transformation day - nos€¦ · transformation nos’ fixed network strategy nos’ mobile network...

Transformation Day

Technological Transformation


NOS’ Fixed Network Strategy

NOS’ Mobile Network Strategy

Innovation as a service

Evolve HFC Grow FttH+

Full duplex(N+0)

Distributedarchitecture

DOCSIS 3.1

10 GPON

Footprint

Mbps

HFC network starting point >1000 homes

=

32-128 homes

100 – 1000 homes

Capacity is managed inan efficient “need to” basis

Docsis 3.1 is the current norm

Removes active elementsfrom the network (less opex)

Is a step function deployment strategy

Evolution to Remote Phy / Mac Phy in order to move fibre deeper into the network as needed

10-100 homes

Standalone Shared (with VDF)

Penetration

Market Share

CAPEX

HH Density

FttH Cost Per Home Passed

≈100-250€2014-2017

≈100€

>15%>25%4P

40%

3P

60%35 – 40 €

AVERAGE SAC

CPE

350 – 400 €

Sales commissions

Installation + Other

Peak funding reached in first 2 years – network CAPEX and SAC

3-4 years to reach target penetration

Target IRR 18%

AVERAGE ARPU AND CUSTOMER PROFILES

70

90

110

130

150

170

190

210

CAPEX PER HOME FTTHNETWORK (NOS, DST AND VDF)

FTTH SWAP: HP DELIVEREDTO DATE (CUMULATIVE)

Mar 18 Apr 18 Jun 18May 18

(Euro)

2018 Forecast YEND

20162015 2017

Cost per Home (FttH – NOS)

Cost per Home (FttH – Total)

-50%

2.6 million FttH households to be swapped withVodafone until 2022 (1.2 million NOS, 1.4 million Vodafone)

VDF to NOS NOS to VDF

% NOS HOMES PASSED WITH FTTH

3,2%

9,4%

16,4%

18,5%

27,8%

2014 2015 2016 2017 2018e

NOS FTTH EVOLUTION (NOS, DST AND VDF)

2014 2018E 2022E

HFC FTTH (NOS)

3.2

1.2

3.23.5

3.8 3.94.3 4.4 4.4 4.4 4.4

(Million homes)

By the end of the project, we will have the most advanced network in Portugal with a significant advantage in terms of future CAPEX requirements

Best user experience

Significant reinforcement of capacity and coverage, in line with traffic and customer growth

Focus on 4G technology

Compact and multi-technology architecture

2G/3G/4G Equipment enabling more efficient network resource management, reduced energy consumption and operating costs

3G to 4G network reconversion

3G network convertedto 4G, keeping pacewith handset migration

Quick responseand less investment

Gbps ready network, IoT and 5G evolutionary

Layers of 4G capacity and new funcionalities enable evolution to Gbps IoT HW ready for NB IoT

5G evolutionary network

+200% 4G capacity

Increased 4G capacity and coveragein 90% of network

Option to gradually refarm 2100Mhz(+4G capacity and 3G network renewal)

Future Proof 4G network

Complete modernization of 3G network

Global network optimization

+ Voice Capacity / EDGE data

+ 2G capacity (TRX): 25%

15% of sites with reinforced coverage

Global network optimization plan

Improve 3Gand 4G data QoE

+ data coverage (90% ofpopulationcovered)

Enable new4G offers over 150/50M

+ voicecoverage

Improvement of voicecall quality

Decrease in dropped calls

250%

200%

150%

100%

50%

0%

A B C D E F G H I J K L M N O P Q R S T

DISTRICTS

HUAWEI NOKIA

Optimized Clusters: 12%

Madeira & Porto Santo: (97%)

Torres Vedras: (96%)

Coimbra: (96%)

Braga e Guimarães: (98%)

Penafiel e Paços de Ferreira (98%)

S.J. Madeira & Recarei: (91%)

Modernized Zones: 19%

Alto Douro e Minho: (93%)

Vila Real: (92%)

Zones being modernized: 26%

Beira Litoral: (67%)

Porto: (51%)

Zones to be started: 43%

Modernized Zones: 17%

Sintra e Estoril: (100%)

Algarve + Costa Vicentina: (97%)

Zones to be started: 64%

Zones being modernized: 19%

Margem Sul: (77%)

Açores: (80%)

Lisboa Core: (29%)

PROJECT COMPLETION 2Q19 (75% BY YE18)

