The calendar year is nearing its end and many of us are using this time for reflection. What have we achieved in 2017? What went really well? Which areas do we need to improve next year? What will we make our top priority?

It’s also the time to look ahead and prepare for the new year. In 2018, we’ll see various changes and challenges in this region. How ready is your business for them?


The probably biggest change to our daily life will be the implementation of VAT on 1 January 2018. Large organisations should have completed their VAT registrations by now and have adjusted their procedures to comply with the new reporting requirements. Smaller companies which fall below the mandatory threshold may want to be proactive and learn how they can be best prepared for VAT reporting, once their revenue exceeds AED 375,000.

VAT and financial wellbeing

Many employees are already stressed about their finances and spend 80 minutes per working day worrying about them. The questions often asked is “Will 5% for VAT be added to my pay increase?” Most companies are not prepared to increase their merit budgets for VAT. The Minister for Financial Affairs, Obaid Humaid Al Tayer, is expecting VAT to have minimal impact on people and investment and as such, no increase in salaries to cope with VAT will be provided.

Companies will thus need to focus on financial wellbeing initiatives to reduce the productivity lost due to employees being pre-occupied with their money concerns. This can start by providing basic personal finance education and go further with personalised debt consolidation and individual investment support for retirement both through a third-party provider.

Making total rewards count

The financial wellbeing initiatives need to fit into the total rewards strategy in a holistic way. These days, every dollar counts and organisations can no longer afford to just throw money at a people problem. Instead, companies need to be more strategic about the total rewards offered to their staff.

HR and in particular Total Rewards professionals have to establish targeted rewards which are both cost effective for the organisation and valued by the employee. Finding the appropriate mix of financial and non-financial rewards for a multi-cultural workforce was already challenging. In 2018, Generation Z will enter the workforce, adding to the complexity of looking after also a multi-generational workforce (baby boomers, Generation X and millennials). Traditional rewards models with a one size fits all approach will no longer be sufficient.

Organisations are urged to offer out of the box benefits. Flexible working hours with core hours for professional employee is no longer enough. An educational allowance for work-related courses or 1-2 hours each week at work to attend webinars or a book club which discusses business-related topics during lunch are easy to implement, supporting employees in their current role and improving their creativity. Rewarding employees for their length of service is generally done in 5-year-intervals (e.g. 5, 10 or 15 years). Why not issue service awards after 3, 5, 7 and 10 years? These can be made with a public announcement and a thank you letter issued by the CEO and don’t always have to be of a monetary nature, still contributing to employee engagement.

Rise in automation

Demands for increased productivity requires changes in business procedures and calls for increased workplace automation. Willis Towers Watson expects automated work to almost double in the next three years.

The move towards cloud-based HR systems like SuccessFactors or Workday is not only for large corporations. Small and medium sized companies are also transitioning to centralised HR systems which support self-service functions for their managers and employees.

To embrace and maximise automation, companies should consider deconstructing jobs to increase the efficiency, effectiveness and impact of work. Employees whose jobs are subsumed by automation need to be reskilled and matched with new work opportunities.

Continued emphasis on big data

In 2018, HR professionals must finally lose their fear of numbers, working in excel and running deeper analyses. HR needs to utilise data as visuals (e.g. graphs, charts or tables) when sharing their insights with the business and when recommending and influencing the business and/or HR strategy, programmes and initiatives.

If not already done, leaders need to evaluate their team’s expertise and qualitative knowledge to identify the appropriate training opportunities. Building up HR’s capacity, training has to become targeted for the individual’s jobs and their dealings with data analytics.

Increased performance

Transforming organisations into high performing ones will remain a major topic in 2018. After all, an increase in performance will lead to increased efficiencies which translates into increase revenue. Which company can afford to miss out on this?

For employees to see the link between their individual activities and the organisation’s success, a requirement for engagement and performance, leaders have to create meaningful goals and provide constructive and on-going feedback throughout the year. Providing employees with the tools and skills to perform, a trend towards personal development plans for the current role, future assignments and personal interests can be noticed.

Is your company ready to face these challenges in 2018? Do you want to benefit from targeted HR initiatives to increase your organisation’s efficiency? Call us on +971-52-2516322 and find out how we can help you develop a high performing culture that embraces technological changes to achieve increased productivity and sales.