Mr. Faiek Fazal, Senior manager, Corporate Division
MBR: Please share with us your opinion regarding the impact of Covid-19 on the RMG sector of Bangladesh. What are the initiatives you’ve taken differently and what are your suggestions for the struggling industry players?
Mr. Abdullah Hil Rakib: The COVID-19 situation has been very challenging for [the industry but at the same time, it opened up a lot of opportunities for us. It made us learn how to communicate and manage operations remotely, and thereby adapt to the new normal. To do so, we made sure that all the manufacturing units and offices were connected via communication platforms. We took steps to ensure that our workforce is skilled enough to attend Zoom conferences, use Microsoft teams, and operate other applications where group meetings can be conducted while they remain at their own homes. Looking forward, we are optimistic about the strength that technology can add to our work. It is an added bonus especially for employees in managerial roles since using these platforms enables them to be available to their subordinates twenty-four seven. Prior to the COVID situation, we were accustomed to holding= meetings in a festive manner where we arranged town-hall meetings and informal conferences where factory heads would move at their own pace. Moreover, traffic and pre-meeting arrangements made these meetings quite time consuming and labour- intensive to hold. As opposed to that, digital meeting platforms allow us to attend meetings bypassing all such preparations. Now employees can attend meetings from their workplaces at the designated time whether they are in the US or in their factories in Gazipur, Uttara, or Karwan Bazar. We have been spending a significant proportion of time conducting brainstorming sessions, analysing how to utilize the workforce rightly, and studying expenses. We are also trying to incorporate lean management techniques so as to minimize our costs and be conservative with the capital we have. I believe that we have to work a little extra on these points so that our outcome is at par with the expectation. As long as the industry is ready to take on these requisite measures by having the mind-set to learn, it would be easier for us to overcome this situation as well as boost our confidence.
MBR: What do you think are the primary reasons why RMG companies are preferring to employ expatriates over local professionals in the RMG industry?
Mr. Abdullah Hil Rakib: The reason why overseas staff are selected over local staffs in RMG is that sometimes local staff with the required level of skill are not available. I believe that it has no underlying foreigners-versus-locals connotation. It is purely about the efficiency of work and the skillset possessed by the selected employee in a particular chair (position). Because RMG is an industry where people from Korea, China, Taiwan, or Turkey, have ventured in much before than we [Bangladeshis] did, their technicians often have more skills than ours. So, their employees have a well-round idea regarding efficiency maximization, industrial engineering, management roles, and probable challenges that the industry is likely to face along with the solutions to overcome those challenges. Additionally, we need [foreign] demonstrators to teach our local employees how to use the imported equipment and machineries. They go floor to floor demonstrating how to use such machinery. Our goal is to engage and train our local workforce within the period of the demonstrators’ contractual timeline. We look forward to our natives coming up with innovative technology so that we too can proudly claim that people from our country came up with new production procedures, cutting-edge technology, or systems better than the lean management. I am sure there will be a time when our people will be employed by garment companies overseas and they would render a stellar performance.
MBR: What are some of the key roles within a large RMG company, where expatriates are hired? And what are the major required skillsets and personality traits assessed for these roles?
Mr. Abdullah Hil Rakib: In most local RMG companies, employees are being hired from abroad to fill the positions of COO, head of operations, and head of IE etc. Posts requiring technological skills, especially mechanical engineers, are being filled from overseas as well. When the local employers see that the foreign employees can deal with the machineries and technical work more efficiently without the need of an orientation, they feel more confident about the employees’ expertise. The employers feel that the selected employees are more professional and are more accountable to the ROI. The investors too prefer experts who are more accountable to the generation of ROI. It is not that our local human resources are incapable; it is just that the foreign human resources have historically displayed a better performance. I am sure if our local workforce works of on the identification of the gaps between their skills and their foreign counterparts’ followed by reducing the said gap, the owners of RMG companies would be more than willing to have local employees on board.
MBR: In what ways are the expatriates offering more value than the local workforce?
Mr. Abdullah Hil Rakib: Value addition is about a person’s contribution as per the need of the company and the industry at large. It does not have anything to do with whether they are local or foreign. We need employees in managerial roles to remain focused, decide what to do, and take immediate actions. The fittest people exhibiting these characteristics are selected for the managerial roles without regard to their nationality. However, our local workforce should be aware of the features they usually do not possess. Upon comparison, it is seen that foreign employees are usually more dedicated to their work compared to the Bangladeshi employees. Of course I do not believe that this applies to all employees. Exceptions are there in the local market; exceptions are also there in the foreign market. I would request all employers to remain careful when they select employees. They should refrain from selecting a foreigner just for the sake of exerting influence on their subordinates – which is unfortunately a common phenomenon. I would recommend selecting employees who can really contribute, keeping in mind that we should aim to transfer foreign technologies into our local industries. We should take steps to get out of this situation where we have to drain out all our money from the country to ensure efficiency.