Before After Before After Before After

implemented excellent samples retention rate

23%

24%

100%

2017 2018 2019 2020 2021 2022 2023 2024 2025

May: EC decision as to the use of the 470-790 Mhz frequency band

700 MHz band attribution

30 June: 700 MHz attribution calendar published

Technical harmonization of the 3.4-3.6 Ghz and 24.25-25.5 Ghz bands

5G available in one major city in every member state

700 MHz band available in all member states

Gigabit Society:(5G available in major cities and major terrestrial transport paths)

December: TDT licence deadline

L2600

5G - 3500

5G – 26 000

U2100 + L2100U2100

5G-ULL1800

G900 + U900/L900G900

L800 5G-UL

L700 / 5G - 700

Super Data Layer

400-800MHz

eMBB/FWA 10G

Capacity 100MHz eMBB/FWA 1G

mMTC e URLLC

Capacity 20MHz MBB

Capacity 15 + 5MHz MBB

Capacity and Coverage

20MHz MBB UL 5G

Coverage 7.8 + 0.2MHz Voice

Coverage 10MHzMBB/IoT/VoLTE

UL 5G

Coverage 10MHz mMCT & URLLCeMBB/

100Mbps

Products and ServicesQuick to Market

New SW every month with new features and bug correction

Attackers are leading change with new methods

Vendor lead times of 2-3 quarters for development and deployment

Higher quality

Focus on OTT

Feature Rich

Record launches

Innovation

A History of Innovation

IRIS7 Day

RestartnPVR NOS Play

RDK STB 4K

YoutubeLeanback

UMA New

Interface

2011 2013 2014 2015 2016 2017 2018

and more to come …

V1

Full control of the STB

V3V2

HARDWARE:

SOFTWARE:

Quality

Scale

Innovation

Speed (features and HW)

Voice as a new control interface

RDK OPEN SOURCE

aligned with COMCAST (RDK Alliance)

SIMPLE(R) STB

More flexible installation

Eco Friendly(er)

More business opportunities

Better CustomerExperience

Satisfied Customer

- 40% Cost

+ 20% Lifetime

Moving to full IP OTT

SAME EXPERIENCE ACROSS DEVICES

ALWAYS EVOLVING

Same approach as Amazon, Google and Apple

Easier to integrate new internet driven services

Less cost

Future proof

OTT Docsis 3.1Speed test

UMASet-top box

Operating Model Transformation

Programme

Zoom-in on selected initiatives

Transformation Programme building blocks

Key drivers for Transformation

Tour of the Transformation Hub

A disruptive way of working

…the ultimate Entertainment company

…the partnerfor digital transformation

…a SERVICE 4.0 company, for superior customer value proposition

TransformationProgramme

Transform the Operating Model

Build Key Capabilites

Revolutionize Customer Centricity focusing on quality and experience

1.Achieve NPS leadership

Boost digital weight on total client interactions

Capture recurring cash savings

Build a Fitter Operating Model2.

Strategic ambition Core objectives

1. Ambitionand Vision setting

2. Transformationroadmap execution

3. Active transformation follow-up and monitoring

Ongoing

Baseline & AmbitionSet-up Launch of Transformation

Voice of the Customer

Voice of the Employee

International Outside-In Insights

Transformation Programme

Starting Point

Transformation Programme

Ambition and Guiding principles

Strategy definition for priority blocks

Programme Roadmap

* Target Operating Model

Team setup and scope definition

Goal:Customer Experience

LeadingDigital Experience

Non-incrementaltransformational lens

Simplicity, forboth Client and NOS

Qualityby design

First-time-Resolution

Higher focus,higher effectiveness

Agile, autonomous and accountable teams

New technologies, new skills

07 0906 08

01 02 03 0504

Create a transformational customer experience CUSTOMER EXPERIENCE

Develop digital offers and business models OFFER AND BUSINESS MODEL

Establish customer centric processes in the organization, focused on service and data-driven

CUSTOMER CENTRIC PROCESSES

Implement productivity levers to simplify currentprocedures and generate efficiency

