From Hamilton to Riyadh: DeGroote's Blueprint for Global Growth

Derrick Wu (400498897), Rishabh Rajiv Ramamurti (400508913),

Jonathan Waldman (400500489) & Shefali Liyanage (400135241)

DeGroote School of Business, McMaster University

BUSADMIN B650: Managing People in Organizations

Dr. Rami Alasadi

July 21, 2024

Introduction .................................................................................................................. 3
Internal Analysis ............................................................................................................ 3
Business Strategy .......................................................................................................... 7
External Analysis ........................................................................................................... 8
1. Political Factors ...................................................................................................... 8
2. Economic Factors.................................................................................................... 9
3. Social Factors ....................................................................................................... 10
4. Technological Factors ............................................................................................ 10
5. Environmental Factors ........................................................................................... 10
6. Legal Factors ........................................................................................................ 11
Recommendations for HR Practices ................................................................................ 11
1. Recruiting ............................................................................................................ 12
2. Performance Management ...................................................................................... 13
3. Compensation and Training .................................................................................... 14

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Introduction

This analysis delves into the internal workings of the DeGroote School of Business, with

a sharp focus on its resources and capabilities. It explores the solidity of its faculty, the competence

of its administration, its sound financial standing, state-of-the-art infrastructure, respected

academic programs, and culture of innovation. These strengths are the bedrock of DeGroote's

international ambitions and particularly the establishment of a new campus in Saudi Arabia.

The analysis also outlines strategic business and HR plans essential for effective market

entry and sustained growth, aligning with Saudi Arabia’s Vision 2030 framework. This thorough

evaluation demonstrates DeGroote's readiness and strategic blueprint for advancing its

internationalization efforts.

Internal Analysis

Strengths in Resources and Capabilities. An evaluation of the DeGroote School of

Business’ internal environment indicates that the business has numerous strengths in resources

and capabilities that will enhance its international expansion strategy. The institution has

competent and a diverse faculty, qualified administrative staff, and strong leader, which is crucial

for setting up and maintaining high educational standards at a new campus in Saudi Arabia. From

a financial point of view, the school is able to obtain University funds, grants, donations, and

partnership to provide sufficient finance for the establishment of infrastructures, staffing and

marketing. The facilities already in place, along with the strong technological support system,

gives a good reference point from which to start developing the new location. Such attributes such

as the resource of intellectuals, proved curriculum, and high research productivity add to the

school’s academic portfolio.

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 Strong Brand and Administrative Excellence. Having a strong brand, the DeGroote

School of Business has a large number of alumni and potential students and faculty drawn to the

institution. On an administrative level, the school performs well in areas of organization and

management of projects, which are indispensable in carrying out a school’s fiscal and

administrative activities and in the management of projects and programmes. The collaborations

with industry and international institutions are an excellent source of internship and research as

well as exchange programs. Culturally, the flexibility of the school and language learning readiness

foster sense of belonging in Saudi Arabia. Strategic approaches to marketing and staffing policies

and practices, as well as quality assurance and improvement, guarantee the institution’s capacity

to attract and retain personnel while delivering quality services. Altogether these resources and

capabilities put the DeGroote School of Business in a good stead regarding the expansion on the

international market.

Financial and Academic Strengths. The DeGroote School of Business at McMaster

University stands strong, built on solid resources, proven capabilities, clear structure, and a vibrant

culture. With over 80 dedicated faculty members across eight departments, supported by part-time

instructors and research associates, DeGroote has a deep well of talent. Financially, the school is

a fortress of resilience. It boasts an annual revenue of at least $300 million CAD and a net income

of approximately $30 million CAD, drawn from research, grants, tuition, and a substantial

endowment fund of about $900 million CAD in 2023. This financial muscle gives DeGroote the

power and flexibility to either partner with existing universities or open its own branch within

Saudi Arabia.

