BT is combining three of its formerly standalone businesses into a new £400m IT services arm.
The new BT business, to be led by John Thornhill, integrates BT Engage IT, BT Business Direct and Dabs.com, which the company says sell and manage IT services across different market segments.
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Martin Balaam has stepped down as head of BT Engage.
"The Engage IT board will report direct to John Thornhill with effect from 1st September. Martin Balaam will work with John over the next few weeks on the handover. Martin's next steps will be announced in due course," said BT in a statement.
"The new entity will deliver IT services to the entire spectrum of BT Business customers. It will allow BT Retail to work more effectively as one team across its customer base and across the different businesses," BT said.
The telecoms giant said the integration will improve the company's purchasing power and provide better utilisation of assets and skills between the businesses.
One former BT Engage employee, who worked at the company for 30 years, said, "[Balaam] got rid of the old guard and the business struggled. Over 100 people have left."
Balaam's change of role is the latest executive change at BT in the last few weeks.
Computer Weekly's sister-title Microscope reported that former BT Engage IT sales director Gary Butters is heading to managed network, hosting and services provider Easynet Global Services to head up its UK sales and marketing activities.
John Snagg also recently joined BT's Wholesale division as chief executive officer.