FITNESS

Build skills in the organization to address the transformation goals ENABLERS

TRANSFORMATION PROGRAMME


Digital

Data Management & Adv. Analytics

RPA & AI

New Ways of Working

4

3

2

4

CustomerLighthouse

Next Gen Marketing & Sales

CustomerService 4.0

Service Failure Avoidance and Mgmt

Offer Simplification

Segment of One

RelationshipLifecycle

Management

E2E Process Integrity

New Service Models

RelationshipLifecycle

Management

Zero Waste

Simplify & Automate

60# # of initiatives

3 4 5 3

2 2 3

7 5 4

4 5

CUSTOMER EXPERIENCE

OFFER AND BUSINESS MODEL

CUSTOMER CENTRIC PROCESSES

FITNESS

ENABLERS

Initiative Active MonitoringInitiative Design Initiative Execution

Expected annual impacts defined, including investments needed

Detailed implementation plan, including resources and change management

48

• Fecho de DS = Fim de desenho detalhado da solução

• Início Desenvolvimento IT = Negociações completas, equipas formadas e kickoffsiniciados

• System Ready = desenvolvimentos concluidos e testados com qualidade

• Business Ready = Áreas alinhadas e envolvidas, pessoas formadas, dashboardsde monitorização prontos

• Check Points Dev = Demos periódicas feitas à equipa core

• Go Live = Roll-out

MilestonesFase 0

Centralização de Criação

Fase 1Limpeza

Fase 2Caracterização

Fase 3Utilização Holistica

Setup Inicial

Gestão da Mudança

Início Desenvolvimento IT

Configurações e Bloqueio

Desenvolvimento Relatórios

Testes Aceitação

System Ready

Formação

Business Ready

Go Live

Desenho solução

Aprovação DS

Fecho de DS

Estimativa de Esforço Final


Desenvolvimento MGM

Preparação Sist. In house

Check Points Dev

Testes Aceitação

System Ready

Formação

Business Ready

Go Live

Desenho solução

Aprovação DS

Fecho de DS



Desenvolvimento IT

Check Points Dev

Teste Aceitação

System Ready

Formação

Business Ready

Go Live

Desenho solução

Aprovação DS

Fecho de DS



Desenvolvimento IT

Check Points Dev

Teste Aceitação

System Ready

Formação

Business Ready

Go LiveMar 20Oto 19 Nov 19 Dec 19 Jan 20 Fev 20Fev 19 Mar 19 Abr 19 Mai 19 Jun 19 Jul 19 Ago 19 Set 19Set 18 Oto 18 Nov 18 Dec 18 Jan 19

17-09-2018

30-11-201801-10-2018

15-10-2018

16-10-2018

13-12-2018

14-12-2018

15-10-2018 16-11-2018

01-11-2018

01-112018

20-122018

24-012019

21-022019

21-032019

18-042019

17-05-2019

30-05-2019

31-05-2019

19-042019

15-03-2019

29-03-2019

24-052019

21-062019

19-072019

16-08-2019

19-09-2019

20-09-2019

17-05-2019

03-06-2019

18-10-2019

31-10-2019

01-11-2019

24-062019

22-072019

19-082019

23-092019

Capacidade de controlar Fraude em UA’s com dívida, melhorando a experiência do Cliente.

Catálogo de Moradas único, limpo e enriquecido. Com a criação da equipa de Qualidade de Moradas é garantida a centralização da criação e edição das moradas e proteção da integridade do Catálogo.

Lançamento da nova pesquisa de moradas nos principais front ends,com possibilidade de venda de multi-tecnologia. Redução de

incumprimentos por morada incorreta, usando o modelo preditivo.

Utilização do catálogo, normalizando as moradas de faturação e contacto.

Adaptação dos front endssecundários e back ends

Centralização da Criação de moradas

Initiative life-cycle

Go live preparation, operational KPIs defined and tracing process in place

Training sessionsfor new processes

New software, new tools

KPIs defined and dashboards ready

Robust iterative process to challenge results and enable early response

Calculate monthly KPIs

Match expected vs real impact

Monthly forum with Executive Board

Adjust activities and recalibrate

Focus on vision and ambition

set-up

Main focus on initiative design

and planning

Main focus on implementation

and capture of quick wins

Main focus onmonitoring and

boosting impacts100

FY18 FY22

60

FY17

0

FY21

40

FY20FY19

80

20

All initiatives in monitoring mode

1st wave initiatives into monitoring mode

Launch of 1st

wave initiatives

Launch of 3rd

wave initiatives

1st wave initiatives into execution

mode

Launch of 2nd wave initiatives

2nd wave initiatives into execution

mode

Enhancecollaboration leveraging

new work methods (agile)

Boost productivity with collaborative, simple

and social tools

Catalyse new practices with innovative spaces"Transformation Hub"