Top-Notch Facilities and Alumni Network. DeGroote's facilities are top-notch. The Main

Campus in Hamilton serves undergraduates, researchers, and doctoral candidates. Meanwhile, the

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Burlington Campus hosts classes and workshops for the MBA program. The school also prides

itself on the Allen H. Gould Trading Floor, one of the first of its kind in North America. providing

students with hands-on experience in financial market interactions. Additionally, DeGroote boasts

an impressive alumni network, spread across different industries and continents, these connections

provide insights and help the school stay ahead of emerging business trends.

Academic Excellence and Technological Readiness. Academically, DeGroote ranks

among the top ten Canadian business schools. It offers programs from undergraduate to doctoral

levels, both full-time and part-time. There are also executive education programs for seasoned

professionals. Unique courses like Predictive Analytics, Islamic Finance, and Negotiations sharpen

students' one-of-a-kind skillsets. Programs requiring internships, such as the BCom/IBH with

Internships and the MBA Co-op, offer 12-to-16-month work terms with possible exposure to

companies like Procter & Gamble, RBC, CIBC, Deloitte, Microsoft, and even Google. DeGroote's

international partnerships with over 18 business schools offer students exchange opportunities,

showing the school's ability to navigate diverse political, legal, and cultural landscapes; expertise

which will be invaluable when expanding into Saudi Arabia. Technologically, DeGroote’s IT

department and customised application systems are ready to support a new campus.

Organizational Structure. The organizational structure at DeGroote follows a hierarchical

model. At the top is the Dean, supported by Associate Deans responsible for areas like academic

programs, graduate studies, research, faculty affairs, accreditation, and external relations. Each

academic department, focused on fields such as Accounting & Financial Management Services,

Health Policy & Management, and Operations Management, is headed by a Chair or Director.

Centres and institutes, such as the McMaster Digital Transformation Research Centre (MDTRC),

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delve into specialized research areas like finance, innovation, sustainability, entrepreneurship, and

health management.

Faculty and Administrative Support. The faculty at DeGroote includes professors,

associate professors, assistant professors, lecturers, and sessional instructors. They teach, research,

and contribute to academic programs. Administrative staff support student services, admissions,

career services, alumni relations, finance, facilities management, and technology support.

Advisory boards, with external industry experts, alumni, and stakeholders, provide strategic

guidance and networking opportunities. The student body comprises undergraduates in Bachelor

of Commerce (Honors) programs, graduate students in master's and doctoral programs, and

professionals in executive education programs, workshops, and seminars.

Culture of Innovation and Integrity. Culturally, DeGroote is a beacon of innovative

thinking and evidence-based knowledge. It promotes interdisciplinary collaboration and integrity.

Students and faculty are encouraged to challenge norms and foster new ways of thinking,

empowering graduates to tackle complex business challenges and drive progress. Emphasising

diversity, inclusivity, and ethical conduct, DeGroote nurtures a supportive learning environment

where students can contribute to economic progress while developing socially responsible

leadership skills. The school's commitment to bold thinking, rigorous research, and collegial action

cultivates a community of trust, respect, and inclusion. These principles exemplify DeGroote’s

dedication to innovation, knowledge creation, and ethical leadership in its programs, research, and

community engagements.

In conclusion, the DeGroote School of Business is ready for international expansion. Its

strong internal environment provides a solid foundation for establishing a new campus in Saudi

Arabia.
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Business Strategy

To expand into Saudi Arabia, DeGroote must craft strong business plans that form the

bedrock for effective HR strategies. The approach involves offering Canadian-standard education

at reduced costs and with novel educational opportunities in order to achieve competitive

differentiation.

Collaborating with local educational bodies is crucial, particularly within the framework

of Saudi Arabia’s Vision 2030 program, which aims to diversify the economy and develop public

service sectors, including education. Aligning with initiatives like the Human Capabilities

Development Program, focused on enhancing educational outcomes and workforce readiness, can

facilitate smoother market entry and address staffing needs efficiently. Partnering with Saudi

universities and educational institutions can create a symbiotic relationship, allowing for resource

sharing, joint research projects, and cultural exchange programs.

