploit on Saudi Arabia General Investment Authority’s central objectives, can be timely implemented, are cost effective and are possible utilizing the available resources.

As a consequence of this prioritizing, six strategic roles of Saudi Arabia General Investment Authority appeared.

  • The agency will provide comprehensive licensing support services to the foreign investor.
  • Saudi Arabia General Investment Authority will work towards identifying opportunities that will result in certain competitive advantage for the foreign investors.
  • Saudi Arabia General Investment Authority will indulge in regional development by cooperating with local authorities to tailor promoting plans and strategies.
  • The agency will motivate and encourage start-ups by encouraging local funding companies to finance the needs of service related, non-profit organizations and small businesses.
  • The agency will also focus towards power, transportation, communication, information, health and education sectors with the intent to produce long term benefits for the overall economy.
  • The organization will strive towards creating a favourable and attractive business environment by seeking the cooperation of public and private companies in developing reform in the business law of the Kingdom.

Public-Private Corporations

Devising the strategic roles for the organization Al Dabbagh was now facing an intimidating task of implementing this new plan. And in doing so he opted to exploit the private sector for searching for the talent that was required by the organization in order to implement their plans.

Saudi Arabia General Investment Authority had inherited staff that were bureaucratic in nature and will be unable to implement the new plans of Al Dabbagh for the rebirth of the organization. And in order to provide a lucrative opportunity for better talent Al Dabbagh needed at least to increase the human resource budget of the agency to double. But Minister of Finance was unlikely to approve and double the budget as already it was reflecting the returns to employees as of a private organization than a government owned.

Further jeopardy was faced by the organization as they were scrutinizing their 200 inherited employees via a committee, Al Dabbagh looked into the matters himself and took additional charge of operations. After, intense screening only fraction of inherited employees were declared suitable to the current ambitions of the organization and to carry forward the mission at hand. But good news for the organization was that the majority of these employees were actually executives and very less slashing in the staff was required which could be bypassed.................................

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