Leadership & Life: Tadawul in Focus

By: The WFE Focus Team Jul 2021

Name: Eng. Khalid Al-Hussan

Title: CEO, Saudi Stock Exchange (Tadawul)

1. My most challenging project and how I conquered it

Changing the securities settlement cycle of the Exchange from T+0 to T+2 was a demanding project that required deftness across multiple organisational facets.

The differing perceptions of stakeholders regarding the project's importance compounded its complexity and posed a substantial challenge by itself. Aligning stakeholders behind such a change required an initiative in and of itself. Making this change seemed counterintuitive to most; it was perceived as a step backwards! Why would we do such a thing while the rest of the world was trying to shorten settlement cycles?

However, the common understanding was flawed. The real challenge was broader than operational efficiencies and required a more comprehensive trade-off across the organisation. Ideally, we wanted to ensure that every market participant was ready technically and ready from a risk perspective.

Introducing a delay in the settlement cycle creates risks in the financial market infrastructure compared with real-time, pre-validated settlements. In addition, the absence of a central clearinghouse required the design of risk management rules, procedures and fall-back measures in the event of trade default. We also had the challenge of explaining and enforcing these measures on market participants.

The project timelines were tight. Until the final few days before the shift to the new settlement cycle, we faced uncertainties and apprehension from market participants. We managed to support them and transition smoothly to a more standard settlement cycle, thereby allowing us to sync with how International Institutional Investors operate.

2. What is the most challenging part of being a leader?

I view leadership at the nexus of values, emotions and logic, as leadership combines innate and learned behaviours. Personality features, cultural attitudes, and life experience combine to define an individual's leadership potential, but providence and personal choice also contribute to determining the extent of one’s leadership opportunities and achievements.

The simplest and most direct way of being a leader is by becoming an expert in specialised and narrow fields. However, becoming a multifaceted, inspirational leader driving complex, diverse organisations and business ecosystems is a rare skill-set requiring a degree of deliberateness, coaching and perhaps most importantly, continued reinvention. This type of leader doesn't rely on knowledge to inspire others. Their vision, values, gravitas, and the respect they command define their leadership.

My professional life has been a constant journey of reinvention. From the earliest point in my career, I constantly sought new and demanding challenges. These early decisions had long-lasting implications and defined my career trajectory. In the first phase of my professional life, having studied engineering, I was headed towards an engineering career. Although I have refocused my career away from engineering, my engineering and physical sciences background convinced me of the importance of mathematics as the core backbone of problem-solving and strategy execution.

In the spirit of reinvention, I built my knowledge of capital markets over time; initially in the insurance sector and then after joining Saudi Tadawul Group. Some aspects of my leadership came naturally, and some through deliberate practice. One important lesson I learnt early on in executive leadership was the need for leaders to visibly display the behaviours they wanted to change in the organisation.

3. How I motivate my team

Being able to motivate and maintain motivation in a team is a critical item in the toolbox of any successful executive. Executing complex projects and mandates requires resilience. Motivation encourages team members to take on challenging projects, and a consistent focus on motivation and team morale act as a guide to navigating challenging times. If one can't motivate one's team in difficult times, one can hardly be thought of as a leader.

Motivation takes different forms. Operationally, we use a combination of financial, recognition, and career management awards. However, good leadership is more than these operational aspects. It requires a deep understanding of the people in an organisation – their ambitions, hopes, and fears, and the need to set a vision more extensive than the current organisation's boundaries and outside its current capabilities. In the act of communicating a grand idea, our people derive purpose, and we build a culture of excitement, optimism, and resilience. Through this type of extrinsic motivation, we grow as humans, as teams, and as an organisation.

4- How do you measure success as a leader?

Measuring success is essential but should be done with caution, as it can become a trap into which many executives fall. The period over which one measures success should be commensurate with what one is trying to achieve. Executives should measure some strategies over the short term and others on a longer-term basis. Deciding on time horizons requires good judgment, and often this can only come from experience. In all cases, however, it is important to continually track the evolution of an initiative to ensure congruence with its stated objectives and to take the necessary corrective measures, if needed.

Deciding which measures of success are important requires good judgment. Often, stated objectives can become confused with operational ones. Unforeseen influences of competing mandates can further muddy how we look at success. I've found that a rigorous understanding of potential trade-offs and an obsessive focus on the end result acts as an organisational North Star.

As my career has advanced, I have realised that some operational measures of success are more important than others in ensuring our long-term strength as an organisation. During my tenure as CEO, we have significantly increased the number of female employees and maintain a culturally diverse and uniquely international work environment. Our diversity, coupled with our shared purpose, generates our unique organisational dynamism that establishes the cultural platform for the future long-term growth of our organisation.