The old line about consultants is that they borrow your watch to tell you the time.
So what are BT Group plc (LON:BT.A) investors to make of the news at the weekend that Mckinsey has been appointed to sort out the problems in its Global Division.
Does this mean that chief executive Gavin Patterson has little idea how to regroup after the disastrous Italian fraud that cost the telecoms giant £530mln, a scandal that he himself said had tarnished the company’s name.
Shareholders will get their chance to ask for themselves tomorrow at the company’s annual meeting and, who knows, after the mea culpa performance when the scandal first broke, BT management may be in the mood to give a frank assessment of the many issues piling up for the telecoms giant.
It will be a very uncomfortable few hours for them whatever, but the bones of a recovery strategy starting to be laid out may deflect some criticism.
McKinsey are apparently to assess if the Global Services division can now become a ‘UK Services’ business with the international bits quietly dropped.
A plan to hold its telecom network assets in a Scottish Limited partnership is also said to be under consideration, a move to allow it avoid cash top-ups for its already heavily in-deficit pension scheme.
In addition, recently acquired mobile group EE may be merged with BT Consumer, if this can be achieved without swamping the Kevin Bacon –enhanced brand.
All radical stuff and a time of tightening UK competition, changes like this would be expensive.
Some brokers predict BT may be even bolder by dramatically stepping up the pace of its fibre roll-out.
Again that would be costly and with BT shares now yielding 5.6%, more than a few seem to think it may be incompatible with the current level of dividends.
Any change here would be a bold step, but possibly that is what McKinsey have been brouught in to avoid.