Insufficient environment for development of real science – Sar Kinal

Aplus Consulting Co., Ltd does tasks such as monthly payroll calculation, support for recruitment work, and support for HR compliance service for many foreign clients. They also offer training services for human resources management for HR professionals although Aplus is expertise and playing a key role in Manpower outsourcing Service. They work with partner consultants and lawyers to solve various problems that occur related to HR field and labor compliance.
We asked Mr. Sar Kinal, the Managing Director about points that foreign companies should keep in mind when they conduct business in Cambodia. (Interviewed at: September, 2017)

Interviewee Profile

Sar Kinal: Managing Director of Aplus Consulting Co., Ltd.

We need “qualified people”

We had interviewed your company in 2015. Have there been any changes in this industry in the last two years especially in human resources skills?

I think that the main change in this industry is that quality is needed more than anything, if you cannot provide quality through your services, then you cannot compete with other companies. To provide quality, we must have qualified staff, this is the recent change in the industry. Three to five years ago, the product or the provided services was not much different. We now must compete with quality to gain trust from clients.

These days there are new local start-ups and companies coming to Cambodia from overseas, amongst one is Japanese companies. Most of them are entering the market with higher quality, and providing better skills to employee. This is the reason why existing companies and new companies need to require qualified people, proper staff capacity development to provide better service and good quality of products. Such situation in the market makes the human resources fluid, especially qualified people are moving around a lot now. Therefore, companies are challenged with seeking for and retaining their talents.

Another change is skill sets of resources. Everyone is talking about Industry 4.0, which is about the automation in the framework, changing from the traditional labor market. The employer is now facing increasing budget for human resource skilled with IT or ICT skills. If you want automation and to be able to use automated machines in your organization, then you need people who understand it. The salary line is also changing, minimum wages for workers in the garment industry are also increasing. The government has come to a decision for 170 USD of minimum wage for 2018.

The HR industry is changing dramatically too, including recruitment agencies, there are now more than 100 companies in Cambodia. As the number of new companies increase, job seeker registers are also increasing.


What kind of jobs do you offer in your outsourcing business?

We have outsourcing services in many fields such as customer service at banks, workers for manufacturing companies and logistic companies, drivers, cooks, accounting staff in various sectors. We started in 2008 and we have been expanding every year, currently having almost 1000 outsourcing employees.


A background in accounting and finance can be an easy way to find a job

Could you tell us about the Cambodian job seeker’s preference and Characteristics?

In the past, most of the people used to follow what other people were doing, they didn’t have their own goal and majors of interested was not clear. Even in my generation, we didn’t have a lot of career guidance to tell us what’ major and job fits us. This is not only about the students but the parents couldn’t consider what is the best path and the best major for their children were. Lately, accounting and finance is an easy path for Cambodian people to find a job, that’s why these subjects are popular.

In the past, most universities provided only business specialty courses such as accounting, marketing, finance, and not much real science courses such as engineering and architecture. It is because of the investment cost and low demand for the academic background in the past. As a result, not many Cambodian people wants to study real science.

Education sector, educational institutions are not aggressive in investing in real science either. Real science requires the purchase of machines and equipment, which requires enormous investment. While in the job market, there are not enough jobs to promote the engineering or real science field. Even TV and newspapers do not frequently show the people from this field, instead focus mostly on the business field. That’s why many people do not understand the advantages of jobs in engineering, design or architecture.

For these reasons, the public view towards job in business, economic or finance profession is increasing, and many people want to study the field of Accounting, business and finance too. However, now things are changing. In the past, your basic knowledge may not have been carefully considered with matching jobs. Currently, if you are specializing in accounting, the employer expects the skills in the accounting field. If you specialize in HR, they expect the skills in the HR field. To create better services and products, many companies have realized that specific professional skills are important, comparing with the past. Without qualifications, getting a job is difficult. This is the challenge for job seekers, whether they are applying for a job in an international company or a local company.

Although family business is still mainstream in Cambodia, many of them are trying to convert from family management to standard management. To compete in the market, they must change their structure. To do this, they will need qualified people to support them.

Is there still a difference between Phnom Penh and the provinces?

Yes, there is a difference between Phnom Penh and the provinces. There are many job seekers coming to Phnom Penh because there are a lot of opportunities here. You may still be able to find human resource out of Phnom Penh but the number is small, because most want to come to the city to create a new life and family here in the city.


The needs of human resources in technology and accounting sector will increase

What industries are popular amongst Cambodian job seekers?

Microfinance and banks are growing rapidly in Cambodia. That’s why this industry needs more people to support them. In the past, foreigners could enter at management position, but now we have more Cambodians entering management level for banks. This is another reason why the financial industry is popular amongst job seekers. From my point of view, as it has already grown rapidly, the speed of the growth will slow down.

