The BT transformation story:

“knowledge management & ICT”

Agenda

§  Some facts about BT Group plc.

§  About my team - stepchange.gov

§  The only constant is change (no more clichés, I promise)

§  A selfish view of knowledge management in BT

§  Disruptive Innovation - does size count?

BT Group facts §  BT Group plc.:

§  British Telecommunication plc. §  BT Ignite – international networks & solutions §  BT Retail – residential & business relationships & channel to market in UK §  BTopenworld – mass market internet §  BT Wholesale – runs the BT Group networks, sells network capacity. §  BT Affinitis – business & computing services §  BTexaCT Technologies – research, development & consulting business

§  137,000 employees (03/2001)

§  Procurement: £5bn, 17m transactions

§  £20.5 billion turnover (fy 2000/2001)

§  mmO2 plc. – new mobile company

§  Global & diverse operations

BT stepchange.gov §  Part of BT Retail §  92 people §  Innovating to transform public services §  We break rules & generally cause trouble (constructively) §  We generate business opportunity & develop new markets:

§  www.ukonline.gov.uk (first phases, now with new supplier) §  www.businesslink.org (Small Business Service) §  Public Sector Change Research (with Lancaster university) §  International Centre for eGovernance (SCF, ITC & CEG) §  Public Policy Forum & innovation thought leadership §  Greater London Authority advisory §  Mobility §  Location Based Services §  eProcurement §  eDemocracy

Constant change Employees in BT

0

50,000

100,000

150,000

200,000

250,000

300,000

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000

Year

No.

of E

mpl

oyee

s

BT Group Turnover (£m)

0

5,00010,000

15,00020,000

25,00030,000

35,000

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001

Year£m

This is, in fact, a graphical representation of knowledge management.

How did we do it?

Activity-Based Costing * Adaptive Organization * Ambidextrous Organizations * Benchmarking * Business Process Reengineering * Commitment-Based Management * Competitive Capabilities * Continuous Process Improvement * Core Competencies * Customer Focus * Customer Loyalty * Cycle of Failure * Database Marketing * Disruptive Technology * Employee Empowerment * Five Forces Analysis * Flexible Manufacturing Systems * Holistic Management * Horizontal Integration * Just-in-time * Learning Organization * Mass Customization * Neural Networks * Quality Value Engineering * Organizational Delayering * Paradigm Shift * Performance-Based Compensation * Process Value Analysis * Radical Re-structuring * Reengineering * Customer Relationship Management * Rightsizing * Service Profit Chain * Strategic Benchmarking * Team Based Management * Time-based Competition * Total Employee Involvement * Total Quality Management * Economic Value Added * Value Chain * Virtual Corporation * Zero-based Budgeting * Zero Defections *

Change fatigue

BT intranet beginnings

§  BT’s business case forecast average £57.5m/yr §  The actual was £305m benefits for 1995/6 §  Since early 1995 there have been billions of savings §  But… much improved customer satisfaction §  And… European Quality Award §  And… Completely different ways of doing business §  And… Organisational Learning §  And… Flexible working §  And… The “nervous system” §  And… Understanding (benefits)

Our corporate nervous system

KM principles:

no matter who you are or where you are,

you can easily access the people, information and

services you need to do your job

Right time, right place,

right information.

Culture, policy and values.

Human design & Business benefits

A selfish view of KM in BT

§  Really a personal view of KM in BT §  ICT (IP) enabled knowledge management

§  BT.com §  Intranet Home §  BT Today §  Teamconnect Directory §  eGatekeeper §  Intellact

BT.com KM inside & out

§  www.bt.com

§  1.3m registered users, doubled in 6 months

§  15,000 logins/day

§  the “killer apps”

§  e-Billing (83k per day)

§  Friends & Family

§  directory enquiries

§  increasingly personalised

Disruptive Innovation

Applying new or novel technologies through new or novel ways of organisation.

“enable a larger population of less skilled or less wealthy individuals to do things once reserved for

specialists.”

(Prof’ Clayton Christensen HBS)

Disruptive Innovation

§  Usually very simple technology §  Usually cheaper §  Usually of lower performance/functionality §  Is almost always disregarded by mainstream §  It challenges existing wisdom & models §  It creates, enlarges or makes more accessible markets

§  It makes what BT’s done cheap & easy!!

Summary

§  BT is big and complex §  KM was and is at the heart of transformation §  We started small §  Growth brought some chaos §  We have a long way to go §  Pull not push §  But are recognised globally for what’s been done §  Disruption means size doesn’t matter

Andrew Mitchell Chief Innovation Officer BT stepchange.gov andrew.5.mitchell@bt.com 020 7778 4080

Thank you