The country is facing a number of economic challenges, including high inflation, a large trade deficit, and a growing fiscal deficit. This has led to a challenging business environment, with high levels of uncertainty and volatility.
In such an environment, it is important for businesses to attract and retain talented employees, who can drive growth and innovation. However, the high levels of employer dissatisfaction among the potentially qualified, young professionals make this difficult. As employees are more likely to leave their jobs in search of more challenging and rewarding opportunities for slightly more money.
This creates a vicious cycle, where high levels of turnover reduce the productivity of businesses and limit their ability to drive economic growth. Also not serving the GDP in any significant way, as they are part of a rotational pool of marginally skilled and sub-optimal resources.
Valued only, between players of a closed economy. Meaning that most of their value is not globally competitive and typically doesn’t stem from innovation or growth related skills. It comes from”beating the system” longest.
At the crux of this issue lies the much larger issue of corporations based in Pakistan. Be it local or foreign. The DNA over time for both, is nearly indistinguishable from the perspective of the Ambition Tax placed on the young graduates who join them with hopes and dreams.
So what is this Ambition Tax?
In my mind, ambition tax refers to the idea that the corporate culture in Pakistan is stifling the professional growth of graduates by limiting opportunities for advancement and hindering their ability to fulfill their career aspirations because at their core; these corporations are thinly veiled monopolies or oligopolies protected by subsidies, generational wealth, influence, political leverage and national security related items. Essentially any where else in the world they would not be able to compete. Let alone get to the scale at which they operate in Pakistan.
This is due to a number of factors, including a lack of transparency, stagnant growth, and seemingly large corporatized businesses being run like family-owned businesses vs globally competitive ones. Or large foreign owned businesses run at the whim & fancy of their local leadership who typically are in entrenched roles for decades on average. They serve the $ earning potential of their principals/foreign masters, by dealing with the dirty work in Pakistan and only reporting back on the growth.
These parties are almost also over in the Telco space and some Foreign FMCGs where billions spent to build brands, built many millionaires, setting the wrong work culture and success benchmark of colluding with advertising agencies and television networks to harvest hordes of cash. (Every one f**ing knows this, they just don’t have the courage to call out the insane level of corruption and lack of morality at these organizations)
Under the don’t ask don’t tell principle, what happens at Large Telcos/FMCGs and others in PK is glossed over by printing and sticking FCPA (Foreign Corrupt Practices Act)Rules by American companies and Value statements by most others.
In a crazy development, the local corporate groups have stopped pretending; they now consider their growth ambition linked to breaking the law and consider the speed monies paid as a natural symbiotic relationship between what they do and what the government has to do.
Like kids watching their parents and learning their traits, young graduates watching their employers, their companies, their peers, their bosses all being involved in 5 activities at large
1)Look Away
2)Control the flow of info to retain your job
3)Please the bosses/society by resigning to your fate (much like this kid who who got mugged)
4)Play Politics
5)Do what you are told vs doing any thing extra
In a society that over indexes on “juggar” and under indexes on “ingenuity” and doesn’t know the difference, the only war we are at, is a war with our broken selves as one guy tries to pull the other down, in an attempt to take a piece of the available pie, vs growing the pie.
So whats going on? (At Large Companies)
One of the major reasons for the ambition tax in Pakistani corporations is the lack of transparency in the hiring and promotion processes. Often, positions are filled through nepotism or connections rather than merit and practice of not letting the old guard retire, look at the PSX 100.
You would be hard pressed to find directors in their 30s and 40s who are not family members of the listing sponsors, leading to a dearth of opportunities for young, talented professionals.
Major banks like HBL and others recently announcing they will retain their above 60 staff? The jokes write them selves, it’s a self rewarding club of boomers. They have to be retained because their counter parts operate in the government and its not worth the hassle to train a younger person on how to evade the system.
This creates a vicious cycle where the most competent and qualified individuals are overlooked, and the least capable are given positions of power, hindering the growth and progress of the company as a whole. The few who are capable and make it to some where, spend their time politicking vs focused on professional growth.
Cant blame them either, they went from, “I wish I had a job, to I have a great job, with most creature comforts, I better not f**k this up” when they hit this level, they are married to the roles job security, its monthly check, their nice offices a settled family life and a family co-dependent on their work outcomes.
In such a setting, the ambition is over, it is traded for longevity by subservience to those in charge. Large Pakistani corporations are where hope goes to die.
Banks how could I forget banks….oh Pakistani banks …
When I have taken it upon my self to put out the going ons at most if not all telcos and FMCG companies, Banks along with saiths, also deserve our attention. They are the epitome of ambition killers.
