Saudi Arabia’s Dynamic

Case Culture

Saudi Arabia (see Map 2.1), a land of contrasts and ­paradoxes, has traveled abroad, wants such trappings from economic
can be perplexing to foreign managers as they try to exer- growth as greater choices in products and lifestyles. At the
cise acceptable personal and business behavior.1 Its mixture same time, the conservative group is supported by religious
of strict religious convictions, ancient social ­traditions, and leaders and people who fear that modernization will upset
governmental economic policies results in laws and customs traditional values and adherence to strict Koranic teach-
that sometimes shift with little advance notice and vary by ings. The government (the Royal Family) must balance these
industry and region as dominant forces evolve. Many of viewpoints while taking care not to overstep the accept-
these laws and customs contrast markedly with those in the able boundaries of conservatism lest it become vulnerable
home countries of the companies doing business there. Thus, to being replaced. For instance, it is well aware that Iran’s
­foreign companies and the employees they send there must Islamic Revolution was spearheaded in part by dissenters
determine what these differences are and how to adjust to who viewed the Shah’s modernization movements as cor-
them. A brief discussion of the roots of Saudi traditions and a rupt and too secular. In 1979, a group largely marginalized
sample of both cultural norms and foreign operating adjust- by modernization seized the Grand Mosque of Mecca, which
ments should help you understand the importance of culture brought questions about the Royal Family’s ability to protect
in international business. Islam’s holiest site. Meanwhile, liberals have been largely
pacified by taking well-paid government jobs and slowly
A Little History and Background gaining the transformation they wish. The government has
sometimes made tradeoffs to appease conflicting groups,
Although the land encompassing the Kingdom of Saudi
such as requiring women to wear longer robes (women must
Arabia has a long history, until recently most inhabitants’
wear abayas and men customarily wear thobes) in exchange
­loyalty was primarily tribal rather than national. In most times
for advancing women’s education.
past, invaders controlled a divided land. Nevertheless, the
inhabitants have shared a common language (Arabic) and
The Religious Factor
religion (Islam). In fact, Saudi Arabia is the birthplace of Islam
and the location of its two holiest cities, Mecca and Medina. If your country maintains more or less strict separation
(The opening photo shows the Grand Mosque at Mecca.) between religion and the state, you will probably find the
Beginning in 1745, the Wahabi movement swept across and pervasiveness of religious culture in Saudi Arabia daunting.
united most of the peninsula by calling for the purification Religious proscriptions prohibit the sale or use of pork prod-
of Islam through a literal view of the Koran. King Ibn Saud ucts and alcohol. During the holy period of Ramadan, when
(1882–1953), a descendant of Wahabi leaders, took power people fast during the day, restaurants serve customers only
in 1901, merged independent areas, created an entity that in the evening. Because Muslim men are called to prayer five
was both political and religious, and legitimized his monarchy times a day, restaurants such as McDonald’s dim their lights
and succession by being the defender of Islamic holy areas, and close their doors during those periods. Many companies
beliefs, and values. convert revenue-generating space to prayer areas; Saudi
The growing importance of oil for Saudi Arabia, particu- Arabian Airlines does this in the rear of its planes, the British
larly since the 1970s, has led to rapid urbanization and given retailer Harvey Nichols in its department store.
the government the means to offer social services such as However, there are regional differences. In the capital,
free education. These changes have furthered its citizens’ Riyadh, women traditionally wear niqabs that cover their faces.
sense of a national identity, while diminishing their tradi- But in the port city of Jeddah, which has more contact with
tional ways of living. Since 1950, the rural population has ­foreigners and is less conservative, dress codes are more relaxed
decreased from more than 80 percent (about half nomadic) and fewer women wear them. Nevertheless, merchants routinely
to less than 20 percent. Cities have also modernized physi- remove mannequins’ heads and hands and keep them properly
cally. However, below the physical surface, Saudis hold clad to prevent public objections. Starbucks franchises even
­attitudes and values that are neither like the norm elsewhere altered the company logo and Coty Beauty its point-of-purchase
nor easily discerned. exhibits in order not to display women’s faces.
Modernization has been controversial within Saudi Rules of behavior may also be hard to comprehend
Arabia. The liberal group, supported by an elite segment that because of the ways in which religious and legal rules have

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 Chapter 2 Culture 89

Map 2.1 Saudi Arabia and the Arabian Peninsula

The kingdom of Saudi Arabia comprises most of the Arabian Peninsula in Southwest Asia. The capital is Riyadh. Mecca and Medina are Islam’s holiest cities. Jeddah
is the most important port. All of the country’s adjacent neighbors are also Arabic—that is, the people speak Arabic as a first language. All the nations on the
peninsula are predominantly Islamic.

