AI Revolution Drives BT Group's Workforce Overhaul Amid Strategic Shifts

BT Group's CEO, Allison Kirkby, has underscored the profound implications of artificial intelligence on the telecom giant’s workforce restructuring plans. Speaking to the Financial Times, Kirkby revealed that AI’s advancements could intensify the large-scale job cuts the company is witnessing, potentially surpassing initial projections.

Kirkby indicated that BT aims to eliminate over 40,000 positions by the end of this decade, in a bid to slash costs by £3 billion ($4 billion). However, she noted that these figures do not fully capture the transformative potential AI holds for the business operations.

The leading provider of broadband and mobile services in the UK had previously announced plans to reduce its workforce by as many as 55,000 employees, including contractors, by 2030. At the time, then-CEO Philip Jansen emphasized that the company would rely on a considerably smaller workforce and a reduced cost base towards the close of the 2020s.

Moreover, Kirkby's remarks arrive as she marks a year since succeeding Jansen as CEO, during which she has hinted at future strategic moves concerning Openreach, BT's network infrastructure arm. She believes Openreach's current valuation is not reflected adequately in BT’s share price, suggesting that should this persist, exploring diverse strategic paths would be essential.

Despite these insights, BT clarified in an email response that it is not actively contemplating a separation of Openreach and refrained from commenting further on Kirkby's interview with the Financial Times.

Last month, BT reported that robust demand for fiber optic broadband and cost savings exceeding £900 million had bolstered its annual revenues and enhanced cash flow. Additionally, the resilience of Openreach has offset declines in revenue and profits within its enterprise and consumer segments, which are grappling with the continuous shrinkage of traditional voice services and diminishing mobile sales.