Ian Livingston has been lured from helm of BT to become David Cameron's Trade minister, banging the drum for UK exports and inward investment.
The surprise move was viewed as a good hire for the Government, but knocked shares in the £25bn telecoms giant as investors mourned his exit.
The 48-year-old Scot will replace the HSBC veteran Lord Green as the Minister of State for Trade and Investment.
Mr Livingston, who spent five years as the chief executive of BT, is to be succeeded by Gavin Patterson, the head of the company's retail business. "This was not in my plans or my timing but it is something really important and a difficult thing to say no to," he said. "If someone said to me six weeks ago I'd be doing this or even four weeks ago I'd have been extremely surprised."
BT's chairman, Sir Mike Rake, paid tribute to Mr Livingston, saying: "Ian has done a tremendous job in transforming BT. His decision to accept a government post demonstrates the sense of public service which many of us know to be characteristic."
Mr Cameron called him an "outstanding business leader", adding: "I know he will make an invaluable contribution to this agenda as the Government continues to open new trade links and grow exports."
Mr Livingston will step down from BT in September and take over the unpaid role in December from Lord Green, who had always planned to serve a two-year term. The Scot will take up his seat in the Lords as a Conservative life peer before getting down to business. "It is not just about the big corporates, I want to help more SMEs to get exporting," he said. "We are still a great trading nation and the more we trade, the better."
Mr Livingston spent 11 years at BT, first as finance director, helping to slash a debt pile that peaked at £28bn, reduce costs and manage a blow-up at the group's division that provides services to multinational companies. Competition increased when regulators forced BT to open its network to rivals such as TalkTalk and BSkyB. More recently, it has held its nerve to invest billions in a superfast fibre network.
Mr Livingston, who will put his investments into a blind trust, picked up an annual pay package worth £9.1m, up from £7.7m the year before. He added: "At some point chief executives step down, but I wasn't looking to do so. But one of the things I've been conscious of is it's really important, as I've got a great team and it helps to refresh them."
Mr Patterson joined BT almost a decade ago after spending four years at the cable group Telewest, now part of Virgin Media. He has led BT's retail arm, which serves small business as well as homeowners, since 2008. "We have great opportunities ahead and are well placed to take advantage, in the UK and internationally," the father-of-four said.
He has also overseen BT's recent ambitious move to take on BSkyB by winning the rights to show 38 Premier League football games live each season and offering its relaunched sports channels free to its broadband customers.
City analysts reacted warily to the departure. Liberum Capital's Lawrence Sugarman said it was "disappointing". Shares in BT fell 5.6p to 313.7p.
Flying to the top
While Ian Livingston has a reputation as a numbers man, he prefers to think of himself as a retailer. At Dixons he was marked out as a high flier when Stanley Kalms appointed him finance director at the age of 32. His family of Polish-Lithuanian Jews arrived in Scotland 120 years ago, to run a factory that made flying jackets and police uniforms. The Celtic director and season-ticket holder trained as an accountant at Arthur Andersen, where he set up a payroll system for the newly launched "Independent" newspaper.