His training at Dixons taught former retail high-flier Ian Livingston the disciplines he is putting into effect as BT’s new chief executive.
Spare a thought for the wife of BT chief executive Ian Livingston. Heading to the airport on the way home from a trip to Italy to celebrate their 15th wedding anniversary, Livingston was tempted to pop into a branch of UniEuro, which had recently been bought by what was then Dixons Stores Group.
Mrs Livingston gave a firm “no” for three reasons. Firstly, they would miss their flight. Secondly, it was their anniversary. And thirdly, well, Livingston had left Dixons two months before.
Once a retailer, always a retailer – particularly when they come from Dixons’ finishing school. Now, as the boss of the telecoms giant, the affable Scotsman aims to take best practice from retail and combine it with the technological expertise in the business he runs.
Livingston is in fact still an electricals retailer himself through BT’s ownership of pure play e-tailer Dabs.com, which it bought three years ago. But he also retains close relations with many of the UK’s biggest retailers through BT’s client base, an area of the business he takes a close personal interest in.
“It’s nice to go and see our retail clients,” he says. “It’s good, because hopefully I can help provide some insight and understanding, because sometimes retailers feel like it’s only retailers who can understand their business.”
Livingston’s rise to the helm of one of the UK’s best-known companies owes much to the training he received at Dixons. Still only 43, he became finance director of the electricals giant at the age of 32.
“Dixons was a bit like Asda – one of the academies of people development within retail. In retail, you’ve got Kate Swann, Terry Duddy, Trevor Bish-Jones, Euan Sutherland, George Fairweather at Boots, then, outside retail, you’ve got John Pluthero at Cable & Wireless and Jeremy Darroch at Sky.
“People ask if there was an outstanding people development programme – there was actually no people development programme. Some blue-chip companies teach you to swim one stroke at a time, but Dixons threw you in the water. It was great at giving people opportunities to move across the business – finance people to HR, HR people to sales, sales people to marketing.”
Having taken over from Ben Verwaayen as BT’s top man in June, Livingston wants to bring some of the lessons he learned in retail into the company. “Closeness to customers and [retailers’] speed are two of the things I’m really going to try to bring into BT.”
In the retail sector, growing BT’s business will mean getting existing customers to adopt more services. While some companies, such as WHSmith, use BT for most of their technology requirements, many only use it for parts.
“It’s about being able to do the end-to-end for retailers. I know from experience that, too many times when something went wrong, it was always somewhere else – it was like trying to nail candyfloss to the wall,” he explains. “One of the things we’re trying to do is say that we can provide everything from the till systems, the local area network, the wide area network, the stock system, the planning, etc.”
But, with many saying that market conditions are at the hardest they’ve been for a decade or more, retailers are becoming more cautious about investment in systems. Livingston is realistic. “Retailers never want to spend money, even in the best of times – it’s engendered in their DNA. It’s very simple – you’ve got to be able to show retailers that they’ll save money or make higher sales.”
He says he has noticed that, in today’s climate, radical innovation has moved down the list of priorities. “In the current environment, they are looking for somebody who can take over or manage something they do and do it cheaper. There’s no question that doing things more cheaply in today’s environment is very high on the list – more so than some of the cutting-edge technologies.”
This desire to offer an end-to-end service for BT customers prompted the purchase of Dabs. About 60 per cent of its customers are businesses, primarily smaller enterprises where time and resource are at a premium. Likewise, on the consumer side, the rationale is that most people buy broadband when buying a PC.
Livingston is well placed to comment on the future of electricals retailing in the UK and thinks his alma mater will ride out the storm, despite the challenges of the internet, the supermarkets and new entrant Best Buy.
“People have tended to pronounce the death of mainstream electricals retailers, and the supermarkets and internet have had an impact, but, on the other hand, the growth of new technologies has helped. Best Buy is a good operation, but it will not be able to enter the UK and suddenly dominate in the way some are implying.”
He may be at the cutting edge of technology and an advocate – as one would expect from the boss of BT – of the role that multichannel will play in the future of retail. But Livingston is convinced that the bricks-and-mortar retail businesses in which he forged his career still have a vital role to play.