The transformation of our Group was a key issue in past years and will continue to be so in coming years. Against the backdrop of digitalization and the associated changes, we must secure our long-term viability and competitiveness. This process is connected to complex staff restructuring. We are creating new jobs in growth fields and are training qualified personnel to fill these positions. Other areas are the focus of restructuring activities involving workforce reduction. We make sure that all restructuring measures are implemented in a socially responsible way for our employees. In doing so, we try to support them in the best way possible on our way to the digitalized working world.
Integrated staff restructuring management introduced at Telekom Deutschland GmbH
Over the course of the upcoming changes, our goal is to provide even more professional assistance to employees during their professional reorientation phase. That is why integrated staff restructuring management was introduced in the Germany segment, which should be effective early on in the restructuring process. This means that in cases where tasks could be canceled or different skills could be required for certain positions, we want to take preemptive steps and consult with the affected colleagues and managers much earlier than we have in the past. During such consultation, various employment alternatives are devised together with the affected employees and their specific potential labor markets are ascertained. Added to this is comprehensive assistance with developing an individual job application approach and – if necessary – targeted planning and implementation of skills development measures.
Accompanying the above measures, Vivento, our internal service provider for Deutsche Telekom's staff restructuring measures in Germany, will continue to help civil servants transfer to positions in public service. About 450 civil servants employed at Deutsche Telekom opted for a permanent transfer to federal, state or local authorities in 2017. In 2017 the focus was primarily on transfers of civil servants to the Federal Employment Agency, branches and field offices of the Federal Office for Migration and Refugees and to the Federal Armed Forces. Employees were assisted in finding positions with federal, state and local administrative authorities.
New framework conditions for staff restructuring at T-Systems
Competition in the worldwide ICT market and the changes resulting from digitalization are creating major challenges for us. This necessitated a collective agreement for 2016 and 2017 that does not place any additional strain on T-Systems' competitiveness and supports staff restructuring measures. The collectively agreed upon moratorium on compulsory redundancies will last until December 31, 2018. As an employer, we continued to make significant investments in the necessary socially acceptable staff restructuring measures in 2017.
T-Systems' goal is competent, employee-oriented change management that enables employees affected by staff restructuring to undergo professional reorientation and effective reintegration. Negotiations with employee representatives regarding framework regulations for the staff restructuring process took place at the end of 2016. The central works agreement on supporting and implementing staff restructuring at T-Systems International (CWA on Staff Restructuring 3.0) was revised in March 2017. It defines HR instruments as well as processes and procedures for carrying out compulsory staff-related measures. The Job Service & Placement (JSP) service launched in 2014 will continue to support affected employees in finding new jobs. The cooperation with JSP is set forth in T-Systems' Central Works Agreement on Change Management.
Transformation measures were necessary at the TC Division and IT Division in 2017. This change resulted in a moderate loss of jobs. The reconciliation of interests required for this were negotiated with the relevant department representatives. Here too, assistance with helping employees find new employment opportunities is important so as to ensure that the restructuring process remains socially responsible. Thanks to JSP, T-Systems was able to find new career perspectives for 50 percent of the 188 affected employees.
JSP's success stories in past years were also noticed by other Group units. As a result, JSP took over advisory activities for 25 Telekom Training employees and has already found solutions for 75 percent of them. Since September 2017, JSP has additionally been supporting the internal staff restructuring process of the Europe Board department and has achieved initial success in advising both employees and managers.
Reorientation of Telekom Deutschland GmbH
Telekom Deutschland successfully completed its transformation program in 2017. The goal of the reorientation was to make the unit more competitive by changing its structure. To this end, Telekom Deutschland concentrated on processes and interfaces that directly affect customers. The transformation project consists of three large organizational key elements. First, a new service organization was created that includes most of the operational back office – customer service and technical service. Hence services for consumer, business and carrier customers now come from one source. Second, a new sales organization was created for business customers from the sales units of the business customer segment, while the sales organization for consumers was rebranded and expanded. Technical service units were integrated into Deutsche Telekom Technik so that network expansion would be managed entirely by this company. On July 1, 2017, about 20,000 colleagues moved to the new units by way of transfer of operations, job offer process, transfer, assignment or temporary leave from civil-servant status. The last steps of reorganization and transfer of operations were completed at the turn of 2017/2018.
In order to promote Telekom Deutschland's targeted transformation, a needs-based staffing strategy was developed, consisting of three elements: staff cuts, restructuring and safeguarding the company’s future. The strategy entails monitoring of how requirements change over time in the individual companies and units. This is the basis for planning ideal headcount development. To this end, Telekom Deutschland uses a forward-looking competence management concept that analyzes which skills will be in demand in the future. The concept allows a reasonable assessment of the areas where staff cuts or recruitment should take place and of how existing skills need to be managed and missing skills need to be added. In addition, this helps to transfer employees to new positions, also beyond their own departments, and ensure systematic succession management. The year 2017 also saw new impetus for transfers to a different employment relationship – such as by making phased retirement more flexible, which can now last between two and eight years. Special severance packages are also still on offer, especially for managers.
Telekom Deutschland is also going down new paths with respect to working hours. "Breathing working time" is one example of this. This concept enables flexible response to fluctuation in workload, such as during network expansion activities. In order to introduce the new model, a collective agreement was concluded with ver.di as a basis for a temporary increase in weekly working hours. Next, specific regulations were agreed with the works councils of six technology units. These regulations have been applicable for about 2,600 employees since April 2017. This way, a "breathing capacity" of around 150 employees was created, enabling a flexible response to special requirements. This concept is scheduled to be expanded in the technology units.