1. EFQM Education Community of Practice Budapest, 08 May 2003 1 08 May 2003 Endre Hercz Executive Director - TQM Executive Director - TQM Westel Mobile Telecommunications Co. Ltd. Quality at Westel

2. EFQM Education Community of Practice Budapest, 08 May 2003 2 Westel: The Market Leader The Company: GSM penetration:GSM penetration: 69,6% (March 2003) Stakeholder:Stakeholder:MATÁV Equity:Equity: 457,809,370 EUR (2001) RPC:RPC: 3,401,770 (March 2003) RPC (000) March 2003

3. EFQM Education Community of Practice Budapest, 08 May 2003 3 Westel Vision We believe that everyone needs a lifeline to their world to give them the security, confidence and inspiration to venture out and seize the opportunities that make life more rewarding and enjoyable.

4. EFQM Education Community of Practice Budapest, 08 May 2003 4 Westel Mission We are dedicated to connecting our customers with every aspect of their world - personal, professional, human and institutional. We are dedicated to connecting our customers with every aspect of their world - personal, professional, human and institutional. We will give them the power they need to take advantage of all opportunities as they present themselves and help them work, learn, think and communicate in more interesting ways. We will give them the power they need to take advantage of all opportunities as they present themselves and help them work, learn, think and communicate in more interesting ways. We know that we can only do this when our stakeholders, first of all, feel a connection to us that they can trust and rely on. We know that we can only do this when our stakeholders, first of all, feel a connection to us that they can trust and rely on.

5. EFQM Education Community of Practice Budapest, 08 May 2003 5 Quality Milestones 1993:Foundation 1994:Malcolm Baldrige survey Establishment of TQM strategy 1995:ISO 9001 Quality Certification 1996:Winning the National Quality Award 1997: Integration of Self Assessment 1998:Winning the Marshall Award 1999: Applying for the European Quality Award 2000:Establishing the integrated management method European Quality Award - Finalist 2001:ISO 14000 Environmental Management System setup European Quality Award - Prize winner Deutsche Telekom Top Team Award Winner 2002:Start to implement Balanced Scorecard

6. EFQM Education Community of Practice Budapest, 08 May 2003 6 Quality strategy

7. EFQM Education Community of Practice Budapest, 08 May 2003 7 System supporting the systematic approach Main process structure and process management system based on expectations of stakeholders Main process structure and process management system based on expectations of stakeholders Assessment and review system Assessment and review system Continuous measurement and integration of quality parameters into the business plan (Quality Plan) Continuous measurement and integration of quality parameters into the business plan (Quality Plan) System of integrated customer surveys System of integrated customer surveys Integrated Performance Evaluation System that support the development of human resources Integrated Performance Evaluation System that support the development of human resources

8. EFQM Education Community of Practice Budapest, 08 May 2003 8 Main processes

9. EFQM Education Community of Practice Budapest, 08 May 2003 9 Assessment and review system

10. EFQM Education Community of Practice Budapest, 08 May 2003 10 Structure of the quality plan Attachments - Detailed description of measurement - Development goals Parameters - Definitions - M ethod and frequency of measurement - Targets QUALITY PLAN Coverage Basic service quality indicators Call Center indicators Waiting times Customer complaints Customer satisfaction Churn Quality of billing

11. EFQM Education Community of Practice Budapest, 08 May 2003 11 Customer surveys

12. EFQM Education Community of Practice Budapest, 08 May 2003 12 Performance evaluation system

13. EFQM Education Community of Practice Budapest, 08 May 2003 13 Important Quality Projects 2002-2003 +BSC New method ISO 9001:2000

14. EFQM Education Community of Practice Budapest, 08 May 2003 14 ISO 9001:2000 Customer focus: The process of customer surveys are integrated into the system.Customer focus: The process of customer surveys are integrated into the system. Objectives - measurements - actions: Quality Plan.Objectives - measurements - actions: Quality Plan. Process orientation: The ARIS process management tool is integrated.Process orientation: The ARIS process management tool is integrated. Competency: Personal performanceCompetency: Personal performance appraisal. appraisal. Main aspects:

15. EFQM Education Community of Practice Budapest, 08 May 2003 15 Balanced ScoreCard System CriticalSuccessFactors

16. EFQM Education Community of Practice Budapest, 08 May 2003 16 Financial Perspective Strategy Financial Parameters 1. Maximising the company value 1. Maximising the company value 2. Increasing the income 2. Increasing the income 4. Improving cost efficiency 4. Improving cost efficiency 3. Improving the effectiveness of the assets 3. Improving the effectiveness of the assets 1. ROE 2. Income increase 3. Current asset turnover 3. Total asset turnover 4. EBITDA ratio 4. Operational cost per customer

17. EFQM Education Community of Practice Budapest, 08 May 2003 17 Learning and Improvement Perspective Learning and improvement 13. Innovative, and change oriented company culture 13. Innovative, and change oriented company culture 14. Improving the employee’s commitment and satisfaction 14. Improving the employee’s commitment and satisfaction 15. Ensuring the access to the necessary information 15. Ensuring the access to the necessary information Strategy Parameters 13. Fluctuation of key employees 13. Ratio of training costs vs general and administrative costs 14. Fluctuation 14. Employee satisfaction 15. Index of access to information

18. EFQM Education Community of Practice Budapest, 08 May 2003 18 Some factors of the success Leaders’ commitment Leaders’ commitment Stakeholder approach Stakeholder approach Balanced approach Balanced approach Step by step progress Step by step progress Focusing on area for improvements, not on weak points Focusing on area for improvements, not on weak points

19. EFQM Education Community of Practice Budapest, 08 May 2003 19 Thank you for your attention!