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The Middle East's IT skills paradox

Here's a true or false question for you: "The availability of highly skilled IT professionals in the Middle East is inversely proportionate to the number of highly skilled IT professionals being made redundant in the West." Come inside for the answer.

In my mind, the IT spending slow down in the US and Europe should be good news for the Middle East. At last, we will be able to draft in the highly skilled consultants we could never prise away from plumb contracts in larger markets during the boom years.

With big-name vendors laying-off thousands of skilled workers in the West, surely they must be itching to redeploy them in the [$25+ per barrel] oil-rich GCC.

Those CRM, supply chain management, ERP and e-procurement projects that you had to put on hold until you could find the right skills must now be right back on the agenda.

The potential here is not just from these high-end software projects. Just look at the current penetration for PCs. In the GCC as a whole, well under 5% of households have a PC. That, of course, means they don’t have any software or peripherals either and they don’t have a home Internet account. This market has grown 30% already this year, according to the region’s largest IT distributor, and shows absolutely no sign of slowing.

So why then are IT vendors here being subjected to headcount freezes and even enforced redundancies? Why are marketing budgets being zeroed in the Middle East with a single slash of a corporate axe in California?

The last time I saw this kind of reaction was in the early nineties. At that time I was a little more understanding. Global communication was far less advanced so it was nearly impossible for corporate HQs to know what was happening in a small market like the Middle East. Few of the major vendors even had offices here at that time so it was even harder to know if the Middle East was immune to the Western recession.

That is no longer true. Oracle and Cisco, for example, claim they can check the advanced order book for any subsidiary in the world at any time of the day. If business is as good as their local executives tell me it is, I simply do not understand why they should be included in any global cutbacks.

I am not alone in these opinions. Sales managers within the vendor community are voicing the same frustration. “Here I am busting my targets quarter after quarter and now I’m being told to reduce my headcount,” a regional sales director told me over dinner the other day.

It seems to me that we are suffering from the same kind of hysteria that created the dot.com bubble two years ago; only this time in reverse. Companies don’t seem to have the flexibility to match the size of their businesses to the size of the potential market. Clearly the likes of Cisco, 3Com, Lucent and Nortel are overstaffed in the US (because they believed their own hype through the boom years), but it does not necessarily follow that they are overstaffed in the Middle East.

I would like to see a period of quiet contemplation at the top of these global IT giants during which regional subsidiaries are invited to state their cases. Of course, if expanding subsidiaries can contribute more to the bottom line of the corporation by trimming costs, this should be considered, but not if this trimming stifles their ability to serve the market better and increase top line revenues.

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