Growing a mobile operator from nothing to 400 employees in three years
SMART headquarters is done in green and white.
Smart has the fastest mobile internet service in Cambodia, at up to 22 megabits, according to CEO Thomas Hundt.
“If you want to have mobile internet in Cambodia, there is no faster option up to 22 megabits if you have the right device, “said the 34 year-old CEO who was born in Blankenburg, in the former East Germany.
Those speeds are available in Phnom Penh, Siem Reap, Battambang, Kampong Cham, Sihanoukville, right now according to Hundt.
Smart is one of the top three brand names in mobile operators in Cambodia, headquartered in a modern building along the southern part of Monivong, with a distinctive green and white color scheme and very clean.
“Internet consumption over our network is skyrocketing,” he said.
His childhood in the orderly society of the German Democratic Republic (GDR) had a big influence on Hundt’s outlook and it was his early apprenticeship with one of Germany’s largest industrial companies Siemens that sent him on his path that led him to Cambodia’s mobile phone market.
The Berlin Wall came down when Hundt was a boy of 13.
“I can still remember, in those weeks and months everybody was traveling to western Germany, to collect welcome money, and to go shopping.”
Even though Hundt’s homeland of Germany is reunified now largely under the capitalist system of the west, he still argues that GDR education system was possibly better than the one they have in Germany today.
”The school system in former GDR was completely different. It was all inclusive school from first grade to tenth. Education could compete with western school system. Education on average was higher than right now in Germany. “
After a mandatory one year service in the German Army, Hundt was admitted into a Siemens program for young people with high potential.
Through Siemens University he worked and studied for two years, running through various departments including a commercial educational program, accounting, financial, legal, business administration.
After two years in the program Hundt went to work for Siemens in Munich doing commercial sales in the telecom infrastructure sector, which led him to Taiwan, China for more than a year, as well as Russia, Ukraine and other countries selling cellular networks.
In Azerbaijan, Hundt served as a board member of telecom operator Azerphone. Later, he founded a new telecom operator in Turkmenistan, all on behalf of Siemens between 1996 and 2008. During that time, he met a lot of investors in the telecom sector including those of Latelz, which had acquired a license in Cambodia and were looking for someone to build up the team and run the business.
Hundt arrived in Phnom Penh in mid-2008 and started from scratch.
“Latelz is the legal entity and Smart is the brand.”
That’s the time when I changed from being a telecom vendor to the operator. Being an operator is much more complex.When we started officially to work, on the first of June 2008, we had no employees, no brand, no network, no office, and we started becoming a professional telecom operator.”
Hundt hired the first people, in technical, marketing, human resources, administration and accounting.
They rented the building on south Monivong and got underway.
One of the important steps in rapid growth, Hundt says, was the merger with Starcell in December, 2010, a move which grew Smart from 600,000 subscribes to 900,000 at the time, and to 1.5 million today.
“We narrowed the number of telecom operators from nine to eight with that merger,” Hundt said.
As a result of the merger TeliaSonera, previously Starcell’s shareholder now holds a 25 percent stake in Smart.
The merger also made Smart the number-3 player in the market, behind Cellcard and Metfone.
“When we came here, we were the number seven operator. Our aim was to become number three which we have reached now.Our next target is to reach number two,” Hundt smiled.
He shared how he believes success was achieved from number seven to number three in the marketplace:
“We came with an extremely fresh, appealing, attractive brand, developed by us, for us, worked out with an agency in a complete brand package to differentiate us. We established an extremely consistent brand association, with the name, the logo, the color and the phrase Welcome to the Smart Life.”
Hundt says the look of the shop is very consistent with a very strong brand and a lot of money was spent on advertising.
“From a technology view we were the same as everybody else in the beginning. We had to come in at a substantial disadvantage in terms of the coverage – but now we are covering 23 provinces.”
To compensate for the early weaknesses, in addition to the emphasis on a strong brand, Hundt opened a 24-hour, 7 days a week call center.
“Our Smart Store and Smart Shops are always open on Sundays too.”
“When we came here, we wanted to do things better as compared to what was existing in the industry. We took ideas from the outer world to be adapted to Cambodia.”
Hundt is proud of the influence Smart has had on making the marketplace better.
“The idea for us as a business is that whoever comes to our shop, comes in to touch, feels the brand, even if he is not a customer yet, we have a good chance to make him a customer.”
The Smart brand is also acoustic, Hundt says, with three unique songs and an association with green apples. The Smart staff is clad in Smart-color polo shirts.
“We have been copied now quite intensively by others.”
“We have been really coming with new, fresh ideas, implemented consistently in a way that has not been done before in Cambodia. That’s a key distinction.”
Hundt supports a youth leadership organization called AIESEC, which also gets key support from Paul Popelier of Coca-Cola, and Rami Sharaf of RMA.
On Friday, September 9, Smart headquarters hosted AIESEC’s launch of their Global Leadership Program. Hundt puts in money and time for the young leaders group – and sees a big advantage in the support, both for Smart and for Cambodia in general.
“We provide funding and our venue for them to host all these workshops and trainings” he said.
“Challenge number one for Cambodia is, we have a huge young population that needs to be accommodated in the labor market, millions of people coming, and all of them need a job. We need to grow companies to accommodate all these people, and for that you need leaders.”
“The AIESEC idea of promoting leadership and developing future leaders out of students is extremely appealing to us because it is exactly what we stand for, having a good life, good education, developing the society. It is exactly fitting to our philosophy. We are sponsoring AIESEC since they came here, and it has been proven an extremely valuable.”
After 15 years in the telecom industry and the last three years building up Smart in Cambodia, Hundt says he keeps door always open to staff.
“The biggest challenge we are facing with regard to upgrading is that many Cambodians don’t know better. This is one of our main challenges, you can do it this way, and this might be the better way. Some have thought this guy is crazy, but the results stand for themselves. Those who are with us are enjoying it. Now we have a different culture than what people are used to having. We are certainly different and I am proud of that,” Hundt said.
“We have a young team with average ages around 25. In the end, success is a lot about motivation.People believe in the vision and they are also fighting for it. By motivating the people to be loyal, sticking to our company, we are creating a kind of family. Most of the people we hired first, they are still here.I am quite a fanatic for having good quality. We have certain ambitions in terms of quality, but also about processes and service. From the very beginning I was praying that people should do better than they used to. We are telling people what is the better way -- what can be done if you are thinking out of the box.”
Hundt admits it can be “extremely exhausting” to maintain high standards of cleanliness and order, but he offers no compromise.
“The entire environment has to look neat and clean and there can be no compromise,” he smiles.