My talk plan, by BT's new chief

By Candice Krieger, April 18, 2008

Ian Livingston, the new chief executive of British Telecom, explains how he has achieved so much at just 43, and reveals his plans for the company

Ian Livingston is taking nothing for granted. It is through making the most of his chances that he has become the new chief executive of BT at the comparatively young age of 43.

Ian Livingstone (centre) wants BT to be among the best service companies in the world

The Scotsman was appointed last week after the current boss, Ben Verwaayen — credited with taking the group into broadband — announced his resignation. Taking over the reins on June 1, Mr Livingston will be one of the youngest heads of a FTSE 100 company — an achievement he modestly says he could never have considered.

“Your career is an absolute coincidence of opportunities,” says Mr Livingston, currently head of BT’s retail division. “I’ve been very lucky in the opportunities I have been given and I have tried to grab them.” And from leaving school in Glasgow at 16 to taking on one of Britain’s most prominent business roles, Mr Livingston has done just that.

When he was 28, his former boss at Dixons, Stanley (now Lord) Kalms, sent him to the United States to become chief finance officer of one of the company’s billion-dollar subsidiaries. It was daunting, but he relished it. He spent 11 years with Lord Kalms, before joining BT in the same role aged 37.

“Lord Kalms gave me a real opportunity,” recalls Mr Livingston. He says both Lord Kalms and his chief executive, John Clare, gave employees the chance to show what they could do. Fellow Dixonites include Jeremy Darroch, the newly installed chief executive of BSkyB, and John Pluthero, who now runs Cable & Wireless.

He adds. “People may think there was some grand career plan, but there wasn’t. Stuff happens. Two years ago, I couldn’t have told you I would be doing this. The important thing is to just try and do your best at the job you have got.”

But from an early age, the refreshingly down-to-earth Mr Livingston showed shrewd business acumen, winning competitions at school including a Royal Bank of Scotland share-investment tournament. After school, he went on to study economics at Manchester University. He qualified as an accountant in 1987, working at Arthur Andersen before moving on to senior management positions at 3i Group PLC and Bank of America International. He joined Dixons in 1991 and took over finances there in 1997, overseeing the launch, float and sale of Freeserve, the internet service provider. He was made BT group finance director in 2002 and took over as chief executive of BT Retail in 2005.

He is credited with a significant turnaround of BT’s retail business, which has returned to growth and increased profitability. Last year, the division reported earnings before interest, taxes, depreciation and amortistion (EBITDA) of around £1.5 billion, despite fierce competition from the likes of BSkyB and Carphone Warehouse.

So what does he have planned for BT? He intends to improve customer service, expand the brand’s global activities, and make BT into a more agile organisation. He tells JC Business: “Part of what I want for BT is based on something I happily ascribe to Lord Kalms. He said that when he was a small business, he tried to act like a big business, and now he is a big business, he tries to act like a small business.

“We are a very big company, but if you can make a big company very agile then you have all the advantages of scale and all the advantages of being close to your customers and being
really efficient.”

Mr Livingston, also a director at Celtic football club, does not plan dramatically to alter the strategic direction of the company. But the high-flyer does intend to improve it. “We are the best in our industry for customer service, but that’s not good enough, because the industry isn’t good enough. We have to focus on being the best by a long way. We want to be among the best service companies in the world. While we get it right most times, we don’t get it right all the time.” He acknowledges this will benefit the profitability of the business, which has lost out financially when things go wrong, such as when customers do not understand a bill or a repair job is unsuccessful.

He says international expansion is a priority, notably in Asia, South America and China. Around 40 per cent of BT’s services are to major corporate clients, which include Unilever, Fiat and Reuters. Twenty-five per cent of the business is consumer-based. The remainder is split between wholesale and the small and medium enterprise (SME) sector.

The group, which employs 150,000 people and has around 12.5m broadband users, is active in 170 countries, including Israel. He notes: “This means that when I go to Israel on holiday, my wife can get a bit upset when I say I have to go and see the company manager in Israel.”

One of the main challenges Mr Livingston will face is the huge amount of competition in a congested market. He explains: “According to the OECD, the UK has the lowest-priced calls of any major industrialised country, higher broadband utilisation than the US, Spain, Germany, France or Italy, and has more choice of broadband providers than any other country. It is the most competitive market in the world. This is great for customers and a challenge for us.”

Will the current economic climate not prove to be a challenge? “It may well do. We are not seeing a big effect just now, but obviously if there are less new houses and less businesses being formed, then that must have some sort of long-term effect.” But Mr Livingston is looking for the opportunities. “If big companies have issues, they may ask us to look after all their telecoms services to try and cut costs.”

Outside of the office, Mr Livingston, who typically works 15-hour days, says he enjoys spending time with his family, watching his beloved Celtic, and going to his local synagogue in Elstree, Hertfordshire.

So what could be left for him to achieve? “I never think about the next step. My next step is to try and be the best CEO I can be.”

The City has expressed its confidence in the new boy. On news of his appointment, BT moved to the top of the FTSE 100 leaderboard with a 1.5 per cent share-price boost.

Last updated: 5:23pm, May 14 2008