Academic journal article Review of European Studies

The Role of Recruitment and Selection Practices in the Organizational Performance of Iraqi Oil and Gas Sector: A Brief Literature Review

Academic journal article Review of European Studies

The Role of Recruitment and Selection Practices in the Organizational Performance of Iraqi Oil and Gas Sector: A Brief Literature Review

Article excerpt

1. Introduction

Oil and Gas sector forms the backbone of Iraqi economy and have been playing a crucial part in economic and social development in Iraq. The crucial role of this sector in the economic and social development of Iraq can be seen from the fact that 94 percent of all enterprises and accounting for 75 percent of all employment are related to oil & gas (UIA, 2013). Although, most people are familiar with large oil companies, such as Iraq National Oil Company, Iraq Petroleum Company, and Iraqi Oil Tankers Company, etc., it is the oil sector that drives Iraqi economy. Therefore, the health of this vital sub-sector is very important to up keep the health of the overall Iraqi economy. Although, the relative importance as a share of the number of enterprises and the number of employees is declining as compared to the situation at the beginning of the 2000s, there is no change in the fact that the sector still accounts for the vast majority of enterprises and employees in Iraq. Many of the large oil companies, such as Iraq National Oil Company, Iraq Petroleum Company, and Iraqi Oil Tankers Company began as small family businesses (Al-Sabah, 2007) and turned into mega corporations. The resurgence of oil sector would not only encourage competition in the market and but can be the thrust in making new industries and translating the existing industrial structure.

Most of the products of the sector are made up of crude oil products made by firm subcontractors, and hence, the availability and reliability of Iraqi products is backed by the fundamental strength of oil sector. Local economies are supported by the activities of the firms especially those which are involved in the service industry, the retail industry, and the construction industry helping to revitalize the local economy and increasing employment opportunities (Al-Sabah, 2007). Since the oil sector has been driving the economic growth, the last decade has seen a sluggish growth in the oil sector. Further, the profitability and investment of oil firms have not increased significantly and the entry of new businesses in the sector has been on the decline. The main reason for such a state of affairs of Iraqi oil & gas sector is attributed to severe lack of investment, poor management, lack of skilled human resources and destruction of infrastructure due to two decades of war and sanctions (Hanna et al., 2014). The Iraqi government has made the oil production contracts with various multinational companies. The principal element behind this seems to be the trend in performance, which explicate a big number of enterprises. This development, however, should not be regarded entirely as a problem of performance because they have the potential to grow and employ more people or companies. To meet the timetable, Iraq has been facing many challenges. Iraqi refining and export, both infrastructures are at bottlenecks, which are supposed to be upgraded so that they can process much more oil. In Southern Iraq, oil exporters are utilizing their full capacities, whereas in North Iraq, the export capacity has been restricted, which needs to be expanded.

Nevertheless, productive business management of firms mostly relies upon the quality of human resource that supports companies (Anthony et al., 2002). Abundant studies exist that the significant relationship between human resource management practices and organizational performance. (e.g. Guest, 2002; Wright et al., 2003; Tessama & Soeters, 2006; Quresh et al.,2010; Chen and Huang, 2009; Lorg et al., 2013; Tangthorg et al., 2014). To secure and train the high quality personnel is fundamental factor for firms' growth, which frequently has specified opportunities to employ managerial resources. But, it is argued that small firms pay less attention to human resource management (HRM) practices as compared to large enterprises (Kok, 2003; Wong, Marshall, Alderman, & Thwaites, 1997). Therefore, the prime objective of this study is to develop and test a conceptual model linking recruitment and selection function to firm performance that fit oil sector firms. …

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