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been adapted to contemporary situations. Islamic law, for instance, forbids charging interest and selling
accident insurance (strict doctrine holds there are no accidents, only preordained acts of God). In the case
of mortgages, the Saudi government gets around this proscription by offering interest-free loans. The
government has simply eliminated the prohibition against accident insurance because Saudi businesses,
like businesses elsewhere, need the coverage.
Nor are expected behaviors necessarily the same for locals and foreigners. Non-Muslim foreign
women are not required to wear head scarves, although religious patrols may admonish them for not
doing so. Saudi Arabian Airlines does not hire Saudi women as flight attendants (being in direct contact
with men might tempt promiscuous behavior), but it hires women from other Arab nations. In addition,
some compounds are inhabited largely by Americans and Europeans, who work in specialized posi-
tions and for foreign companies. To attract these needed specialists and investors, Saudi Arabia allows
­compound residents to dress and behave within the compounds much the way they do back home (alco-
hol, pornography, and drugs are still prohibited). However, in an example of a reverse dress code, some
­compounds prohibit residents and their visitors from wearing abayas and thobes in public areas.

Traditional Factors
Some Saudi Arabian traditions are probably the outgrowth of a tribal and nomadic past. For instance, the
oft-quoted saying “Me against my brother, my brothers and me against my cousins, then my cousins and

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 90 PART 2    National Environmental Differences

me against strangers” illustrates a family-centered society where trust of others is highly correlated with
the degree of familiarity with them.
Given the trust factor, most Saudi businesses have historically been family owned and operated,
preferring to hire family members or people they know well even though others might be better quali-
fied. However, these companies have seen the need to partner with foreign firms to gain expertise. The
process of partnering is usually lengthy because Saudis take time to know the foreigners well and are
reluctant to make full financial disclosures outside the family. They generally prefer to get to know you
well, perhaps invite you into their homes, and develop a certain level of friendship before ever turning to
business details.
Not understanding this norm, a British publisher dispatched two salesmen to Saudi Arabia and paid
them on commission. The salesmen moved aggressively, figuring they could make the same number of
calls—and sales—per day as they made in Britain, where they were used to punctual schedules, the
undivided attention of potential clients, and conversations devoted only to business transactions. To them,
time was money. In Saudi Arabia, however, they soon found that appointments seldom began on time and
usually took place at local cafés over casual cups of coffee. As far as they were concerned, Saudis spent
too much time in idle chitchat and would even turn their attention to personal acquaintances rather than
continue with business. Eventually, both salesmen began showing their irritation, and their Saudi counter-
parts came to regard them as rude and impatient. The publisher had to recall them.
Saudis’ preference for dealing with people they know has led to a system known as wasta, which
roughly translates into English as “connections.” Thus, who you know helps a great deal in almost
­everything, such as moving a résumé to the top of a pile, gaining approval of a zoning request, getting a
passport, and obtaining a visa to bring in a visitor from headquarters.

Gender Roles
Perhaps the most baffling aspect of Saudi culture to many outsiders is the expected role of people by
­gender. Based largely on a Koranic prescription whereby daughters receive only half the inheritance that
sons receive, females are placed in a separate and often subservient position. Their role has been to be
virtuous, marry young, and have offspring, while males take responsibility as their protectors and the
family breadwinners. Not only is female virtue required, but also the appearance of it. Because of family
importance, a negative perception of one member reflects on all. These beliefs have led to a number of
proscriptions for women, such as no traveling abroad without permission of a male relative and no study-
ing abroad without a male relative escort. Basically, non-kin males and females may interact personally
only in “open areas,” or in “closed areas” when the females are accompanied by a male relative. However,
applying this restriction may seem a bit confusing to outsiders. For instance, restaurants are considered
closed areas, and proprietors must maintain separate dining rooms and entrances for men without female
companions. However, the food malls at most shopping centers are considered open areas where mem-
bers of both sexes intermingle.
Nevertheless, several happenings since 2011 foretell possibly fewer future differences in gender
requirements: women received future rights to vote and hold political offices, there was little intimidation
when a group of women drove autos to protest their prohibition against driving, a Saudi prince spoke
out in favor of women’s driving as a means of limiting the number of foreign workers, a two-member
women’s team participated in the Olympics for the first time (but critics labeled them prostitutes for doing
so), and prohibitions were lifted on female physical education classes in schools.
A 2008 royal decree lifted a ban on mixing men and women in the workplace, but the situation is
complex. Male and female employees within the public sector work in separate buildings. When they
must meet together, they do so within meeting rooms in the Governor’s office, where they must use
separate entrances. Men and women may work together within the private sector, but there are other
limitations.
Although there are now more female than male university graduates in Saudi Arabia, only about
15 percent of the workforce is female. Why? The answer is partly cultural. Some women prefer traditional

