Water Sector Privatisation in Saudi Arabia

Executive summary

This research paper explores the decision by the Ministry of Water and Electricity (MoWE) in Saudi Arabia to form the National Water Company (NWC) as a vehicle to facilitate privatisation process and oversee the regional operations under Private Pubic Partnership contracts (PPP). Consequently, 5,000 employees moved from MoWE to NWC. The transition process for human resources will be the main interest to this research study.

The assumption is that that a paradigm shift with regard to the role of the employees concerned is necessary to execute change management successfully. Thus, the intention of this research study is to determine the role played by change management during the employee transition process. In addition, the study shall also endeavour to understand the need of managing change through a mix of communication and training programs for the transfer of employees in order to equip them with the required skills and knowledge to operate effectively in a commercial environment.

The research study has identified a descriptive approach to undertake this project. The study population shall be on those employees from MoWE, who already have been seconded to the NWC’s customer services operations in Riyadh, whose number in total is 750 employees. A systematic sampling technique shall assist the researcher choose the study’s respondents. A self-administered questionnaire will be the tool of choice for data collection and the collection procedure will be by personal administration of the study questionnaire. Use shall be made of SPSS (Scientific Package for Social Scientists) and Microsoft Excel (Ms Excel) for statistical data analysis. Finally, the presentation of research findings in the form of graphs and tables will assist in data interpretation.

Introduction

Background of the study

The ministry of water and electricity in Saudi Arabia is committed to the provision of clean, yet reasonably affordable and portable water to all the residents, while at the same time also enhancing its organisational performance (Pillai 2). In addition, MoWE aims at ensuring that all households get adequate sanitation facilities, besides the protections of the environment. In a bid to achieve these objectives, MoWE has implemented a Strategic Transformation Plan (STP), to lead the reforms within the water sector, in addition to defining a common path for privatisation.

Thanks to the implementations of STP, four cities in Saudi Arabia, Jeddah, Riyadh, Khobar, Madinah and Dammam, have already initiated PPP projects, to enhance the management of wastewater and water operations. In addition, the formation of NWC was with the intention of facilitating the privatisation process and managing the regional operations by PPP contracts (Pillai 2).

NWC formed MoWE and thus far, two cities, Jeddah and Riyadh, have each signed a five-year PPP contract with Europe based Water Companies. Presently, assets and labour transfer is underway, from the pre-existing entities to the newly formed NWC city business units (Pillai 3). NWC is poised to oversee a transfer of 5000 employees to the NWC, from both the Jeddah and Riyadh cities branches by application of transfer mechanism, processes and criteria designed and approved by NWC’s board of directors.

Research problem(s)

In the wake of privatisation of the Saudi Arabia water sector, there is a need to explore the paradigm shift from a public entity to a private one, and the impact of this change on the transition process of the employees from working for a public sector (MoWE), to now a private sector (NWC). It is important to take into account the impact that such a change in terms of management shall have on the communication plans and management techniques of the employees. Such a smooth transition would often call for the implementation of communication strategy and resistant management plan.

The explorations of the right transition mechanism for the employees are vital, based on potential inefficiencies anticipated in the new organisations, following a surplus of the labour. The role that the executive management at both the MoWE and NWC plays is also significant when it comes to the issue of supporting and directing the transition process. The mindset of government employees is different from that of employees from the private sector, as regards compensation, working hours, labour law requirements, and civil service laws. This is bound to impact on the transition process of the employees. It is also important to address the criteria applied in employees’ assessment before the transition process, so that the process may be fair, objective and transparent.

Research objectives

1. Expected role of leadership during change?
2. Type of messages to be communicated at each organizational level?
3. Type of workshops to be held to support the transition process of employees at NWC customer care department.
4. Is their a need to offer a mix of communication and training for the employees supporting the change process?

Significance of the Study

Today, many feel that bureaucratic structures are largely unable to effectively execute the social functions as required. This is the case yet the fundamental reason for instituting bureaucracy is to better stabilise the environment and deal with emerging challenges by introducing more rules and regulations.

The power of managers has greatly been curtailed but responsibility has remained full. This is due to the use of numerous regulatory procedures by the central agency which are commonly separated from normal service delivery. Greater congruence between operating responsibility and managerial authority is necessary to provide the Kingdom with superior water management services.

In conclusion, this change management process is to ensure that the Kingdom gets more predictable, precise and orderly water management services.

Definition of Terms

PPP: Public private partnership: A term used in reference to either a private business venture or a government service that is operated and funded via a partnership between the government and either one (or more than one), company from the private sector.

NWC: National Water Company: This is a creation of the Saudi government through ministry of water and electricity for flexibility and service delivery within the water sector.

MoWE: Ministry of water and electricity: These acronyms refer to the water and electricity ministry in the kingdom of Saudi Arabia.

