Pasop, Amazon, post offices are coming to eat your lunch
Since they know just about everything about everybody, post offices can be a hub for ultimate deep data mining
Last week I attended the Universal Postal Union (UPU) annual CEO Forum in Istanbul – a get-together for CEOs of post offices around the world to learn from one another’s experiences and plot future global postal strategy.
UPU is an inter-governmental organisation, established 144 years ago, with a membership of 192 countries. It has a universal network with physical, financial and electronic dimensions within a formidable infrastructure, providing essential public services to billions of citizens and businesses. Worldwide, we employ 5.3 million people who process and deliver 320 billion letters and nine billion parcels a year. It is the world’s largest physical network, operating out of 690,700 locations.
Many of the opportunities and challenges facing individual post offices in different countries are much the same as those we are grappling with in South Africa.Customers, like Amazon, are at once serious customers and emerging competitors. Public services, required to meet the social mandate of post offices, require funding, without an immediate or obvious direct return, despite being essential to a functional society over time.
E-commerce is massive, with the Asia-Pacific long ago having surpassed the US, with business-to-customer sales expected to be $2.4-trillion in 2018. More than 130 million people are buying products online from countries other than their own, and the market is growing at 25% per annum.
Competition from the private sector is robust, well-funded and pervasive in almost every aspect of postal services. The private sector operates within a free market mechanism with minimal specific regulatory compliance to deal with. Global footprints have been developed which are eating post’s lunch.
Post offices around the world act independently and haven’t stood back to reflect on what we could achieve if we combined forces, globally.Beyond the commercially irreplaceable infrastructure that we occupy, post offices must have the best commercial client data in the world. Uniquely, we know where you all live, we have everyone’s personal delivery address. If we applied our minds and systems to this opportunity, we would be best placed to know what you consume, where it comes from, what you dispatch back into the world and how you pay for it. Post offices are surely the central repository for ultimate deep data mining.
We face at least two principal challenges.
The technology-spend required is huge, but worth it. We come up short because individual country budgets simply cannot compete with global players. If we could combine our resources and capital to build a global postal, logistics, transactional, financial services delivery capability, it would be without peer. It is achievable and certainly worth it. That simply requires money and common purpose.
The biggest change that postal operators require is culture. A new mindset will be required to take on the exuberance of the private sector operators in what has become their game (that used to be ours). Radical mindset change and the wholehearted support of all post stakeholders, particularly governments. There can be no doubt that the postal operators of tomorrow have the credentials to succeed today. Many are doing it already.
South Africa could benefit from an equally opportunistic evaluation of who we are and what we could be, in terms of global participation and social prosperity.
Of course we’ve got holes to fill before we can expect castles to be built, but so what? It is possible, given our credentials and our resilient people and yes, the Post Office could play a significant role in that, but we must invest.
Mark Barnes is CEO of the Post Office.