Let’s look at a young grad who gets into an operations role at 35k PKR. The Banks CEOs driver by then has a better total comp package including fuel, meals, and interest free loans. The driver is un skilled but the young grad is skilled. It would take 5 career jumps over 10 years to bring this person who enters the Bank at 35k to make a salary of 250k if they are lucky and suck up the right way and tolerate inhumane treatment from the public at large and their “seniors”.
By this time they are in their forties, have a family, and the charm to stick around, is the servitude the bank buys by offering a house loan. Lock stock and barrel, this 40 year old who looks like he’s 60, traded his caged existence for a loan because the state has no f**ing system to enable this. The banks, the saiths, the Sindh club biradri wins every single time. At the cost of the ambition the youth are trading for basic survivability and life events.
The CEOs wear tailored suits, typically enjoy a good bottle of single malt, I can name a dozen or more such gentlemen but thats not why we are here. Who by no professional conviction have gotten where they are.
They too are security men, who love their jobs and the security it provides to sit in well guarded homes, with their friends over single malt and build the courage to curse the politicians, their very own Sindh club peers, whom they lend to and wash away their sorrows into the night by complaining about the same. Do you not see the hypocrisy?
Most of these bankers/ceos/leaders, their numbers 2s and 3s are has beens, they wouldn’t be able to find globally competitive roles for the shit they deliver to the masses daily in PK. The only reason banks worked in PK is not because they are innovative, but because the government is stupid, and the awaam is land locked from access to debt and loans.
All these details not because Banks and Bankers have issues or me with them, it’s to paint the sorry picture of what is happening at the top and how worlds apart, the growth trajectory is for the young chap who joined the branch. To ever making it to the single malt club(if they so desired, not endorsing they should). They watch from a distance and their lips run dry in the delivery of the word “sir”.
Each Business unit head, each Management Team member runs a fiefdom in these corporations. Their fiefdoms are a microcosm of Pakistani society, where the most marginalized is the most subservient, but since he gets a pay check at the end of each month, he’s conditioned to make the most of the misery of being a personal slave to the business leaders. What do you think this daily torture does to ones ambition? It dies a slow but certain death.
Saiths, their children & the “principal, sponsor” drama….
Next we have the established saiths, their families, with alleged “professional” CEOs. Running large diversified but subsidized businesses because of concessions, cheap real estate, rebates, tax evasion or other such premium deals.
Saiths are winning because they have rigged the system, a system of corrupt politicians and bureaucrats. In a closed economy like Pakistan they win, they compound their wealth, they pretend to care for the people who work for them. They have learnt from their foreign counterparts very well, the only motive is profit at the cost of ambition.
Most of young graduates trade their ambition for job security and a fighting chance to get close to “management” some make it, most don’t and a vast majority die trying. The tiered system ensures, no one learns any thing new, companies don’t need innovation to win, they need legislation, lock-ins, essentially a machinery of inside men.
When you are not playing at the global scale, all you are doing is re aligning the chips to win locally. When you give up global competitiveness you only optimize for local pettiness, in doing so you ensure the learning outcomes of every one are stunted. When you don’t have to compete but rather co-opt your ambition also gives up.
Saiths and sponsors who build and list companies also manipulate their stocks. Every one knows it. We can also name the 4-5 brokers who do this, have been doing it for years, yet we don’t, my post is equally critical of all but the reason for writing is to make the youth aware of the principal/sponsor problem, for them to recognize they are being dealt a short hand. For them to have the fortitude to focus on their growth vs growing into roles that have no meaningful impact on their lives.
Another contributing factor is the stagnant growth of many local corporations. This lack of growth is due to a number of reasons, including poor management(as the saith aren’t some great operators, most are petty crooks in pretty suits), a lack of investment in innovation and research, and a lack of focus on expanding the business. When they make enough money their second generation comes in from Harvard and Yale with bright ideas, who are handed over to family advisors to be brainwashed in to “Abba jis” ways. Therein begins the second wave of more of the same. If kids don’t comply, Abba ji identifies some hired executive “munh bholay bataays” who are more than happy to carry out his wishes.
This can make it difficult for young professionals to find opportunities for advancement and can result in them feeling stuck in their careers, unable to grow and develop their skills when they look outside of Pakistan.
So what can be done?
In order to tackle the ambition tax and create a more inclusive and dynamic corporate culture, it is important to focus on implementing transparency in hiring and promotion processes, investing in growth and innovation, and encouraging the development of professional networks and mentorship programs.
By creating opportunities for young professionals to grow and develop their skills, we can help to create a more dynamic and competitive corporate culture in Pakistan, one that encourages ambition and hard work and not short-term-ism.
