BT is pioneering a radical shake-up of internal IT that will see projects green-lighted or scrapped on a 90-day cycle, with bonuses for staff to encourage rapid results. If successful, BT could serve as a model for other firms seeking improved IT returns.

The IT restructuring is part of a larger effort to transform the telecoms giant into an IT services provider. BT Group's IT changes have been driven by Al-Noor Ramji, who was appointed chief information officer in May last year.

Ramji told IT Week that BT's transformation demanded a change of mindset among IT staff and an overhaul of project management. "When I arrived there were over 4,300 projects underway," Ramji said. "When you have that many things happening, you tend not to be very focused on returns. Today we've got it down to 29 programmes."

BT has also adopted a rapid-prototyping scheme in which new projects are adopted or rejected during three-day "hothouse" sessions, working with early-adopter customers. Thereafter projects must deliver results on a 90-day cycle, inspected by an external examiner, or face the chop.

"If you've hit your benchmarks, you get paid extra," Ramji explained. "That's new for IT staff - other than salesmen, nobody in BT has been paid on the basis of 90-day cycles."

The first of these cycles is currently underway, and will close at the end of June 05.

Ramji also said IT staff must focus on real customers, rather than artificial internal customers. "I've put a stop to that," he said. "There was a culture of 'everybody is a customer' and frankly the actual customer got one-tenth of the attention they deserved."