Developing these business strategies requires HR practices that support overall goals.

Recruitment efforts should focus on attracting academically qualified and culturally adept faculty

and staff. Offering competitive compensation packages and professional development

opportunities will help attract and retain top talent. Integrating cultural sensitivity training and

support systems for expatriate staff will foster a cohesive and productive work environment.

Additionally, robust training programs for local hires will ensure they are equipped to

deliver high-quality education and support services. This includes training on Canadian

educational standards, teaching methodologies, and school values. Investing in the professional

development of local staff enhances their skills and knowledge, contributing to the campus's

overall success and sustainability.

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 Establishing a dedicated office to handle regulatory compliance, local partnerships, and

community engagement is essential. This office can work closely with Saudi authorities to ensure

DeGroote meets all legal and regulatory requirements. It can also foster relationships with local

businesses, government agencies, and community organizations, building a strong support network

and enhancing the school’s reputation in the region.

Continuous evaluation and feedback mechanisms will be implemented to monitor the

effectiveness of these strategies. Regular assessments of academic programs, faculty performance,

and student satisfaction will provide valuable insights for ongoing improvement. By staying

responsive to the needs and expectations of students, faculty, and the broader community,

DeGroote can ensure successful and sustainable expansion into Saudi Arabia.

In summary, developing business strategies focused on value differentiation, novel

educational experiences, collaboration with local entities, and alignment with Vision 2030 can lay

a solid foundation for DeGroote’s expansion into Saudi Arabia. These strategies, supported by

robust HR practices, will ensure that the school delivers high-quality education, meets local needs,

and establishes a strong and enduring presence in the region.

External Analysis

Before formulating a robust HR plan for DeGroote School of Business to support its

strategy of expanding into Saudi Arabia, a thorough evaluation of the external environment is

essential. This evaluation can be effectively conducted using the PESTEL Business Analysis Tool,

which examines Political, Economic, Social, Technological, Environmental, and Legal factors.

Below is an analysis based on each of these factors:

1. Political Factors

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 Government Stability. Saudi Arabia operates under a stable monarchy system with a

centralized government structure. This stability and consistency in policy can be advantageous for

business management, providing a predictable environment for long-term planning.

Regulations and Policies. Under Vision 2030, the Saudi government has implemented

significant reforms aimed at economic diversification, enhancing the business environment, and

encouraging foreign investment. These reforms are beneficial for establishing a new campus in the

country.

International Relations. Saudi Arabia maintains strong international relations, particularly

with Western countries, which can facilitate international business engagements and

collaborations.

Education Policies. The Saudi government has been progressively increasing its budgetary

allocation to education, focusing on enhancing both the quality and accessibility of higher

education. This trend supports the development of new educational institutions in the country.

2. Economic Factors

Economic Growth. Saudi Arabia boasts one of the largest economies in the Middle East,

predominantly driven by oil. However, ongoing efforts to diversify the economy present new

opportunities for development and investment.

Income Levels. The country has high income levels, with a growing middle class that can

support the demand for quality higher education.

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 Currency Stability. The Saudi Riyal is relatively stable, being pegged to the US Dollar,

which minimizes currency risk and provides a secure financial environment for business

operations.

3. Social Factors

Cultural Considerations. As an Islamic country, Saudi Arabia's cultural characteristics are

deeply influenced by religion and tradition. Understanding and respecting these values and beliefs

is crucial for effectively managing the campus.

Demographics. Saudi Arabia has a predominantly young population, driving a high

demand for higher education. This demographic trend is advantageous for the development of

educational institutions.

Language. Arabic is the official language, making it important to consider language

preferences for both employees and students. Offering courses in English can attract international

students and meet global educational standards.

4. Technological Factors

Technological Infrastructure. Saudi Arabia is gradually developing its technological

infrastructure, including internet connectivity, which supports modern educational techniques and

online learning.

Innovation and R&D. The government is actively promoting research and innovation,

aligning with the business school’s objectives and enhancing its research and development

capabilities.

