1.
Towards a
Next Gen Telco
How KPN S&I Digital is Paving the Way

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for call centers and retail locations. This could
not be done without the greatest asset of S&I
Digital: experts. The business unit is populated
with motivated, innovative and highly skilled
people. More and more of these experts
keep flooding in, as the unit continues to
grow rapidly in the next couple of years. How
come these highly skilled and highly sought
after individuals choose to work for a telco
such as KPN? And how are they changing the
telecommunications sector?
KPN - the largest Telecommunications and IT
services company in the Netherlands - launched
the program Simplification and Innovation (S&I)
to tackle this issue. Under its wings the start-
up business unit S&I Digital was created to turn
KPN into a simplified company, data-driven
and ready for the digital world. S&I Digital is
making this ambition become a reality through
innovation based on customer needs, keeping
things very simple and delivering on a short
cycle basis. The division also translates these
customer needs into system improvements
Telcos are facing an increasing pace of change due to disruptive technologies.
Lean and agile are said to bring relief, but the implementation of those methods in
large organizations is a daunting task, especially when supply chains with a lot of
legacy are forced to work in a more old fashioned manner.
Our server park can be viewed
as a living creature.
‘ ’

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Innovation Lab
Since the beginning of the industrial revolution,
technological change has become a permanent
feature of our society. Over the years, the pace
of this change has accelerated. Now, change is
taking place so fast that the younger
generation is growing up heavily immersed in
technology, and they expect this technology to
change every six months or so. Many IT
organizations struggle with this faster pace of
change it. Even telcos must become lean and
agile, maybe even faster due to market
pressures. This will not be an easy task, they
have to deal with challenges such as legacy
systems, established interests, enterprise
models, legislation, partner deals and mutual
dependencies in the supply chain.
I am involved in bringing our supply chains online, in creating a central
customer identity and collaborating with third parties on joint web solutions.
I love this sort of dynamics.
‘

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MOBILE FIXED CLOUD ETC.
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Call
CUSTOMER
AppWeb Mechanics
DIGITAL ENGINE
CONNECTED BY DATA
Identity
Interaction
PlayShop
Internet,
Mobile, Landlines
& Television
4P
Service
?
Master
Retail
(in/extern)
API’sWEB
ROUT IT FIXED MOBILE P
OmniChannel
Strategy
Small Medium
Enterprises
Eco System
Large Ente
Corpo
Eco Sys
Mobile MVNO
LION OSS
Portal & Shop Com
Single Identity Feder
Customer data
CRM & Service
O
Channels
Digital
Layer
Client
Interaction
Layer/BSS
Network &
Platform
Interaction
Layer/OSS
Network &
Platforms
The Digital domain What is the secret to staying fresh, lean and
mean when you are a large tech company that
wishes to simplify and innovate in order to
reduce the time-to-market? With that question
and goal in mind, KPN initiated the S&I program.
The ambition of S&I Digital - its startup IT unit
and innovation lab - is to make KPN a simplified
company, ready for the digital world. The unit
helps KPN to make the transition from an offline
to a digital company, assisting the customer in
its journey, from online comparing and
choosing, buying, checking the order status to
managing the product and services the
customer has bought.
At S&I Digital all innovation for the online
surroundings (web, apps, systems for call
centers & retailers) of KPN happens. The unit
innovates by looking at client needs, making
solutions data-driven, simple and delivering on
a short cycle basis. The two central pillars of the
KPN startup unit are its people and a more
profound, agile way of working compared to
other European telcos.

