Success factors that have transformed Oman Customs

Public opinion seems to favour and even praise the E-services provided by the Royal Oman Police (ROP). Some attribute the reasons for this distinction to military discipline and leadership. One may ask, what are ROP’s “success factors” in its qualitative transformation in the provision of E-services? The scientific approach I adopted to come up with findings to answer this question is based on field diagnosis and finding solutions, or through the field study of the factors of success of a model that has already proved its worthiness on the ground and as substantiated by international reports.
The Directorate General of Customs was able to realize the dream of “E-government” through linkages more than 45 government agencies, presenting a model of a mini e-government. The journey began by convincing high leaders of the necessity to improve customs work in order to enhance trade security and facilitate cross-border trade to boost the national economic growth. The deep belief in the need for change is evident in the removal of all obstacles to the project of upgrading customs and allocating a budget to it by the ROP General High Command, since availability of money is a principal element that should be preceded by will, since it is a leadership mission in the first place.
Bayan as National Project
There are no secrets in this national project except for the word “national.’’ The Customs leadership felt that without a real partnership with the public and the private sector, they would not be able to move forward, since it is not a project for Customs alone. The Directorate General of Customs has not only achieved an electronic transformation but also a complete upgrading of the customs system. This, the Bayan System, includes three basic components: 1) an integrated system of customs procedures and processes; 2) a one-stop electronic window that links all customs partners, including government agencies, shipping and clearing companies, commercial banks and operators of ports and airports; and 3) a risk management system implemented in the field for the first time by a government service body in the Sultanate.
For the Directorate General of Customs, a “national” project meant helping other bodies to achieve the same level of success. It was easy for the Directorate not to interfere with other agencies on the grounds that it had completed its electronic transformation, and that it was not responsible for those who lagged behind. The “success factors” included taking the initiative and completely keeping away from making excuses; it included thoroughly sensing the level of responsibility. Here, the skills of the Customs team in the engineering of procedures became obvious since linking the other bodies required process mapping. Electronic transformation does not mean transformation of what existed. Real leaders keep away from easy solutions that give rise to temporary results. Nor do they fear climbing mountains and settling for an easy yet unfulfilling life.
The message
In recognition of the pioneering national efforts, I am honoured to publish my article on the occasion of ‘International Customs Day’ celebrations in the hope that I can deliver a message that we are “capable” of making the Sultanate of Oman reach advanced competitive levels. The Directorate General of Customs eliminated the illusion of “overlapping powers” when it adopted the principle of dialogue and constructive discussion — one of the most important elements in the “success factors” — in inviting the concerned agencies to attend a workshop to determine a mechanism to deal with 8,000 types of goods. In doing so, the Directorate General of Customs gave a beautiful lesson in the possibility of achieving consistency and integration in government work, after it was believed that the single item falls within the competence of more than one agency. The harmonization and integration appear between the units of ROP services themselves since this upgrade of the Customs requires ROP’s Directorate General of Financial Affairs to lend support to the electronic financial system to collect large amounts of revenue.
Efficiency in numbers
It is only possible to give an exact picture about this qualitative shift when knowing how the previous Customs situation was. I had the opportunity to work in the preparation of the Oman Logistics Strategy 2040, where I visited the air cargo warehouses and the Customs outlets in the ports and witnessed the size of the required documents and waiting queues until the Directorate managed today — for example — to reduce the initiation of a customs clearance process from two weeks down to 24 hours. Thus, Customs proved that there is nothing impossible and that there are ways to overcome the resistance associated with any attempt at change.
One of the most important “success factors” is the Customs leadership’s adoption of the method of offering positive alternative solutions. The Customs’ leadership managed for the first time at the level of the GCC Countries and the Middle East to sign a Service Level Agreement (SLA) with various government units. In accordance with the Agreement, Customs are able to clear goods within 24 hours or in some cases within two hours “automatically” if the concerned agency does not respond within the specified period, which naturally contributed to the speed of completion of the work. Hence, such agencies found no alternative but to respond to the winds of change. Leadership thinking does not hover over the problem; but it, rather, focuses most on solutions.
The efficiency of customs collection is measured by low cost and time reduction. The indicators of the World Bank report point to a cost reduction of more than 100 per cent and more than half the time as compared to countries in the Middle East and Africa. The application of the Risk Management System has led to the removal of human judgment which was previously manifested in the form of 100 per cent inspection. Today, inspection reached just 12 per cent, which is in fact a marvelous achievement. Inspection has become a selective process based on criteria and indicators that have greatly reduced time and achieved security, which is one of the main functions of Customs. The results achieved by the Risk Management System pave the way for the transfer of Customs’ experience to the relevant bodies to communicate the need to create “Risk Management Departments” in their organisational structures, particularly those related to the disclosure of goods, especially foodstuff.
The Leadership’s belief in the need to adopt the scientific approach — one of the “success factors” without doubt — led to a precise diagnosis of reality and to define the gap in order to move forward, and prepare a strategic plan with clear objectives and time frame followed by an evaluation of performance through key performance indicators.
Building on the principle of “hiring skilful employees,” the Directorate was successful in choosing the Singaporean company Crimson Logic, a company specialized in providing electronic solutions, particularly in the field of logistics. Such a choice was built on the field knowledge of the Omani Customs team.
Returning to the language of statistics, after the actual beginning of the Bayan project, Customs revenues jumped from RO 235 million in 2015 to RO 302 million in 2016 despite the decline in commodity imports value in 2016 to RO 9 billion compared to RO 11 billion in 2015.
We used to look outside to study international experiences, although their circumstances and data are different from ours. Let us this time look inside our country to see a dynamic Omani national experience that has carved its own success. The Sultanate’s ranking in the World Bank report for the ease of doing business issued in 2016 — when the Sultanate began the qualitative shift in Customs — increased 7 positions from its 2015 ranking, driven by a jump in the cross-border trade standard. Thus, the security barrier is no longer present in discussions on how to stimulate economic growth. The Sultanate also occupied the first place among the GCC countries in the same report for 2019 regarding the cross-border trade standard.
Not only has Directorate General of Customs developed the Customs system, but it has also upgraded the logistics system and launched initiatives in which the private sector tries to catch up with it, such as pre-arrival clearance, where Customs Clearance is carried out prior to the arrival of shipments to the Customs outlets, as well as the Customs Broker, as the Directorate allows any Omani citizen to apply for this job after undergoing a training course in the Customs training centre. The Customs contribution to the development of logistics is reflected in the launching of Bonded Warehouses, where the payment of the customs taxes that must be paid during the importation process and their entry into the local market shall be suspended, which motivates re-export. The Customs team has many more initiatives in a stimulating work environment and a receptive and responsive leadership that applies the principle of open door policy in its essence rather than its formalities.
In conclusion, there are many important lessons that can be learnt from the experience of the Omani Customs which is worthy of documentation and study in preparation for their implementation. Yet, one of the most important “success factors” lies in the complete faith of senior leaders in the importance of human capital. The General High Command gave importance to building and preserving the “cumulative” Customs expertise of its team. The Customs leadership came from the system itself, which reflects its success in building leaders. I witnessed young leaders “empowered” with both high scientific qualifications and practical experience in the field. The leader of any institution, no matter how capable they are, cannot make a difference without selecting a strong team. [The author is a Strategist and Board member of the Omani Economic Association. Her twitter handle is: @AnnAlkindi]