Telecoms giant BT has been at the centre of some
colourful stories about executive infighting and back-stabbing over the past
few months. One name which has not been associated with the more lurid, and
perhaps imaginative, tales is that of Andy Green, director in charge of the
company’s growing global services division.
Green, who has built up a reputation for hard work over his 16 years at BT,
appears unusual in the ambitious world of modern business because he says has
no desire to take the chief executive’s job.Green was
in Edinburgh last week for an awards ceremony at Edinburgh Castle and to meet
BT clients and staff. Sitting in BT Scotland’s spacious HQ at South Gyle, Green
looks younger than his 49 years and speaks enthusiastically about plans to turn
his operation into a giant of the global market for corporate communications
and IT.
BT Global Services is riding the wave of the trend for companies and public
sector organisations to bring their communications and IT networks together
to improve efficiency. The global market is worth between £200bn and £300bn,
with public and private sector keen to consolidate their voice, video, e-mail
and IT requirements into one network, managed by one company.
Green was given the task of sorting out the mess that
was BT’s overseas business when he was appointed head of global services in
October 2001. He says: "We had the crisis in the joint venture with AT&T, we
were losing £800m of the company’s cash every year. I was brought in and the
message was pretty simple: ‘Please could you stop doing that.’
"It took us about 18 months to turn that around to a cash flow neutral position.
Since then, we have managed to convince customers and the global industry that
BT has a real role to play."
Statistics appear to reinforce Green’s claims that his division has turned a
corner, or is close to it, but it has yet to make a penny. He says the division
is growing at 30% a year. In the first quarter of 2004, the earnings before
interest, tax, depreciation and amortisation (ebitda) margin was 7.2%.
He says: "We are still making a small loss. It’s all going in the right direction,
but we are losing a few tens of millions at the profitability level. The issue
for us is how fast to grow. Unlike the rest of the industry, we are growing
- last quarter results showed 9% growth. AT&T, having started in the same position,
are seeing 10% - 15% decline."
It has come at a cost, though. Green speaks of the division entering a "valley
of despair" during the restructuring, when he laid off 15% of staff, and altered
strategy to only go after large corporate accounts.
He says: "We had too many people, spending too much capital on things we didn’t
need and which weren’t paying back quickly enough. It’s much better to shed
15% than have it closed with everyone on the streets."
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