Consignia a ‘chronic failure’, says chief
IN AN astonishing act of corporate honesty, the chairman of Consignia – soon to revert to its old name of Royal Mail – did a “Ratner” yesterday, admitting his company was a “chronic failure”.
Allan Leighton admitted that “you cannot imagine a company which is a monopoly, which has £6 billion of sales and manages to lose £1.2 million a day”.
The part-time chairman, who is on the board of eight other companies, made a scathing attack on the company just days after executives revealed plans to charge businesses £14 a week to have their letters delivered before 9am.
Mr Leighton said he had told them in the strongest terms to “go back to the drawing board”. He added: “Morale in our business is awful. People have to work in terrible conditions, they are not listened to, the levels of harassment, bullying, racial discrimination will be as high as any company in Britain.
“All those things are unacceptable, unpalatable, and we have to change them.”
Not since 1991, when Gerald Ratner, the chairman of a chain of jewellers, described some of his stock as “crap”, has an executive been so blunt about the quality, or the lack of it, in the service he provides.
Mr Leighton was brought in to “firefight” the huge problems within the company as it heads towards losing its monopoly on mail delivery. He said that the company was “in dire straits”. and that he believed the proposed charge of £14 a week was too high and that the pilot projects for the scheme would now examine the options of charging £5 or £10 a week.
Mr Leighton said: “We are having a re-think because on one hand I am trying to put a price increase through on stamps so I can argue that the first-class stamp is the best value you can get in Britain.
“One of the things we have to do is we have to deliver some value – £14 is a lot of money for small businesses.
“So the point of these pilots is to learn how to do this properly, move to one delivery and then find a way in which we can cover our costs, but at the same time deliver some value.
“There is a cast of things that have gone wrong. The most important thing is it can’t continue because the business will go bust.”
Mr Leighton went on to defend his part-time status. He said: “Most chairmen are part-time, but I spend 50 per cent of my time on Consignia.
“The company had to be made more efficient if it was to cope with new competition coming into its markets.
“The only way we are going to compete is if we change the way in which we do things, because at the moment competition coming in will slice us.
“We are not going to give in, it can be a great service, it is and can be the best postal service in the world, but not if it continues as it is.”
Mr Leighton and Mr Ratner are not the only voices that have shouted in the wilderness.
David Shepherd, the chief executive of Top Man, said his typical customers were hooligans who bought suits for their first court appearance.
Anders Dahvig, the chief executive of Ikea, said his stores were “appalling” while Abbey National’s boss, Ian Harley, said his customers “needed calculus” to work out which company, his own included, offered the best deals on credit card bills.
