The monolithic monopoly game

Stuart Bruce is seriously unhappy with Royal Mail in the UK. Stuart has started a new business and recounts a sorry tale of dealing with an organization that supposedly provides an essential service to businesses, yet which seems wholly incapable of understanding simple business/service concepts, never mind actually wanting a customer’s business:

The Royal Mail shows all the signs of a business that doesn’t want to succeed. […] We want to give them £45,000 of business and the Royal Mail don’t want to listen!

Setting the Agenda | The up and downs of a start-up

This is a sad example of what’s still wrong with many monolithic state-owned enterprises in Europe as they evolve in a marketplace that is radically changing, has been for some years now, but they still don’t get it right. Contrast this picture with TPG, the Dutch post office/express delivery/logistics business that is a public/private sector combination. While many underlying issues and scale are a little different compared to Royal Mail, TPG has certainly got it more right than its UK counterpart.

Royal Mail has been through the type of organization changes that have extremely high social costs (restructuring leading to massive layoffs), as well as the debacle a few years ago when it rebranded itself with the silly name Consignia. But they have now started making profit.

The winds of bigger change are now blowing. On Monday, Reuters reported that Royal Mail is likely to face the impact of full competition in 2006, 15 months earlier than expected, as the UK postal regulator moves to beef up competition and improve delivery at the state-owned unit.

That’s how issues such as Stuart’s will ultimately be addressed – competitive pressures and marketplace changes. Small comfort to Stuart in the meantime, though.

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