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Serco expects 50% of Middle East revenue to come from Saudi

Red Sea Development: Saudi Arabia's Vision 2030 airports and gigaprojects are viewed as opportunities by public services provider Serco Foster + Partners
Red Sea Development: Saudi Arabia's Vision 2030 airports and gigaprojects are viewed as opportunities by public services provider Serco
  • Vision 2030 projects require master plans for public services
  • Advisory contracts go live when Saudi gigaprojects become operational
  • Serco seeks to grow involvement in airports as Saudi tourism takes off

London-based public service provider Serco expects to draw 50 percent of its Middle East revenue from Saudi Arabia by 2026.

Daniel McGregor, corporate development director at Serco Middle East, told AGBI that this ambitious plan is already in motion — and it is being formulated to capitalise on Saudi Arabia’s huge investment in public infrastructure, big budget megaprojects and Vision 2030 goals.

“We’ve been operating in the kingdom for 10 years and have seen the most progressive growth in the last 18-24 months,” McGregor said.

“The kingdom is where we see the most amount of growth coming from in the region.”

Serco Middle East is aiming to increase its overall revenue in the region by 65 percent within the next four years.

In order for 50 percent of this to come from Saudi Arabia, McGregor’s team is investing in advising Saudi entities in the early stages of their plans across various projects and regions, before moving in later to deliver the operations.

He said Serco has now placed more than 130 advisers across the kingdom’s public sector and government agencies — including on one of the country’s ongoing megaprojects.

“We’re in the business of managing and delivering public services, which typically requires all the sites to be developed, built and operational,” McGregor said.

“If you look at a lot of the developments contributing towards Vision 2030, they’re all in the main greenfield, so they’re going through their own strategy developments.

“In Saudi, we will build up the frontline services capability as we get through these advisory contracts and these greenfield sites eventually turn into brownfield operations, so advisory is the focus at the moment but then that builds up our long-term delivery pipeline.

“We’ve reversed our business model so, in the kingdom at least for the next two to five years, we can take long-term operational expertise from different sectors and provide advice and input into design, operating models, and other services.”

Portrait, Photography, Head
Daniel McGregor, corporate development director at Serco Middle East

Kingdom of opportunities

Saudi Arabia’s gigaprojects like Neom, the Red Sea Development and others, which are receiving hundreds of billions of dollars of investment by the state, are an important part of the kingdom’s attraction.

“Like all businesses, we’re circling gigaprojects like Neom and the Red Sea Development that were announced four or five years ago. Amaala and Qiddiya are following closely,” McGregor said.

“There is a focus on how we can bring our operational expertise to help advise on some of their strategies and plans for the long-term.” 

Aside from the kingdom’s headline-grabbing projects, a wider top-down push for investment in the country’s infrastructure also presents an opportunity for Serco — particularly its growing spending on airports and air travel across the country to support its push for international tourism.

Saudi Arabia is expecting to invest $147 billion in air infrastructure by 2030, including a major upgrade to Jeddah’s King Abdulaziz International Airport.

“We’ve recently secured a contract at Riyadh Airport to deliver managing agent services, and we then expect that places like Jeddah and Damman and the smaller new airports at Red Sea and Neom are going to be a focal point,” McGregor said.

Serco is looking at the customer journey at airports, with its new Riyadh hub playing an important role.

Inside the hub, which opened officially on October 31, sits Serco’s ExperienceLab, the company’s customer insight and service design agency, which they use to test and refine the experiences of end-users ahead of launch. 

“We’ll be looking at the whole customer experience approach by airports,” McGregor said, explaining that the labs will be used to test what it’s like to “live a day in the life of business travellers, Hajj travellers, tourists and residents, to then design that into the airport experience.”

The hub will also be used to examine the experience of travellers visiting megaprojects like AlUla, he added, and make sure they are “wowed.”

Serco aims to have Saudi nationals as a quarter of its workforce in the kingdom by 2026.

“We’ve been in the UAE since 1947, so are well embedded there,” McGregor said.

“We’ve been in Saudi for about 10 years. Given it’s the largest economy in the region and it’s got such ambitious plans, it’s a core component of the strategy for the Middle East business.”

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