Vodacom Integrated Report 2017

services (in TV and video, music streaming, gaming, news and

sport), as well as developing new offerings in areas such as

mobile financial services, insurance and IoT. We have already

achieved impressive results this year in the youth segment,

with our recently launched NXT LVL campaign. Since launch

in May 2016, we have achieved impressive results with more

than 1.5 million youth customers on the platform with much

stronger ARPU uplift and more data usage.

Best customer experience:

Our aim is to provide customers

with a seamless and frictionless one-channel experience,

ensuring consistent, personalised and efficient customer

engagement, across all touch-points, with digital the dominant

support channel and MyVodacom app the channel of choice.

Having successfully delivered on our three-year retail strategy

– transforming 97% of our Vodacom-branded stores, achieving a

10% year-on-year improvement in total NPS – we are placing

greater focus on enhancing our digital customer channel. We are

investing in richer and more intelligent interfaces, big data

analytics, and IT-based customer engagement and management

tools to optimise the customer experience and achieve greater

efficiencies across all channels. We experienced limited

operational challenges this year in the transition to our new

Customer 3D billing system, which is expected given the scale of

this change. Although this caused a drop in our NPS score on

billing, we retained our healthy lead in overall NPS.

Best technology:

We are preparing the network for the future to

be the leading telco with the best network, and are placing an

increased focus on technology and intelligent information

systems to unlock big data capabilities and improve

organisational agility. We will further expand both mobile and

fixed connectivity (FTTx) and deploy new network technologies,

while rolling out a national IoT network and developing new IoT

applications and solutions. In November 2016, we commenced

network build in the narrowband Internet of Things (NB-IoT), a

low-power wide-area network technology that brings significant

new opportunities for the types of IoT use cases that we are

developing, including in e-health, connected agriculture, smart

metering and logistics.

Digital organisation and culture:

Becoming a leading digital

company requires a digital transformation within our own

organisation. We have begun the process of transforming

Vodacom into a truly digital organisation, with our investment in

acquiring new skills and talent in areas such as big data,

analytics, actuarial science and digital marketing. We have

partnered with tertiary institutions to develop and access the

required emerging skills for our digital future. To ensure that we

capitalise most effectively on the rapid rate of change across the

ICT sector, we are developing a culture of innovation and agile

decision taking, simplifying our existing systems and processes,

and empowering our people to use their skills and resources to

develop and deliver innovative products and services through

more collaborative structures.

Our brand and reputation:

Our aim is to ensure that Vodacom

is the customer brand of choice, with a strong purpose-driven

brand and a deserved reputation for responsible leadership.

This year saw further progress in promoting financial inclusion,

education, agriculture, and healthcare, through our business-

driven partnership initiatives such as M-Pesa, the Connected

Farmer platform, Vodacom e-school, and our various health-

related mobile applications. Taken together with our corporate

social investments activities, and our core business of

connectivity, these initiatives are making an important

contribution to national developmental objectives and the

global UN Sustainable Development Goals. For example, on

education, one of South Africa’s most pressing development

challenges, we have provided more than 220 000 learners with

free access to relevant education content, supplied ICT

equipment and Internet connectivity to 3 000 schools, trained

over 100 000 teachers on the use of ICT, and equipped and

connected 92 teachers across the country. We have continued

to demonstrate leadership in Black Economic Empowerment

(BEE) in South Africa, and are seeking to drive this further with a

particular focus on promoting transformation across our

distribution channels. I believe that our evident commitment to

promoting transformation and driving digital inclusion are

important contributors to the strength of the Vodacom brand

and to the numerous brand and reputation awards that we

received across markets and consumer segments.

Future outlook

The rapidly developing digital environment, and continuing

political, regulatory and market uncertainty, highlights the

need for us to be highly agile in our operations. The anticipated

sustained pressure on consumers in most of our markets,

underscores the relevance of taking a segmented consumer

view, with highly personalised offerings. Regulatory and policy

developments remain an important challenge across our

markets. In South Africa, we held constructive engagements with

government and the regulator on the ICT White Paper. We are fully

committed to the overarching aims of the White Paper, and have a

shared interest in promoting universal access to connectivity,

ensuring the success of the proposed wireless open access

network, and sharing the important social benefits that ICT

provides. We will continue to engage with government and the

regulator during the process to give effect to the objectives of

the White Paper, with the aim of finding an optimal solution for

all parties. We believe that the solution lies in a hybrid model

which ensures that the industry gets spectrum to achieve key

societal milestones while ensuring the success of the wholesale

access network.

I believe that with our new Vodacom Vision 2020 strategy, and the

steps we have already taken towards implementing the strategy,

Vodacom is well placed to realise and share the significant

opportunities associated with the increasingly rapid uptake of

digital technologies. I am confident that we have both the right

strategy and the right team to deliver on our core purpose:

connecting everybody to live a better today and build a

better tomorrow.

In closing, I would like to thank my colleagues on the Board and

the executive team for their guidance and assistance over the

year. Particular thanks to our Chairman, Peter Moyo, who will be

stepping down from the Board after eight years of dedicated

service. I wish him much success in his new role at Old Mutual.

Shameel Aziz Joosub

Chief Executive Officer

2 June 2017

CEO’s statement

continued

Vodacom Group Limited

Integrated report for the year ended 31 March 2017