UK Royal Mail trio pay the price for postal failure

ROYAL MAIL boss Adam Crozier will this week dismiss three key figures from his front-line management team in an aggressive response to a recent slump in service standards.

Crozier has also tightened his personal grip on the company by installing himself as chairman of the committee which has day-to-day responsibility for the running of Royal Mail.

Sources close to Royal Mail said marketing director Paul Rich, logistics chief Paul Bateson and Parcelforce boss Vanessa Leeson had been removed from the management board, leaving it w ith eight members.

Former Football Association boss Crozier has also replaced Royal Mail’s executive deputy chairman, New Zealander Elmar Toime, as chairman of the committee following rumours of a difficult working relationship between the two men.

In May, Crozier took day-to-day control of Royal Mail’s letters business from Toime.

Among the directors who remain on the management committee are Post Office chief executive David Mills, finance chief Marisa Cassoni and human resources director Tony McCarthy.

“He [Crozier] is asserting his authority over the running of the business, which as chief executive he has every right to do, ” said a Royal Mail source. “The move has the full support of [Royal Mail chairman] Allan Leighton.”

The shake-up comes less than two weeks after Crozier revealed figures showing the company failed to meet all 15 of the performance targets set by Postcomm, the industry regulator. The disclosure prompted Postcomm to suggest it may impose fines on Royal Mail.

Crozier has already questioned whether Postcomm’s targets are realistic while Royal Mail continues to pursue a massive modernisation programme which is designed to enable the company to fight off commercial competition.

A spokesman for Royal Mail maintained its service standards are improving, with preliminary figures for August showing first-class, nextday delivery hit 92.4 per cent, a fraction below the 92.5 per cent target.

But the company has admitted it will have to fork out an initial 50million in compensation to business and domestic customers as a result of service disruption during the previous financial year, much of which was triggered by unofficial strike action last autumn.

Royal Mail is expected to report annual profits of 400million at the end of this year, marking a significant improvement from the group’s performance two years ago, when it lost 1million every working day.

The three-year turnaround plan being overseen by Leighton and Crozier, which has several months still to run, has included shedding more than 32,000 jobs and closing thousands of Post Office branches. The Post Office’s revival is being spearheaded by a broadening of the services offered by branches, including financial and telephone services.

Royal Mail refused to comment on the fate of the executives.