Our focus for innovation – Explore. Develop. Deliver.

SDG 9

Digitalization is the major change in our time. And this ongoing change challenges everyone, the users, the customers, and the providers. Intelligent robots and smart factories, self-driving cars, or artificial intelligence are increasingly finding their way into our daily lives; the real and virtual world are merging in the Internet of Things.

The new organization within the Board of Management department Technology and Innovation (VTI) helps ensure Deutsche Telekom can react faster and more flexibly to these changes. After the Technology and Innovation Board department was set up in 2017, the first step involved joining all relevant functions under a common leadership to ensure a tighter integration of innovation, network, and IT. To develop our products faster and provide them more efficiently, the following core elements were implemented in 2018: focusing the individual units on a single purpose (Explore. Develop. Deliver.), reducing organizational hierarchy levels, and rolling out more flexible, more competence-oriented structures. At VTI people work on comprehensive technology and provide innovation in the long run. VTI sees itself as a customer’s advocate that satisfies today’s customer needs while seeking future requirements at the same time. The ambition is to be the central product developer for Deutsche Telekom’s markets and customers and to drive relevant innovation in the technology space.

Reorganization of the Technology and Innovation Board department

To further strengthen and optimize VTI, the following key steps were implemented in the reporting year:

• Creating the new unit Strategy & Technology Innovation (S&TI) to combine all research and technology topics
• Creating the new unit Product Innovation & Customer Experience (PIC) to put more emphasis on product and customer experience
• Establishing the new Innovation Hub (IHUB) for more flexible innovation development
• Optimizing structures within International Technology & Services Delivery (ITS)
• Starting a cultural transformation

VTI consistently combines research, development, and innovation with the ability to deliver.

VTI operating model – from idea to marketable product

The operating model describes the responsibilities within the organization, processes, and interfaces as well as interaction between the VTI units. Every unit is given a purpose and focus along the value chain (Explore. Develop. Deliver.).

The operating model of the Technology and Innovation Board department

The model ensures that collaboration between the units works smoothly, highlights the particular responsibilities, and forms the basis for more flexibility as well as allowing projects to be set up swiftly and effectively. This will help develop new products and services more easily and more efficiently than ever before. Project teams can work together with the necessary specialists from other units. If requirements change, staffing for projects can be adjusted easily. Innovative methods are applied and prototypes developed in agile projects. In this respect, VTI acts mainly in the area of jointly defined strategic priorities such as 5G, Edge, campus networks, home, or smart city, while, however, also focusing on new fields.

Phase 1: Explore – identify promising innovation ideas

Innovation needs exploration giving ideas the scope they need to develop into innovative products and services. This approach aims to translate the needs of customers into products and experiences that really matter to them. The first step toward developing valuable solutions involves listening closely to the customer. But we also use partnerships and start-ups as a channel for innovations and new ideas. The main steps during exploration are: ideation, filtering the ideas in line with the strategy, identifying opportunities for new products, selection of the most promising ideas, start of validation. SDG 9

Phase 2: Develop – bring opportunities swiftly to market maturity and prove market relevance

Our teams must be agile and flexible in how they manage and budget innovation projects. In this phase, innovation leads and developers from our Innovation Hub (IHUB) work together closely to devise a minimum viable product (MVP). An MVP is the first minimum viable product in the development process. It already runs on a platform and is tested by customers in this development phase. An MVP is assessed according to the following criteria:

• Delightful: We can “wow” our users.
• Valuable: People like using it or buying it.
• Usable: People can figure out how to use it.
• Feasible: We can build and deliver it.

If these criteria are not fulfilled, the Fail Fast. Fail Cheap. principle applies, i.e., we would prefer to take a decision about possibly abandoning innovation projects early on and thereby save resources, rather than putting it off for too long.

Phase 3: Deliver – scale profitable products

Following a decision in the Develop phase that an MVP will be transferred to production for several markets, the International Technology & Service Delivery unit takes over and pushes forward with platform operation and the further development and scaling of the products. The handover from the Develop to the Deliver phase takes place gradually in cross-unit teams and ensures a smooth transition with regard to expertise, customer relationships, and processes.