BOT: build-operate-transfer: A type of financing a project in which the public sector awards a private entity a concession to design, finance, construct, and also operate a given facility that the concession contract has stated.

SPSS: Scientific Package for Social Scientists: This is a computer software package that is used to computer statistical data to yield useful research findings.

STP: Strategic Transformation Plan: MoWE’s medium-term strategy for water sector reorganisation

Study results on how change management affects the transition of employees will depend and vary based on the following variables:

• “Independent (I), Dependent (D)”

Key Categorical Variables

1. Nationality of Employee – Saudi, Other Arab or Non-Arab (I)
2. Gender of Employee – Male or Female (I)
3. Educational Qualifications of Employee – PhD, Master, High Diploma, Bachelor, Diploma, Vocational High School, High School, Intermediate, preparatory, Vocational Training Center or Without Qualification (I)
4. Religion – Muslim or Non-Muslim (I)
5. Marital Status – Married or Un-married (I)
6. Job family (D)
7. Position within Organization (D)
8. Level and Grade within Organization (D)
9. Country and City of Birth (I)
10. Past Performance Appraisals (D)

Key Continuous Variables

1. Age of Employee (I)
2. Other Educational Qualifications and Professional Experience (I)

The level of buy-in will depend on the timeliness and comprehensiveness of the messages and the willingness of the employee to work in a commercial environment after years of working in the public sector under a civil service mandate.

Limitations of the study

This study captures only a snapshot view, during a volatile phase of implementation and transition from a governmental environment to a commercial and profitable practice. It is not possible to predict effectively the actual application accurately, and further processes are to be developed based on employee responses and level of resistance. Time is another limiting factor that needs identification. The shortness of time dedicated to this research study means that the researcher is limited in terms of the extent to which he may explore the research questions of the study. Other study limitations include travelling costs, inadequate budgetary allocation, and the small sample size.

Literature Review

Undoubtedly, Saudi Arabia has had to encounter big challenges for the further development of its water sector (Shandling par. 6). Consequently, the government resolved to privatise the water sector, through the formation of a National Water Company. Amongst the several resources, that the NWC requires is labour. Already, five thousand former employees of MoWE have moved to NWC. Given the differences in terms of contractual agreements, laws and regulations between the private and the public sectors, the expectation is that employees will face the challenge of having to adapt to the transition.

The initial capital set aside for NWC was US$ 5.9 billion. With operations already underway in the cities of Jeddah and Riyadh, the company hopes to extend its operations in about 15 cities in the next three years (Shandling par. 5). The implementation of the privatisation exercise is in two forms: as PPP or BOT (build-operate-transfer) forms of water projects. Both of these two schemes require pursuing in the name of the privatisation process and the expectation is that the water project shall attract varying bidders from the private sector. The deputy prime minister in Saudi Arabia has asserted that when successfully, the PPP initiative shall enable Saudi Arabia to attain the targets for water services (in a better and timely manner) that it has set in the years to come (Pillai 3).

In the face of change, there is a need for organisations to embrace strategy development techniques that are well-established (Shaw 24). Due to the development of the economies, rapid technological advances, coupled with the expectations of both the private and the public sectors, change becomes a necessity. The transition of the water sector in Saudi Arabia from a public entity to a private one is a necessary form of change, not least because it shall enhance service delivery and efficiency, but as the demand for water increases steadily with population growth.

However, it would be futile to imagine that the workforce that has experienced a transition from the MoWE to the NWC shall not have any difficulties in adjusting to the new change. Shaw (24) has noted that usually, organisations and by extension, the human resources have a tendency of clinging, to the practices and systems that they are already accustomed. For this reason, there is a need to develop a strategy that ensures a smooth transition of the workforce. One of the ways through which this can be achieved is by way of identifying the corporate values of the entities involved, in this case, the value attached to the public sector on the one hand, and those that the private sector hold dear, on the other hand.

Organizational change has its arguments falling in either of the two main categories. The first category stresses organizational efficiency while the second stresses social change. For both categories, the focus is on a desired result instead of developing better understanding of the numerous dynamics of organizational change. This hypothesis is based on market forces, which have made the idea of improving efficiency in the organisation a lucrative undertaking.

Kurt Lewin greatly informs the literature that emphasizes the achievement of efficiency in the organisation. To better understand organizational change, he suggested a “force field” analysis model. The analysis model proposes that an organization is typically in equilibrium. Driving forces and restraining forces are the two main forces which maintain stability at the organization. The driving forces are the aspects of the organization supporting a desired change in the organization. Restraining forces ensure the stability of the organization’s equilibrium. In the case where the two forces equate, the organization is very stable and remains so. Disturbances develop when either of the two forces gets stronger than the other (disequilibrium). The occurrence of the change ends with the organization reverting back to a new equilibrium state reflective of the desired change.

