Turkcell’s supply chain management transformation is driven by technology and communication

Turkcell’s supply chain management transformation is driven by technology and communication

Turkcell, the largest mobile operator in Turkey, has undergone a significant shift in its procurement and supply chain operations driven by a radical ideological change to the business itself. “Turkcell is a unique company, a digital operator,” says Ali Türk, Executive Vice President of Supply Chain Management at the firm. “We are dealing not only with the mobile part, but also the commerce part: it’s one entity.” With a focus on establishing a high quality internal infrastructure, technology and network infrastructure, and meaningful, functional digital services, Turkcell has undergone a structural change that highlights the importance of procurement to its wider strategy. As part of supply chain management’s realignment as a strategic function, Turkcell established a dedicated procurement committee to drive positive change. Meeting every week alongside the CEO, Murat Erkan, the committee makes key decisions on the company’s biggest purchases. While these make up 3% of the firm’s purchases at large, their combined volume equates to 80% of the total made by Turkcell. “All of the company’s top executives are fully involved in these processes, and they acknowledge and evaluate all of the aspects of procurement investments and strategy.” Not only that, but a unification of operations between teams has been achieved through the adoption of agile management methodologies, enabling a consistent thread for supply chain management strategy to follow throughout the organisation.

These structural adaptations are bolstered by the application of disruptive technologies, driving efficiency and transparency at Turkcell. However, Türk stresses that digital transformation is, to Turkcell, a tool rather than a goal. “Digital transformation is a must to survive in our era,” he says. “It enables us to focus on optimising costs in a sustainable structure, to increase revenues, and to increase the level of quality we offer our customers.” A particular area of interest for Türk is robotic process automation (RPA) and the benefits it could have for internal teams. He adds that the application of this technology will be based on what those teams themselves view as the areas that would benefit most from automation, and the freeing up of staff from repetitive tasks that it would enable. “We have procurement departments, logistics departments, real estate, construction and site acquisition departments, and they are each highlighting their requirements,” he says. Once those needs are defined, they each collaborate with Turkcell’s ICT department to drive the gradual rollout of RPA through specific digitalisation departments. “For example, supply registration, fee operation, calculation of monthly payments, operation of the tender process, opening site acquisition and scrap sales orders; they’re all operational issues and ritual issues,” says Türk. “Right now, we are developing some use cases and we will forward those tasks to RPA.”

In addition to its RPA ambitions, Turkcell has deployed artificial intelligence (AI) technology to enable price estimations for services and network site acquisitions. “Right now, we are managing approximately 20,000 value sites and we have a huge site acquisition team that oversees the hiring of those sites,” says Türk. With AI, Turkcell is using Big Data and analytics to drive intelligent land acquisition, selecting sites that offer the best value to the company: maximising efficiency whilst simultaneously cutting costs. The company is also developing a supply chain management chatbot that will streamline communications between internal departments. The chatbot stands to mitigate time spent chasing answers to various questions across multiple teams, particularly when it isn’t clear who might be best placed to provide those answers. “We will eliminate these unproductive elements” says Türk, “and we will address our teams to focus more on strategic business operations.” He adds that digitalised contracts and digital signatures will significantly streamline its dealings with contractors and landlords.

Türk’s team manages around 20,000 contracts with landlords which, until now, has been done through physical copies, meaning turnaround times are protracted, cargo and courier costs mount up, and there is significantly increased risk of delays caused by lost or damaged paperwork. “In Turkey there are regulations that limited us to using hard copies for contractual documents,” says Türk. “We got approval from the regulators to go digital and, thanks to mobile and biometric signatures, the completion time for contract signatures will be decreased from 10 days to between six and 10 hours. No cargo costs, no courier costs, no lost documents. The processes will be fully optimised.”

Across its supply chain, Turkcell’s application of disruptive technologies is supported by a meaningful, hands-on approach to vendor management that ensures their respective offerings meet Turkcell’s needs in the fullest capacity. “We regularly evaluate our suppliers’ operational, commercial and quality perspective capabilities,” says Türk. “Also, for effective vendor management, meeting regularly is crucial. I don’t expect the vendors to only come to us, but we also visit them at their own premises and facilities to help us understand how they operate.” With the added insight provided by Turkcell, Türk notes that the key driver of this approach is encouraging its vendors to evaluate their processes and inspire innovation. Not only that, but operational stability is also supported by this focus on establishing effective lines of communication. “At times we generate new projects which impact our business methods and processes, and every time that happens it’s known by all parties,” Türk adds. Furthermore, supplier-enabled innovation has been defined as a key performance target for each procurement specialist at the firm, ensuring that innovative opportunities are actively sought whilst working with suppliers.

Tying everything together is an unerring commitment to effective change management. “If you want to be successful on this transformation journey, change management is the most crucial part,” enthuses Türk. “You have to change people’s perspectives. Change means changing to good, not bad. The next era should be better than before.” To drive this positive attitude to shifts in operations and the application of new technologies, Turkcell operates what Türk calls Supply Chain Management Bootcamps that bring together the talents of different teams across the SCM spectrum at the firm. The focus is primarily on generating innovative ideas and making employees a part of the transformation process, with the additional benefit of cross-functional collaboration at these events and establishing strong lines of communication between different teams. “The bootcamps have generated a lot of projects so far, and some of those have already been approved by our boss to take forward,” says Türk. “We tell our staff that, as we’re changing everything, they have to adapt quickly, but we emphasise that they are managing these innovative projects. They’re driving the change, and that’s crucial.”

Ali Türk