Groups and Committees

UPU conference report

A market breaking free from hundreds of years of monopoly

Intellect, through the European industry body EICTA, participated in a unique conference at the Universal Postal Union in Bern on 28 April 2006. This was the first in a series of meetings where all stakeholders in the postal sector gather to explore new business “development models” for posts. About 120 delegates gathered in the conference hall where until recently those who were not from the monopoly national post offices were barred from entry as if unclean. The realisation is slowly permeating the psyche of the traditional post offices that change will result from the liberalisation of the market. After the protection of hundreds of years of monopoly and the reassuring insulation from market forces, the word “customer” can now occasionally be heard. The final vestiges of government patronage are falling away across Europe, with the UK taking the lead as Postcomm, the UK regulator, created a fully open market from January this year.

The conference was addressed by leading figures from postal service providers, their private competitors and consultants. Noble sentiments were expressed propounding the virtues of customer orientation, innovation, private equity, and the application of technology. But there was an air of academia analysing the virtues of candlelight as the world flicked their light switches. In general the speakers from the private sector were the ones who showed the spark of recognition and the passion for the opportunities and threats. In the original agenda, Adam Crozier, the CEO of Royal Mail was listed as a speaker. It was a shame he was unable to attend because he would have been the ideal person to add that much needed realism and authority from someone working to move his business to success in a free market.

But it is clear that customers also have to change and to work at innovation in this traditional business. A long-standing monopoly stunts the imagination of customers and limits their aspirations to those possible within the constraints laid down by the regulated monopoly supplier. “A little quicker” or “a little cheaper” are slowly being replaced by new emerging product and service demands as the innovative process is fired by the iterative interaction between multiple suppliers and customers.

The conference was a great leap forward and clearly there are opportunities for those who wish to seek and satisfy the needs. There are declining parts of the market where e-substitution is taking place but equally there is significant growth in the higher value areas of packets and parcels, direct marketing, and catalogue and magazine distribution. Post Office networks are being squeezed but those with an imaginative outlook are building additional customer value especially through banking, insurance, local services and access to new information and communications technologies.

There was recognition that to survive, the businesses will have to drive through change and harness the power from new technology, which will facilitate the development of new products and higher levels of service and value. All they now have to do is to return to their operations and turn back hundred of years of ingrained protectionism and market arrogance.

For more information contact:

Carrie Hartnell
Programme Manager
T 020 7331 2007
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