Our HR work based on the HR priorities

1. Talent strategy and planning

When it comes to transforming the Group, our workforce plays a crucial role. It is hugely important to us to have the right people in the right jobs and to further develop their individual skills.

Recruitment. We want to be the magnet for global digital talent. In Germany alone, we recruited over 2,000 new employees in 2018, particularly in the ICT environment. A quick digital recruiting process with a positive candidate journey is the key to success here. We offer a global careers website as a platform to search for jobs. A further example of digitalization in the recruitment process are game-based assessments. They are a new generation of psychometric tests in the form of online games that are currently being tested as part of a pilot in the context of our hiring process for the Start up! trainee program. We also use digital tools that rank final university grades based on algorithms and therefore make a fair comparison. Our recruiting strategy also aims to encourage more women talents to join our company by addressing specific target groups. This allows us to support the Deutsche Telekom diversity culture. Since 2017, women students of STEM subjects from across all of Europe have been able to apply for our Women’s STEM Award. We are also involved in Femtec, a career program for female STEM students, and the Global Digital Women network. SDG 5

Employer brand. Through our global employer promise, we also want to continue strengthening our employer brand in growing job markets and make Deutsche Telekom the employer of choice for IT talents. We also consistently use digital contact points as well as personalized methods to network in particular with IT talents and thus get closer to our target group and address them personally. Our largest, Europe-wide LinkedIn recruiting campaign to date successfully supported one of our largest recruiting projects in the IoT business. Our Global Online Challenge Platform allows us to reach IT students and graduates all over the world who enjoy virtual simulation games in order to win this talent target group over. Our CMD+O project in 2018 in Munich and Cologne created an open workspace for students and young professionals and provided a straightforward way for us to make contact with our target group.

Succession and talent management. We know that good employees are not only recruited from outside the Company. Many people with key skills and huge potential already work within our Group. In order to proceed in a structured manner, we will take a global approach to succession planning. A digital process allows us to plan and develop candidates on an ongoing basis, and we always have an overview of potential successors to management positions. Additionally, the Global Talent Pool is a platform and database that generates complete transparency over our global talents and their respective profiles. Talents can use the Global Talent Pool group on YAM, our social network, to plan the next steps of their career, identify strategic project assignments, and find interesting job vacancies. To prepare our global talents for new positions we also exclusively offer a portfolio of digital development opportunities, including CV consulting, career meetings, e-training modules, and mentoring. This system makes it easier to fill vacancies, improves the visibility of talented employees, and promotes rotation. Once again, we supported international networking with our Talent Summit conference where around 350 talents convened to share experiences and network with executives.

2. Performance management and leadership

Lead to win. The working world is becoming increasingly dynamic, agile, and innovative. In order to keep pace with these changes, we updated our “Lead to win” performance management model. Essentially, it is now decoupled from remuneration, fosters intense and ongoing exchange on performance and development, and includes more feedback elements. The employee is also given more personal responsibility when using optional elements and supporting instruments for self-reflection.

levelUP! In the age of digitalization, managers must possess skills and methods that differ greatly from those needed in the analog world. That’s why we support our executives with levelUP! – an innovative digital further training service for successful leadership in the digital age. levelUP! comprises modules that can be flexibly combined and uses mainly interactive learning formats. In 2017 and 2018, more than 1,400 executives at Deutsche Telekom participated in this successful program.

Practicing diversity. For over a decade, we have sustainably and comprehensively practiced and promoted diversity throughout the Group. In 2015, we launched a campaign on unconscious bias, which is now running at international level. The goal is to raise employee awareness of this issue and bring fresh stimulus for greater diversity within the Company. We took part in the German Diversity Day with several campaigns. Gender equality remains a particular concern of ours. Back in 2010, Deutsche Telekom set itself the target of filling 30 percent of management positions across the Group with women. We aim to meet this target by 2020. Across the globe, the proportion of women in middle and upper management stood at 25.4 percent at the end of 2018. Following the introduction of the Act on Equal Participation of Women and Men in Executive Positions in the Private and the Public Sector (Gesetz für die gleichberechtigte Teilhabe von Frauen und Männern an Führungspositionen in der Privatwirtschaft und im öffentlichen Dienst), we extended the target to include the Board, the two levels directly beneath the Board, and our internal supervisory boards in Germany. Since 2015, via our Supervisory Board Readiness Program, we have trained almost 60 women to take on national and international supervisory board mandates. The annual Keep the Readiness program gives the women participants the opportunity to also take part in follow-up training on new corporate governance topics and challenges. The supervisory boards in our entities in Germany comprised 40 percent women as of December 2018. In our fully consolidated European subsidiaries, this figure stood at 26 percent. We are constantly working on the topic of equal opportunities through our involvement in the Chefsache initiative and memberships in schemes such as the Diversity Charter and the Technology-Diversity-Equal Chances Competence Center. SDG 5

