Global Postal Players Transformation Initiatives

GLOBAL POSTAL PLAYERS TRANSFORMATION INITIATIVES: AN OVERVIEW

Postal organizations are transforming to adapt. In response to the changing landscape, postal organizations have transformed to survive. Some have been corporatized to allow them to be more commercially and economically effective. These national posts have streamlined their networks, introduced new products and services, and went into new businesses such as logistics often by the means of subsidizing acquisitions or joint ventures:

• Australia Post has successfully leveraged its retail network from providing bill payment and identification/authentication services to selling computer peripherals and selected consumer products. It has 25 subsidiary operations whose services range from document production and logistics to warehousing and express freight delivery.

• New Zealand post has 17 subsidiaries that are related to its postal operations. It established the highly successful and popular Kiwibank and entered a joint venture with DHL in international services.

• Posten Sverige (Swedish Post) entered the business-to-business delivery market and has subsidiaries in Norway (distribution network) and Finland (logistics).

The most successful transformation, however, perhaps is Deutsche Post. From a loss-making operation, Deutsche post has turns around to a multi-million profit making company with businesses in mail, parcel, express and logistics both in Germany and globally.

The transformation of Deutsche Post happened in phases beginning with a focus to turnaround their domestic business and getting their core business right. An example of this is the complete redesign of their mail network which reduced more than 1000 mail processing centers into 83 highly automated processing centers in Germany. Upon becoming profitable, Deutsche Post set out to build new platforms for international expansion which eventually led to the acquisition of several assets internationally, most notably, DHL.

Deutsche Post 4-phase transformation journey that took 15 years to complete

The lesson is clear: successful transformation starts with focusing on the domestic core business.

Germany and the Netherlands have transformed their national postal organization furthest having successfully turned around their domestic core business first before embarking on their global expansion. Similarly, Austria Post followed the same formula before expanding regionally.

Strengthening domestic expertise before building external expansion

They had all used their market dominance to access capital and investment funds to finance acquisitions and modernize their operations. As formidable

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