Organization Design Case Study: Royal Mail | ON THE MARK Organization Design Case Study: Royal Mail | ON THE MARK
CASE STUDY

Parcel Force

Developing internal capability

The Issue:

Parcelforce Worldwide [PFW] is the UK parcels shipping business of Royal Mail Group. It delivers over 160,000 parcels every day and serves over 21,000 business customers. The parcels market in the UK is extremely competitive, with many large operators, often subsidiaries of larger organizations such as TPG and Deutsche Post, competing for market share. PFW had consistently lost money for over 15 years and a decision in 2000 to close PFW was made but suspended to allow the executive team five years to turn the business around.

What we did:

HR was in the very early stages of re-inventing itself from a bloated, transactional-focused HR group to a group focused on adding real value to the business while driving much-needed change across all of the RMG businesses. OTM was brought in to help design and deliver a relevant and substantive development program for the new and remaining HR generalists to build the competencies needed to drive and sustain change across the business. The PFW executive team was armed with new-found skills, tools and methods supported by shadow consulting from OTM. The team supported the redesign of sales and operational functions; Project Freedom

The Result:

Despite the direst of scenarios, PFW achieved operational breakeven at the end of 2004 and into 2005. Project Freedom formally ended in 3rd Qtr of 2005 but the implementation of any design solution never really ends. Some of the changes made as a result of Project Freedom include:

  • New organization structures implemented
  • New Management team in place in 2005
  • New Executive team and central functions structure
  • Commercial recognition/reward terms & conditions introduced
  • New decision processes in place to support new structure & commercial culture
  • Development program to support General Manager

By 2007, PFW achieved a growth rate of 8% and made a £17m profit [before business overheads].

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The process was successful due to good sound methodology coupled with the way it is delivered – with infectious enthusiasm and with plenty of real life experience – this is not a textbook solution!
Simon Davies, Program Director, Parcel Force

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