BT: The strategy to revive a 180-year-old giant

This week at Business Leader, we caught up with a remarkable woman. Allison Kirkby is BT Group’s first female CEO and one of only a few women leading FTSE 100 companies. She’s made it to the top from a working-class background: both of her parents were factory workers in Glasgow.

That puts her in a minority. But in another way, she is more typical. She is one of dozens of Procter & Gamble alumni who have gone on to hold CEO positions at large companies.

She joined P&G in 1990 and would take on more than a dozen different, increasingly senior roles, both in the UK and abroad. Her time at P&G was “fundamental” to her development as a leader, she says. “It was almost like a university for creating brilliant leaders.” Colleagues from that era include Paul Polman (Unilever), Jeremy Darroch (Sky) and Austin Lally (Verisure) – not to mention Sir Richard Harpin too (HomeServe).

When you were put in charge of a brand at P&G, it resembled taking on a CEO role, she pointed out to Harpin on our latest Business Leader podcast. “It was like running a business, with a functional leadership team around you.”

She is drawing on all those skills acquired at P&G in order to lead the BT Group. She took up the CEO role in 2024. It's going through a challenging time. During the Covid period, it committed to invest around £40bn in a full fibre broadband rollout, delivered by its infrastructure arm, Openreach.

“We made a once-in-a-generation decision,” she tells Harpin, describing it as the single biggest capital investment in the UK. Her challenge since then has been to explain the logic of that long-term investment and demonstrate its financial return to investors, her 100,000 employees and the public.

BT Group’s challenge is even greater because it is a household name, regulated by Ofcom, with challenger brands also competing in the broadband space, demanding a level playing field. And of course, as a public company, BT Group has shareholders eager for a return.

Kirkby says her plan is to focus back on the UK and “core connectivity”, “pivoting to free cash flow growth sooner rather than later”. The seasoned strategist has mapped out a path to growth and return to growing dividends by the end of the decade. She also plans to bring the central BT brand “back into the consumer space”, with a relaunch imminent. Its main public-facing brands at the moment are EE and Plusnet.

“BT being the oldest telco in the world,” says Kirkby, “[we were] slow to invest in modern-day technologies, which meant we were one of the most inefficient telcos in the world.” She is now drawing on all her hard-won experience to execute her modern vision for this 180-year-old institution.

This week at Business Leader we also welcomed another former P&G alumni, Chris De Lapuente. He was Kirkby’s boss for a while there, in fact. He spent nearly three decades at P&G before taking up the role of CEO of beauty retailer Sephora. This means he joined the LVMH group in Paris, working alongside business legend Bernard Arnault. Lapuente’s interview with Harpin is coming up soon on the podcast. He also attended a packed-out private event for Business Leader members.

From the archive

If you want to hear an interview with someone who has a different perspective on BT, then check out our interview with Joanna Carman, who has led both the company’s Plusnet and EE brands during her time there.

And if you want the story of a challenger brand in telco, then check out our interview with Richard Tang, who built Zen Internet.

Question of the day

• Astra AB and the Zeneca Group PLC combine to form AstraZeneca
• The Angel of the North is erected
• Manchester United TV begins broadcasting, making it the world's first football team to have its own television channel
• Checkatrade, lastminute.com and eastJet parent easyGroup are all established in this year

You'll find the answer at the bottom of this page

What happened this week?

1. The UK economy will lose £35bn over the next two years and inflation will top 4 per cent as a result of the global energy crisis caused by the war in Iran, according to The National Institute for Economic and Social Research. The think tank downgraded its growth forecasts, raised its inflation projections and said interest rates would hit 4 per cent this year, rather than falling to close to 3 per cent, as a result of the oil and gas crunch caused by the blockade of the Strait of Hormuz.
2. Britain’s biggest drugmaker AstraZeneca has said it will invest £300m in the UK in a surprise U-turn after pausing large-scale projects last year. The drugmaker had pulled back projects in Britain after becoming disillusioned with the business environment, including the availability of new medicines on the NHS and drug pricing.
3. Chancellor Rachel Reeves won her battle with the House of Lords over legislation that will give ministers the power to force pension funds to invest a minimum amount in UK companies and private assets. But parliament’s upper house only agreed to approve the pension schemes bill after ministers made a series of last-minute concessions that put safeguards around any use of the controversial “mandation” power.
4. Taylor Swift has filed three trademark applications with the U.S. Patent and Trademark Office, two tied to her voice and one to her likeness, following numerous instances of her persona being used in AI-generated content without her consent. The letigious popstar already owns more than 50 trademarks connected to her name and is expected to be among the first high-profile figures to protect their likeness.
5. The rise of artificial intelligence is prompting fears of widespread job cuts across finance, but European bank executives don’t expect that to happen anytime soon. European banks’ AI buildout could see net headcount to rise 4 per cent on average in the next three years, according to a Bloomberg Intelligence survey of senior executives at 57 global banks.

Weekend reading

🫯 Musk v Altman: the how, what and why of the tech titans' courtroom battle

A bitter rivalry between two of the world's richest and most powerful men is to play out in court, with tech industry royalty due to take the witness box. It's a fight over one of humanity's most influential companies after years of bitter attacks. Sky News explains what's happening and why.

💍 Nostalgia wasn't enough: What went wrong at Claire's

Claire's first appeared on British high streets in the late 1990s, selling jewellery and accessories mainly aimed at tween and teenage girls, and offering ear piercing services. But all 154 stores in the UK and Ireland have now shut down with the loss of 1,300 jobs, ending a year of turmoil for the brand. The BBC breaks down the demise of the retailer and what can be learnt from it.

And finally

Our economy may be struggling to find growth in the UK, but one sector that doesn’t have that problem is women’s football. Success on the pitch, including victories for the Lionesses in major tournaments, has built up undeniable momentum.

So it’s a sign of the times that Brighton is building Europe’s first, purpose-built, dedicated women’s football stadium. It’s an £80m investment and due to launch for the season of 2030.

It’s an investment in long-term fan growth. It will be located at Bennett’s Field, connected to the men’s Amex Stadium by a bridge, with a capacity for 10,000 people.

I’ve been to watch several women’s games at Wembley, including FA Cup finals and international games. The stadium regularly attracts 70,000-90,000 fans for these events. The tickets remain cheaper than the men’s game and there is more of a friendly, family atmosphere.

It will be interesting to see if other clubs follow suit.

The answer to our question is 1998.