Introduction
It is worth acknowledging that the business setting is experiencing tremendous changes, a feature that has influenced the way global workforce is sourced, organized and managed. Besides, globalization has enhanced interaction amid knowledge, trade, and innovation, which are significant factors that influence business. However, different stakeholders are concerned that emerging markets have led to increased number of employees working outside their homes. Besides, there is a shortage of talent in specific disciplines in the market, a feature that has attracted a lot of concerns.
Therefore, the mobility of employees has been experienced in the recent past and is expected to grow further by 2030, contributing to more diversity at the workplace. According to the country’s labor statistics, the private sector lies behind the public sector and in order to meet the 2030 vision, the country needs to invest more in the sector. The country needs to establish about 2.2 million jobs for the private sector by 2030 to reach full employment. The aspect is influenced by the new business demand and employee preferences. According to PWC emerging markets have significant impacts on the mobility patterns that are experienced. Moreover, the skilled workers are gaining popularity both locally and in the international markets due to increased range of opportunities that are presented by the emerging markets. The concept of mobile employees is appreciated by many to have significant benefits to people and is growing popular with time. The above study seeks to understand the importance of talent management and how it influences institutional voids in the emerging markets, with a focus on how Saudi Arabia Vision 2030 will be achieved.
Main Body
Saudi Arabia Vision
Vision 2030
Saudi Arabia is an emerging market and has a vision based on three distinct pillars, which include appreciation of Arab and Islamic worlds, wish to become a global investment powerhouse and engagement in global hub connecting three continents due to its strategic location. Emerging markets have gained popularity in the recent past, and it refers to the market potentials available in the market as organizations seek to venture into the international marketplace. However, institutional voids, as will be used in the above study, indicates the absence of critical intermediaries such as market research firms and credit card systems that help in efficient connection of the different players in the market.
Saudi Arabia is characterized with social, geographic, economic and demographic advantages, making the kingdom to have attractive global image. The vision of the Kingdom of Saudi Arabia is to be the heat of the Arab and Islamic world. However, for the government of Saudi Arabia to achieve its set vision, the following strategies will be adopted which include having a vibrant society, thriving economy and an ambitious nation. Through a thriving economy, the Kingdom aims at providing marketing opportunities to entrepreneurs and creating an education system geared on market needs. Being a vibrant society means living according to the required principles and being proud of the national identity. However, a vibrant society can be established by overcoming the different institutional voids that can be overcome by efficient utilization of natural resources. Although the Kingdom has a lot of resources, it is worth noting that most are yet to be tapped due to the existence of institutional voids, a feature that should be eliminated. According to the country's vision, establishing a vibrant society with a fulfilling life incorporates the development of different strategies that will help promote culture and entertainment, enhance healthy living, develop cities and engage in various environmental sustainability plans. All this will be driven by the ambition of the Kingdom to achieve its Vision 2030 vision, and this can only happen through an effective, accountable and transparent government.
Adverse Effects of Institutional Voids
According to De Lange, institutional voids are great opportunities to emerging markets if well utilized. The institutional voids refer to the different aspects that limit the efficient functioning of the market such as labor challenges, capital, and inadequate research among other significant issues. The issues act as obstacles that limit the efficient functioning of the companies in the market, and understanding such voids is the key to success for organizations. Therefore, institutional voids are compared to a market that lacks developed infrastructure and institutions, hence limiting the company's ability to engage inefficient business operations. Therefore, lack of supporting facilities offers both opportunities and challenges to the firm.
Therefore, to counter the problem of the institutional void, organizations ought to embrace efficient models that will overcome the shortcoming. Therefore, an entrepreneur conducts a market research and efficiently analyses of the market to understand the different factors that are contributing to the void. For instance, while various organizations complain of high turnover among employees, high salary demands and inadequately qualified individuals, the job seekers, on the other hand, are complaining of lack of employment. The problem with the above example is that there are too many players in the market, resulting in a void. However, the solution for the challenge is coming up with a strategy through which talent can be matched with opportunities for the two parties to be satisfied. Besides, Zhao explain further that "institutional voids" refers to the market ecosystem that makes companies dependent on it. However, such mechanisms are either missing or fail to operate as required hence incapacitating the market from achieving its full potential.
The global marketplace has received tremendous changes in the recent past. Changes in demographic features and economic forces in different parts of the world have contributed to the development of the institutional voids. With time, new centers of growth are slowly developing, as multinational corporations have experienced increased competition from new entrants especially from the emerging markets such Africa and Latin America.
An aging workforce is one of the challenges that are experienced in many countries, and the evolution of multinational companies has a significant influence on the way business is managed. This has contributed to increased cases of international mobility as businesses are outsourcing staffs from different places where they want them to assist in enhancing production. Therefore, countries are implementing strategies through which they will develop a stable supply of competent workforce for sustainability purposes. Most of the developing countries such as in Asia and Africa are therefore investing in the talented youngsters to develop a consistent supply of labor in the market.
