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Ben
Verwaayen, Chief Executive, explains that BT will create
value for shareholders by its passion for customer service,
its focus on profitable growth and its commitment to
broadband.
A
year ago, I said that there were three main parts to
BT’s strategy. This year, I’m saying the same thing.
First, we have a passion for customers. Second, we have
broadband at the heart of BT – and BT at the heart of
broadband. Third, we have rigorous financial discipline.
By
concentrating on these three priorities we can continue
to reward shareholders, drive down debt and invest in
the business – where it matters.
First
and foremost, we are passionate about customers. Every
time we deal with a customer, our goal is to deliver
an excellent experience – an experience which is simple,
but also complete.
We
are working to meet the needs that customers have today.
And we are innovating to meet the needs they will have
tomorrow.
This
means getting ever closer to customers, understanding
their lifestyles and businesses, establishing long-term
relationships with them. We are proud to serve individuals,
families, small or medium-sized businesses, and global
corporations.
In
the past year, our passion for customers has delivered
results. For example:
-
consumers and businesses are now more satisfied with
the way we provide and repair their services, as shown
by our satisfaction surveys
- packages
such as BT Together, which has ten million residential
customers, have been a major success story. From June
this year, BT Together will be even simpler, making
minute-by-minute charges for evening and weekend calling
a thing of the past
- we
are the UK’s leading internet service provider for
small and medium businesses
-
the order book for our solutions business is very
strong and orders worth £3.6 billion were taken during
the 2003 financial year, including a major €1 billion
contract to manage Unilever’s worldwide communications
network for seven years
- we
promised that our major European operations would
break even at the EBITDA level and, thanks to our
market success and efficiency programme, we delivered
-
new business revenues among wholesale customers (other
telecoms operators and internet service providers)
grew by 85% year on year
- and,
very importantly, overall customer dissatisfaction
was significantly down by 37% for the company (against
the target we set of 25%).
Broadband
is the biggest opportunity for growth in the communications
market. It’s no exaggeration to say that it will be
as important to our future as voice telephone calls
were to our past. Broadband is more than just another
product. It is a whole new way of communicating. It
sparks off tremendous demand and is growing at a rapid
rate – connections having increased almost fourfold
in the 2003 financial year.
Our
record over the past year shows how we are meeting this
demand:
- at
31 March 2003, we had around 800,000 ADSL (asymmetric
digital subscriber line) connections, and we are well
on the way to reaching our target of one million this
summer
- two-thirds
of the UK population is now connected to an ADSL-enabled
exchange, and our development of new business models,
coupled with technological breakthroughs, could put
90% of the UK’s homes and small businesses within
reach of broadband services within the next few years.
And
as well as signing up customers, we are moving quickly
to offer them inspiring new services. Our understanding
of what customers want is growing every day and we are
making sure that the company is able to provide it.
For example, new broadband services were launched, offering
music – Dotmusic on Demand, sport – Sportal on Demand,
and education –the BT Learning Centre.
Our
third key priority is financial discipline. We put our
heart into customer service, but also into a rigorous
approach to finance.
As
the broadband record shows, we have to meet the demands
of our customers in a way that also serves the interests
of shareholders – in other words, it has to be financially
responsible and sustainable.
Financial
discipline is not the same thing as cost savings. It’s
about doing things smarter, raising the bar, proving
that it is possible to do more with less. We did substantially
reduce operating costs and, in addition, we very carefully
targeted our capital expenditure, which was £2.4 billion
during the 2003 financial year, a 21% reduction on the
previous year, on a like-for-like basis.
We
are investing to transform our network. Equipment designed
for 20th century services is making way for a true 21st
century network, delivering the broadband, multimedia
services that today’s customers require. It will also
deliver these services in the way many of today’s customers
now demand them – for example enabling customers to
configure and adjust their services themselves.
In
this network, we are creating a new engine for growth;
simultaneously offering lower operating costs and higher
performance.
These
then are the priorities that we have been focused on
in the past year and that we will remain focused on
in the year ahead.
Our
success will depend not just on making our strategy
work but on the way in which we make it work. The new
corporate identity that we unveiled at the beginning
of April 2003 defines the kind of company we are now
and need to be in the future.
Central
to that new identity is a commitment to be simple and
complete in all we do. And that, in turn, means living
our brand values.
Being
trustworthy means consistently delivering on our promises.
Helpful means listening and responding. Being straightforward
means keeping things simple and clear, and inspiring
means constantly working to create new communications
possibilities. And we have to do everything with real
heart – showing passion and conviction.
Those
values, of course, can only be lived through people
– and, of course, our strategy can only be delivered
by the teams of motivated people throughout the business.
It simply couldn’t happen without them. They breathe
life into it. They make it work. And I’d like to thank
them for their loyalty and their hard work.
Ben
Verwaayen
Chief Executive
21 May 2003
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