Business decisions in the face of Covid-19

[Celgar]

Royal Mail senior management have taken quite a revealing response to Covid-19. Contrast RM to other Companies that remained open and faced large increases in business at the same time as facing attendance issues due to self-isolation. Their first response was to hire loads of extra people. Many companies have openly admitted they're taking in more revenue at the moment, but they're spending a lot more on staff (including giving them bonuses). It's more about keeping things going, than making a profit.

Royal Mail's initial response to the Covid-19 lockdown, was to implement a total recruitment ban on all delivery staff. So inevitably, since everybody is at home bored and ordering stuff online 24/7, and most shops are closed. We're now busier than Christmas, but unlike Christmas we've also got a recruitment ban and higher than usual staff absence. Royal Mail's response to the mountain of stuff piling up in some delivery offices, is to cut the Universal Service for the whole country, but cut it in such a way that it makes it more difficult for the Delivery Offices that have been operating completely fine. I don't see how double mail on Monday, is going to help us at all. We're just going to have staff going home early on a Saturday, and then we'll fail stuff on a Monday, and backlog the whole week. You genuinely couldn't make it up, Royal Mail logic at its finest.

It really boggles the mind that something so simple can be made so complicated. If you have Delivery Offices that are snowed under with parcels. Hire some people to deliver some parcels. Like we do with those other "unprecedented situations" like Xmas, and It wasn't so long ago they were talking about hiring temporary agency staff for their "peak Easter period"...

The temporary easter staff was about hiring strike breaking staff as the rumour was we would go on strike immediately after or on Easter. That obviously didn't happen though with TP & Ward extremely resistant to allowing any strike action.

[SpacePhoenix]

Royal Mail is not just about the UK.
As we all know GLS has been propping up the company financially for the past few years. GLS has been hit very badly by Covid-19 across Europe especially in the Business to Business sector. Without GLS profits or in fact with GLS making a loss the parent company (us) is going to be making a loss.

Even with increased revenue from parcels the cost of delivering each parcel has obviously increased with social distancing and new delivery methods, profit margin isn't that great in the parcel market as it is.

Anybody who thinks the company is raking it in is kidding themselves on.

Saturday is a fine example of why royal mail as a company are basically buggered. If they didn't have a clue how long packets take to deliver, they do now. Most people I would say, only took about 1- 1.5 hrs less than they would have done to take the letters as well. Managers expecting one person to take two delivery worth if packets was a joke. One which in most offices backfired spectacularly. If we move to more and more packets and less letters it really isn't gonna take any less time to process and deliver on their current model. And this is when on lockdown most are getting rid of 99% first time. Almost forgot how to fill in a 739 now. Imagine this level of packets when people are at work!

Wonder if long term RM are going to use something like:

[Vimeo]https://vimeo.com/292304094[/Vimeo]

But scaled up in size. Probably only a matter of time before a manufacturer brings out some sort of sequencing system for packets that can handle anything from very small packets right up to shoebox sized packets

[Celgar]

I think that the decision over Saturdays was a PR decision rather than a financial one.

If you know failures are somewhat endemic then perhaps getting the public to think RM are good employers may be a good look further down the line.

I am fairly certain it was a strategic move rather than a benevolent one.

The people at the top of RM are liars & backstabbers & we can never ever trust their actions. They used the push by the CWU to try and reduce the chance of us catching Covid19 to launch their cover story. The public were under the impression RM had given us Saturdays off, maybe even paid, but this was never the case. When I have explained to people about 'absorption' in the past they never really understand it. Remember how absorption was only ever going to be a temporary measure and how that turned out??
If this trial goes the whole six weeks they will use the data gleaned from it to further their end game. They are devious and this is all it is about. Cost cutting is the only game in town.

[Celgar]

Even our DOM who is fair and even handed mentioned to me yesterday about using the navigation app on the PDA in reference to delivering parcels on walks we have not been trained on or where we don't know where we are going.
We really have to be careful now in terms of how we do the job otherwise we are going to fall into their trap.

[clashcityrocker]

That aside, there is an excellent business opportunity here to grow parcel revenue far quicker than would have been expected. What I've noticed too, is that once people get used to buying a lot of their "stuff" online, it tends to stick and snowballs into their main method of buying things. Similarly, once a business goes to the hassle of setting up an online delivery system, they very rarely stop offering that service.

Agreed. So what if they built dedicated parcel hubs and separated those parcels from the current pipeline?

What if, just what if, their current decisions are based on trying to ensure RM remains a viable concern going forward?

[HTPostman]

I’ve had a theory about the finances of RM for a while. I know the accounts are there to read but the books can always be cooked.

I’m going to assume that while they have cash in the bank, they also owe a lot of money in the form of loans. The £2 billion or whatever it was figure to revolutionise the business won’t be stored in a big safe, it will be borrowed.

So while income is probably up, they are looking at it as making a dent into the money they owe.

It’s similar to owing £1000 cash to your mate. You win £200 on a scratch card - do you spend it all on yourself (or in RM terms, use the increase in money to hire more staff/vans/pay more OT). Or do you keep it to pay back your friend (In current RM terms: start working off the deficit, knowing eventually even without extra staff we’ll catch up regardless of if it takes weeks or months).

[Murdoch]

That aside, there is an excellent business opportunity here to grow parcel revenue far quicker than would have been expected. What I've noticed too, is that once people get used to buying a lot of their "stuff" online, it tends to stick and snowballs into their main method of buying things. Similarly, once a business goes to the hassle of setting up an online delivery system, they very rarely stop offering that service.

Agreed. So what if they built dedicated parcel hubs and separated those parcels from the current pipeline?

What if, just what if, their current decisions are based on trying to ensure RM remains a viable concern going forward?

I have no problem with parcel hubs, however the implementation of LAT offices is the main point of contention. The plan for our Delivery Office is to have larger Parcels being delivered by a LAT office 40 miles away. But that's a whole other discussion.

The current Covid related decisions are deeply flawed in my opinion, exactly because they've tried to implement a pre-existing plan that was hatched as a response to national strike action. I hate to break it to Royal Mail, but a global pandemic that has caused unprecedented changes to how we live our lives, and people's shopping habits, is not the same thing as a CWU strike. They've approached the current situation with completely the wrong mindset, how do we fit what we were planning to do, into a completely novel situation, and they worked backwards from the solution to a different problem. It's an idiotic way to manage the business.

They should be ensuring that we're competing for a larger share of parcel market (at a time of accelerated growth), by making sure we get them delivered to customers in a timely fashion. To me, they seem to be doing the opposite. Making cuts and implementing a plan that will make us fail many more items nationally. All at a time while all of our competitors are hiring en masse to raise their capacity. I've lost count of the number of new couriers I've seen out on the street.

That said, I think we're in agreement about the idea that increasing parcel revenue is vital. We perhaps just differ about the competency of senior RM management and how best to achieve that growth.

[Murdoch]

The temporary easter staff was about hiring strike breaking staff as the rumour was we would go on strike immediately after or on Easter. That obviously didn't happen though with TP & Ward extremely resistant to allowing any strike action.

Yeah I was making the joke that they'd hire for strike action. But for a global pandemic that has caused an unprecedented increase in packets and parcels, they instantly implement a hiring ban.