When Franck Touch returned to Cambodia as a tourist in 2001, he had no idea that 14 years later he would still be here, running one of the Kingdom’s biggest and most respected Information Technology firms. Born to a French mother and Cambodian father, Touch spent his childhood in Cambodia but moved to France before the country fell into civil war. 30 years later, he came back to look for his family. He found them, and the place where he felt he belonged.
“I decided to create a business in Cambodia, because I wanted to stay here to keep in touch with my roots,” he says.
Touch’s company, KhmerDev, was originally set up as an outsourcing operation, mainly serving French companies. But over the years he has cultivated more and more clients inside Cambodia. He says the change – from dealing with companies accustomed to operating on the international market to firms emerging locally – was not always easy. “I discovered a market here for programming, network development, websites, and marketing, but in Cambodia 10 years ago, customers were not ready to pay the right price for the services,” he says.
Higher Prices for Higher Quality
Initially, the Phnom Penh wing of KhmerDev operated at significantly lower margins to its international operations, but over time and with much patience, Touch says he convinced the locals that they would be paying higher prices for higher quality. “Step by step we built up the business in Cambodia, and after a while people saw the quality of our service and customers agreed to pay the right prices,” he says.
European clients, says Touch, are generally simpler to work with than Cambodians as they can have a wider experience in business. They have a deeper understanding of the nature of the job, the price, the processes, and they are mature enough – business-wise – to understand what they’re getting. In Cambodia, this is not always the case. “They always want to bargain over the price,” he says. “Mid-size and small customers want everything without paying very much for it.”
When building an IT company from scratch, as was the case with KhmerDev, staffing is undoubtedly the greatest obstacle to success, Touch says. Adding that there are roughly 1,500 to 2,000 IT graduates countrywide each year. “We don’t have a lot of human resources here, because there are too few schools that teach IT. Of the 2,000 students, maybe only 200 or 300 are any good, and that’s not enough.”
“ TO BE A GOOD PROGRAMMER, A GOOD IT ENGINEER, YOU NEED TO LOVE IT, YOU NEED TO HAVE IT AT HOME AND SPEND A LOT OF HOURS LEARNING THE INTRICACIES OF COMPUTER WORK. ”
The other major problem is perhaps more deep- rooted and systemic – hence harder to change – and Touch is blunt on the topic. “It is governance, and corruption,” he says, adding that complying to laws and regulations can often put firms at a disadvantage. “You obviously have to follow the laws in Cambodia, but if you pay everything – the tax on salaries, tax on benefits, and so on – and your competitors don’t pay, then they can sell the same products for less money,” he says. “You need the market to be fair, but when you work with some companies, it can be…” Touch hesitates for a moment “different for them.”
Quality is Key
In 14 years of operations in Cambodia, Touch says he has seen a lot of change. He says that Internet access was prohibitively expensive 10 years ago – $200 per month for one gigabyte – making it near impossible for young people to take an interest, and the first steps toward an IT career. “To be a good programmer, a good IT engineer, you need to start programming when you are 14, 15, 16; you need to love it, you need to have it at home and spend a lot of hours learning the intricacies of computer work, basically to be a geek,” he says, adding that today’s Internet penetration has vastly increased the base of talent for him to call upon, somewhat offsetting the lack of formal education programs. “Now it’s cheap and everywhere and students can pay for unlimited Internet, it’s made a big difference.”
As a result of increased Internet penetration and usage, the market for IT services in Cambodia is becoming increasingly crowded, but Touch thinks that’s generally a good thing, especially for clients, with firms now having to fight for business. “There are now more competitors at our level. 10 or 15 years ago, no one in Cambodia was working at our level, but now there are quite a few companies,” he says, adding that the competition keeps his staff on their toes and operating at their peak. “It’s a good sign, it means the market is maturing, so it keeps us working at a high level, and quality is the key to keeping us on top.”
Having watched the country rise and fall from within and from afar, Touch says that those experiencing Cambodia in 2015 should be full of optimism. “I love the country. I’ve started a number of companies (K-DigiData, Vecteur-IT, AD Communications, O3D Asia, KGI), and we’ve provided more than 150 jobs. I’m proud of that, and I want to continue to do business in Cambodia,” he says. “I hope that the government will fix the problems with human resources and education, and I think if they succeed in that, Cambodia will be a great place to do business.”
Text by Rupert Winchester| Photograph supplied
Words by Rupert Winchester