Marieke Smits: 0:00:03.0: 

I would like to welcome you to stage, Hamza, and we will be discussing the digital world-class organization. 

Hamza Tedik 0:00:11.6: 

Finally, on the stage at Anaplan! It's a big achievement for me. My name is Hamza Tedik. I'm head of the GPS organization at KPN, leading all the shared server centers. I'm really passionate about digitalization. For me, that's the engine for transformation. So it's a great pleasure to share the highlights from our digital transformation journey, and also to learn from you. Before I start, let me first show you a short movie about KPN. 

[Video plays 0:00:40.8 - 0:02:06.3] 

Hamza Tedik 0:02:06.3: 

So KPN is the leading telco provider in the Netherlands, serving consumer and business customers with our fixed and mobile networks for TV, broadband, and mobile services. On top of that, we also deliver content, entertainment, gaming, and smart home applications. We are the market leader in fiber for both consumer and business. Our 5G network is recognized with the highest score worldwide. This year, we launched a new company, a tower company called Althio, and last year, we acquired Youfone. By 2027, two-thirds of our energy will come from renewable sources. We serve over four million broadband and fifteen million mobile users on our networks, and now hold the top spot in both segments. Security is of central importance to us, and we invest heavily to protect privacy, and our customers are our top priority. We attained industry-leading net promoter scores. All of these achievements are made possible by team KPN, over 10,000 professionals who drive innovation and connectivity across the Netherlands. Our purpose is clear. We go all-out to connect everyone in the Netherlands to a sustainable future. That means that we want to make the Netherlands the best-connected country in the world. 

Hamza Tedik 0:03:27.0: 

We are literally building the digital highway of the Netherlands. As launched during our Capital Markets Day in '23, our Connect, Activate, and Grow strategy is built on three key pillars. One, we continue to invest in our leading networks, meaning that we will continue with the fiber rollout until 85 per cent of the Dutch households have access to internet by 2030, and we will also continue with the modernization of our mobile network. A lot of investments happening there. Two, we continue to grow and protect our customer base by offering them converged propositions and rewarding loyal customers. Three, we further modernize and simplify our operating model. To do that, we have launched a couple of transformation programs within KPN. These priorities will support our ambition to grow our service revenues and adjusted EBITDA by approximately three per cent on average, and our free cash flow by seven per cent over the entire strategic period. The question now is, what does this mean for finance? What are the implications for finance, and how is this strategy translated into the finance function? With finance, I mean core finance, procurement, projects, supply chain management, basically all the [?stuff 0:04:48.6] functions, and this is the answer. 

Hamza Tedik 0:04:51.6: 

So take your time to have a look at this nice visual because it touches here, everything. So our aspiration within finance is crystal clear. We want to become the best in our profession and achieve the status of truly digital world-class. That's not a slogan, it's a commitment, and this slide captures how we are making that happen. To us, digital world-class means operating in the top quartile for business value and operational excellence. Let me walk you through this slide. At the heart of everything we do is the customer. You can see the customer on the top receiving a mobile handset, as an example. If you put the customer central in your vision, in your strategy, it means that you need to eliminate all your inefficiencies, all your waste, and your duplication in your processes, because the customer, the end customer, is not willing to pay for your inefficiencies, right? Also, not for the inefficiencies in the finance function, which is ultimately reflected in the overall P&L of KPN Group. That's why continuous improvement is in the midst of this slide. The middle part is basically the operations of finance. It's the engine that drives value. It is the engine that drives efficiency. It's the heartbeat of finance and GBS. Surrounding this score, you will see our finance professionals performing analysis, running reports, producing forecasts on a rolling basis. That's basically what you see here: reporting and forecasting is an assembly line, like a factory, meaning that it is not a static process, it is not a static product. It's a continuous practice that keeps us aligned also with the business. 

