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Going Dutch on transformation with KPN

There's no place for weak legacy systems, product silos, slow TTM, and inefficient O&M in the cloud era. KPN chose the right solution and partner and made 7 serious gains that won it a TM Forum award.

By Katie Matthews, Zheng Zelong
Jun 2017

Back in 2014, the Dutch telco KPN was finding it hard to expand its market share for a slew of reasons, including inefficient and costly legacy architecture, product silos, and an incomplete picture of customer requirements. The operator knew it needed to transform to respond to the market with the kind of agility that the cloud era demands. And to do so, it needed the right solution and partner.

Back in the day

Three years ago, KPN’s ambitions were being frustrated by an inefficient and costly IT architecture, which couldn’t support the operator’s long-term business vision. For example, more than 75 percent of KPN’s 80-plus applications were outdated. Moreover, many were overlapping, with the operator running three different business supporting systems (BSS) for the mobile market. Its systems and processes were organized and structured along product siloes, and the telco’s sales staff lacked a 360-degree customer view, hindering both cross-selling and up-selling. 

KPN’s distributors were frustrated with having to enter orders for multiple products, while customers experienced slow order times because the shop floors were entering orders in multiple systems using multiple processes. Customers also faced friction when trying to move from one product or channel to another, negatively impacting KPN’s brand equity.

Finally, its weak legacy systems crippled innovation by slowing TTM and inhibiting KPN’s ability to comply with new EU regulations.

Time to change

KPN decided its transformation project needed to improve stability, simplify processes, shorten TTM, and reduce TCO. KPN’s business aim was to increase its market share by improving customer satisfaction and responding quickly to market trends. The technical measures for achieving this included simplifying its IT portfolio, standardizing processes across all brands, and consolidating its IT stacks into a single low-cost environment.

KPN contracted Huawei to migrate its legacy IT systems to Huawei’s BSS, which comprised Huawei’s CRM system as well as the core rating and billing module in Huawei’s next-gen BSS – the Convergent Billing Solution (CBS) Release 5. The project involved configuring and commercially launching more than 200 offerings on CBS R5.

KPN and Huawei jointly redesigned internal processes to be independent of products and channels, enabling a seamless customer experience. The shift to a single CRM system and order entry system also simplified the processes at customer touch points, including channels, shops, digital channels, and call centers. 

KPN also rationalized many of its legacy price plans and products to smoothly migrate customers from legacy systems to new processes and IT stacks, removing silos and optimizing the customer experience. 

According to KPN CIO Bouke Hoving, “During transformation, you can never really predict what the real challenges will be. With Huawei we were able to manage and overcome these challenges and succeed with transformation. And that’s the key to successful collaboration.”

The gains

With far greater efficiency and agility, both customers and channel employees are seeing the benefits of transformation.

As a result, customer satisfaction has jumped dramatically: KPN’s Net Promoter Score has shifted from negative to positive, with NPS for residential customers at +9 and for consumer mobile customers at +10 in 3Q 2016. 

KPN is the largest telecoms and IT service provider in the Netherlands. At the end of the third quarter of 2016, KPN was serving 3.66 million households and providing 5.27 million consumer mobile connections to the Dutch population of 17 million. 

Digital transformation also supports KPN’s six strategic aims: New ways of living and working reflect the rapidly changing work environment that will enable people to work anytime, anywhere. The telco’s energy-efficient solutions are designed to help customers across sectors to cut power use. Its best-in-class networks are grounded in helping the whole of Dutch society flourish, which is linked to another strategic aim of ensuring security and privacy. Its other two major activities are healthcare and CSR in the form of sponsorships.

Recognized for its success in the industry, KPN won the Business Transformation of the Year Award at TM Forum Live 2016. KPN is now equipped to realize its strategic vision and extend its lead in the market.