PARTNER FEATURE: XL Axiata CTO I Gede Darmayusa shared the Indonesia market dynamics and the growing demand for digital services that drive the need for digital transformation during an interview with Mobile World Live at Huawei’s Win-Win Live studio during OTF 2022.

 Digital transformation is not only at the heart of the Indonesian government’s strategy for economic growth, but also core to XL Axiata’s own strategic roadmap, he remarked.

Darmayusa outlined the four key drivers behind its digital transformation: macroeconomic factors, demand for digital services, rising competition and the fixed-mobile convergence (FMC) trend.

“The unprecedented Covid-19 pandemic is having a tremendous impact on our economy and society, and at the same time accelerated the pace of digital transformation. The outbreak has reshaped the way people work.”

Internet users shifted their day-to-day activities online, creating heightened demand for data as well as increased interest in fixed broadband and FTTH services.

While the country experienced massive growth in mobile broadband adoption, a report from GSMA Intelligence found that internet connectivity remains a key barrier for some citizens’ full participation in the digital society.

Meet Challenges with Digital Transformation 2.0

The challenging diverse geographical and competitive landscape in the country have driven XL Axiata to accelerate its digital transformation programme that aimed at improving operational efficiency and enhancing on customer experience.

XL Axiata has adopted the Digital Transformation 2.0 strategy in executing its strategic framework that defines the digital operating model, underpinning digitalization, customer centricity, and convergence. To realize the digital operating model in aligning with strategic framework, XL Axiata is developing capabilities that leverage on data analytics and applied on the “Four Rights Actions”. This refers to the executing “Right Offer” to the “Right Customer” and investing “Right Place” at the “Right Time”. The capability development includes areas in the customer experience management, focusing on tNPS automation in identifying detractors, demarcating the network performance reason, and recovering performance to the impacted network.

“We had a very positive business outcome from the tNPS solution, and the tNPS improved with a double-digit score,” Darmayusa said.

As the operator launched FMC service in targeted areas in Jakarta, it also used advanced data analytics to differentiate the offering to attract users and improve customer lifetime value. As a result, XL Axiata registered double-digit annual growth in mobile revenue in Java and improved cost efficiency for the FMC operation process by more than 20%.

Data-Driven Precision Marketing

For converged services, the company used data analytics to enable it to invest in networks in high-value areas and buildings to meet demand from both residential and non-residential sites. “Digital-driven operations enable decisions in prioritising and placing profitable towers in high-demand areas.” Darmayusa said. “With intelligent data analytics, we can evaluate KPIs across customer engagement, campaigns and customer loyalty, so we can devise strategies to address the challenges and opportunities at the right time.”

XL Axiata realized that this analytics-driven approach is important to evolve themselves in the fixed mobile convergence (FMC) journey and improve Offer Acceptance Rate and ARPU/DoU.  It also enables them to understand the customers’ needs and communicate with customers at the right time.  For example, assuming that XL Axiata is tracking the internet usage pattern of the subscribers. With analytics, XL Axiata can predict how much data they use this month, next month or the next year, and also what activities they perform and how much data they use for each activity, and so on.   With predictive analytics, we can also track the upcoming trends, predict customers’ behaviours well in advance, and then launch new offers in the future, at the right time.

Convergent data-driven approach to drive operational efficiency

The data-driven intelligent operation is a key operation model to XL Axiata digital transformation success. XL Axiata perceives that excellent operation revolves around three pillars: digitalization, customer centricity and convergence. With this mission, XL Axiata is building capabilities to transform their organization into a fully digital, converged service provider delivering the best customer experience across all areas.

Darmayusa said. “Throughout the past couple of years we have succeeded in realizing significant cost savings across network investments and digitization of processes and achieved enhanced velocity and responsiveness in go-to-market initiatives.

For the FMC network deployment, XL Axiata faces the challenges with service differentiation. To improve the FMC service, XL Axiata has adopted an analytics-driven Four Rights Action. This helps them to drive network investments in high-value areas and buildings.  XL Axiata can gain insights on the existing fiber coverage as well as identify the potential fiber tower locations that can meet the demand from both residential and business customers. Thus, digital-driven operations enable intelligent decisions like prioritizing profitable towers in high-demand areas. These strategies have been paying off. The analytics-driven FMC strategy has helped XL Axiata wins over its competition in the saturated market in Jakarta area.

Future steps 

Riding on the strong momentum of the digital transformation, Darmayusa emphasized “We will not stop here and will maintain our momentum on our Digital Transformation 2.0, with the aim to be the number one carrier in converged services in Indonesia.”

This will involve developing new capabilities by adopting industry best practices and automating operations, which includes TM Forum’s Autonomous Operation Maturity Model (AOMM) and Value Operation Framework (VOF). To do that, XL Axiata will regularly assess their autonomous operation capabilities and identify their capability gaps between the to-be target and as-is maturity level through the AOMM assessment tool. Together with Huawei, XL Axiata will conscientiously identify MVP to deliver business outcome that results in desirable business values all through VOF.

“We are targeting to drive our operation toward autonomy in achieving a higher level of operational efficiency and delivering the next level of customer experience.”