Hamza Tedik 0:06:49.2: 

Ultimately, you will see our business controllers who play a key role within finance, within the company, standing in front of a screen or dashboard, monitoring the progress of our actions against the strategic objectives, Connect, Activate and Grow. Ultimately, that's what matters the most, right? It's not about finance. It's about the company realizing the goals, and in order to achieve this transformation, to realize this transformation, we have two powerful drivers, human and tech. The green desk and the blue desk. The green desk is about our finance community. It's about how we live our core values. It's about trust, courage, growth. It's about, we work together within finance, but also how we interact with our partners, whether it's Anaplan, Oracle, or Microsoft. It's about building the skills that we need over three years. The blue desk is about digitalization. It is about how to become a digital and modern finance function. Finance at your fingertips. That's the slogan, and how cool is that? Realizing a touchless month-end close, hands-free forecasting, interactive dashboards, AI operations, and real-time insights. I think we made significant progress, so let me walk you through a couple of examples, and then we will end up with the forecasting part. 

Hamza Tedik 0:08:14.5: 

First, starting with Bridge. Bridge was the name of our ERP cloud transformation program, which we finished two years ago. It is globally considered one of the best implementations for two reasons. First reason is the scope, because we moved our ERP on-premise to the cloud, not only for finance, but also for procurement projects, supply chain management, and HR, so the entire scope, basically. The second reason is that we have standardized a lot. When we started the program, we had more than 1000 customizations in our ERP system, and we ended up with only three customizations after go-live, single instance ERP system. Then, we've got data, which is also mentioned today a couple of times. Really important. We already had all our finance data in a data warehouse, but within KPN, we have approximately 40 data platforms that we are now going to migrate to a new, modern data platform, and introduce the concept of data mesh which, basically means that the responsibility for data products will reside within the business. If you have a single instance ERP system with a broad scope, and you are introducing the concept of data mesh, unified data model, which it's also called. Then, you have laid the foundation to scale up with AI. We did a lot of experiments with AI, also in this part. The question is, how can you bring these prototypes to production, and how can you scale? 

Hamza Tedik 0:09:43.1: 

So we have crafted a game plan, basically, for AI, and we will make sure that we implement and scale these AI use cases within finance. Dashboarding is also a very important concept. It's also an award-winning concept back in 2018, where we created these nice visuals, dashboards, interactive dashboards, where you have the possibility to drill down to the lowest level of detail. Last, but not least, forecasting, connected planning, hands-free forecasting, performance management. It's really the bread and butter of finance, in my view. It's the license to operate, and that's why it's a key pillar in our digitalization strategy, because it touches both business value and operational excellence. I will do a short deep dive on the next slide, but this is how digital world class looks like to us. So customer-centric, continuously improving, powered by a strong financial community, and working with state-of-the-art technology. You also need to have a burning ambition to realize this. This will be my last slide about forecasting. So we basically started our forecasting journey in 2018. Then, we had a burning platform, so different than a burning ambition, because the financial performance of KPN at that time was not that okay. Basically, our forecasting tooling or forecasting process, forecast accuracy, was really crap, to be honest. 

Hamza Tedik 0:11:14.7: 

If the financial performance is not okay, and the tool and the process is not working effectively, then you can imagine what kind of tension, what kind of stress you have within the finance organization. So there was an urgent need to change the process, the way we worked, but also the tooling. We selected Anaplan in 2019, because Anaplan had, at that time, already state-of-the-art technology, a modern, professional tool, but to be honest, when we started with Anaplan, it was more a transactional relationship. Anaplan delivered the software, and we implemented it with some help. Looking back, that was not the best choice, because I truly believe that, if you want to transform your business, if you want to change your business models, your forecasting model, then you need to use the technology as a catalyst for your transformation. You really need to rethink your models along with the product. It will enable you to do much more in a different manner, and that's where the value comes from. We identified three guiding principles at the start of the program. First, we said it must be action-driven. What do we mean by that? Every plan you make, every financial plan you make, should be designed to drive action, because what's the purpose of forecasting? 

