Japan Post aims to create 12 model post offices

Japan Post will try to improve itself by creating 12 model post offices across Japan so employees at its 24,000 outlets can learn about cost cutting and better productivity, Japan Post President Masaharu Ikuta said in a recent interview.

"We will arrange for each of (the 12 major) regional offices to create a model post office so that (the model of high productivity) can filter down into post offices nationwide," Ikuta told Kyodo News.

Ikuta, who assumed the presidency of what was the Postal Services Agency until March 31, said he will have 280,000 Japan Post employees emulate Toyota Motor Corp.'s production policy of eliminating "over-stretched labor conditions, waste and unevenness."

"I was deeply impressed when I toured Toyota's operations," said Ikuta, 68, former chairman of major shipping company Mitsui O.S.K. Lines Ltd.

The government appointed former Toyota board member Toshihiko Takahashi as one of two senior executive vice presidents of the new public corporation in charge of mail delivery and postal savings services. Takahashi is spearheading Japan Post's efforts to eradicate waste and improve productivity.

"Since the Toyota side put forward several hundred proposals to improve Japan Post operations…we are in the process of creating an efficient system by picking the good ones," he said.

At Koshigaya Post Office in Saitama Prefecture, a select team of seven Toyota officials who are experts in Toyota production recently checked every action by mail and postal savings workers.

Ikuta said he has ordered an overseas training system set up for Japan Post staff so the public entity's human resources can be knowledgeable in the overseas mail business.

"We would like to send employees to internationally acclaimed corporations in the fields of mail and parcel and cargo delivery services," he said.

"If we send four to five people each time for periods lasting three to six months, and we do five training sessions, we'll have sent two dozen," he said. "In that case, they would be able to discuss international business affairs on a practical basis."

These preparatory stages would open the way for Japan Post to expand international mail and parcel delivery services to challenge industry leaders, he said.

As for proposals in government circles to allow Japan Post to branch out into lending business, Ikuta said, "Since we have huge financial resources, we would end up putting a heavy strain on private-sector (banks) unless we are very prudent."

"It's better for us to refrain from extending mortgages and lending to individuals," he said.

Japan's post offices accept deposits, sell insurance policies and pay interest after managing money through loans to governments for investment in public works projects and other state projects. Currently, Japan Post has 235 trillion yen in postal savings, and a separate pool of 124 trillion yen in postal insurance premiums.

Asked how Japan Post will tackle rationalization, Ikuta said, "We have to reform our structure in two years if we are to accomplish the profitability goals set under the current four-year midterm management (improvement) program."

Japan Post has pledged to seek a combined net profit of 4 trillion yen in the four-year period starting April 1, 2003.

"The pains of reform will be shouldered in every area, including the review of trucking transport of mail and parcels…and changes in how post office duties are implemented," he said.

Truck transport has been outsourced to major trucking firm Nihon Yubin Teiso and its 15 group trucking firms whose top managers were reported to have landed plum jobs after retiring from the posts ministry.

Asked whether Japan Post plans to cut the number of post offices from the current 24,000, Ikuta said it will maintain the current number.

"Although we do not say we do not deem the large number of post offices a burden, there is no other company with business resources of this magnitude," he said. "We would like to consider how to take full advantage of these resources, rather than restructuring them."

Japan Post's slogan is "Macco Service," which literally means straightforward and honest service. Asked what it means, he said, "To provide sincere services with all our strength and heart by considering what customers want us to do."

"Of course, we're going to take your money — after all, this is the service industry," he said.