Achieving a good work-life balance. Alongside offering traditional support in the form of childcare facilities and family care options, we are also moving increasingly to an HR policy oriented to different life phases that offers flexible working conditions for greater self-determination, and, in doing so, exploits the opportunities provided by digitalization. After concluding the general collective agreement with ver.di in 2017, we rolled out mobile working across the Group as a new way of working. This allows our employees to work from home or on the move, provided the nature of the task lends itself to this. In addition, flexible working hours, the opportunity to go part-time with a guaranteed option to return to full-time work, and the lifetime work accounts all give employees greater freedom to structure their day flexibly and achieve a better work-life balance.

Employee satisfaction. According to data collected by the Group-wide employee survey of 2017 (excluding T-Mobile US), our commitment index score – our measure of employee satisfaction – was good at 4.1 (on a scale of 1.0 to 5.0). We also conduct regular pulse surveys to obtain feedback from our employees. 72 percent of employees took part in the pulse survey in November 2018, of which 70 percent stated they were satisfied with our Company. We have several initiatives in place to further improve the corporate culture and employee satisfaction. We expect the results from the next employee survey in 2019 to once again indicate a high level of satisfaction among our employees.

Employee health. Our health management strategy is designed to maintain our employees’ health and performance. We view occupational health and safety legislation as minimum requirements. For further information on occupational health and safety, please refer to the section “Corporate responsibility and non-financial statement”. In addition, we practice a corporate culture that encourages employees to take personal responsibility for their health. Managers make an important contribution in this respect. Our commitment to this topic has won us numerous accolades. SDG 3

3. Working in the digital age

What does the transformation of the working world mean for our employees? The innumerable opportunities inspire our HR work, culminating in a range of measures on “people,” “places,” and “technologies.”

People. The transformation of corporate organization and culture is accelerating, driven by the pace of digitalization. Transformation is not an end in itself, but an expression of the relentless demand for adapted, more flexible work forms and operating structures. The automation of transactional and repetitive activities creates new options for “human” value creation, while social media and digital platforms unlock new ways of working across hierarchical divides. We gave agility a framework in this reporting year. The All About Agile project pools all Group activities concerning agile working, supports units in becoming more agile, and provides opportunities to share information. Six dimensions of agility were defined in this project and, based on these recommendations for action, how-to guides were developed that comprehensively support the employees and managers in the digital transformation. The success story continues: 4,746 Group employees were able to extensively demonstrate their design thinking abilities in projects as part of the third Magenta MOOC (Massive Open Online Course) under the slogan Tap into Design Thinking. SDG 4

Places. The workplace of the future will also undergo transformation. Our Future Work program offers modern, open office environments and shared work zones to promote flexible working, a trust-based leadership culture, and mobile working. The range of events on the new ways of working (Neues Arbeiten) was continued in 2018 in order to improve employee networking and to strengthen collaboration at our locations.

Technologies. Digitalization can make many things easier in our daily work routine. The Digital@Work program with its extensive training portfolio was launched following the rollout of modern, cloud-based solutions that was concluded in 2018. Through this program, we met our aim of training more than 7,500 employees using digital collaboration tools as early as the end of 2018. Our Mitarbeiter staff app was also developed further in 2018 and is constantly being equipped with additional features that will significantly reduce the amount of paper-based processes and laborious forms to be filled out. Mobile solutions not only make everyday work easier, they also promote modern and flexible working. We are aware that we must promote virtual collaboration if we are to maximize performance. In addition, most employees worldwide now have access to the following options for collaboration between units and across national borders: video and web conferencing services, live broadcasts and chat services, as well as knowledge-sharing via secure data rooms.

4. Skills management and innovative training opportunities SDG 4

Skills-up! Our employees and their skills are a key factor to our business success. Following a successful pilot project in four business units, we have reached an agreement with our employees’ representatives to implement a strategic skills management program in the Group in order to ensure competitiveness and employment. In addition to qualitative HR planning based on revised task descriptions and skills profiles as well as identifying retraining measures, the aim is to recognize skills gaps at an early stage and derive tailored training programs.

The 80/20 model. The 80/20 model is yet another innovative program to improve employee motivation and collaboration across departments. It gives employees the freedom – on a voluntary basis and in agreement with the superior – to dedicate 20 percent of their working hours to Group-wide projects. The model allows skills gaps to be closed, while giving employees the opportunity to apply their skills in other areas, irrespective of their department. Introducing this level of flexibility not only promotes the general success of the Company but also creates a new and innovative way of working in which employees’ skills are valued and managers receive targeted support.

Major HR awards in 2018