Al Rostamani invests in its people

Incoherent HR strategies can prove costly for any organisation. Find out how Ranjana Lobo put in place the HR strategy for the enormous Al Rostamani Group.

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By  David Ingham Published  April 29, 2001

People are key to success|~||~||~|It was with the support of top managers, themselves members of the Al Rostamani family, that Ranjana Lobo began to implement an HR strategy for the Al Rostamani Group. That kind of support from the top, she says, is vital if human resources policies and procedures are to work across eighteen group companies employing over fifteen hundred people.

“I had the support of the chairman and the MD,” says Lobo. “Unless you have the support of top management, you can’t achieve anything.” It all began around five years ago, since when the group HR department has put in place systems and procedures that are followed throughout the company.

Every new recruit that joins Al Rostamani now receives an induction manual that sets out procedures on things as simple as applying for leave. Job descriptions and duties are now made clear to every employee.

Employees have a six month probationary period with a mid-term appraisal after three months. Every year, there is an employee appraisal based on what Al Rostamani Group calls ‘management by objectives.’ Those are objectives that have been articulated to an employee at the beginning of the year.

Lobo says that structured procedures like these are necessary in today’s employment market. Shipping unskilled employees in and out every six months is no longer good enough. As competition intensifies and the Gulf market becomes more professional, human beings are becoming the difference between success and mediocrity.

A structured environment, where objectives are made clear and progression is possible, is the minimum expected by bright potential employees. “In the Gulf, professionalism is coming in; I can see the change,” says Lobo. “There is a need for people to be more specialised in the work that they’re doing.”

There are other factors at work too. The cost of recruiting personnel, especially from abroad, is going up and every employee lost is productivity lost. “If I’m bringing you in from the US, UK, India or Pakistan I have to know you are the right person for the job,” says Lobo. “I have to keep you because there’s a wastage of manpower in terms of days recruiting a person.”

Loss of personnel also means a loss of continuity in a department and a possible loss of productivity as a new person learns the ropes. Visas for overseas workers are also gradually becoming more difficult to obtain.

Putting in place procedures goes beyond what happens when a person arrives. Line managers have been told that it’s up to them to ensure that the best people are recruited.

“You cannot give a 100% guarantee on every person you’re recruiting, but at the same time it shouldn’t be that four out of every five employees you recruit are thrown out at the end of the six months,” says Lobo. “That means there’s something wrong with the managers.”
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Al Rostamani has a salary grading system which rewards employees based on experience and qualifications. Market research is carried out at least every two years to ensure that salaries are competitive with those offered by others in an industry.

There is also an incentive element for employees in the form of increments that are given on the basis of individual performance. “If I have five people doing the same job in my department, definitely between the five of them there will be a difference [in increments],” says Lobo.

Should an individual disagree with either their end of year increment or their manager’s evaluation of them, Lobo says they are free to disagree. In such a case, her HR department could be called in to mediate.

A structure is also in place to allow employees to move around within the group companies. This can be particularly helpful in the case of very promising people that may have reached a ceiling in one particular department or company. “Employees know that if they perform well, they can move up the ladder, not just in their own company but in any of the other group companies,” says Lobo.

That’s another reason why it’s important to have appraisals of employees. Across such a large group, it would be impossible for a manager in one company to know about an employee in another that could be right for him.

Training is becoming an increasingly key part of Al Rostamani’s human resources strategy. Training programmes are put together by group HR on the basis of line managers’ requests.

Al Rostamani Group does not take the approach that training isn’t worth it because people leave. “If I train my employees and upgrade their skills, it’ll be good for me in the future,” says Lobo. She says the entire group can boast an annual employee turnover rate in the single digits.

Of course, putting in place the human resources system over the last five years has not all been plain sailing. But Lobo says that once people got their head round the fact that HR strategies are there for their benefit as well as the company’s their attitude changed. “In the past few years everyone has realised that the HR department is there to help them, not put a spanner in the works,” she says.||**||

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