Richard Beckhard and David Gleicher the Formula for Change, and is sometimes called Gleicher’s Formula (Beckhard and Harris 64). The formula offers a way to evaluate the relative strengths influencing the possible success or otherwise of change programs in the organisation.

D x V x F > R

Three critical factors have to be there for any sensible change in the organization to happen.

These factors are:

• D = Dissatisfaction with how things are now;
• V = Vision of what is possible;
• F = First, concrete steps that can be taken towards the vision.

In a case where the product of the three determinants is larger than R = Resistance, change is viable. Due to multiplication of D, V and F, the absence or low, presence of any of the variables means that the final product is low and hence not able to overcome resistance.

Other literatures describe the resistance to change as the ultimate cost of change. The cost is then split into two, the economic cost of change (e) which is the monetary cost as well as the psychological cost of change (p). This tries to showcase is that even in cases where economic cost of change remains dismal, the change will indeed not happen if the psychological resistance of employees is at its high levels and vice versa. In such a case, the formula for change becomes:

D x V x F > C (e+p)

What this allows managers to do is to isolate the actual problem areas of change and develop unique strategies specifically designed to resolve the correct form of resistance.

Organizational change management includes processes and tools for managing the social change at an organizational level. These instruments incorporate a very well developed approach very useful in ensuring effective transition groups or organizations through change. If combined with a proper understanding of individual change management, the instruments offer a structure for managing the individuals’ side of change. Organizational change management processes include techniques for creating a change management strategy (readiness assessments). This is as an addition to the engagement of higher managers as change starters (sponsorship), developing knowledge on the need to undergo changes (communications), the development of skills and knowledge in aid of the change (education and training), as well as assisting workers move through the change process including ways of sustaining the change (measurement systems, rewards and reinforcement).

Research Methodology

A research methodology addresses the actual research activity, ways of proceeding, progress assessment methods, as well as the measures of success. This research study is concerned with the privatization of the water sector within Saudi Arabia. In this case, the study wishes to explore the role played by change management, because of the ensuing paradigm shift of employees moving from the public sector, in this case the ministry of water and electricity (MoWE) to the national water company (NWC).

Research design

According to Creswell (134), a research design is a framework for collecting and utilizing sets of data that aims to produce logical and appropriate findings with great accuracy, and that aim to adequately and reasonably rest a research hypothesis. Höger (18) views a research design as the glue that is necessary in order to ensure that a research project stays together. This is because the structure of a research borrows heavily from its design, in effect illustrating the manner in which the various main sections of a research projects (for example, the research instruments, samples, and assignment methods) are able to functions in unison, for proposes of addressing those issues that are central to the research (Laurel 36).

This research study hopes to apply a descriptive research approach, with a view to accurately describing the different variable that are being explored, in addition to aiding in the assessment of the level to which these variables could bear a correlation (Zikmund 45). Creswell (134) has noted that an exploratory research is best suited at a time when the researcher is exploring insights into the broad nature of research problems, as well as the most appropriate variables that require to evaluating. In this case, this study wishes to assess the manner in which change management impacts on employees transition. Consequently, both dependent as well as independent variable shall be at play.

The independent variable to consider includes the nationality of the respondents, their gender, and level of education, religion, and marital status, among others. On the other hand, the dependent variable to consider include the job family, position of the employees within the organisation, grade and level within the organisation, as well as past performance appraisals.

Study population

The study population for this research study shall be on those employees from MoWE, seconded to NWC’s customer service centers in Riyadh. The customer service centers houses 750 employees. This study chose to target the customer care department at NWC to take part in the survey, by filling in the study questionnaire that had been sent to them. However, the actual number of participants to this study was 742, indicating an attrition rate of 1 percent.

Sampling procedure

According to Creswell (137), sampling is one element of the statistical practice that concern itself with the selection of unique observations that are anticipated to surrender some knowledge about a population in question, specifically for the purposes of forming some statistical inference. Before conducting any primary research, a researcher must be clear about the category of respondents it wants to interview. In most instances, it is virtually impossible for a researcher to interview the whole population to get their views and opinions about a research question as this would be unfeasible and costly. In this respect, choosing a representative sample of the population identified will enable their participation in the actual research study.

Having already established that the sample size for the population under study is 750 employees, this research study deems it appropriate to employ a systematic sampling technique, to facilitate in the data collection exercise. This sampling ensures that each individual in the population has an equal and known possibility of been selected to participate in the research (Creswell 137).

However, any researcher using systematic random sampling must first ensure that chosen sampling interval in a population does not conceal any pattern, as this would threaten the randomness of a sample. In this case, every 10^th employees seconded to the NWC at Riyadh service centres shall be chosen. Employees’ database at the company and the systematic sampling will be based on an alphabetic order of the employees’ surnames.