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Innovative people
telco, with ‘user-facing projects, serving many
customers and using technologies in large scale
deployments.’ Product Owner Dennis (36)
particularly likes the ‘chess game on various
chess boards at the same time. I am involved in
bringing our supply chains online, in creating a
central customer identity and collaborating
with third parties on joint web solutions. I love
this sort of dynamics.’ Reindrich (29), Test Lead:
‘When I heard that S&I Digital would change its
login process, this caught my attention. If you
are familiar with KPN, you know this is not a
short term or small project. It is very complex,
because you have to connect with all sorts of
backends. That complexity grabbed me.’
To create a nurturing environment, Leon
believes in investing in people and teams to
develop and broaden their skills and
craftsmanship. His idea of craftsmanship leans
heavily on the notion of software craftsman­
ship, an approach to software development
that emphasizes the coding skills of software
developers. It is a response by developers to
Leon, VP of S&I Digital, believes people are his
greatest asset: ‘The unit is populated with
motivated, innovative and ambitious individuals
with a high degree of autonomy. They have a
collaborative work style and enjoy a highly
team-oriented environment. They embrace
flexibility and have the ability to adapt to new
situations, creating more opportunities for their
customers and their own careers. They have
multiple strong technical skills or the
willingness to further develop these into
broader skill sets.’ According to Leon, these
highly qualified professionals need creative
freedom and a fun place to work.
Anita (31), Developer at S&I Digital, certainly
fits this profile: ‘I wanted to change and expand
my python developing skills. I was attracted to
the complicated architecture and working with
web services. Before KPN I was mainly
developing web applications. It is always a thrill
to experience new technologies and tools.’ For
Developer Sergey (30) the attractiveness of S&I
Digital lies in the fact that it is part of a large

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doing that?”. I am given constant feedback and
interact constantly with senior developers in
our team, I learn a lot and I can really improve
myself like that.’
To foster and promote high-performing
individuals and teams, S&I Digital teams are
self-leading, autonomous and intrinsically
motivated. Autonomy means giving people
control over how they work. The digital
innovation lab moves beyond empowered
teams that must be at work for stand-up
meetings at set times each day, instead giving
scrum teams control over their tasks, time,
techniques and team.
the perceived ills of the software industry,
including the prioritization of financial
concerns over developer accountability. The
idea of software craftsmanship is borrowed
from the guild traditions of medieval Europe.
At S&I Digital, people view themselves as their
heir, as they firmly believe outstanding work is
delivered by constant quality checks, focusing
on the craftsmanship and expertise of the
individual and giving him or her the necessary
room for manoeuvring. Anita: ‘It is designing
the best possible solution for a user story in an
acceptable time frame that I find most
rewarding in my job. In a pythonic - that is:
beautifully structured - way. I also really like
code reviews. Each time I code a pull request
with some changes, someone from the team
will review my code and tell me “maybe you
can do this like that” or ask you “why are you
It is always a thrill to experience new
technologies and tools.
‘ ’

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Building agility
The people working for S&I Digital are
attracted to this agile challenge.
Sascha (37), lead architect: ‘I have chosen to
work for KPN because of the technological and
organisational challenges that accompany the
simplification and innovation process. Building
an agile architecture and organization is what
is appealing to me.’ His job is to ensure new
functionality is being built, while changing
Digital into a data-driven, web-based and
scalable organization. His aim is that S&I
Digital is highly productive with the least
number of people, while at the same time
being able to scale up or down. When a
company needs to scale up, there usually is a
decrease in relative productivity. Sascha wishes
to achieve that this productivity remains
proportional to the number of people. This
requires profound changes in the enterprise
architecture and organization.
Second to people comes the agile way of
working that has been adopted across KPN S&I
Digital. Agile is a flexible, iterative and
incremental method for managing product
development. It challenges the traditional,
linear-sequential approach to product
development, and enables teams to self-
organize by encouraging physical co-location
or close online collaboration of all team
members, as well as daily face-to-face
communication among all team members and
disciplines in the project.
A key principle of the agile philosophy is its
recognition the customers can change their
minds about what they want and need, and
that unpredicted challenges cannot easily be
addressed in a traditional predictive or planned
manner. Agile accepts that the problem cannot
be fully understood or defined, focusing
instead on maximizing the team’s ability to be
ready for the unexpected, to deliver quickly
and respond to emerging requirements.