People

Dedicated team of PMOs

Initiatives locatedat the Hub and

staffed with people from key areas

People selected from top talent

pools and with key subject matter

expertise

IT involved and accountable early

on to speed up developments

and ensure early feedback loops

Weekly sponsor updates and

bi-weekly Board meetings ensures

strategicalalignment

40% time allocation for

initiative members

We revised our employee Bonus targets to reflect the Transformation ambition and reinforce our commitment to customer experience

We adopted multiple tools… …with specific goals in mind

Collaboration & Communication

Team planning Project management

office

Seamless synchronization

Live collaboration

More collaboration

Better communication

Omnichannel engagement

More productivity

Higher motivation

Increasedco-responsability

People Tools

Single space dedicated to the programme allows teams to focus on the transformation initiatives

Broad common areas to promote interaction, team work and awareness of other initiatives

Spaces dedicated to team needs during the work day: thinking rooms, quiet rooms, phone booths,chat & lounge rooms

Workplace equipped with most recent technology to foster collaboration, e.g. seamless connectivity and best-in-class VC

Focus

Collaboration

New needs

New technologies

Workstations

Thinking rooms

Standing tables

Quick meeting stations

Brainstorm rooms

VC meeting rooms

Quiet room

Chat&lounge room

19

2

5

6

3

3

1

1

People Tools Space

01

Transformation Programme layers

02

Selected initiatives

03

Areas for initiative zoom-in


Enablers

Fitness

Customer Centric Processes

Offer and Business Model

Customer experience

Advanced Analytics Programme

Digital Programme

Automation and Robotization

Service Architecture

Equipment Recovery Optimization

Troubleshooting Management

Service to Sales

Key Driversof Change

Approach ofTransformation

Initiative Ambition

Advanced Analytics

DATA STRATEGY

Data-centricity culture

Data recognized as key asset

Data available and usedfor all company's decisionprocesses

Value from data constantlymonitored

ADVANCED ANALYTICS & AI

Business outcome driven

AA key value generators and path to new businessmodels

AI and ML constantly used forreal time decision making

Use case industrialization

DATA AND ANALYTICS GOVERNANCE

Organization synchronized

Fully functional, vested andcoordinated AA organization

Mechanisms in placeto control data platformsand quality

A P P R O A C H

Squad operating model ensuring E2E development

UCs to create relevant valuein the short term

Use Case Owner

Business Translator

Data Scientist

Data Engineer

Subject matter expert

Smash voluntary churn

Intelligent collections

NBO@B2B

TV QoS from customer’s eyes

A P P R O A C H

Digital

A P P R O A C H

Automation and robotisation

More than 600 processes identified with high prevalence of automation potential

Marketing & Brand Strategy

CRM & MicrosegmentingCampaigndevelopment

Campaignexecution

Sales Strategy & Planning

Channel ManagementSale of products and services

Up-sell and Cross-sell

Order entry & Handling

Provisioning & Activation

Customer Service Strategy & Planning

Commercial enquiries Technical enquiries

BillingPayment processing & collection

Churn prevention Retention Deactivation Winback Value Management

Market intelligenceand segmentation

Product/segment strategy & planning

Proposition development

Proposition life cycle mgmt

Relationshiplife cycle mgmt

Network and Tech. strategy & planning

Network and Techn. development

Technology deployment Fault repair

IT strategy & planning Service Design IT development Service Transition

Strategy/Business Development and CF

Business Planning Corp. Comm & IR LogisticsData & Knowledge Management

Finance & Audit Legal & Regulation Real Estate ManagementHR Management and Admin

Procurement

Process Dev. & Governance

Culture Organization

Marketing Campaigning

1

2

3

4

5

6

7

8

9

10

11

Lead Generation& Sales

Order Fulfilment

Customer Service

Billing & Collection

Retain & Winback

Product Mgmt.& Innovation

Network & Technology Mgmt.