Instrumentation

Creswell opines that best method of ensuring that the research measurements errors are minimised is through the measure “use a good [research] instrument” (p. 394). Consequently, this research study wishes to utilise a questionnaire containing (mainly) closed-ended and open-ended questions administered to the respondents as the instrument for data collection. By using open-ended questions, the study participants shall be in a position to express their views with minimal limitations, as Cohen and colleagues (26) have noted.

Further and colleagues have asserted, “Closed and open ended questions can catch the authenticity, richness, depth of response, honesty and candour which is the hallmarks of quantitative data” (p. 255). The anticipation is that a mixture of measurable closed-ended and a limited amount of open-ended questions is the best approach to explore the views and opinions of the respondents to the study about how their transition from the public sector to the private sector may influence them.

Data collection procedures

The procedure for data collection shall involve a personal administering of the study questionnaire to the respondents. Creswell (394) has noted that one benefit of personal administration of a questionnaire is that respondents are best suited to comprehend the concepts and questions contained therein. Further, Personal administration accords the study respondents a chance to make clarifications from the researcher. Besides, personal administration enables the attainment of longer, detailed as well as complicated interviews (Laurel 69) and consequently, it gives more insight to the research study in hand.

Data analysis

Creswell (395), talks of data analysis as a technique of gathering, transforming, and modelling data with the purpose of suggesting conclusions, highlighting useful information, and supporting decision making. There are various approaches that facets that are used to analyses statistical data and these shall vary from one discipline to the other. For example, the analysis of data in the business domain may be quite different from that in the social sciences. Once the collected data has been cleaned and edited, analysis shall be done using a number of statistical packages such as SPSS (Scientific Package for Social Scientists), and Microsoft Excel (Ms Excel). This is with a view to generating research findings for the study, presented in the form of tables, and pie charts.

Data analysis and results

Demographic information

Nationality of Employee

Almost two-thirds (65 percent) of the 750 respondents that took part in this study were Saudis. A further 31 percent were non-Saudi Arabs, while the remainder (4 percent) were non-Arabs.

Gender

More than two thirds of the respondents on transition from the ministry of water and electricity in Saudi Arabia (71 percent) to the newly formed national water company were more likely to be males, as opposed to females (29 percent).

Educational Qualifications of Employee

Table 1: Educational Qualifications of Employee

In terms of educational qualifications, only 2 employees had PhDs, 11 had masters degrees, a further 57 had higher diplomas, 138 were bachelors degrees holders, 257 were graduates with diplomas, 104 had completed vocational high school, and 61 were high school leavers. In addition, 41 respondents had an intermediate school level of education, 23 either had completed preparatory education, while the remaining 7 were without any formal educational qualifications, or had attended vocational training centres.

Religion

• Muslim (88 percent)
• Non-Muslim (12 percent)

In terms or religion, a majority of the respondents were Muslims by faith (88 percent), compared with 12 percent non-Muslims.

Marital Status

In terms of marital status, 56 percent of the respondents were married, 41 percent were unmarried, while the remaining 3 percent, had separated.

Employee transition information

Are you anticipating the move of employees from a public sector to the private sector to be resisted?

Most of the employees expect a certain kind of resistance during transition (81%). Interpretation: 1. People’s awareness and expectations are high during the transition process. 2. People are willing to utilize resistance in such a case that the new environment will not be the like as they expect it to be.

What are the forms of challenges that you foresee during the transition of the organisation from a public entity to a private entity?

When questioned on the forms of challenges that they foresaw during the transition process of the organisation from a public entity to a private one, the employees interviewed by this study offered diverse types of potential challenges. Challenges employees mentioned are:

Table 2: Employees challenges to transition

• Interpretation: These challenges have to be considered by the management when defining their messages to employees

Are there problems that you anticipate because of this transition?

Table 3: Anticipated employees transition problems based on marital status

An increasingly number of married employees anticipated problems due to the transition process.

• Interpretation: it is possible that the transition process may affect the work-family life balance of the employees, and this may explain why more married respondents foresee it as a problem.

What are some of the transition problems you anticipated?

Out of the 742 participants that took part in this survey, their anticipated problems towards the impending transition process differed.

Problems employees mentioned are:

Table 4: Anticipated employees transition problems based on gender

• Interpretation: These challenges have to be considered by the management when organizing workshops for employees.

Do you feel that there should be a right way of ensuring a smooth transition of the employees, as a way of minimising potential resistance?

Majority of the people requesting a right way for transition (87%).

• Interpretation: Employees deliver change to the management (they have the recipe and know what to do). Employees are more function as the audience rather than to be actors influencing the change process according to their wishes.