Hamza Tedik 0:12:33.0: 

The purpose of forecasting is not just to produce numbers; it's about generating the plans that create the most value for the company, right? Let's not forget, numbers support decisions, but the actions will deliver the results. That's what matters. If you are able to shift the focus from numbers to actions, you will see that you have a tool - a forecasting tool - that is designed for you to make impact, not to just produce numbers. So that was the first guiding principle, from numbers to action. The second guiding principle was basically to install a learning loop. What do we mean by that? We wanted to move to a driver-based forecasting, much more driver-based, extrapolating the trends with machine learning, and also introducing the concept of improvement actions, or trend changes. After every month-end close, you can measure your forecast accuracy. You can evaluate the impact of your current actions and adjust your outlook accordingly. If you do that every month, you will see that your forecast accuracy will gradually improve. The third guiding principle was, obviously, digital. Remove the Excel spreadsheets as much as possible, automate, and have a faster planning cycle. Aside from the investment in the tooling, we have also invested a lot in the teams. So we've built this COE Centre of Excellence within GBS, and we made sure that we had all the capabilities in-house with product owners, grand masters, model builders, developers, adoption specialists, you name it. 

Hamza Tedik 0:14:05.4: 

There's a heavy investment that you need to make. Also, from a functional perspective, we made some changes within the finance function, so we centralized FP&A within GBS, transformed FP&A, traditional FP&A to xP&A, extended planning and analytics. In the work, you can also see the ambition, because we want to move from traditional financial forecasting only to also business planning. If you look at our current scope, we are also serving the business. We are using Anaplan, not only for financial planning, but also for business planning. Like, for capacity planning, FTE modeling, CapEx, contract costing, and there is still room for opportunity there. If we look at the results, so last year, we asked Hackett to do a benchmark for us. One of the key conclusions of Hackett was that our forecast accuracy for the P&L is extremely high. It's 99 per cent from top line to EBITDA, whereas digital world-class performance is 97 per cent. It's fantastic, right, but it comes with a price, because - and that's the whole story - if you look at how much FP&A capacity we have allocated to the forecasting process, it's around 23 per cent, and that is higher than digital world class, which is around 12 per cent to 15 per cent. That's an interesting question for our CFO team. We've got high forecast accuracy, but the effort is also high. 

Hamza Tedik 0:15:38.1: 

So that's something that we are discussing continuously in our teams. Obviously, and my last point, there are always new challenges. At the beginning of this year, I challenged Anaplan as well, because they are partners. So I asked them three questions. Help me to improve to boost the adoption, especially within finance. As I've said, we're using Anaplan for finance and business, and to be honest, if I look, if I compare these two units, I think that our business users use Anaplan better than finance. I understand that, because people within finance are more critical. They want to understand how the calculations are done. They want to do all kinds of checks and balances, but that's interesting to understand what the motivation is behind that. We took an action to, yes, to understand what we can do to improve the adoption within finance. We had some good recommendations that we will implement. Second question was about proving the value of… Anaplan proving the value of the investments we have made in our COE, in FP&A, because, ultimately, it's basically a business case, so why do we need to invest in a tool? Why do we need to invest in a team, and who would see the benefits? I think we have found a way how to quantify that with interviews, questionnaires. 

Hamza Tedik 0:17:04.2: 

So this top of mind, whenever we do a business case epic user story, I want to know what kinds of benefit it will bring to the company. Last point, and I'm happy that Iver also explained that in his presentation, identifying future opportunities. I do not feel only responsible for dealing with today's challenges, but I feel also responsible for the challenges that the company will face in the next two to three years. So I want to know, from my partner, what are your plans? How are you going to develop the forecasting tool, and how can I benefit from it? That's a question that I also asked to Anaplan's management team, to help me to understand what's on the roadmap, and how I, as KPN organization, can benefit from it. So don't be shy to challenge Anaplan as well, because if you're only calling them when you have an incident, then you will not get the most value of it. To sum up, I hope that I gave you a short overview of KPN, how we have translated the company strategy into finance, what our burning ambition is, to become digital world-class, and a short view on our forecasting journey. Thank you for listening to me.