28 November 2017, Astana. Samruk-Kazyna JSC has held a media event to report on the intermediate results of its transformation programme. The speakers at the event included:  Adamas Ilkevicius, Managing Director for Transformation and Optimisation of Assets of Samruk-Kazyna JSC; Azat Mashabayev, Managing Director for Business of Kazpost JSC; Yelnar Adaybekov, Vice President for Development and Legal Issues of Transtelecom JSC; and Sanzhar Elyubayev, Vice President for Logistics of Kazakhstan Temir Zholy NC.

Samruk-Kazyna is implementing approximately 130 transformation projects across its portfolio companies, with the aim of improving their corporate and production processes. Depending on the scale of the changes, the time required to implement these projects may vary; for example, the most ambitious projects will be completed in 2020.

Adamas Ilkevicius, Managing Director for Transformation and Optimisation of Assets of Samruk-Kazyna, commented:

"The transformation programme is a long-term project that will lead to significant improvements at the Fund's portfolio companies and help bring them to a new level. We have already completed the transformation process within the Fund, which has allowed us to significantly optimise our internal processes and develop a quality management model. Our companies are increasingly focused on developing a customer-oriented, competitive and digitised business model. The companies are already demonstrating results that underline the timeliness and  justify the steps that we have taken."

Kazpost has developed significantly since the transformation programme began. The company has opened 130 automated parcel terminals and 47 supermarkets for parcel delivery, as well as launched a business which has helped to issue more than 1,000 loans through Kazpost branches. The volume of mail processed by Kazpost is experiencing strong growth, with more than 30,000 parcels delivered across the country on a daily basis.

According to Azat Mashabayev, Managing Director for Business of Kazpost, most of the customer complaints [in the past] were regarding the timely delivery of parcels. Mr. Mashabayev said: "Many people do not fully understand the basic nuance – there are registered and unregistered parcels worldwide. When a parcel is registered, it means it can be checked at every stage of delivery, whereas unregistered parcels are handled by weight and are not tracked anywhere else. This is a cheap delivery style, and it makes up 70 percent of our overall volumes. As a result, we have decided to register all of our parcels." 

To improve the quality of its services, Kazpost has trained its staff in the principles of lean manufacturing, purchased the necessary equipment for its facilities and has automated its sorting process. Due to this, the company has successfully increased the capacity of its sorting centres by 30%, brought mis-sorting rates down to 1%  and shortened the average delivery time within Kazakhstan from 11 to 6 days.

To develop its transit potential and in line with the transformation programme, Kazakhstan Temir Zholy has commenced work to improve the efficiency of its commercial activities, as well as the quality of its services and processes. According to Sanzhar Elyubayev, Vice President for Logistics of Kazakhstan Temir Zholy, positive results have already been delivered. For example, in recent years, revenues from transit traffic account for at least 30% of the company's revenue structure. It is significant that, in 2016, Kazakhstan jumped 11 positions and ranked 77th among 160 countries in the World Bank’s Logistics Performance Index (LPI), ahead of other CIS countries.

Speaking at the event, Sanzhar Elyubayev said:

"The trust that global producers and logistics companies place in trans-Kazakhstan routes is increasing every year. In 2015, the number of transported containers on the China-Europe route was 47,000; in 2016 – 105,000; in 2017, this number is expected to reach 200,000 units, which is a 200-fold increase compared to 2011".

Another successful example of business transformation is Transtelecom, in which Kazakhstan Temir Zholy owns a 51% share. It is a telecommunications company that owns the longest stretch of trunk lines in Kazakhstan – more than 16,000 kilometres. Due to the fact that the backbone network is represented in 14 regions of the country, the company implements the ‘Digital Kazakhstan’ programme, organised by the Government of Kazakhstan, which is aimed to provide internet in the village.

As part of the transformation programme, Transtelecom has decided to diversify its business and develop in the IT sector.

Yelnar Adaybekov, Vice President for Development and Legal Issues of Transtelecom, commented:

"As a result of the transformation programme, revenues from IT solutions have increased from KZT 21 to KZT 75 billion. For the first time in 15 years, the company paid dividends of over KZT 1 billion to its shareholders. In the past, we would receive the  primary income from our parent organisation, whereas now the share of revenues from outside organisations has risen to 57%. These indicators show that the development as an IT company and a competitive business is proceeding successfully."