What are some of those right ways of ensuring a smooth human resource transition?

Right ways for smooth transition are:

Table 5: Employees’ perception of proper HRM transition practices

• Interpretation: Those answers have to be regarded by the management when formulating their communication strategy.

Key:

1. Proper orientation process
2. Co-operative management team
3. Introduction of incentives

Is it your opinion that the top management at the organisations concerned (MoWE and NWC) is actively involved in the transition process?

Employees are disagreeing about NWC/MOWE top management involvement into transition process (50/50). Interpretation: It can be expected that the role of the top management is not the only viable part for the transition process. Rather the middle management and other supervisory functions will play an important role.

What criteria have previously been used within your organisation to assess employees’ capabilities in a fair, objective and transparent manner?

Past employee assessment was based on:

Table 6: Criteria for past employee assessment

Interpretation: Past assessments rely more on positions and trust rather than on performance and effectiveness

Discussion

Introduction

Following the privatisation exercise of the water sector in Saudi Arabia from a public entity to a private one, it is important to examine this form of a paradigm shift, in addition to the impact that this will have on employees transition process from working for a public entity (MoWE) to a private one (NWC). It was therefore the intention of this study to assess the impact of the privatisation exercise on the plans of communication and management techniques for the employees. This is because for a transition to be smooth, it is important that a communication strategy and resistant management plan be implemented.

Seeing that resistance to change during the transition of an organisation should be anticipated, the exploration of the right transition mechanism for the employees is vital. In light of this, it was the intention of this study to determine the leadership’s change management role during the employee transition process. In addition, the study also wished to examine the type of change management messages to communicate at each level within the NWC and at certain points during the employee transition process. This was in addition to better understanding the need for managing change through a mix of communication and training for employees being transferred to equip them with the required skills and knowledge to operate effectively in a commercial environment.

81 percent of the study respondents answered that they anticipated the move of the employees from a public sector to a private entity to be resisted. When asked about the potential barriers that they foresaw as being a handicap to the transition process of the organisation from a public entity to a private one, the respondents cited fear of the unknown, a lost status quo, commitment barriers, barriers in new management, and systems barriers as the possible handicaps. These findings appear to contradict those that have been reported by Weinstein (par. 5). The author reports of a survey that involved 2,600 managers to 149 organizations, all of which are Fortune 1000 companies. According to this report, 86 percent of the managers surveyed were found not to be fully involved in the transition processes of their employees. Out of the 2600 managers that the study interviewed, a further 1,200 were interviewed concerning the challenges that they experienced during the transition process to their roles as managers. A total of five challenges were realized, and they include, in order of frequency, doing, as opposed to the management of work, having to manage former workmates, having to let go of their expert status, reduced time, and the challenge of producing results, as opposed to coaching and developing people.

On the other hand, a majority of the respondents that took part in this study were of the opinion that there should be a right way of ensuring a smooth transition of the employees, as a way of minimising potential resistance. The beliefs, raised facts and values of employees act as sound pointers of the underlying causes to their resistance to change. Frequently, attempts at instituting change within organisation are faced with a handicap since organisations are not able to manage and recognise the vital components of their human resource, for the change to be successful.

Novel technical solutions call for individual participation in the activities of an entire organisation. In addition, such individuals need to be ready and willing to change their ways of acting and thinking, and their behaviours. Nevertheless, this usually requires motivation, time, practice and skills (Coetsee 205). Nonetheless, for the reasons that change in both the pastern of thinking and behaviour are activities that are not only time-consuming, but also less tangible, there is the likelihood that the human resources within an organisation could fail to attract the much-needed attention.

Folger & Skarlicki (25) argue that resistance is more of a predestined reaction to any from of change that could be considered as being major. There is a tendency for persons to attempts to preserve the prevailing status quo should they feel as if their status of security is under threat. Accordingly, Folger & Skarlicki have opined that “organizational change can generate scepticism and resistance in employees, making it sometimes difficult or impossible to implement organizational improvements” (25). Should the management fail to accept, understand or even attempt to find a way of cooperating with the employees in a bid to curtail resistance during transition, there is a likelihood that even the most well-conceived and well-intentioned change efforts gets undermined. In the same way, Coetsee (205) has argued that “any management’s ability to achieve maximum benefits from change depends in part of how effectively they create and maintain a climate that minimizes resistant behaviour and encourages acceptance and support” (p. 205).

When individuals offer a resistance to an organisation transition, it is not change per se that they are opposed to, as Dent & Goldberg (25) claim. Instead, individuals are usually out resisting loss of pay, status, or even comfort. The authors further argue that “it is time that we dispense with the phrase resistance to change and find a more useful and appropriate models for describing what the phrase has come to mean – employees are not wholeheartedly embracing a change that management wants to implement” (p. 26).