5. Environmental Factors

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 Climate. The hot desert climate of Saudi Arabia can pose challenges in construction and

student comfort. Efficient climate control and sustainability planning are imperative.

Sustainability Initiatives. The Saudi government is committed to environmental

conservation, incorporating green building practices and sustainable operations. Adopting these

initiatives can enhance the campus’s visibility and appeal.

6. Legal Factors

Labor Laws. Saudi labor laws, including Saudization policies that prioritize the

employment of Saudi citizens, must be adhered to. Compliance with these regulations is

mandatory.

Intellectual Property. Robust measures are in place for the protection of intellectual

property rights, ensuring the prevention of plagiarism and safeguarding the institution's

innovations and ideas.

Foreign Investment Laws. While Saudi Arabia is increasingly open to foreign investment,

understanding and navigating the specific legal procedures and regulations is essential for

successful market entry.

Recommendations for HR Practices

To exercise the proposition and vision DeGroote School of Business wants to offer to

prospective students in Saudi Arabia, a careful determination of HR practices is necessary.

Appropriate staffing, performance management, training, and the design of compensation

packages are the cornerstone of effective HR management. Hiring the right people, motivating

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them to carry their best, and preparing them for the required skills to work at an educational

institution would in turn create an exceptional studying environment for the students.

1. Recruiting

In the case of DeGroote establishing a campus in Saudi Arabia, recruiting teachers and staff

should be done first and foremost. Serving as the touch point of the students and the school,

DeGroote relies on these personnel to deliver values at the front line. In determining the right

people to hire, this report summarized the types of positions to be filled and gave recommendations

on HR procurement strategy for each position.

Administrative Staff. Staff that support students throughout the program fall under this

category. Such includes general student service, recruiting team, career center, counseling, and

receptionist. These people must possess a high familiarity with local customs and business

environments, and a good level of connections in the Middle East region to offer recommendations

to students regarding school, life, and career. Moreover, due to the large amount of personnel

demanded for these positions, it is best to hire HCNs for their cost-effectiveness and added value.

Directors and Managers. As the management team of the overseas campus, a major task

of these people is to liaise between the Saudi Arabia campus and the main campus in Canada.

Therefore, PCNs, preferably ones willing to be relocated to the new campus from Hamilton, are

required. They will be in charge of making sure the policies and core values of the overseas campus

align with those of the main campus, delivering consistent perceptions and service quality. HCNs

on the other hand, are also favored for managerial roles for their ability to seek local sponsors and

collaborations, and deal with the legal or regulatory issues should any occur. Therefore, a blend of

PCNs and HCNs is suggested for the handful of directors/managers needed.

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 Professors. Being the largest body of employment and one of the most important assets of

universities, professors are the primary service providers. Considering the broad range of business

courses available, DeGroote should target different groups of people for distinct subjects. For

instance, PCNs, HCNs, and TCNs are all capable of lecturing subjects that are more general (e.g.,

macroeconomics, statistics, calculus, etc.). DeGroote would have more flexibility in scoping for

lecturers, and a bigger pool of candidates to select from. Assuming all candidates are equally

competent, priorities should be given to those who would cost the school the least, are the most

proximate and easiest to accommodate, and require the least administrative work such as visa

application, training, et cetera. For courses that have prerequisite knowledge and experiences,

DeGroote’s choice will be a lot more limited to the ones that are capable of the task competencies.

For example, the school will most likely have to find a teacher with a background in practicing

accounting in Canada if they plan to open a Canadian taxation course overseas or find HCNs to

lecture Saudi Arabian business law on the new campus.

Apart from identifying the type of people needed for each role, the design of the job

description is also crucial to successfully attracting people the school is actually looking for. If the

position targets HCNs, the context in its job posting should be more collectivist, highlighting the

positive culture and dynamics of the organization, and things people can expect to achieve through

team effort in the role. If targeting PCNs or people with a more individualistic cultural background,

the tone of the job description should lean towards pinpointing the potential personal fulfillment

and competitive compensation.