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There is a downside to this concealed waterfall
workflow, Reindrich points out. ‘With the
traditional waterfall approach it has often
occurred that just before going live the test
team discovers that during development or
even the design stage one or multiple mistakes
were made. The product has to be redesigned
and redeveloped, while it was planned to go to
production. It is therefore crucial that product
owners from the business, designers,
developers and testers are collaborating from
the design phase onwards. Solving potential
bugs and issues earlier on in the DTAP street is
much less costly then when you do it at the end
and it leads to higher code quality.’
Among the employees of S&I Digital, the cross-
functional way of working is very popular.
Sergey: ‘My work is satisfying, because there is
a lot of room for me to contribute to
improvement. I act as a consultant and can
influence the architecture of user stories. I am
also involved in structurally improving the
codebase, merging API implementations and
Implementing an agile way of working is not new
for telcos in Europe, but KPN is the first telco in
the Netherlands to have cross-functional scrum
teams. At Digital each team consists of
multidisciplinary people with different but closely
related and overlapping areas of expertise. A team
member is no longer considered just to be a
designer, tester or developer. Each team also has
been made responsible for a piece of the final
product (feature) for the customer. All team
members work together on this, collaborating
closely.
Reindrich: ‘Other telcos in the Netherlands have
functional teams, with people having the same
job. The product that is delivered by a functional
team is very large. At KPN S&I Digital the product
is divided into smaller chunks and the teams are
cross-functional, consisting of people from various
disciplines. This is a huge difference from the past,
and it is quite unlike the the agile change process
at other telcos. Other telcos now do sprints within
which they deliver a relatively small feature, but
they still work in large homogenous teams.’
Cross-functional feature teams

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of working and speed were very similar to a
large gaming company, with a multitude of
scrum teams that have to communicate with
each other. That can be quite a challenge, and
you also see this there. You have to talk to a lot
of people if you all wish to move in the same
direction. Luckily, the fact that we are all on the
same API, ensures we are in touch regularly.’
that takes a lot of code analysis and design.
Reindrich: ’When we create a user story, we
discuss refinements and think about the
tehcnical an design approach. Anyone can
contribute. This turns you into a better
professional.’ Jan-Eric, Tech Lead: ‘I expected
KPN to be dull telecom, so when I walked into
the office for an interview I was positively
surprised. It was not dull at all. I had previously
done a project at a rigid German telco, with
waterfall and similar methods. They were doing
scrum at Digital and I thought the culture, way
My work is satisfying, because I do some consulting and
because there is a lot of room for me to contribute to improvement.
‘ ’

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Continuous interaction between business and IT
Handoffs from Dev to Ops usually go hand in
hand with friction and delays. The presence of
development and operational responsibilities in
one team enables fast feedback, speeds up the
delivery process and makes a team more aware
of the delivered product and what does and
does not work.
Product Owner
The Product Owner is the second role that must
bring business and IT closer together. As a
representative from the business, he drives the
cross-functional feature team from a business
point of view. He communicates the vision of
the product and defines the high level
characteristics. Sascha: ‘When the IT
organization is not properly aligned with or
connected to the business, your agile change
process will not have optimal results. That is
because you are still waterfalling. Only when
there is intensive collaboration between
business and IT you can iterate in short cycles.
People from the business - the product owners
- should explain to IT what the business domain
Sascha believes that the concept of agility and
data-drivenness is not just a matter of IT but
also of business. In the KPN past, the business
specified what it needed from the external IT
supplier, who then would build a solution and
would deliver it to the business. This is only a
good setup today, if you know in advance what
you want within a year, and are able to
translate that into specs. ‘At KPN, interaction
between business and suppliers must be a
continuous process. We as a supplying unit
must continuously ask ourselves what our
internal customers want, and must act as
consultants towards the business,’ says Sascha.
This way innovation becomes a permanent part
of the business.
DevOps
A key role in the changeprocess is DevOps, a
role facilitating communication and
collaboration between development (Dev) and
operations (Ops) to help an organization
rapidly produce software products and services
and improve operational performance.

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looks like. Our IT unit has people that act as a
consultant towards the business and advises
the business on possible solutions. A positive
side effect is that the work of IT specialists
becomes much more rewarding. As Sergey
states it: ‘Developers should be consultants and
have domain knowledge. By giving developers
strict specifications, they get bored very easily.
That is a way to kill creativity in a developer and
their motivation to work. It was a very positive
surprise to discover that you can actually be a
consultant. That keeps me in the company.’
Speeding up change
Part of building an agile architecture and
organization at KPN has been that it is moving
towards insourcing IT. S&I Digital views this
change as an opportunity to making its infra­
structure and development process faster and
scalable. On the development side, the
innovation lab achieved a substantial
improvement by implementing continuous
delivery. Valuable software is produced in short
cycles and software is reliably released at any
time. All tests and checks have been automated,
after which software is released automatically if
all tests and checks are passed. Nowadays any
code commit may be released to customers at
any point, perhaps even multiple releases per
day. ‘This is completely different from the past’,
says Reindrich. ‘A cross-device regression test
used to take up eight days. Now we are able to
do the same test in one or two hours. A Limited
Production Run (LPR) took up one hour. This
time has now been reduced to two minutes. We
also automated our test reports, which are
automatically stored and sent to release
management. This saves time while being
traceable for auditing at the same time.’
Dennis: ‘We are now able to release at a much
faster pace than before. We do 500 automated
deployments per two weeks, to different
locations within the DTAP street.’ Like with
testing, this saves a lot of time, not only
because deployment is faster, but also because
less time is being spent on error solving. ‘With
manual deployment we had an error margin of

