'This was not about firing people and starting over again,' he said yesterday. Instead, Ramji is radically reinventing how BT manages its IT operations, in an effort to make his team more agile and responsive to the telecom's customers.
How radical? Ramji has cut the number of in-house IT projects from 4,300 to 29 and instituted 90-day deadlines on most projects. He is asking small, internal teams to vie against one another in customer 'bake-offs' and providing bonuses to the winner. And rather than deconstructing the prior IT team, mostly long-term BT employees in their 50s, Ramji is retaining the group to realize his pro-innovation initiatives and go up against the likes of Google Inc. and IBM.
Ramji, who spoke in front of an audience of IT managers as part of the Computerworld Premier 100 IT Leaders Conference and was later interviewed by Computerworld, calls this either a 'hothouse' approach to IT projects or 'extreme programming.'
Ramji tried it before at two previous jobs, with mixed results. At London investment bank Dresdner Kleinwort Benson in the mid-1990s, he oversaw a small, top-notch IT team that was naturally agile and responded quickly to such incentives. Success was not so straightforward when he took over an 8,000-employee IT team at Denver-based Qwest Communications International Inc. in 2001.
Even one of his gurus, the man who literally wrote the book on extreme programming, was dubious. 'Kent Beck told us that there is no way you can do this in a large company,' Ramji said.
At BT, Ramji's approach is to let between six and nine technical teams compete to offer the best solution to customers -- not internal employees setting the business requirements, but actual end users. The teams meet the customers early on so that they understand the problem and are more motivated to solve it. Would-be solutions are then presented in a competitive public environment before internal executives and customers.
'There's huge peer-group pressure, Ramji said. 'The whole point is to have fun but also make it hugely stressful.'
It is important that customers get to see the proposals, warts and all. 'That was when they started to view us like their own internal IT guys,' Ramji said.
He said it also was important to get all of the groups in an IT organization -' which he says can be as hierarchical as the Indian caste system -- to work together.
That involves more than copying messages to different managers. It means actually ensuring that all teams participate and insisting that everyone be measured by the same two metrics: cycle time and whether something was done right the first time.
The unfettered growth of metrics tends to lead to false productivity gains. For example, he said, customers seeking technical support might be redirected from one staff person to another, each of whom could mark down a short call time without ever actually solving the caller's problem.
At BT Exact, the IT division Ramji runs, the transformation -- part of a larger initiative called 21st Century Networks -- is still a work in progress. The telecom company has been able to retain much of the IT staff that had worked on the company's voice phone business by retraining and shifting workers to higher-margin network and Internet-related projects.
For jobs that BT already outsources, Ramji insists that 90% of it be done offshore to get maximum savings. Many managers, he said, don't realize that they are not saving as much as they could from offshoring projects because a larger-than-expected percentage of workers actually remains onshore.
On another front, Ramji is trying to downsize nearly 3,700 systems into just 14 platforms and offering bonuses to employees whose teams devise solutions to customer problems. The winning teams get bonuses worth 10% of their three months' salary.
After a few initial quarters in which few bonuses were paid out, workers are getting on board, Ramji said. 'This gets them out from hundreds of layers of requirements and gets them excited about doing the right thing,' he said.