Human Resource Management of Abu Dhabi National Oil Company - Case Study Example

Name: Instructor: Course: Date: Human Resource Management Report on Human Resource Practices Audit Abu Dhabi National Oil Company (ADNOC) is one of the leading producers of oil in the gulf coast, and has contributed significantly to the economic growth and development of Abu Dhabi for the past three decades. The company has taken part in distributing oil to many of the areas in the UAE because of its reserves. The Human Resource Management department has taken part in the planning and utilization of human capital for the growth of the industry. The overall mission of the oil firm is to ensure that while comprehensive and high quality products and services are provided to customers, the firm maintains a healthy relationship with dedicated clients, owners, employees, investors, and the larger community in which it operates. Since ADNOC is an organization owned by the state, many of the decisions made within the company may have significant political implications for Abu Dhabi nationals (Al Murawwi and Abdulla 48). Therefore, the government has been able to set forth policies that ensure the overall well being of Emirate nationals in relation to the firm. For instance, the company’s Emiritization policies have ensured that there are more employment opportunities to the nationals as compared to foreigners. From an economic perspective, the human capital is significantly influential in the economic well being, where operations run smoothly and revenue is generated. However, the human resource management has a limited capacity to affect the overall economic situation (Du Plessis and Sukumaran). For instance, there is little that the department can do in the event of an oil or economic crisis in Abu Dhabi or the regions it serves. The department has the capacity to affect the social ramifications of decisions made. Part of the responsibility of the human resource management of any company is to ensure that their social obligations are met. Abu Dhabi has been able to meet many of the corporate social responsibilities they have set out in their missions. These involve ensuring that the interests of stakeholders and even the larger communities are met. The existing labor laws as well as trade unions contribute to the legal regulations set forth for ADNOC and other companies in oil industry for Abu Dhabi. From a technological perspective, the human resource department in Abu Dhabi is keen on recruiting workers who can be able to deal with new technology as pertaining to the requirements of the firm. The company also takes part in ensuring that the existing employees are well trained and kept up to date with the technical requirements within their respective designations. Part of the mission in the Emiritization policy has been to recruit more nationals. The National Human Resource Development and Employment Authority sets a target of a certain percentage of people who are to be recruited within state owned and private operating firms in the United Arab Emirates. ADNOC has been able to achieve the 50 percent target of employment of nationals, and plans to exceed these expectations to reach 75 percent in the following 24 months (Al Murawwi and Abdulla 48). Another strategy, which the human resource department of Abu Dhabi has been able to focus on, is training of new recruits as well as existing employees. Their mission is to enable them to have the most productive work force. ADNOC has also collaborated with other firms to provide career planning for the young nationals who will soon seek jobs in the labor markets. This is a long-term strategy for the human resource department, which seeks to obtain new talent that will facilitate their achievement of their missions. In order to enhance training, there exists a separate Employee Development that works closely with the human resource department to improve on the career, experience, and skills of employees. The Human resource department has also ensured that remuneration packages are up to the market standards for all employees with respect to their job requirements. These include provision of housing and housing allowance, medical covers, and other benefits. The Human resource personnel also seek to develop an environment, which adheres to company policies, thus creating a place where people can work with comfort (Du Plessis and Sukumaran). Strengths and Weaknesses One of the greatest strengths in the oil company is their ability to maintain the Emirati policy of recruiting a higher percentage of nationals as required by the National Human Resource Development and Employment Authority. In fact, the firm has been able to exceed the target of 50 percent of employees comprising of Abu Dhabi nationals. Furthermore, the company has again set a target of reaching 75 percent within two years. The move towards recruiting more Abu Dhabi nationals than foreigners has been geared towards contributing to not only the reduction of employment within the region but also ensure that higher revenue is achieved as a result of the increased proportion of the work force (Al Murawwi and Abdulla 48). Another strength of the institution lies in its ability to ensure that the nationals are provided with market rate benefits that include financial and other forms of benefits. This has been geared towards maintaining a high level of employee satisfaction and retention on a long-term basis. The ability of ADNOC to provide training services for new recruits as well as existing employees has