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Österreichische Post AG's Future Oriented Action Plan

Pressemeldung from 28.08.2000

Enhanced Services and Quality, Expansion by Innovation

Mr. Anton Wais, Österreichische Post AG's C.E.O. presented to the Supervisory Board meeting held today the company's enhanced strategic plan developed in order to ensure optimum competitiveness in a free market. This plan centres around optimisation based on leading position as concerns quality and costs, best possible use of growth potential of well defined essential activities of Österreichische Post AG, and a clear-cut new organisation.

Expansion based on innovation, internationalisation, and co-operation

According to Mr. Wais, "the company's assets are its logistic competence, especially when used in co-operation with future-oriented activities like e-commerce, and its capacity to generate synergies out of international co-operation. Österreichische Post AG aims at leadership on its domestic market, and at becoming the gateway to South-Eastern Europe".

Österreichische Post AG furthermore plans to create new products, technologies and business systems, e.g. development of specific logistic services for e-business, for commerce, and for small and medium sized enterprises (SMEs). Introduction of new products like Euro-Mail (a service package for advertising mail abroad) will serve keeping and expanding leadership on the domestic market.

Action blend to enhance cost-effectiveness

According to Mr. Wais Österreichische Post AG's cost effectiveness is to be brought in conformity with that of competitors. To this effect a series of actions is planned to boost revenue and reduce costs. On the medium term, reorganisation of sales in post offices has a potential of some 1.3 billion ATS.

Österrichische Post AG is just now in the process of restructuring basic activities - branch network, logistics (i.e. sorting), distribution (delivery), and sales and marketing. New structure aims at combining advantages of a big company (visibility on the market, terms, in-company services etc.) and local flexibility by constitution of sectors, lean organisation, and faster communication. "This company shall become an industrial services enterprise", says Mr. Wais.

Looking for same productivity as competitors - staff reductions

The "Speed" action programme once implemented will ensure competitiveness by cost reductions. This programme aims at enhancing productivity to the level of competitors on the European postal market. Staff productivity (i.e. net turnover/staffing) at Österreichische Post AG amounts just now to some EUR 48 000 per staff member, at Deutsche Post AG it is some EUR 73 000, in Switzerland EUR 81 000, in Denmark EUR 56 000, and in Norway EUR 51 500.

Measures to enhance flexibility, part time employment, a staff pooling system allowing variable personnel deployment, and immediate recruitment stop will lead to reduction of staff by more than 6000 during the period running up to 2004. A social plan including compensations, an employment fund etc. will accompany these measures concerning logistics, distribution, and counters, as well as management.

First phase of the "Speed" action programme already implemented

"Three phases will serve Österreichische Post AG to get ready for privatisation: create the required structure, modernise, and implement", stressed Mr. Wais. The first phase of the "Speed" action programme, i.e. entrusting staffing matters to divisions, capacity management, staffing system, and provisions concerning multiple handling have now been implemented. According to Mr. Wais reorganisation already brought clear-cut organisational separation of all activities in the central domain of Österreichische Post AG, and starting actions to reduce personnel costs.

New orientation in the logistics and distribution fields aimed at making delivery the core business

Market, competitors, and investors consider Österreichische Post AG to be a company specialised in delivery, and, therefore, it is to be compared not only with European post companies, but also with private couriers. Such companies are large scale operations. Mr. Wais stressed that this means that "delivery, is to be considered as the core business of Österreichische Post AG".

Restructuring of logistics and distribution aims at the following:

  • Optimising transport logistics:
    Integration of postal motor vehicles service and freight forwarding ensures direct access to vehicles, and thereby enhanced flexibility resulting in up to 35 % cost reductions (80 million ATS per year). Flexible pricing of rail transport will bring cost reductions amounting to some 53 million ATS per year.
  • Delivery bases:
    Optimisation of delivery bases and restructuring of postmen's walks. Concentration (1900 delivery post offices will be reduced to some 430 delivery bases all over Austria) serves to simplify administration of smaller post offices. 50 out of the planned 430 delivery bases will be established this year, 170 in 2001 and 2002 each, the whole process being implemented in 2003.
    Each delivery base will group at least 15 to 20 postmen, the smallest unit for a delivery base being "half a truck". Maximum distance to the first address to be served by postmen will be less than 15 km.

    This new organisation of postmen's walks aims at reducing sorting time in favour of delivery.
  • Innovation by focussing on six letter and parcel sorting centres:
    Vienna (letter sorting centre as of July 2002, parcel sorting centre as of January 2004), Linz, Salzburg-Wals (letter sorting centre as of July 2001), Hall (combined sorting centre as of January 2004) Graz (combined sorting centre as of August 2001), Carinthia (combined sorting centre as of January 2004).

    Concentration of sorting centres on six sites, automation, and eight hours shift work instead of twelve hours will enhance quality and reduce costs.
Innovation by reorganisation of the branch network:
Three new customer-oriented branch types

Post offices network will be re-structured according to a new idea based on three types of branches:
  • "Mc.Post" offering the frequently required services, and staffed with a minimum of personnel, hence at reduced costs. Mc.Post kiosk specification: No queuing at counters, customer-friendly opening times, and most up to date technology. It is targeted to private persons and small and medium enterprises.
  • "Postmeisterei", a service interface for all customers ensuring normal postal services, individual consulting, and intermediary services for neighbourhood help, assistance to the elderly etc. It will also serve as communication platform for local companies and institutions.
  • "ServiceCentre" will be organised according to the shop in shop idea, and offer postal products as well as other services like copy shop or packaging services. A few post offices will serve as pilot as of the second quarter of 2001.
Österreichische Post AG's requires from Government revised rules creating the basis for fair competition

"A new legal framework is required to ensure fair terms of competition for Österreichische Post AG" said Mr. Wais when presenting a list of basic requirements:

1. Österreichische Postbus AG (omnibusses):
  • Assignment of Österreichische Post AG's subsidiary Postbus to ÖIAG.
2. Civil service law:
  • Hiring out of personnel and mobility in case of transfer
  • Double worker representation according to the relevant law
  • Freedom of company management as concerns supplementary fees
  • Simplified company-owned solutions for compensation of additional expenditure incurred when working outside the company
3. Right to tender:
  • Margin in negotiating orders in the sector
4. No universal service decree without clear-cut financial regulations.

Contact for further information:
Österreichische Post AG
Company Communication
Press service
Mr. Michael Homola
Phone: from abroad +43 1 515 51-5217, in Austria (01) 515 51- 5217