Middle management culled in sweeping BT rejig - Mobile World Live

Middle management culled in sweeping BT rejig

10 MAY 2018

BT announced 13,000 job losses across three years and a reduction of its office footprint as the company bids to slash £1.5 billion from annual costs.

Redundancies are expected to be focused on back office and middle management roles and will come at a cost of £800 million. The operator pledged to employ 6,000 staff in customer service divisions and network rollout teams over the same period, as part of attempts to “refocus” the business.

Although the headcount reduction was leaked to media last week, the figure reported turned out to be short of the mark (today’s official number is 8 per cent of its total workforce).

BT’s global headquarters in central London is among a number of office sites which will be closed as part of the cost reduction strategy.

CEO Gavin Patterson (pictured) said BT was at a “pivotal moment” in its evolution, unveiling plans to revamp both its consumer and enterprise divisions.

BT Consumer – which includes mobile operator EE – will refocus on selling converged services, an area Patterson said had “latent demand” in the UK. He added the country was far behind comparative European markets in converged communications.

Further detail on changes to its consumer-facing units will be unveiled at a separate event next week. However, Patterson did state the company aimed to provide a commercial 5G service within 18 months – roughly in line with industry expectations.

Its Enterprise business, Patterson said, would benefit from lower cost of delivery through increased automation.

Despite sweeping changes, the executive remained positive on the direction of the company, stating: “I’m excited about the future of BT,” adding “we need to reshape our organisation and renew our capabilities and culture.”

Earnings
The announcements came as BT revealed its earnings for its fiscal Q4 and year to end March.

Patterson said after a “challenging” period in the year ended March 2017, BT delivered a “year of disciplined delivery and risk reduction” and strong results in its fiscal Q4.

During the quarter, mobile division EE booked a 5 per cent year-on-year boost in revenue to £1.3 billion. Alongside growth in its other consumer divisions, this offset declines in BT’s Enterprise, Wholesale and Global Services divisions.

Its mobile subscriber base stood at 29.6 million by end-March, broadly flat year-on-year. The company added a process to integrate EE into its Consumer unit, which is led by EE CEO Marc Allera, was on track and had already achieved savings of £180 million during the fiscal year. Costs related to the integration were £241 million across the whole year.

In Q4, BT Group booked net profit of £722 million compared with £380 million in the comparable quarter in 2017, following a reduction in one-off costs.

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Chris Donkin

Chris joined the Mobile World Live team in November 2016 having previously worked at a number of UK media outlets including Trinity Mirror, The Press Association and UK telecoms publication Mobile News. After spending 10 years in journalism, he moved...

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