Currently other ASM actively focus on Industry 4.0 or event Industry 6.0, so in the future, the technology field will require more work force and job seekers in this industry will increase. This is because the Cambodian government is currently working on developing experts in this industry and to support the IDP 2025 which was launched in 2015. Although it is a field that Cambodians have not shown interests in so far, and it will not be the top of the range, but it will be popular in the future. I think that it will take three more years for people to understand this market.

Tax and accounting is also a field with potential growth. Because currently, the government’s tax department is discussing tax regulations and implementing the new tax regulations and laws, companies will now take financial reporting seriously. People who understand this sector will be important for the market.

The growth in these two industries can be expected, and can be supported, focused by TVET center, educational institutes and HR experts or professionals.

Government restrictions for setting up new universities

The government announced some initiatives and goals of improving human resources in some industries. Please tell me the current situation and what is needed to improve human resources in Cambodia.

The government has already taken a lot of initiatives so far. For example, the reform and restrictions of examination at high schools. Before, students could copy from documents or each other, but now they cannot do that. This is forcing the students to start preparing for the classes and to ensure they pass the exams with quality.

The Ministry of education also has started to reform some curriculums at the schools as a national program. They have now started to improve the quality of higher education. The ACC (The Accreditation Committee of Cambodia) also have standard operations so universities can follow, they have restricted set up of new universities as well. Now, you cannot set up a new university, you will have to provide evidence of qualifications to setup a new university. If you don’t have any, you will not be permitted to setup new schools.

The government is also encouraging TVET Center and Technical schools in real science, engineering and IT. The government is trying to improve quality of education to ensure that they can meet the market needs and they will also work closely with other ASEAN members and other organizations to support the improvement. Cambodia is not the only country suffering with skill mismatch, many ASEAN countries also face similar problems. Cambodia will also need workforces in architecture and construction, the government is also paying attention towards this.


The mind-set is totally different

What should we think about when looking for workers?

I think that the situation is getting better now. It seems that Cambodian job seekers and Japanese employers are deepening their understanding towards each other. Cambodians have an image towards Japanese companies for punctuality, hard-working, loyalty towards the company and long-term employment. However, some of these are different cultures comparing with Cambodian people.

When you talk about long-term employment, Cambodian people don’t have such mind-set. Some people change jobs twice a year, some change jobs every year, and especially in some industries the workers are fluid and the turnover rate is high. If the workers find a better opportunity than their current job, they will move to another company easily. This is because the trust mentality and the mind-set is different, but miscommunication about career development plan among employer and employee is another reason.

Currently Japanese management levels are working hard to deepen their understanding that Cambodians are based on a family oriented culture and will always put family first. Japanese people may work till 9 or 10 o’clock at night until the work finishes, but this is only possible in Japan. Because of difference in the culture, and security concern, you cannot do the same here in Cambodia. Security issues towards women workers are another issue. These aspects can lead to anxiety among the workers if it is not done correctly.

I also want to mention about rules and regulation within the Japanese companies, they are strict towards policies as well. For Cambodians, it is not common to follow the rules strictly. Even in transportation, you can frequently see some people ignoring the traffic light or rules, driving without proper traffic tools and breaking rules in general. This is also because of their mindset or low education.

For security and safety, you may want to make the rules and expect them to strictly obey them, but you need to do this step by step. You must know the way to deal with it. These points are important things for employers to understand when they enter Cambodia.

If you don’t know how to work with them, you may think Cambodians are lazy. This is not true, many of them are quite active and enthusiastic. But due to the favorable weather, relaxed life style, and the number of public holidays in Cambodia, the working environment and other framework surrounding such issues, makes it hard for enthusiastic people to be in action. This is not because they are lazy but partly to do with the general system here in Cambodia, which are starting to change now.

However, there are positive aspects too. Cambodia is full of young talent, and the young generation has an opened mind-set. If you can create opportunities for training, learning and communication, they will be eager to adapt. If you know how to work with Cambodians, their potential can be very high, so the key is to develop active human resources. Regarding this, you can see more and more young Cambodian people taking part in top management of small or big local companies and even in international companies. There are also many young Cambodian entrepreneurs setting up new companies too.


Aiming to be HR experts and professionals

Could you tell us about your future business development?

We are one of the biggest HR companies in Cambodia. We would like to keep focusing on the outsourcing business. We want HR or manpower outsourcing service to be known for our core services in the HR sector. We also want to be the big hub of HR experts and professionals to support companies in Cambodia, so people will know Aplus consulting as one of the professional companies.

We want to be known as HR professionals and a company complied with regulations, and we want to be known as the best company in this industry. There are many HR companies in Cambodia, but we want to be the best among them by having a qualified team and providing best services and complying with laws which is responding to our vision “Sustainable success for all”. Therefore, caring for our teams, our clients, and stakeholders is the way we are working hard to develop and expand our company toward the ASEAN Market in the future.