A survey that was carried out by Kent Gaylor sought to assess factors that impacts on change resistance at the organisation level. In this case, the case study explored two police departments located in North Texas. According to the study findings, the educational levels of the participants did not have an impact on how open they were to change. Further, 15 percent of the participants in this study said that they were open to change, revealing that a majority of the participants (85 percent) resisted change (Gaylor 34). This is a figure that is similar to the one revealed by the study at hand, in which 81 percent of participants anticipate the transition process to be faced by a resistance.

Whereas this study indicated that the participants were divided equally on the priority given to the top management in a change process, the one that Gaylor carried out had an even lower priority level for the management, at 18 percent. What this appears to suggest is that the middle management and supervisory functions within an organisation could significantly influence the transition process in an organisation, as opposed to wholly relying on the senior management. When asked about the forms of challenges that the transition of the organisation from a public to a private entity would have on the employees, the respondents to this study differed in their responses. For example, 27 percent of the respondents cited adjusting to a different cultural organisation as a challenge, a further 34 percent cited increased pressure to deliver results in a private organisation, while the remaining 39 percent talked of increased accountability as a potential challenges to the transition process.

One of the greatest impediments the human resource department of any organisation during a transition process is assisting employees triumph over the existing cultural divide between on the one hand, the policies and employment conditions in a public sector and on the other hand, the same conditions from the private sector. Therefore, a cultural challenge is a leading hindrance for a smooth transition of an organisation. From a cultural point of view, employees moving from a public sector to a private entity could are likely to encounter a struggle of having to work extra hard in order that they may attain strict deadlines that are a characteristic of the private sector. In addition, there is also the issue of resource allocation, whereby the private sector demands that money be spent in a more wise manner, including the need for the employees to become more accountable to all; the resources that they have been granted.

In case of a transition of employees from a public sector to a private entity, the onus falls on the human resource department of the latter organisation to see to it that their employees are in a position to handle those new demands that the management could have placed on them. However, there is the likelihood of a transition having an emotional impact on the employees, and it is important that the human resource department be in a position to handle such an impact as it arises. Cohen and Mankin contend, “A preexisting supportive culture can help set the stage for a successful [inter-organizational] project” (p. 56). On the other hand, Kernaghan opines, “long experience working in silos under strict accountability requirements creates a culture of tunnel vision rather than the peripheral vision needed for horizontal government. This tunnel vision is often accompanied by turf tension as individuals and organizations strive to protect established mandates and processes, in part by restricting the sharing of information. These barriers can be exacerbated by the absence of incentives and of a culture of innovation supporting creative efforts to pursue [integrated service delivery]. Since values are the essence of organizational culture, it is essential to cultivate shared commitment to those values such as citizen-centered service, trust, teamwork, leadership and accountability that is most likely to support [integrated service delivery] initiatives” (135).

Separately, Johnson and colleagues have talked of the need to ensure that employees in an organisation are in a position to comprehend fully the culture of the organisation (that is, its values, rules, structure, and communication patterns). This way, the authors argues that employees will be better bale to handle the transition process and avert a more spirited resistance to the looming transition process. In the same way, Schumacher is of the opinion that “a climate of mutual respect demands that each member of the collaboration devote time to understanding the norms and values of their partners’ organizational culture” (3).

The causes and nature of resistance to organization transition could be diverse. At this point, it is important to note that at a time when individuals are resisting change, there is a tendency for them to exhibit certain symptoms. Kegan and Lahey (88) talks of the need to draw a line between change resistance symptoms on the one hand, and the causes that could be responsible for such symptoms, on the other hand. Cohen and Mankin further opine, “There is always the danger of identifying a symptom of resistance when you are really looking for its cause. To diagnose the causes, we must understand a person’s state of mind. The most important factors that go into a person’s state of mind are his or her facts, beliefs, feeling, and values” (124).

Over the years, there have been growing lists of the reasons employees provide on why they are opposed to organisational change through resisting it. One of the reasons as to why employees could be against the introduction of change in an organisation could be the fact that with the new change, it is more than likely that they may be required to learn new things. For a majority of the cases, the fear is not so much as about benefits disagreements that could result from the new process, as about fear from the employees of a future that is uncertain, along with the ability of the employees faced with the change transition to be in a position to adapt to it. As de Jag er has observed, ‘Most people are reluctant to leave the familiar behind. We are all suspicious about the unfamiliar; we are naturally concerned about how we will get from the old to the new, especially if it involves learning something new and risking failure” (p. 24).