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Dennis says proudly. ‘Servers can be easily added
and removed, the same goes for CPUs and
memories.’ Availability was a second part of the
infrastructural change. Online sales will grow
tremendously over the next couple of years and
services are increasingly delivered online. Our
platform must therefore be available 24/7. S&I
Digital is also implementing an active-active
setup. ‘Having an active cluster and a disaster
recovery cluster as a backup is like driving a car,
and keeping a second car that you never use in
the garage. In an emergency, do you feel
comfortable driving a car that has always stood
still? Besides that, it is a waste of resources
keeping a car unused in the garage. Hence an
active-active setup where you don’t have any
downtime and do not have to take any measures
to switch to the disaster recovery cluster.
five to ten percent. That is now brought back to
0.2 percent.’ With software delivery no longer
being an issue, potential risks are reduced and
flexibility is improved.
‘For our development process to change, we are
also refactoring the existing source code base to
make it scalable,’ adds Sergey. ‘This takes time
away from feature development, but if you
continue with just adding features to the code
you are making it more difficult to refactor.’
Jan-Eric explains: ‘Our API has one big source
code base. All code of several teams is being
deployed simultaneously. We are now splitting
code base up in functional chunks. When the
chunking of the code base is completed, each
team can deploy independently.’
On the infrastructure side, part of the agile
transformation was virtualisation. ‘Within a year
we have built our own private cloud.
Maintenance is now simplified, costs are down,
stability and availability has been improved. Our
server park can be viewed as a living creature,’

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Success stories
‘We have managed to simplify the extremely complex login
process of within a year. With the new central identity
for customers of KPN digital services, they can now be
authenticated and authorised online. The result is a
tremendous reduction of customer calls to our call centers.
Jan-Eric: The most successful story is perhaps our team effort
of putting our central identity live. There are now more than
300,000 KPN IDs’.
‘Our test team monitors the entire customer journey on
production, even if the customer feature the customer is using
is built by another team. We came up with the idea, because
we saw that nobody was monitoring features from a customer
perspective. We have prevented a lot of issues doing this,
including very costly ones, and prevented a lot of inbound
customer calls.’ Jan-Eric: ‘You get better insights this way. Our
realtime northbound and southbound monitoring is now
visible on a screen at our workplace. We see instantly when
something goes wrong.’
Reindrich
Having an active cluster and a
disaster recovery cluster as a
backup is like driving a car, and
keeping a second car in the
garage that you never use.
‘
’

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We have only just begun
Contact us
Do do have any questions about KPN S&I Digital
and the agile transformation? Please send an
e-mail to Fleur de Nijs, fleur.denijs@kpn.com
Are you interested in working for KPN S&I
Digital? Please do the following:
• Take a look on our digital vacancies page
• If you can’t find anything suitable there, do
not hesitate to send an e-mail to Wouter
Koeleman, wouter.koeleman@kpn.com.
With SI Digital, KPN is among the first telcos in
Europe that has adopted the Spotify model and
agile way of working in cross-functional teams.
The digital employees of KPN are pleased with
the new way of working, organization and the
digital infrastructure. ‘The work is rewarding,’
says Dennis. ‘Two years ago I knew almost
nothing about infrastructure, but now I do. And I
would not have imagined to be a guest speaker
at conferences talking to other companies about
what great things we have achieved in a short
time, such as continuous integration and
delivery.’
‘And’, he enthusiastically continues, ‘we won’t
stop there. If we want to be a telco frontrunner,
we must keep on improving ourselves.
Stagnation is decline. We are now implementing
microservices, and setting up our own
databases. To help us with that, we will need
more good people, who - like all of us - like
change, dynamics, lots of freedom, are outgoing
and take matters into their own hands.’