Will the Middle East "Leapfrog" Other Markets in Procurement? (Part 1)

My fearless colleague Peter Smith was in Dubai earlier this month to deliver the “Real World” sourcing series of lectures on which he’s been collaborating with Guy Allen in the UK (the lectures have been sold out, not to mention incredibly well received by the procurement community). In the above-linked dispatch, Peter notes that he visited the region “to deliver the first of four events this year we’re doing in Dubai for Tejari, the BravoSolution owned software / advisory business based in the Emirates.”

The Middle East is fascinating on so many levels when it comes to business. As Peter observes, “the region appears to be pulling out of the global financial problems of 2008/9, which did affect Dubai and the property world strongly, and by all accounts there is a lot of activity again in that sector, as well as in energy, retail and tourism.”

Wages are fascinating in the region, as skilled manpower in procurement and supply chain can command rates as high as anywhere in the West. Yet average wages for semi-skilled and blue-collar professions can vary dramatically, as can the sources of available labor based on the various restrictions put in place by each country.

From an organizational structure perspective, there are a number of large conglomerates in various markets, including Dubai and Saudi Arabia, that are ripe for shared technology, services and potentially aggregated or leveraged buying models. Many of these organizations have general managers who have spent time in Western companies and understand the power of procurement.

Questions remain regarding whether or not these organizations and trading companies will lead the way in helping the region leapfrog other markets such as Korea and Japan when it comes to next-generation sourcing and supplier management (which ironically often have similar company structures among the larger OEM/trading company organizations). We’ll wait for Peter to report back on his observations!

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