Schuler (2) has highlighted a number of reasons as to why individual normally resist change within the work place. To start with, Schuler argues that the fear of the unknown alone is enough reason to force people to resist change. In this regard, the author argues that in terms of making change, this is usually more of a leap of faith, literary. According to the author, in as much as an organisation or an individual may reach a decision of making a transition at their place of work, usually there lacks enough proof for them to decide if it is worth taking this leap of faith. As can be seen, this is a decision that is more of a risk, which is why resistance from employees is bound to occur. Schuler suggests that in order to duce the potential tension from the employees, the management could be in a better position if they made use of numbers to, as individuals are more likely to pay attention to these. Consequently, not only is the emotional mind of employees engaged by use of numbers but their rational mind is engaged as well. On the issue of having to abandon the status quo, Schuler contend that more often than not, individuals enjoy a form of connection with the rest of the individuals with whom they can be able to identify with the conventional way of doing things at the place of work.

With a transition from a public organisation to a private one, the expectation is that employees from the ministry of water and electricity in Saudi Arabia seconded to the national water company would find it hard letting go of the status quo. Schuler (3) argues that as social beings, individuals not only enjoy establishing a connection with other parsons that they are familiar with, they also like the rapport that they are able to cultivate. For this reason, the experience of a transition process by employees at the place of work oftentimes has to contend with challenges and a potential resistance.

Another reason provided as a potential challenge to a transition process within an organisation is that of employees having a low tolerance towards organisation change. Folger and Skarlicki (37) notes that for those employees whose tolerance towards change is low, there is a tendency for them to experience an enhanced uncertainties owing to the fact that when they are called upon to undertake their job differently, there is the likelihood that they may resist the already established new way of accomplishing their allocated tasks. There is also the likelihood of employees understanding the need to institute change within an organisation, and yet they still oppose change. This is because emotionally, employees may not be in a position to accomplish the much-needed transition. Accordingly, there is the tendency for employees to resist the instituted change, out of their unconscious ability to understand it.

According to Hultman (19), employee-raised facts, beliefs, and values are good indicators of what may cause their resistance to change. These authors have further argued that usually, barrier-to-change is a form of resistance as manifested by the employees in question. In this regard, Schumacher (8) perceive change barriers as being unexpected, severe, as well as unplanned problems. However, this view by Schumacher appears to contradict the perception of the employees on transit from ministry of water and electricity to the National Water Company owing to the fact that these employees were fully aware of the impending transition exercise. Nevertheless, the fact that they still foresaw potential barriers to this transition process indicates just how entrenched change in an organisation is within the human resource. Even then, it is imperative that the management of the new entity, the National Water Company, is in a position to manage this transition process, given that it has the potential to derail the advancement of change strategies within the organisation. Accordingly, there are diverse measures that proposed to help management of various organizations realize a smooth transition exercise of their human resource. Therefore, resistance is a significant impediment to change.

Kirkman (76) asserts that by way of taking advantage of cognitive dissonance, it is possible for the management of an organisation to motivate and advance change desires of the employees, without jeopardizing the overall development strategies of the organization. This is especially important for organizations that have a large workforce, like the national water company in Saudi Arabia, since large companies’ causes specific problems to their individual employees who end up feeling quite alienated when they are not involved in the organisation transition process. In this case, there is the tendency for these employees to lose focus of just how they are vital in facilitating in the organization’s overall purpose, at a time when they are confronted with red tape issues. Since change usually entails novel behaviour adoption by both the employees and the management, it is imperative that such behaviour are both enforced, and implemented. Consequently, the style of management that the organisation in question adopts is fundamental towards a smooth transition of the desirable change.

Summary and Conclusion

Conclusion

The research findings indicated that a majority of the respondents to the study anticipated their transition from a public entity to a private company to be characterised by various forms of resistance. Accordingly, the respondents cited fear of the unknown, lost status quo, increased commitment, and having to adjust to a new organisation system as potential barriers to their transition process. As a result of the transition barriers that raised by the study respondents, perhaps this could explain the reason why more than two thirds of the respondents (69 percent) anticipated facing problems due to the impeding organisation transition exercise. On the other hand, the kinds of transition problems that the respondents anticipates includes longer working hours at the private entity, increased individual accountability, having to adjust to new working environment, and new policies and procedures at the work place. Most of the respondents (87 percent) concurred that there should be a right way of ensuring that the organisation transition process was conducted in a smooth manner, in order to minimise potential resistance. Additionally, the study respondents cited what they felt were the right ways of ensuring that the transition process of the human resource was done in a smooth manner and these included a proper orientation process fro the employees, the establishment of a co-operative management team, better terms of employment and bonuses.

When employees are faced with any form of transition in their careers, it can only be expected that just like any from of organizational change that they could otherwise resist, they will also try to resist a transition process. Whereas there are those employees that of the opinion that it is quite natural to resist any form of organizational change, nevertheless it helps when the management of the organization is in a position to provide employees with the moral and material support that they could be in need of, during this transition process. That more than half of the employees that were interviewed by this study felt that the top management of the two organizations concerned were helpful in the transition process, is commendable.