It is evident that over the recent past, emerging markets have portrayed fast growth and institutional voids are some of the aspects that make such economies lag behind. Institutional voids, therefore, are viewed as gaps experienced due to the inefficient implementation of different rules. Voids, as expressed by various scholars, are experienced when economic growth advances at a faster rate than social and institutional structures can sustain. However, if not well utilized, voids can result in the development of unwanted consequences to economic growth, hence limiting the ability of an organization in exploiting the different market opportunities. However, the concept can be defined further into two categories as various factors influence them. While structural voids are affected by the ineffective implementation of rules in society, contingent voids refer to the inefficient combination of the different factors of production. However, the challenge of institutional voids as will be outlined by this paper can be eliminated through effective talent management.
Legal Voids
Having a high-quality human resource and adequate talent has over the years been mentioned as a crucial building block for any nation that wishes to achieve long-term growth prospects and experience sustained growth. Countries with top performance in the global competitive index are privileged to enjoy a pool of top talent, which is a remarkable achievement. Some of the features that indicate countries with a high global competitiveness include the availability of higher education, development of an efficient labor market and increased rate of innovation.
The legal section in the country has failed in promoting policies that will promote a high chance of accessing global talent in the country as for the case of countries like the USA, Canada, and Japan among others. Therefore, the government of Saudi Arabia should implement policies that control talented individuals from leaving based on the significant benefit achieved from talent mobility. For instance, the government should consider eliminating policies that restrict women from working in certain fields, such as driving, restrictions towards employment of foreign labor among other significant aspects like misuse of laws by sponsors. An example in place is the case of Dr. Peggy’s friend from an international class who sought employment in Saudi Arabia, to work with a particular company in the country. However, her application was denied as she later learned from a US company employer that laws in Saudi Arabia did not allow women to work in accounting positions.
Cultural voids
Cultural voids can be characterized by developing of business setting where cultural diversity is not appreciated. Saudi Arabia is an Islamic and an Arabian country, a feature that makes most of its business operations to be run based on the area norms. However, with globalization, the country hubs people from diverse culture and there is a need to develop a conducive environment that supports a setting of cultural diversity due to the numerous benefits that are enjoyed as a result. Overcoming the cultural voids will contribute towards enhanced talent mobility practices in the country, a feature that can be improved through increased innovation. For instance, the country has many soccer clubs, which have offered many talented players, and coaches a lot of cash in the recent past. However, most of the offers are often turned down because of existence of cultural voids. The Saudi Arabia society embraces collectivism, a feature that indicates that businesses have to be operated based on norms of the society. Therefore, the attribution has a significance influence in influencing employment decisions. For example, for an individual to secure an employment opportunity in the country, the chances of getting the job is mainly influenced by the personal relation established amid the employer and the job seeker. Besides, most positions in big organizations in the country are secured by people with similar last names, indicating the significance of personal relationship.
Environmental Voids
Some of the issues that indicate existence of environmental voids include aspects to deal with the lack of adequate facilities to support talent management. The government, therefore, has a mandate to establish a suitable environment that supports talent management prospects in the country. Some of the important facilities to support plans to manage talent include development of adequate entertainment facilities such cinemas or theatres.
Efficient Strategies to Overcome Institutional Voids
Different factors influence they way a country attracts and engage in retaining a pool of talented individuals within its borders. Saudi Arabia should, therefore, engage in various practices that will help support talent mobility, which plays a significant role towards economic development and overcoming the various institutional voids.
Some of the countries with a high level of talent mobility indicated to have a language and culture that is desired by many. A country where the English language is commonly used tends to attract a pool of talented individuals for different educational programs. The different organizations in the country should consider investing in effective management practices that are necessary for attraction and retention of talented individuals. Young minds require to be placed in environments that support rapid development, and this can be enhanced through more research to boost learning of new things. Therefore, the government ought to enact policies that support career development to enhance opportunities for the people in the country. Furthermore, investing in quality educational opportunities is vital for the country as this is one area that will contribute towards the development of talented individuals in the country, hence promoting talent mobility.
Mobility indicates more than the transfer of skills to other complex situations that are incorporated in meeting the diverse needs of the business. To fill the institutional voids, organizations have sought to develop effective leaders that meet the international standards. Besides, different groups are for the idea that people can benefit from various career opportunities by learning effective strategies through which they can attract and retain best talents. In summary, different corporations are concerned that innovation is one of the approaches embraced in enhancing global mobility, and this involves adapting to meet the changing business needs.
