Company's development strategy
Mission, vision, values
Become an irreplaceable and usual part of everyone's life, changing, surprising and exceeding expectations. The key concepts of the Group's Mission are:
A leading Kazakh integrated service provider in the information communications market.
Coordinated actions of all group members to maintain, strengthen and form leading positions in key segments of the information communications market of the Republic of Kazakhstan through the implementation of strategic initiatives and development areas.
Current global trends in the telecommunications industry
The image and development of the telecommunications industry in the world (including Kazakhstan) is now determined by six key trends:
- 1increased competition in the market and increasing pressure from players from related industries (banks, digital companies, retail sector players);
- 2a shift towards simple, intuitive product offerings and digital self-service;
- 3general internet penetration and shift of preferences towards mobile internet;
- 4high-growth load from OTT platforms on the network and their involvement in further infrastructure development;
- 5promotion of 5G mobile networks;
- 6Impact of the 2020 COVID-19 on consumer demand structure, accelerated digital transformation (ecosystem construction, forced online, etc.).
These trends determine the movement of industry leaders towards the active implementation of new high-performance management models (agile), cost optimisation, including through digitalization of client and internal processes, diversification of operations and participation in ecosystems, and preparation for the next stage of the evolution of network infrastructure.
Strategy KPIs
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 through:
- ensuring leadership in monetizing growing traffic using the More For More principle, as well as control over the aggressive pricing policy of competitors in the markets of fixed and mobile communications;
- creating a portfolio of competitive products that are mutually complementary;
- development, pricing and sale of products based on advanced customer segmentation methods;
- optimization of marketing and sales costs.
Many examples from various industries clearly demonstrate the inevitability of digital transformation of the economy: the exit of players with fundamentally new, initially digital operating models is accompanied by a significant increase in pressure on the performance of traditional players. Traditional digitalization leaders are the most resilient to market change, able to adapt quickly to the new market situation.
This trend is particularly visible in the most technologically advanced industries, such as telecommunications, where digital and technology companies accounted for the lion's share of this growth, while the share of telecom players fell by 35%. The decline in the financial performance of telecommunications companies around the world indicates the need for urgent implementation of digital methods of work and analytics to reduce costs and find new sources of income. At the same time, the effect of digital transformation has already been proven — the implementation of this set of measures makes it possible:
- increase revenue by 15-20%;
- reduce operating costs by 20-30%;
- reduce capital expenditures by 5-10%.
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:
- work on the "Everything Online!" principle, with digitalization of client routes, application of digital sales methods, automation and robotization of auxiliary functions;
- ensuring leadership in CVM and in-depth analytics using internal expertise, experience and data (both within the Group and for external monetization);
- digitalization of the network through network function automation and 5G network deployment;
- development of digital business lines and partnerships to diversify the portfolio and enter related industries.
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 (up to 2022): achieving digital maturity through optimization and digitalization of client routes and implementation of digital marketing tools;
- Second horizon (2023+): 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.
The SDD also covers the integration of mobile asset networks within the Group to realize operational and capital cost synergies.
The implementation of the new strategy will make it possible to achieve the following strategic goals in the horizon of 5 years (target state for 2024).
First-choice brand
Effective organization 
Digital platformRisk assessment when implementing the Strategy
The activities of Kazakhtelecom JSC are exposed to various threats that contribute to the achievement of the Objective. In this regard, in order to ensure preventive risk management measures, potential threats under the SDD were identified, with an indication of the impact and measures to reduce them.
However, Kazakhtelecom JSC does not rule out other threats, including risks not currently known or considered immaterial by Kazakhtelecom JSC.
First choice brand
- Close cooperation with the authorized communications body. Monitoring of draft laws and regulations, timely notification of interested parties of draft/amendments to laws.
- Participation in working groups on changes to communications legislation in the authorized body, the TTA, and the NCE. Submission of problem issues to the Roundtable in Parliament, ROSPP, and the Economic Policy Council. Organization of meetings with deputies.
- Establishment of a strategic management unit at the Group level.
- Creation of balanced KPI at the corporate level for all Group participants.
- Ensuring the segmentation of client profiles and the performance of business activity of Group members in accordance with it.
- Creation of a strategic management unit at the Group level (approval of tariffs, investment, interaction with the regulator).
- Creation of balanced KPI at the corporate level for all Group participants to maintain parameters:
- ensuring FMS KPI at the level of ARPU of at least KZT1,050.
- the number of SIM cards does not exceed 1.1 million units.
- and revenue of at least KZT 13 billion.
- In the event of aggressive actions of a competitor, the corresponding change in parameters will be made.
- Implementation of management accounting for business units and Group products to assess margins and shareholder value effect.
- Search for new growth points in the retail market.
- Creation of a strategic management division at the Group level (approval of tariffs, investment, interaction with the regulator).
- Creation of balanced KPI at the corporate level for all Group participants.
- Implementation of management accounting for business units and Group products to assess margins and shareholder value effect.
- Introduction of management accounting to calculate the actual effectiveness and effect on shareholder value.
- Cooperation with the state body to revise the terms of the project in the event of the identification of material threats to the failure of the projects.
- Creation of balanced KPI at the corporate level for all project participants.
- Building a position, organizing interaction with the regulator to revise the conditions (limited in time and constant).
- Search for new growth points in the mobile market.
Digital platform
- Recruitment and/or reclassification of employees to implement initiatives.
- Introduction of new approaches to the digital platform, provision of training.
- If necessary, ensure certification.
- Implementation of standards on new technologies.
- Use of equipment and solutions from leading manufacturers.
- Development of corporate sales of ICT services by the Company's branches, implementation and promotion of cloud services IaaS, PaaS and SaaS based on data centers, cloud data storage system, development of a long-term strategy to promote ICT services (marketing and promotional events).
- Attraction of experts to solve the problems of system integration, formation of a strong staff, increase in sales personnel in the segment of major clients.
- Certification of the Data Centers according to the quality system.
- Provision of additional consulting services to large enterprises, development and promotion of system integration services and outsourcing.
Effective organization
- Systematization of network infrastructure facilities to select optimal technical solutions for use in each specific case.
- Updating the regulatory framework for the Company's investment activity.
- Negotiations on value reduction.
- Transfer of contracts in KZT and in roubles to foreign rights holders.
- Diversification of currency positions by storing and placing temporarily free cash funds of the Company in a basket of currencies.
- Building a transparent system of incentives for key personnel/developing tools to recognize key personnel.
- Succession planning for key positions.
- Creation of a target model for training and development of qualified personnel (functional academies, leadership school).
- To assess the liquidity and capital adequacy of the Banks.
- To adhere to the corporate standard on treasury operations of Samruk-Kazyna JSC.
- Performance of explanatory work among personnel on events and changes to the Company.
- Timely notification of personnel of HR events.
- Systematic monitoring of the moral and psychological climate.
- Implementation of regular feedback sessions between the manager and the employee.
- Clear identification of line managers "areas of responsibility.
- Improvement of the personnel performance assessment system.
- Performance of sociological surveys of personnel.
- Creation of an integration project body in collaboration with the Group's strategic management division.
- Implementation of management accounting to calculate actual synergies and effect on shareholder value.
- Creation of balanced KPI at the corporate level for all Group participants.