SERPIN Transformation Program

The process of client centricity change is one of the Company’s key areas of activity. To determine the client’s needs, you need to look at the service provided through the eyes of clients — this is very important for understanding the development and optimization of client routes. Over the past year we have done a lot to improve our services.

Firstly, we defined the overall goals of digital transformation of the Company as a whole, and focused on specific problems related to customer service, network quality and internal development.

A focus map was approved, which contains measurable goals structured into a single pool, and we began to work on them in a systematic manner. The progress is monitored on a weekly basis at Scrum sessions, Agile approaches are being introduced.

Secondly, building a culture of change is important. Communications have become faster and easier, cross-functional teams from different divisions are being formed. Company began to speak openly about problems that impede the Company’s development, raise issues that they had not previously considered relevant, and set up teamwork between divisions, which is extremely important for a large Company.

Thirdly, Kazakhtelecom JSC achieved results in developing client routes and improving service levels. After optimization and digitalization of a number of processes, the Company accelerated the connection of services.

The number of challenges remains significant. The application of Big Data technology contributes to a more accurate identification of “weaknesses” and promising areas that should be prioritized for work in the first place, as it is confirmed by quantitative data. The Qlik Sense tool is used to generate reports, dashboards and track statistics.

In 2022, the process of transition to microservice architecture was initiated, the Big Data Factory was formed, and a lot of attention is paid to information security issues within the Zero Trust project.

The transition to the divisional structure that has been formed greatly simplifies the management of business processes and increases the speed of decision-making.

Transformation is not a separate direction or activity in the Company, but a change of consciousness of each employee. Kazakhtelecom JSC plans to continue working on sol­ving tasks aimed at increasing customer loyalty of the Company and following the principles of customer centricity.

Goals of transformation:

• meet market requirements and expectations;
• to make the Company ready for changes and challenges;
• to improve and raise competitiveness.

The transformation program is being implemented in three strategic areas: the First-Choice Brand, the Digital Platform and the Effective Organization. Each area deals with a number of tasks, consisting of 48 projects.

The goal of SDD 1 is to maintain long-term leadership in mobile communications markets for B2C and B2X (including B2B, B2G and B2O markets), fixed-line B2C communications (including product segments of broadband access, telephony and Pay TV), fixed-line B2X communications with an increase in revenue and optimization of marketing and sales costs.

Digitalization is a key driver of the transformation program.

Kazakhtelecom JSC, within the framework of the Digital Platform SDD, aims to digitally transform its core business and network and monetize its unique market position using new digital business models and partnerships.

As part of the strategy, Digital Transformation is considered in terms of three areas (digital transformation of the core business, development of new digital lines of business, digital transformation of the network) and two time horizons with different objectives:

• The first horizon: achieving digital maturity through optimization and digitalization of client routes and implementation of digital marketing tools;
• Second horizon: large-scale implementation of analytics to optimize processes in all areas of activity, robotic automation of back office and support functions, large-scale network automation and 5G launch, development of new digital lines of business.

The key objectives of SDD 3 are to launch a large-scale performance improvement program and transition to the optimal organizational structure of the Group, including:

• elimination of duplication in the network infrastructure, transition to wireless technologies in rural areas and increasing the volume of services;
• automation of routine tasks and advanced personnel performance management;
• optimization of administrative functions, including further optimization of SSC and outsourcing of certain functions;
• optimization of the Group’s organizational structure with a separation of the Holding Company and key business units.

In addition, work on improving the efficiency of the organization provides for the automation of budgeting and post-monitoring of investment activities, which will allow for the effective management of the Company’s operating and investment portfolios.

Here, work is also underway to change the corporate culture, create a favorable microclimate in the Company for the successful implementation of all initiatives under the SERPIN transformation program.

Last year’s SERPIN transformation program in financial terms ensured free cash for the Company in the amount of about KZT 9.6 billion. This indicator is ten times more than the announced targets. The SERPIN roadmap is a set of strategic and business initiatives that support the project implementation of the Company’s corporate strategy designated up to 2029.

Based on the results of the previous year, all planned milestones at the end of December were implemented in 95% terms, which ensured that the plan was significantly exceeded.

9.6

billion KZT free cash flow secured for the Company by the SERPIN Program in 2022

95%

implementation of all planned milestones by the results of 2022