IT Management

SupportFunctions

Governance& Culture

CU

STO

MER

FA

CIN

GEN

AB

LIN

G

D R I V E R SO F C H A N G E

We have assessed the full organisation to identify repetitive processes

Identified 14 areas with high prevalence of automation suitable processes

Selected backoffice, customer service, accounting and network operations areas

Selected >80 processes for this robotisation wave

We developed an approach to select the 4 areas with highest potential

Within those areas, we identified the processes with most fit to be automated

A P P R O A C H

CoE RPA NOS

Business Areas IT

Applications

Security

…

Customer Service

Back Office

Network Operations

Accounting

Field Force

Sales

Planning and Control

HR

…

A P P R O A C H

Service Architecture

CLIENT CENTRICITY

SERVICE QUALITY ENABLERS

CLIENT EXPERIENCE

Customer service issues are resolved at and

Voice of the Customer

that take into account a omnichannel service

orchestrationwith new processes, tools and incentives

A P P R O A C H

B2B Sales

Customer Service

Inbound & Web

Customer Service

Retail

Customer Service

Technical CS

Field Force

Loyalty

Technical CS

Customer Service

Loyalty

Retail

Loyalty

Design customer-centric Processes

Implement multi-channel Integrated

Tools

Define cross-channel Incentives

Foster omnichannel

Culture

Track omnichannel

Reporting

Strategic dimensions

Handovers addressed

A P P R O A C H

Equipment Recovery Optimization

•

Customer Journey Disconnection

•

•

Real time reporting and monitoring

Flexibility on drop-off location and slots

Seamless and consistent experience across channels

A P P R O A C H

Troubleshooting and managing technical failures

Customer journey I need technical help

PHYSICAL SUPPORT

SELFSUPPORT

REMOTE SUPPORT

Illustrative: No TV access troubleshooting

A P P R O A C H

Self diagnosis

Automatic channels

Remote assisted

Store Assisted

Local Assisted

Client Channel Interface

Channels

Troubleshooting platform

Troubleshooting enablers

Data Repositories

Network record

Client history and profile

Client network record

Common faults and planned interventions register

A P P R O A C H

Device Client Network Local loop and e Access network

Transport network

Core Network/Service platforms

HandsetTV Box

Router/Pen/ONT

WiFi Coax

Ethernet Antenna

RF internal passive, TAP,

Drop

Node, Amp, OLT…

Mobile

IP, Dark Fibre, DTH …

TV, Voice, Net, Services…

Serviceto Sales

Call centre capacitated with strong sales skills

Sales oriented training and coaching

Client need based scripts across segments

Strong reporting model, enabling granular and real time performance

Holistic incentive model, assuring engagement from all stakeholders

A P P R O A C H

Wrap-up

[%, Thousands, M €]

Note: Figures as reported in each period.

2014 2017

RGUs Total OPEX Direct CostsRevenues Non-Direct Costs

EBITDA

+13%+178 M €

+12%+108 M €

+21%+85 M €

+5%+23 M €

+14%+70 M €

+23%+1,786 k

+22%CAGR

+4%CAGR

+17%CAGR

Fixed Growth 2014-2018E

Fixed Capacity Unit Costs Per Mbps-95%

2,2x

1,2x

1,9x

Fixed Traffic

Fixed BB Subs

Fixed Traffic / Sub

+40%CAGR

+10%CAGR

+30%CAGR

Mobile Growth 2014-2018E

Mobile Capacity Unit Costs Per Mbps-37%

3,9x

1,5x

2,8x

DataTraffic

Mobile RGUs

Data Traffic / RGU

70

30

Q1’14 Q1’18

87 90

2014 2018E

-57%

+1%

CAGR (%): -19%

CAGR (%): 0.2%

NOS Network OPEX per Gbps (Fix+Mob) [€/Gbps]

NOS Network OPEX [M €]

Operating & Structure Costs 2017 [M €]

322M€

Wages& Salaries

Other

Supplies &Ext. Services

Maintenance& Repairs

SupportServices

Commercial & Customer Related Costs 2017 [M €]

CustomerRelated

133M€

Commercial

Direct Costs 2017 [M €]

529M€

Programming

Traffic + Interconn

Other

ADDRESSABLE COSTS= 45% OPEX

Premium sports costs +40M€ since 2015 (additional 15M€ to be absorbed until 1H20)

2015 2016 2017

173

196

172

181

194

150

369352

344

Customer Related Technical

Telco CAPEX [M €]

Customer Related CAPEX, % of Telco Revenues [M €, %] 2017 Customer Related CAPEX Breakdown [%]

2015 2016 2017

14%

196181

150

13% 10%

-24%

CPE≈30%

Installation≈20%

Commissions& Others

≈50%

Technical CAPEX, % of Telco Revenues [M €, %] 2017 Technical CAPEX Breakdown [%]

+12%

≈ 35%

≈ 65%

173 172

194

13% 12% 13%

2015 2016 2017Baseline NW Expansion, substitution, integration proj. & others

Transformation Day

transformation day - nos€¦ · transformation nos’ fixed network strategy nos’ mobile network...

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