Middle East tourism sector can capitalise on global trends, says PwC

09 May 2018 Consultancy-me.com

On the verge of massive growth, the tourism and hospitality industry of the Middle East must act now to respond to and capitalise on the global trends which will impact the regional sector, as outlined in a new report from the local arm of Big Four firm PwC.

The Middle East branch of professional services powerhouse PwC has examined the region’s growing tourism and hospitality industry, shining a light on the sector’s challenges and opportunities in reference to the firm’s newly devised ADAPT framework, which considers the regional impact of the converging global megatrends of growing wealth disparity, shifting age demographics, technological disruption, increased urbanisation, and a rise in national populism.

"Over the past decade, the Middle East has developed into a global hub for tourism and leisure. Visitors are attracted to the region’s retail offerings, hotels, beaches, and unique experiences such as a trip to the top of Burj Khalifa, Sheikh Zayed Grand Mosque in the UAE, Museum of Islamic Art in Qatar and the old-fashioned souks in Oman. However, new winds of change will require further transformation within the travel and tourism industry in the region," the PwC report states. 

The impact of these global trends, the firm says, will manifest in the Middle East tourism and hospitality market in a variety of manners, from employment generation to the enhancement of regional programmes toward social and cultural transformation, with the potential for the local industry and governments to take advantage over the long-term with a focus on the short-term.Middle East tourism sector can capitalise on global megatrendsIn terms of the growing social disparity between the haves and have-nots, of which the Middle East has the greatest global levels of inequality (although such imbalance can be primarily attributed to differences at the national level) the report points to common regional elements such as widespread youth unemployment, citing the 30% unemployment rate for Saudis under the age of 25 and a 50% rate in Oman.

The governments of the Middle East have to date responded to this youth unemployment situation through various measures, but foremost through the promotion of the private sector and by way of diversification toward knowledge-based economies. Yet, the tourism and hospitality industry is the largest employment generating sector globally, and, as Dubai has already demonstrated, holds great potential in broader socioeconomic terms if tourism policies are prioritised and the various stakeholders properly aligned.

Further to local youth unemployment, is the shift in international age demographics, both in terms of a growing youth bulge in emerging economies – with greater mobility and a desire for travel – and a generally greying global population of ‘silver’ tourists, together creating a need for tourist and hospitality market diversification. Again, this can serve as both an employment generator for a young, idle workforce, including as to the development of new entrepreneurs and small businesses, as well as acting in concert with national programmes for diversification.

PwC Partner and Global Deals Real Estate Leader, Martin Berlin concludes; “The tourism and hospitality industry is on the cusp of massive growth in the Middle East and it can play a key role in responding to some of the big challenges we face around job creation and the evolution of the private sector. But if it is to play such a central role, the entire tourism value chain must work together to realise future opportunities – through digitisation, differentiation, alignment and the development of a mindset that embraces tourism and customer service.”


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Mawaddah International taps Four Principles for lean transformation

08 November 2018 Consultancy-me.com

Saudi Arabian hotel and religious tourism operator Mawaddah International has brought in specialist consultancy Four Principles to help institute lean management practices across its portfolio of operations.

Specialised in the provision of Hajj and Umrah pilgrimage services, Mawaddah International has a number of hotels under management in the holy cities of Makkah (Mecca) and Madinah (Medina), and works with an extensive network of tour operators worldwide to provide services to local and international religious tourists, such as through the arrangement of Umrah travel visas, local transportation, and travel to and from the Kingdom.

Described as one of the first full-scale operations designed to serve the needs of pilgrims visiting Islam’s holiest sites, Mawaddah caters to a wide range of clients from a variety of cultural and economic backgrounds, aiming to meet their needs as effectively and cost-efficiently as possible for what is often a defining, once-in-a-lifetime journey.

In an effort to further enhance its guest experience, as well as improve efficiency, Mawaddah has now tapped Four Principles to help instill a lean management culture across the company’s operations. Founded in 2010 by managing partners Seif Shieshakly and Patrick Wiebusch, following individual stints at Porsche Consulting (a German consultancy) and respectively Toyota and Oliver Wyman, Four Principles is a MENA-based globally operating consulting firm specialised in lean management – or the philosophy of Kaizen – a now cross-sector management approach originally derived from the Japanese automotive industry which stresses the notion that small, continuous positive changes can affect major long-term improvements.

According to the firm, which takes its name from the four Kaizen principles of ‘pull’, ‘zero defects’ ‘one piece flow’, and ‘takt’ – together broadly designed to eliminate waste, boost performance and maximise the use of resources – Four Principles was established to bring Kaizen to a new and wider audience in a more accessible and easily implemented manner than before, with the firm since establishing a diverse, cross-sector client roster including locally Avis, food packaging firm Lamina, and Abdul Latif Jameel Motors among others.Mawaddah International taps Four Principles for lean transformationNow operating under the Abdul Latif Jameel banner (since December 2017), Four Principles will soon apply its lean expertise in the transformation of Mawaddah’ operations, with the consultancy describing lean as more than a management tool-kit, but rather a “profound change of corporate culture, from the bottom of an organisation to the top, which is typically based on cooperation and commitment rather than radical changes or top-down edicts.”

“Our mission is to deliver a reliable and valued service to our guests during their stay at the country’s holy sites,” Mawaddah International CEO Karim Al-Sharif said of the collaboration. “We look forward to engaging with Four Principles and are confident this shared effort will optimise our processes and therefore enhance our customers’ satisfaction. This project represents an important step toward our vision to offer pilgrims a memorable religious experience through exceptional hospitality.”

With Kaizen’s underpinning philosophy based on perceiving a business’s value from the customer’s perspective and gearing everything towards optimising that value, the Four Principles partnership with Mawaddah will focus on the implementation of transformation initiatives across multiple value streams – from hotel operations, financial processes, sales strategy and visa issuance processes to procurement, warehousing and stock management – including implementation services in addition to advisory.

The consultants will join internal teams of Mawaddah to identify waste in processes, products and organisational structures. Examples could include double work/rework, excess waiting time or approval bottlenecks in processes, unclear roles and responsibilities and silo mentality in how organisations are run, and over-specification or idle offerings in the products realm. Following analysis and conceptualisation, pilots will be run to trial how waste is replaced by added value, with successful initiatives brought to broader roll-out. Continuous improvement backed by training and coaching will be applied to embed the change.

“In line with the government’s Vision 2030 plan to boost the tourism industry in Saudi Arabia, the hospitality sector continues to witness tremendous growth aimed to cater to domestic and international tourists,” Four Principles Managing Partner Shieshakly said in conjunction with the announcement. “We at Four Principles are proud to be part of supporting this growth through implementing continuous improvement projects with local hospitality establishments in order to deliver additional value to their customers.”