Organizations have therefore prioritized having the right skills and right people where they require them to respond their set obligations as one strategy through which institutional voids is overcome. However, in the recent past, organizations have sought to introduction new approaches that do not require physical relocation as for the case of the past. Different scholars have questioned the need for relocating and instead commented that a person ought to transfer only when there is a pressing need for the process.
It is worth acknowledging that the fast emerging markets presents a broad range of opportunities than for the developed markets, hence offer companies a chance to experience significant opportunities to expand. Emerging markets have presented Saudi Arabia Kingdom with lots of opportunities, making the country integrate fully into the global economy. It is, therefore, expected that with new opportunities, the country’s GDP will double by 2030 and over 6 million new jobs will be established. However, the government has to invest over $4 trillion in the different investment schemes to realize the above benefits. However, a shortage of talent in some of the key areas in the different regions is a setback to experiencing growth. To counter the challenge, organizations have sought to use more systematic and centralized approaches that will contribute towards maximization on the available business opportunities. Moreover, different corporations have sought to embrace talent mapping, forecasting and efficient talent management that is in line with the firm goals.
Scholars such as PWC explain that in the long-run, economic, social and change in demographic features have significant influences on how work is achieved. The three factors, therefore, influence the way different organizations in the various parts of the world organize their workforce to benefit from the existing market opportunities. Therefore, efficient management of the prospects is a sure way through which organizations can adequately achieve its set goals in the market. However, talent management issues significantly influence the future business operation of the different organizations in the Kingdom.
According to Beamond et al., talent issues in an organization can contribute to the following three conditions, which include fragmentation, collectivism, and individualism. However, fragmentation is also referred to like the orange world where the business setting is characterized by small companies that rely on an extensive network of suppliers. However, the respective organizations have multiple business operations and have to supplement their workforce with the international, diverse labor force. However, the supply of global workforce to the firm is based on contracts, which are based on the market forces of supply and demand.
Another possibility that may be experienced in future includes collectivism also referred to as the green world. However, organizations in the above category operate differently as they tend to embrace strategies that are tied to the effective development of their brand. Therefore, such structures are based on sustainable and ethical practices that help attract a workforce with similar attributes from the international market. The success of the company is thus influenced largely by employee agreement with the organizational policies.
Individualism, on the other hand, takes a different approach and corporations are considered to have a significant impact. Moreover, individual preference has considerable influence on the social belief and such companies invest a lot in talent management. The organizations, therefore, believe on the concept that a diverse workforce gives business a competitive advantage in the market hence influence the performance of a corporation in the business setting. The situations have therefore contributed to transfer of skills to help address the different business concerns in the market.
Hence, for efficient exploitation of business opportunities in the emerging market, talent management is a critical aspect that should always be embraced by business organizations. The condition ought to be appreciated by the employers in the international business setting. Therefore, this includes setting in place a plan that will support global mobility and efficient global mobility functions to overcome institutional voids that limit transfer of skills on an international scale.
According to Fourné et al., talent management is a big issue that needs to be addressed in most organizations as a very few organizations are satisfied with the issue. Business in the global setting, therefore, face a challenge of having adequate acute skills to support attainment both short and long-term prospects of the organizations. Moreover, most business leaders lack the ability to find and develop talent that will assist the business to grow in future. To solve the challenge, organizations have therefore sought to embrace different strategies on how they can effectively retain their best talent. Therefore, the concept of mobility supports effective plans to attract, retain and management of talent, which is the key to the success of the business. However, for the different corporations to overcome the issue of institutional voids, there is a need for the management to overlook on the costs of engaging in the international assignment but focus on investment in talent mobility.
Conclusion
It is evident from the study that globalization has brought significant changes in the way business are operated in the global setting. This has contributed to a shift in the manner in which diverse workforce required for the current day business is sourced, organized and managed for the purpose of future growth of the firm. Different scholars shared their concerns in the study that existence of institutional voids limits the various organizations from achieving efficient exploitation from the diverse opportunities that are presented by the emerging economies. Although the study mainly focused on Saudi Arabia, it was further evidenced that all emerging markets experience almost similar challenges, and effective talent management is one strategy through which the challenges can be eliminated.
Therefore developing a practical framework that supports mobility of employees will allow for efficient transfer of skills to different areas where they are in demand. Moreover, the aspect will contribute towards the development of plans to engage in effective talent management. As mentioned earlier, the Kingdom plans to become a global investment powerhouse and a hub to different regions, a goal that can be achieved through talent management. Organization management should, therefore, rely on efficient identification of the particular voids and capitalize on how to fill them to overcome their competitors in the market. Therefore, the study concludes on the note that institutional voids present both business opportunities and challenges, and if well utilized, they assist in exploitation of the business opportunities in the emerging market.