MBR: Why do you think graduates from top Bangladeshi universities like BUET, IBA, NSU or Dhaka University are not very highly attracted towards a career in the RMG industry?
Mr. Abdullah Hil Rakib: It is a pity that our industry could not attract our prime graduates from IBA, BUET, and other top-notch universities. I strongly believe that this is high time that the RMG owners decide that they require more talented people to keep this industry strong. We should create value adding factors that would enable these young people to take the lead not only locally but also internationally. I believe that by giving them a little, we will gain a lot. I look forward to working on our branding and payment structure so as to attract the upcoming graduates from these institutes to take the industry to multinational levels. I look forward to the time when our local graduates will be in charge of foreign branches of our local RMG companies. I must mention a Korean-owned company called YoungOne that employs Bangladeshi people in their projects in El Salvador, Vietnam, and China. I feel proud that our youngsters are performing better than employees of other nationalities in this conglomerate owned by Mr. Kihak Sung. This suggests that our youngsters can perform well if given an opportunity. By recruiting and training talents, and sending them to international platforms if needed, we can raise them to explore their true potential in national and international avenues.
MBR: What type of initiatives do you suggest that educational institutions, as well as BGMEA, should undertake in order to:
a. Enhance the attractiveness of the sector to talented local graduates
b. Improve the employability of local graduates by closing the knowledge and skill gap between them and the expatriates?
Mr. Abdullah Hil Rakib: Institutes such as BGMEA, BUFT, and IBA are to understand the need of the RMG industry and how it contributes the so significantly to the economy. The universities are to identify the upcoming needs of the industry, say within the next 25 years, and groom the students in a manner that would enable them to support the industry needs. This certainly contributes to filling the gap between the skillset of the graduates and the requirements of the RMG sector. I should add that universities should establish an industry-academia partnership and arrange relevant programmes for students. Such as, collaboration programmes and internship opportunities aimed at students would increase their learning curve. By the end of their term, or say tenure at university, they can have the confidence to correlate their studies into a practical field. I believe this would contribute to reducing the said gaps.
MBR: What kind of impact is expected to have on the attractiveness of Bangladesh as a workplace destination for expatriates?
Mr. Abdullah Hil Rakib: COVID-19 has given us the opportunity to lean ourselves down and save costs. Under such circumstances, many RMG companies may not possess the luxury to employ the overseas staff; in fact not bearing the extra cost of employing them becomes a necessity when we do not have enough resources available. I would say that this is an opportunity for our local boys and girls to reskill and up-skill themselves to present themselves to the market. At the same time, this is also a perfect opportunity for managers and entrepreneurs to identify scopes of cost minimization using local resources.
Steel and Re-Rolling industry: fast paced recovery from pandemic on the cards
The Steel and Re-rolling industry, one of the prominent growth drivers of Bangladesh, has had its fair share of hit by the Covid-19 pandemic. This has been reflected on numbers as world crude steel production recorded a 3.2% decline compared to figures recorded in the same time period last year. As a developing nation with increased focus on to infrastructural development and lined up mega projects, Bangladesh sees massive growth potential in the Steel industry. With a market size of around BDT 450 billion the local Steel market employs nearly 1 (one) million people directly or indirectly across the country. The market has been growing at a rate of 15%- 20% for the past 2 years and contributes largely to the country’s GDP. However, the market for steel is turning into a perfectly competitive one from an oligopolistic structure as small players are now gaining efficiency and reaching competitive levels of their larger peers such as AKS, BSRM, KSRM etc. With the growth of the smaller companies, it is safe to say that the challenges that come with surviving in the Steel industry – such as, abundant supply of power and gas, availability of raw materials etc. are being well taken care of.
The Steel industry strategically runs on overcapacity. It is seen that the utilization is around 75% of total capacity which came down to 40% due to the pandemic wave. The prices of raw materials and finished goods are also seen to fall. However, as a resilient nation, Bangladesh is adapting fast to the new challenges that came with the pandemic. And, as we look towards a new normal, companies in the Steel industry must work in collaboration with regulators in order to sustain the growth and maintain the level of efficiency reached prior to the pandemic.
IDLC Finance Limited