People trump technology in successful transformation strategy

Who: VEON Group, formerly known as VimpelCom, is headquartered in Amsterdam, the Netherlands. It operates in 10 diverse markets across three continents providing mobile communications and digital service to 212 million subscribers.

What: The Group’s Talent Management team understands that having the appropriate skills and talent are critical to the Group’s success, and more foundational to digital transformation than technology.

How: The team discovered and incorporated TM Forum’s Digital Maturity Model (DMM) into their brand-new capability planning framework. One of the group’s most successful companies, Kyivstar in Ukraine, pioneered its use.

Results: The findings surprised top management which then supported Kyivstar in setting long-term priorities and developing a strategy to close the skills and capability gaps identified. Others in the Group, starting with Beeline which operates in Kazakhstan, will follow Kyivstar, using VEON’s capability planning framework with the DMM to plot aspects of their transformation journeys.

VEON is world’s ninth largest mobile operator Group with 212 million subscribers and around 50 thousand employees, who deliver mobile and digital services in 10 diverse markets across three continents.

VEON’s Group Talent Management team recognizes the importance of employee development and upskilling in achieving a successful digital transformation. With this project, the team intends to enable all the operating companies to identify capability gaps, aligned to company strategy and its priorities, and close them through various internal and external interventions.

Everyone likes talking about culture, talent and organizational transformation when discussing digital transformation but, “It's usually seen as being about costs and not as investment,” says Erzsébet Malzenicky, Talent and Compensation Director at VEON. However, this is not how her company sees it.

Importance of leadership

The Group Talent Management Team has the full backing of the Group’s top management, which is far from always the case. Malzenicky adds, “Our General Executive Management sees those future needs [regarding talent and skills] as burning ones, and digital transformation and people development are indeed on their agendas.”

Both Malzenicky and Jelena Šutić, Group Chief People Officer at VEON, have a wide experience of transformation projects with network operators, and are aware of the role leadership support plays in such projects. So VEON’s Talent Management team also engaged with Professor Nathan Furr of INSEAD in 2019, who studies innovators’ methods and companies’ transformations. He helped them define and align what digital transformation means for VEON.

“That was all about getting our leaders on the same page when it comes to digital transformation; getting them to understand and use the same language and call the things the same name,” explains Šutić.

Gathering company-wide insights

Beyond the buy-in of leaders, transformation has to be inclusive and holistic to succeed.

“We discovered TM Forum’s Digital Maturity Model (DMM) which was exactly what we needed. As a framework, it still allows for the company to look at it from its own strategic perspective, but puts everything into one frame and allows informed conversations.”

The DMM is part of the Forum’s suite of tools to help CSPs navigate digital transformation and maturity. They include the DMM itself, 30 key performance indicators and associated metrics, a Digital Maturity Readiness Check, training courses, and Digital Transformation Trackers, which provide insights and analysis of industry trends.

The DMM is designed to provide senior management with an accurate snapshot of what is going on across an organization and provide a starting point from which to build out strategy.

The results of the DMM lays the ground for management to achieve that common understanding and consensus about the ways forward. This includes providing a common language to talk about digital transformation across an organization, as stressed by Professor Furr. It is complimented by an expert team to help with an initial digital transformation readiness assessment, as well as training courses to ensure companies gain maximum value from the exercise.

Sustaining success

When the group Talent Management team approached Aleksandr Komarov, CEO Kyivstar, about the Forum’s DMM he was more than willing to engage.

The diagram below shows how the DMM breaks the different aspects of an entire organization down into manageable chunks to gather the necessary data via an employee survey.

This lack of understanding across the company about what digital maturity means and the role of digitalization in longer term goals was an invaluable eye-opener to top management. After absorbing the initial, top-level findings, there was further analysis of the data, right down to the function, managerial and sub-dimension level.

This revealed a huge variety of perceptions, which again surprised the management “because we thought it’s about facts not opinion, yet we saw huge differences,” Malzenicky says.

Kyvistar has about 3,500 employees and 1,000 of them from across all disciplines were selected to take part in the initial survey of the criteria questions. The respondents included 50 transformation specialists. In the opinion of the 950 non-experts, “Everything was fine. They really believe that everything is working professionally and that they are very [digitally] mature – there were almost no gaps. The expert 50, on the other hand, identified some serious gaps,” Malzenicky comments.

Pulling it all together

Next, VEON brought its 50 experts together with the top management team plus experts from TM Forum. They analyzed and discussed the results in a two-day workshop and after the discussions, reached common understanding and what the “to-be” targets should be.

Šutić explains that focus is essential. She says, “Our aim was identifying critical capability areas and one reason we used TM Forum’s [DMM] was that we didn't want to boil the ocean. We wanted to know as a company where we need to focus to close the gaps. The second important thing for us was when closing the gaps, to not only to close them from a skills and competencies perspective, but from the point of view of the organizational design, and from process and technology perspectives, then bring together all these dimensions in a strategy.”

She continues, “Roles have to be organized in the best way and aligned with their underpinning technologies. This is critical because Kyvistar is in the middle of a BSS transformation, which is huge and touches everything in the company, literally everything. You cannot do it without the cooperation and coordination of all the teams, end to end, in all the areas. That is where you have the technology and commercial teams working really closely together.”

Next steps

The group human resources team will now provide support for engaging with the Forum’s DMM service on the basis of on-going consultancy if the CEOs from the opcos request it. After Kyvistar’s successful engagement, Beeline in Kazakhstan has embarked on the same process.

To meet more TM Forum members and learn about their digital transformation journeys, go to tmforum.org/membership.