Competition and electronic mail offer a challenge to an old friend

Published on Thursday 17 January 2008 20:44

INTERVIEW: RICKY MacAULAY

WHEN Ricky MacAulay became a postie in 1988, he never dreamed he would swap his daily rounds to become a major player in a transformation of Britain's postal system.

Now the east of Scotland head of the Royal Mail, MacAulay is at the forefront of a move that has seen his 20-year employer morph from a national service into a highly competitive commercial enterprise.

In the past 12 months, he has battled with crippling strikes, as well as coping with the fall-out of Royal Mail losing its monopoly status at the start of 2006 – opening up the sector to competitors.

Walking through the organisation's main mail centre in Sighthill, Edinburgh, MacAulay claims he is now confident the system is back on track and is looking forward to a good start to the year.

The organisation is still recovering from the Christmas rush. Over the festive period, 500 temporary workers were drafted in to help the 5,500 permanent east of Scotland employees cope with a total of 82 million items of mail.

In addition to the usual parcels flying between distant friends and relatives, the Royal Mail has contracts with companies such as Amazon, QVC and ExpressGifts – helping to offset this year's 2 per cent market-wide drop in postal volumes.

MacAulay explains: "This drop is happening all over Europe and we've got this to contend with as well as competition.

"You've got the reality of e-commerce and people using texting to do what traditionally a mail piece would have done.

"However, what you've got alongside that is a growth in home shopping, which has significantly grown, and we have very good customer partnerships and relationships with all of the big 'e-tailers'."

A 1.2 billion investment package from the government to modernise the company's methods across the whole of the UK will see the east of Scotland benefit with a new machine that sorts mail at 50,000 items an hour rather than 30,000 – rivalling competitors' until-now more modern technology.

Having kicked off his career delivering mail in the east end of Glasgow, before heading up a local delivery office, MacAulay later took on responsibility for the Edinburgh Mail Centre and was then promoted to area general manager. Now, he is leading the Royal Mail into a new age – where it is being forced to diversify to keep afloat.

He hints that the company may be looking to move into new market opportunities, perhaps in tie-ups with other services firms, taking advantage of the fact that Royal Mail workers visit 20 million houses every day.

Of course, it is not just commercial struggles which have plagued the postal service. The darling of both the British public and commercial businesses since Victorian times, it saw customers from all walks of life forced to find alternative methods of communication during a series of strikes at the end of last year. An agreement was finally reached in late November, but not before Britain had suffered delays to millions of items of mail.

Now the company fears customers may have turned to electronic methods of communication, or to rivals, who are stealthily siphoning off business as a result of the Royal Mail's industrial action.

But he now wants to move on. He adds: "We are a business now and we have to do the best in what we do. The enemy as far as I'm concerned is the competition, not anyone internally. It shouldn't be a relationship with the trade union – we need to focus on winning back market share."