Open communication between the employees and the management helps to lessen the level of anxiety that the employees could have regarding the new roles and responsibilities that they are now expected to assume (Beckhard & Harris 134). Furthermore, management provides the employees with a sound orientation process, to alleviate any fears that they could be having about the new environment of working and the expectations of the new organisation. Furthermore, when the management of an organisation and the employees enjoys a sound communication [process, it is more than likely that the employees shall highlight the challenges and problems that they may be anticipating. On the other hand, the management shall be in a position to seek out strategies that would ensure that the transition process is as smooth as possible.

Only when a cordial communication process exists between the employees on transit and the management can we expect the organisation transition process to be smooth. Through a proper training program and orientation process, this will ensure that the expected change management process is implemented is a successful manner. Therefore, the leadership pf the national water company in Saudi Arabia is very important, in order that they may equip the employees with the required skills and knowledge to operate effectively in a commercial environment.

Diplomacy on the part of the management team could help in reducing the expected resistance form the employees on transit. Schuler has also pointed out that when employees feel that in the new roles that they are going to assume, that they lacks a role model to whom they can look up to, then the employees could lack enough motivation top execute their responsibilities as expected. As a result, this may lead to them viewing the new job as being more challenging that the previous one, and hence a source of resistance. At this point, it is important to ensure that during the transition process, a team of the management that is able to motivate and inspire them to face the new responsibilities enthusiastically properly orients employees.

Resistance from the employees during a transition process could also occur at a time when such employees feel as if they are not competent enough to comfortably assume the new roles and responsibilities that could be bestowed on them. According to the respondents to this study, increased accountability and more job-related responsibilities area some of the challenges that employees foresee in the new company. This could be an indication of the fact that the employees do not feel as if they are up to the task that they are about to assume. The onus is therefore on the management to ensure that prior to the employees assuming the new responsibilities, they are taken through a sound and rigorous orientation process, in order that they may familiarize themselves with the demands and expectations of the roles they are about to assume.

Recommendations for future research study

This study has arrived at a number of recommendations for adoption by future research studies in this field.

• Future research studies needs to explore the role played by the middle management and the supervisory functions in employee transition process
• It is important for future related studies to consider using a bigger sample size, to increase the precision and accuracy of research findings.
• There is a need for future research studies to examine the impact of training and development in employees’ resistance to organisation transition process

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Appendix

Questionnaire

Hello. My name is Khalid AlDosari, and I am a Master of Business Administration (MBA) student, at Open University Kuwait. I am undertaking a research study titled, “Privatisation of the Water Sector in Saudi Arabia – The Role Of Change management in the Transition of Employees From the Public Sector to Private Sector (A Paradigm Shift). The employees transfer from Ministry of Water & Electricity to National Water Company (NWC).” Below is the questionnaire related to this study. Your co-operation is highly appreciated.

Outcomes of this study can be obtained by any participant and will be delivered to NWC executive management so that both parties can review and improve their initiatives to make change happen. Data handling is subject to Saudi law and will be kept private. Personalized data will be used for data analysis only and under no circumstances will be given to any third party (incl. MoWE and NWC).

Demographic information

Name: ……………………………………………………………………………………………

Nationality: ………………………………………………………………………………………………

Gender:

• male
• female

Educational qualification:

• PhD. Level
• Masters level.
• Degree level.
• Diploma level.
• Others

Religion:

• Muslim
• Non-Muslim

Marital status:

• married
• single
• divorced.

Work-related information

Job family: ………………………………………………………………………………………………

Position within the organisation:………………………………………………………………………………………………………………………………..

Level and grade within organisation:………………………………………………………………………………………………

Are you anticipating the move of employees from a public sector to the private sector to be resisted?

• Yes
• No.

Why?………………………………………………………………………………………………

Are there problems that you anticipate because of this transition?

• Yes
• No.

What are some of these problems?

• more working hours
• increased accountability.
• adjusting to a new working environment
• new job policies and procedures

Do you feel that there should be a right way of ensuring a smooth transition of the employees, as a way of minimising potential resistance?

• Yes.
• No.

What are some of those right ways of ensuring a smooth human resource transition?

• proper orientation process.
• a co-operative management team
• introduction of incentives (better terms of employment and bonuses)

Is it your opinion that the top management at the organisations concerned (MoWE and NWC) is actively involved in the transition process?

• Yes
• No.

What criteria have previously been used within your organisation to assess employees’ capabilities in a fair, objective and transparent manner?

• assessment of peak performances of employees.
• increased accountability
• ability to deliver on target
• reliability and trustworthiness of the employees.

Thank you very much for your participation!