enabled them to maintain operations on a sufficient and competitive level in the highly intricate oil industry. The oil firm has gone further to provide training and career planning services for potential recruits in the future (Al Marzouqi). Some of the weaknesses in the human resource management department pertain to the criteria of recruiting new employees. The 75 percent target that has been set by the organization may present challenges. Such a target will require the company along with its subsidiaries to give a higher preference to nationals, thus potentially missing foreign workers who may be more qualified and experienced for the jobs. As such, the company would be limiting its own potential for growth and economic development. This also meant that those UAE nationals with less qualifications were more likely to be accepted, thus compromising on the overall quality of the work done. Furthermore, through recruiting such a large percentage of nationals, there is the possibility of straining transnational relationships. Through selection of more nationals, the company also faces the risk of losing more revenue. This is because the time it takes to obtain UAE nationals to fill a position may result in wasting a lot of time and resources, which could have been saved if the company had looked to some section of the expatriate population. Another weakness existing within the human resource department pertains to training of individuals. A high preference for nationals may translate to preference in training nationals for future employment. This means that foreigners who seek opportunities for training and recruitment may obtain options that are more limited than those of nationals are. Essentially, the current workforce of ADNOC is highly diverse in terms of racial, ethnic, and cultural backgrounds. This presents more challenges and responsibility to the human resource management in providing a more conducive and fair environment for all employees (Hassan and Rahimi 258). Policies that are made should be adjusted to cater to the diverse requirements of the workforce from a legal and ethical standpoint. Best Practice There exist some essential best practice criteria for evaluating the quality of human resources processes in organizations. These include equal opportunities, employee retention, training, and performance management (Buller and McEvoy 469). Equal opportunities entail a diverse workforce that promotes the company’s capacity for acquisition of talented and creative personnel. In the case of ADNOC, there is a high level of diversity, where 50 percent of the employees foreigners. However, the move towards increasing the proportion of employees who are nationals to 75 percent may render the company more homogeneous. The quality of employers recruited in the company and its subsidiaries is debatable because of their preference for UAE nationals. Non-nationals who are more qualified may therefore experience lower chances of recruitment, thus contributing to loss of revenue through lower productivity and poor quality of work. Within the training department, the company has been able to maintain a high level of best practices. The firm is keen on ensuring that all employees are sufficiently trained on their professional responsibilities, which ensures that work is carried out safely and efficiently. Employee retention is among the essential elements of bet practice. The company has been able to ensure that the employees who have not only been recruited but also invested in remain a part of the company for as long as they are positive contributors. Recommendations for Change Some of the recommendations that can be provided include a need to obtain a balance in the field of recruitment. While there exists the need to have a targeted proportion of UAE nationals as per the provisions of the Employment Authority, there is also a need to ensure that quality employees are recruited. This means that ADNOC must strike a balance between selection of nationals and selection of highly qualified and talented individuals. Additionally, the company also needs to ensure that they do not block opportunities for training for non-nationals because of their preference to select UAE citizens. This can once again be managed through striking a balance between nationals and foreigners. For instance, the company may decide to formulate policies surrounding the proportion of people to select for training and later recruitment with respect to their nationalities. Works Cited Al Marzouqi, Mohamed A., et al. "Building ADNOC's Pillars for Process Standardization and Best Practices through an Integrated Reservoir Management Framework." Abu Dhabi International Petroleum Exhibition & Conference. Society of Petroleum Engineers, 2016. Al Murawwi, Moosa Abdulla, et al. "Examining the relationship between organizational culture and knowledge management: the moderation effect of organizational divisions at an Abu Dhabi Gas company." SAM Advanced Management Journal 79.2 (2014): 48. Buller, Paul F., and Glenn M. McEvoy. "A Model for Implementing a Sustainability Strategy through HRM Practices." Business and Society Review 121.4 (2016): 465-495. Du Plessis, Andries, and Sukesh Sukumaran. "The role of HRM in leadership development, talent retention, knowledge management, and employee engagement." (2015). Hassan, Azizul, and Roya Rahimi. "Insights and Rumination of Human Resource Management Practices in SMEs: Case of." Handbook of Research on Human Resources Strategies for the New Millennial Workforce (2016): 258. Read More