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T-Systems leveraged the Corona lull

T-Systems used the turbulent time to optimize its systems and processes in order to continue to offer its customers the usual high quality

July 08 2021

Focus on IT services in the DACH region

T-Systems has leveraged the Corona lull. The transformation of Deutsche Telekom’s enterprise-customer unit continued to move forward. T-Systems is completing the reshaping of its portfolio and is now a focused IT-services provider. CEO Adel Al-Saleh presented the long-term strategy in Bonn.

Investments for selected focus industries

Adel Al-Saleh, CEO T-Systems

Going forward, T-Systems will focus fully on growth areas in the information technology market:

  • Digitalization: Top priority of large companies – for growth and resilience.
  • Cloud services will see annual double-digit growth through to 2024.
  • Security and Sovereignty solutions will remain an important trend.
  • Advisory is on the rise due to digitalization push during Corona crisis.

New office concept supports activity-based working

T-Systems is the market leader for IT services in Germany and has the second-largest market share in the DACH region. “We want to build on our leadership position in Germany, Austria and Switzerland and strengthen our market position,” says Adel Al-Saleh, detailing the new regional focus. “In addition, we continue to serve our established regional markets around the world as needed.”

Investments for selected focus industries combined with compelling horizontal solutions for all industries

The new strategy also includes a focus on vertical offerings. T-Systems is extending its reach deep into the value chains of selected industries, bringing digitalization tools and capabilities to the automotive, healthcare, public sector, and transportation markets. In these four areas, T-Systems is striving for market leadership through focused investments. In Germany, for example, T-Systems has been the leader in the automotive industry for over ten years.

With horizontal services for advisory services, cloud services, digital solutions and security solutions, the company continues to address the entire spectrum of industries.

Expand in upper midmarket client segment 

The client approach has also evolved. Until now, T-Systems has primarily focused on multinational corporations and large enterprises. In the future, the newly formed IT-services company will also target the upper midmarket-companies with revenue volumes between one and five billion euros.

Adel Al-Saleh: “We take our customers forward on their digital journeys. With a clear focus on selected industries, regions and offerings with unique selling propositions, T-Systems’ strategy is to be the leading vertically-focused integrated service provider in Europe.”

The new set-up will be effective from 1st January 2022. It is expected to be fully implemented by 2023. Since embarking on its transformation, T-Systems has delivered net cost savings of around 300 million euros, with a further 200 million euros to follow by 2024. The EBITDA AL margin is projected to increase to nine percent and revenues set to grow slightly.

We are supporting our new strategy with our culture change program, new ways of working and office concepts, as well as a global re-skilling initiative under the slogan #peoplemakeithappen. How we think and act, work styles, leadership behaviors, flexibility and agility – we are innovating in all of these areas right now.

Adel Al-Saleh, CEO, T-Systems International GmbH

Culture change continues to be a priority 

T-Systems’ culture change program started three years ago and continues to be a priority. More than 20,000 employees have completed a change workshop.

Here they build on old routines and learn to establish new ways of thinking. Developed over the years, the “T-Mindset,” in which change comes from each and every individual, is at the heart of the program. The focus goes beyond targeting client needs. Empathy with colleagues for better collaboration is also part of the training.

New office concepts support activity-based working

T-Systems used the experience gained from the office time-out during the Corona crisis to change their way of working. Thousands of employees spent the past 15 months preparing for “New Work”. More than two-thirds of the workforce completed training in agile working during this time. For example, T-Systems now has over a thousand certified Scrum Masters.

To meet the increasing demands of digitalization, the company has launched a multi-year global re-skilling program to equip staff for the technologies of the future. Training measures for more than 10,000 employees are planned until 2023.

After the summer break, when the teams return from working from home, they will benefit from a new office concept and redesigned Meet & Connect Hubs at ten locations in Germany. The type of work at hand determines where the job is carried out. Whether at home, on the road or in the office: Hybrid working is here to stay at T-Systems. The new mix has enabled T-Systems to reduce required office space by 50 percent. At the same time, travel expenses have dropped by half.

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