Top postal appointments pave way for liberalisation

Adam Crozier's appointment as the next chief executive of Royal Mail Group brings the skills of a "moderniser and a marketeer" to the beleaguered mail operator.

The former head of the Football Association will take over from John Roberts, who retired yesterday after 10 years as chief executive and 35 years with the group, which is losing Pounds 1.1m a day.

Alan Jones, whom some had considered the front-runner, is believed to have decided against leaving his post as managing director at express delivery group TNT.

Instead Allan Leighton, chairman of Royal Mail, made two new appointments to head the board. Elmar Toime, currently chief executive of New Zealand Post, joins Mr Crozier and David Mills to form a triumvirate just below the chairman. Mr Toime, who will become executive deputy chairman of Royal Mail Holdings, will have responsibilities across the postal group.

Describing Mr Crozier as a "moderniser and a market-eer" and Mr Toime as "one of the most respected postal people in the world", Mr Leighton told the Financial Times that the combination was a "powerful cocktail".

Mr Crozier's appointment will surprise those who thought he would take on a new role in the world of football. Others point to his lack of industry experience.

Explaining the strategy behind the appointments, Mr Leighton said Royal Mail, which is one year into a three-year renewal plan to bring it back to profitability, needed two high-profile figures with complementary roles instead of one chief executive. "There were two of us at Asda for a similar turnaround but on a smaller scale," said the former head of the supermarket group.

The two appointments bring the total of new faces on Royal Mail's board to 11 and complete the boardroom shake-up Mr Leighton announced in June.

Mr Toime's main role will be to manage the letters and international business and to sit on the board of Post Office Ltd, the group's Achilles' heel. Mr Crozier will focus on modernising human resources, information technology and finance with the help of the three managing directors. He will also take charge of the loss-making Parcelforce and logistics to "teach him about the mail business", said Mr Leighton.

Both men take up their new roles in February, just weeks after the opening of the postal markets to competition. They will be paid a basic salary of Pounds 500,000, as well as bonus and incentive payments, depending on their success in turning the group round.

Each, in their own way, will be jumping out of a frying pan and straight into the fire when they take up their new roles at Royal Mail.

Mr Crozier will face the starkest challenge. As head of Royal Mail Group, he will be in charge of bringing the operator back into the black by cutting inefficiencies – with no previous experience of the mail industry.

His main challenge will be to motivate nearly 250,000 employees and encourage them to drive through these changes – a task calling for a football manager's skills. But some doubt whether the famously forthright Mr Crozier will prove sufficiently diplomatic.

The big leap for Mr Toime will be from New Zealand's 5m letter-a-day market to an 80m letter-a-day market. But his previous job prepared him for competition, since New Zealand's post was liberalised four years ago.

Mr Toime spearheaded the transformation of NZ Post, turning it into what some insiders have called one of the most efficient services in the world. This year he established Kiwibank Ltd, a full service retail bank and fully-owned subsidiary of NZ Post – a plan in line with Mr Leighton's ambitions for Post Office Ltd to become the "Easyjet of banking".

Working together will be a challenge. Mr Crozier will be "exchanging 20 Premier League chairmen for one Premier League vice-chairman", according to Peter Skyte of the Communications Managers Association. Although Royal Mail said there would be no overlap between the two new roles, clashes can be expected.

The CMA urged Mr Toime to learn from his experiences in New Zealand, where the universal service at a uniform price is under threat.

The message to Adam Crozier yesterday was very clear, Tom O'Sullivan reports. "If he thinks the vested interests at the Football Association are entrenched, wait until he arrives at Royal Mail," was how one former colleague summed it up.

It is just seven weeks since Mr Crozier (above) resigned as chief executive of the FA after losing a power struggle with members of its executive board. In his three years there, he developed a reputation as a reformer – taking over an organisation that was overly bureaucratic and committee-led – stream-lining its decision-making process and finances. He oversaw the move from the FA's gloomy headquarters at Lancaster Gate to Soho Square, the appointment of Sven Goran Eriksson as England coach and the Wembley stadium project.

Allan Leighton, Royal Mail's chairman, has hired the Scot to perform a similar reforming exercise on a business that is losing Pounds 1.1m a day. But Mr Crozier was also criticised by some as arrogant and accused of a management style that excluded people. This came back to haunt him when he lost the support of key members of the FA hierarchy. Despite that, Mr Crozier has been hired as a "people manager" because of his reputed communications skills. "One of the things he will have learned at the FA is to do things in bite-size chunks and include as many senior people as possible," says one former colleague. "He will not be scared of a fight in the sense that if changes are necessary he will make sure they happen. But he will not go there and look to pick a fight for the sake of it." It may be seen as a gamble by Mr Leighton, also deputy chairman of Leeds United. Mr Crozier's only experience of industry was as a trainee at Mars in the 1980s.

Before joining the FA he spent several years at Saatchi & Saatchi, rising to joint chief executive in the UK. He won plaudits for keeping the advertising agency afloat when most of its senior managers, including the Saatchi brothers Maurice and Charles, and several of its most valuable clients walked out in 1995.