How Telstra plans its digital makeover

Telstra's head of digital, Gerd Schenkel, has three years to overhaul the Australian telco giant's digital sales and service offerings to get from 44 percent of customers using digital services today, up to its target of 70 percent, but he's quick to point out, he's not going to drag customers kicking and screaming.

Telstra has spent the last three years on the first wave of what Schenkel calls Telstra's digital transformation, focusing on digital sales and service. This included overhauling Telstra's support and sales website, developing apps, setting up social media service through Facebook and Twitter, setting up Telstra's user community, and its LiveChat online webchat support service for customers.

Over 6 million customers regularly use Telstra's online channels every month, and online sales have quadrupled in the last three years, with 3 million customers who have now signed up for electronic billing.

A total of 10 percent, representing 200,000 of its customers, get in contact with Telstra each month via the LiveChat system instead of calling Telstra's support services.

Given the success so far, the decision to invest several hundred million dollars over the next three years on the next phase of the project just made sense, Schenkel said.

"To some extent to commit to an ambition that digital is so good that it'll be the first port of call for customers, but by no means restricting customer choice, of course," he said.

Telstra has already been working on real-time billing to provide customers with immediate up-to-date information on their account. Schenkel said it had been "technically challenging" connecting separate billing systems but would enhance the data Telstra would have on how customers use its services.

Schenkel said that work would continue on Telstra's online presence, but this would also be extended out to retail stores, and Telstra technicians.

"We're going to digitally-enable our stores much better than we have in the past, and connect our store networks to the digital ecosystem so it works together much more seamlessly. In the same way, we're going to digitally enable and support the contact centre agents much better," he said.

Store staff will have access to information on what products or services customers were looking at prior to arriving for an appointment in the retail store, and customers will have access to, and be able to add to their customer notes kept in Telstra's store systems.

"It opening up this entire new set of service journeys which are a little bit harder to do today, because the customer is the glue; they have to tell us what they've done. In the future, the data and the underlying technology will become the glue, so to speak, across the different touch points," Schenkel said.

Telstra will also allow customers to track, in real-time, technicians headed out to calls, and through greater oversight of its field technicians, be able to better plan for appointment availability. Schenkel said that the time window for appointments would be much more precise, meaning customers wouldn't have to take extra time out of their work day in order to be home waiting for a Telstra technician.

Schenkel said Telstra already conducted a small trial of this system with a small group of technicians.

"That had a positive reception from the technicians who were part of the trial, as well as the customers, but it was a small-scale trial."

For Telstra's business division, the account executives will have access to a new dashboard which attempts to anticipate customer requirements such as contract renewal, or address changes.

"We'll use the data we already have about our customers and our networks to be much more proactive," he said.

He said Telstra would learn how to use the data responsibly in a way that customers can see benefit, and not just for complying with legislation such as the Privacy Act.

"We have a lot of data about our customers that they have given to us. Customers know we have this information, so the focus for us over these three years is to use that information we already have for the benefit for the customer, and be up front about what we do with it," Schenkel said.

Telstra will establish two digital transformation centres in Sydney and Melbourne from July this year.

"The transformation centre will be the place where these new features will be built, and developed," he said.

Telstra will use agile project management methods to get these features out into the business as quickly as possible.

"The transformation centres will work very closely with the operating business units: the field force, the stores, the contact centres. The idea is that we accelerate the speed at which we can build new features," he said.

There would be regular releases of new features that would then be integrated into each respective business unit.

While Telstra will be looking to retain all the intellectual property developed in the digital transformation, Schenkel said many global and local technology partners will be brought in to help Telstra out in the Digital First project.

"It'll be a mixture of big brands you recognise and smaller contributions from local people, as well, just to get this diversity of views. Everybody is learning how this stuff works, so we can't pick one global partner; it needs to be a diverse panel," he said.

Schenkel said that specific cost savings targets were not set as part of Digital First, but there were some, undisclosed, estimates made on how much it could save Telstra.

"It could be counter-productive if you chase some sort of target. We've obviously got our estimates," he said.

While much of the aim of Digital First is to make Telstra as a company more efficient in dealing with customers, Schenkel said that if Digital First was successful, it wouldn't necessarily lead to a reduction in staff headcount.

"If we do a good job, which I expect us to do, I expect us to see a growth in the workforce on a net basis," he said.

"If stores redefine their purpose, they might grow, and if they do not, they might shrink, because pure transactional experience is not going to keep a store going."