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 Chapter 2 Culture 91

family roles. Some find driving restrictions to be too much of a hassle. And some families prohibit female
members from working because of family honor (“What will people think?”). Economic factors blend with
cultural ones as well, such as companies incurring the cost of providing separate entrances and toilet
facilities. However, the genders do interact at work, especially in multinational companies. For example,
Unilever’s female brand managers, as long they adhere to dress codes, interact with male colleagues and
meet with men from other companies. However, they are limited in traveling abroad on company business
because they need permission from their male relatives. Some multinationals ease this problem by paying
the travel costs for a male relative to accompany a woman abroad.
At one time, visas for single women to enter Saudi Arabia were nearly unobtainable. However, the
Saudi Arabian General Investment Authority (SAGIA) has successfully attracted investments by MNEs
that need visas to send female executives there for short- and long-term assignments. While these
visas are not given automatically, they can be obtained—more easily for women over 40, but also
possibly for younger women, especially with the use of wasta. The U.S. consulting company Monitor
Group brought in American women in their twenties, and L’Oreal has sent its female human resources
manager there.
Restrictions on gender interactions also lead to other adjustments. For instance, four young Saudis
who had lived and studied abroad wanted to test the market potential for opening an upscale r­ estaurant—
the Java Lounge—in Jeddah. Ordinarily, it can be difficult to conduct such research in Saudi Arabia
because limitations on male-female interactions restrain family-focused interviews. In this case, however,
consultants interviewed apparently affluent families by approaching them in restaurants after noting how
they comported themselves, whether they wore custom-made versus off-the-rack robes, what quality of
wristwatches showed beneath long sleeves, and how well the men kept their beards—all indicators that
researchers from outside the society would probably overlook.
At upscale U.S.- and U.K.-based department stores like Saks Fifth Avenue and Harvey Nichols, mixed
shopping is allowed only on the lower floors. There, all salespeople are men (even those specializing in
such products as cosmetics and lingerie), and there are no changing rooms or places to try cosmetics.
Meanwhile, the upper floors are for women only, and female shoppers can check their abayas and shop in
jeans or whatever they choose. (Meanwhile, the men who drove the women there can relax in a space the
stores have set aside for them.) One problem: Because male managers can visit these upper floors only
when a store is closed, they are limited in their ability to observe operations.

Cultural Dynamics
Almost all aspects of culture evolve, and Saudi Arabia is no exception. Take the case of women in the
workplace. In terms of preparation, the first public school for girls did not open until 1960, and the gov-
ernment had to provide troops in one city because of protests that the schooling would negatively affect
girls’ religious and social values. Since then, the country has seen a gradual increase in years of study
and ­curriculum offered for females. Economic need has spurred both changes in education and the use
of education within the workforce. At the same time, critics have had to be persuaded that changes are
compatible with women’s roles. One of the first acceptances of working women (alongside men) was in
the medical field because of the shortage of doctors, the high cost of separate male and female specialists,
and the compatibility of healing with women’s role as nurturers.
In addition, Saudi opinion and policy has been to reduce the heavy dependence on and cost of foreign
workers. Thus, the government pays for foreign university education of its citizens while recognizing the
disregard of much female talent.
The Saudi business world has seen much change. Consider that women own about 20 percent of all
Saudi businesses, or that a woman is CEO of one of the country’s largest concerns, the Olayan Financing
Company. Three things will likely boost Saudi female workforce participation: (1) an increase in inward
foreign investment, (2) more women studying abroad, and (3) women’s psychological drive to prove them-
selves. Bear in mind, however, that changes tend to be uneven, particularly among geographic areas of
the country and people of certain income and educational levels. ■

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