2. Performance Management

Fair and Transparent Performance Management. Performance management should be

fair and transparent, providing a solid ground for a cut, negotiating compensations, and many other
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HR management activities. Furthermore, a well-designed evaluation structure could strengthen the

connection between all stakeholders as they would have to get along and hear feedback from each

other. For the aforementioned reasons, a 360-degree assessment is suggested for the DeGroote

School of Business – Saudi Arabia Campus. The KPIs should be thoroughly communicated and

accepted in the first place to ensure fairness and transparency. At the end of each term, every staff

should be evaluated by people they directly or indirectly interacted with, including but not limited

to supervisors, colleagues, themselves, and most importantly, the major service recipients –

students.

Holistic Performance Evaluation and Incentive Structure. The 360-degree assessment

can significantly reduce biased opinions and better review of a person’s performance from a

holistic aspect rather than focusing on any specific area or indicators. The next step following the

result of performance assessments is determining what can be done to retain good performances

and improve the poor ones. In the modern world, the Incentive Theory of Motivation is often used

to engage a person. As an organization that values the well-being of its students as well as

employees, DeGroote should leverage primarily positive reinforcement in rewarding beyond-

expectation performances and extinguishment, that is to cut down/put benefits on hold for

improvable performances. Negative consequences such as punishment should only be in use when

there is a major violation of rules.

3. Compensation and Training

Strategic Compensation and Training Programs. Compensation packages should be

designed to attract and retain top talent while accommodating cultural and economic factors. For

local hires, compensation should be competitive within the Saudi Arabian academic job market,

reflecting the high-income levels and emerging middle class, with an average salary for a professor
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amounting to SAR 254,070. For expatriates, packages should include competitive salaries, housing

allowances, and relocation support to offset the costs of living and working abroad. The salary for

expatriate staff, such as professors, should strike a balance between what is considered appropriate

for the caliber of local talent, with an average monthly salary of SAR 11,000, and the salary

appropriate for professors in Ontario, Canada. Furthermore, a blend of performance-based bonuses

and long-term incentives can further motivate staff and align their goals with the institution's

strategic objectives.

Training programs are essential for preparing staff to deliver high-quality education and

support services. Expatriate staff should receive initial training that includes cultural sensitivity to

navigate Saudi Arabia's unique social and cultural environment, along with an understanding of

local business practices and educational standards. For academic staff, the focus should be on

Canadian educational methodologies and the specific curriculum offered at the new campus.

Additionally, ongoing professional development opportunities should be provided to keep faculty

and staff updated on the latest research, teaching techniques, and industry trends. This continuous

learning approach will enhance their skills and ensure that the campus operates at the highest

standards of excellence.

To support these efforts, each university should form a standing committee chaired by the

Vice-Rector for Graduate Studies and Scientific Research. This committee, selected based on

University Council resolutions and recommendations, is responsible for managing affairs related

to academic staff, including proposing policies for selecting and distributing academic positions

within departments and colleges. The human resource (HR) office should also ensure recruitment

and selection processes are based on defined criteria, including the number and percentage of Saudi

staff members, teaching loads, and the number of scholarship students. Furthermore, HR should

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facilitate the promotion process by ensuring academic staff meet required criteria and emphasize

continuous professional development and integrity, fostering a high standard of education and

research in Saudi universities.

Dedicated HR Office and Compliance Management. Establishing a dedicated HR office

to manage regulatory compliance, local partnerships, and community engagement is essential. This

office will work closely with Saudi authorities to navigate labor laws, and ensure adherence to

intellectual property and foreign investment regulations. By fostering strong relationships with

local businesses, government agencies, and community organizations, the HR office will build a

supportive network that enhances the school’s reputation and operational effectiveness in the

region. Regular evaluations and feedback mechanisms will be implemented to monitor the

effectiveness of compensation and training strategies, ensuring they meet the needs of both

employees and the institution, and adapt to any changes in the external environment.

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