The real cost of undervaluing human capital in the GCC

An article by Natasha Hatherall, the founder and CEO of TishTash Group.

Human resources are still too often treated as a support function rather than the foundation of how a business performs. In boardrooms across the GCC, conversations tend to revolve around revenue, margins, funding, and expansion. People come later, once the business is “stable enough” to invest in culture.

That sequencing is where many companies get it wrong.

In a region where talent is both scarce and increasingly mobile, the way a company builds and manages its team is not a secondary concern. It is one of the most decisive factors shaping its ability to grow, compete, and endure.

The cost of getting this wrong rarely appears clearly on a spreadsheet. It shows up in slower execution, inconsistent delivery, strained client relationships, and the constant drain of replacing people who leave. In high-pressure sectors, churn is often normalised as part of growth, yet few businesses fully account for the operational and financial weight it carries. Replacing experienced talent is expensive, but the deeper loss is continuity: knowledge walks out the door, momentum resets, and teams are forced back into rebuilding mode.

What this really means is that human capital is not just an input into the business. It is the system through which everything else functions.

I have seen this play out over more than a decade of building a communications business across the GCC and the UK. Growing a company without external funding places a different kind of discipline on every decision. There is little room for inefficiency and even less tolerance for instability. Early on, it became clear that if people did not want to stay, perform, and grow within the business, no amount of strategy would compensate for that.

This is where the idea of a human-first approach is often misunderstood. It is not about lowering expectations or prioritising comfort over results. It is about recognising that performance is inseparable from the conditions in which people operate.

When people feel safe enough to speak up before problems escalate, issues are solved earlier. When workloads are visible and manageable, delivery becomes more predictable. When individuals see a future for themselves within the company, they invest more deeply in its success. None of this is abstract. It shows up directly in how work gets done.

In practice, this requires a shift in how leaders think about their teams. People cannot be treated as interchangeable roles on an organisational chart. They are individual careers, each with a trajectory that either compounds in value over time or is lost the moment they leave. Businesses that understand this tend to prioritise internal growth, invest in learning, and build depth rather than relying on constant external hiring. Over time, that creates organisations that are not only more stable but also more capable.

Culture plays a central role here, but not in the way it is often presented. It is not defined by office design, benefits packages, or internal messaging. It is defined by the everyday experience of working inside the company. How people feel in difficult conversations. How pressure is managed. How decisions are explained. Whether they are treated as adults whose time and circumstances are understood, or as resources to be optimised.

In the GCC, this conversation is becoming more urgent. Workforce expectations are shifting, particularly as more women enter and remain in the labour market, and as younger talent places greater value on flexibility and purpose. At the same time, companies are competing within a relatively limited talent pool. The result is a market where attracting and retaining the right people is increasingly difficult, and where the companies that succeed are those that align their structures with these realities.

One of the clearest examples of this is how businesses approach policies that reflect real human needs. When we introduced structured support around women’s health, including menstrual, menopause, and fertility leave, the immediate reaction from a traditional business lens might have been to focus on cost. Additional leave, more flexibility, and fewer rigid controls all appear as inefficiencies.

What followed told a different story.

The business saw a surge in inbound interest from candidates who were not simply seeking employment but for an environment that acknowledged their realities. That shift strengthened the quality of talent entering the pipeline and reinforced retention among existing team members. What appeared as a cost in isolation became an advantage in context.

This is where the link between human capital and business performance becomes difficult to ignore. Stable teams do not just create better working environments; they create better outcomes. They build stronger relationships with clients, retain institutional knowledge, and execute with greater consistency. Over time, that translates into more predictable revenue, longer engagements, and a stronger reputation in the market.

None of this removes the need for discipline. Human-first leadership still requires clear expectations, accountability, and difficult decisions when needed. Not every individual will be the right fit for every role, and not every situation can be resolved through flexibility. The distinction lies in how these moments are handled — whether they are addressed early, with clarity and respect, or deferred until they become disruptive.

For founders and operators in MENA, the implication is straightforward but often overlooked. As capital becomes more selective and growth more measured, the businesses that endure will not be those that simply move fastest but those that build strongest from within.

Human capital is not a line item. It is the infrastructure of the business itself.

Treating it as anything less is not just a cultural oversight. It is a strategic one.