Additionally, it is important to support businesses that are run like real businesses, and to encourage a shift away from the traditional preference for family-owned businesses. This can be done by providing incentives for companies that invest in growth and development, and by highlighting the importance of professional management practices.
I have seriously high hopes with the newer generation to take a stand and do whats right, report your crooked bosses to your foreign owners, call a spade a spade, you owe it to your self and to Pakistan to not let this brazen miscarriage of negative outcomes shape your future. You owe none of these people any thing, you do not need to be subservient to any one.
This lack of initiative and innovation can be traced back to the fear of failure and the need to maintain job security in the face of economic uncertainty. This results in a culture where people play it safe and do not take risks, opting instead to be loyal to the owner even when it means making bad or wrong decisions. You owe it to your self to not do this any more.
How this re-wires the brains of the young grads and Why thats a bad thing…
From the perspective of young professionals who remain in safe roles for several years, the major disadvantage is that they miss out on opportunities to learn and grow, both professionally and personally. This can limit their career advancement and lead to a feeling of stagnation and frustration, as they are unable to fulfill their aspirations and reach their full potential.
Compared to their peers globally, young professionals who stay in safe roles for extended periods of time may miss out on opportunities to develop new skills, work on cutting-edge projects, and take on new challenges. This can make them less competitive in the global job market and hinder their ability to advance in their careers. Additionally, working in a stagnant environment with limited opportunities for growth can lead to boredom and disinterest, making it difficult for these individuals to remain engaged and motivated in their work and in their lives, leading to seriously un happy outcomes at home.
How does this Ambition tax destroy the country?
The high level of dissatisfaction among young professionals in Pakistan, where nearly half the population is under the age of 25, is a major concern for the country’s economic growth.
A lack of opportunities for professional development and growth, combined with the fear of failure and the need to maintain job security, can lead to a feeling of boredom and un fulfillment among young professionals. Leading to mass un productivity.
A non productive workforce that has nothing new to contribute, has significant economic consequences, as it increases the cost of hiring and training new employees, and reduces the productivity of businesses. Additionally, when talented young professionals leave the country in search of better opportunities, they take with them their skills, knowledge, and experience, reducing the pool of available talent and limiting the potential for economic growth.
The current economic situation in Pakistan further exacerbates these challenges. The country is facing a number of economic challenges, including high inflation, a large trade deficit, and a growing fiscal deficit. This has led to a challenging business environment, with high levels of uncertainty and volatility.
Unless we take ownership of our own issues and come up with a plan to tackle them. We will continue to shape our outcomes like our past, “stagnant with a high chance of extreme lows”
If you are young and motivated do your self a favor and read the thread below, today. Hard work alone is not going to change your outcomes. You knowing history will help. You deciding to change it, has the potential to change your outcomes.
Historical Context that I covered in my News letter
Made in Pakistan (Pre Nationalization Monopolies)
Zulfikar Ali Bhutto (1928–1979) became President of Pakistan (1971–74) on 21 December 1971 after a disastrous end of 1971 war with India. The nationalization programme was implemented for the first time in the history of Pakistan and it was promulgated through three different stages.
I recently came across a fantastic publication. Private Industrial Investment in Pakistan: 1960-1970.
Why is this important? It sheds light in to how the economy was structured and who controlled the monopolies before Nationalization eroded economic capital of the country. It also shows some thing very critical, the growth rates of industry by sector.
Far more interesting is that I was able to see for the first time, the interplay between banks, their ownership, the insurance companies and the overall major monopoly families and their directorships across enterprises. It was an eye opener for me. So as you start to build your journey of better outcomes, be mindful of history, understand how made in Pakistan can be extremely successful and the pitfalls you must avoid.
Why share all this. It demonstrates that no-major hands have changed since the creation of the country, its tumultuous nationalization of industries and the present day. The outcomes have worsened for the youngest and brightest. If you still don’t believe that none of the firms, corporation and their sponsors are all in it to win it, at your expense, the chart below fascinated me when I saw it you should give it a read.
What is it?
The inter-connectivity between the groups visualized circa the 60s.
What now?
The first step is to identify there is a problem.
The second step is to figure out what areas are within your control.
The third is to invest your time an energy to not get into this rat race, but instead look for alternates or build alternates that allow you to excel.
Do not be mis-lead by the fake allure of these corporations because sooner rather than later, they will tax your ambition and you too will be a cog in their machinery. Invest in your self by not investing your time and effort to chase a dream that at best is locally competitive and at worse is globally irrelevant.
