The Postal Service has been holding a series of Innovation Symposiums this summer and fall to solicit bold and creative ideas from customers on ways to grow revenue. Postal officials have encouraged customers to draw from their own experiences but also to think beyond the current legislative and regulatory restrictions and to offer "blue sky" suggestions. The one caveat, however, was that the ideas had to "push the needle" on revenue. They had to be big enough to contribute $50 million to $100 million in profit.
I want to argue for small ideas. I am not opposed to big ideas, mind you. It would be great if someone proposed a handful of products or services that yielded the USPS more than $1 billion in annual contribution. But something tells me that if those ideas were out there, we would be trying them already.
Instead, I think the Postal Service needs to focus on providing the products and services its customers want - even if a product only yields $8 million to $10 million in contribution. First of all, there is a value in providing postal customers what they want; a value that might not show up as "contribution" in the traditional sense. Let's say a handful of customers are asking the USPS to provide a special service tied to data collection from the IMb. The USPS determines the new service would yield only $8 million in new revenue. But maybe that service keeps a commercial First Class Mail customer in the mail. Perhaps it keeps that customer from diverting more of its business to the Internet. There is a huge value in keeping an existing customer in the mail, which might not show up on the P&L statement for that particular product, but undoubtedly helps the overall bottom line of the Postal Service.
One thing I heard at the Symposium I attended, held in conjunction with the Mailers Technical Advisory Committee meeting in August, was that it is easy to customize offerings. The Postal Service already does this to some extent by offering some products, such as Dinero Seguro, only in some post offices around the country. Digital tools now permit "individualization" of offerings. Software makes it simple to individualize an offering and earn a small extra contribution from a variety of customers. But again, the USPS has provided just what the customers want, and perhaps, it made mail more attractive than an alternative communications vehicle for those customers.
Or as one postal sage reminded me, the pursuit of uniformity and size/scale is sooo 20th century. The "curse" of size and continental scope should no longer be a curse. Look at what McDonald's has done around the world. It provides its standard McDonald's menu everywhere, but then regionalizes it as well. It's a huge organization operating in all corners of the world and still can turn its operations on a dime. This is the type of innovative and nimble approach the USPS needs to take.
The last thing I'd like to offer in defense of small ideas is that they train USPS managers and employees to operate like a competitive business. Providing what postal customers want, even if it only moves the needle by a few million dollars, is training USPS employees to manage and operate in a competitive market. I firmly believe the day is coming when the postal monopoly protections won't exist, or at the least, won't look the same as they do today. In any event, the Postal Service already faces considerable competition from the ever-evolving e-commerce world. If the Postal Service won't give its customers what they want because it would only yield a few million dollars, it has no chance of surviving - no matter what its new business model eventually looks like.
I want to argue for small ideas. I am not opposed to big ideas, mind you. It would be great if someone proposed a handful of products or services that yielded the USPS more than $1 billion in annual contribution. But something tells me that if those ideas were out there, we would be trying them already.
Instead, I think the Postal Service needs to focus on providing the products and services its customers want - even if a product only yields $8 million to $10 million in contribution. First of all, there is a value in providing postal customers what they want; a value that might not show up as "contribution" in the traditional sense. Let's say a handful of customers are asking the USPS to provide a special service tied to data collection from the IMb. The USPS determines the new service would yield only $8 million in new revenue. But maybe that service keeps a commercial First Class Mail customer in the mail. Perhaps it keeps that customer from diverting more of its business to the Internet. There is a huge value in keeping an existing customer in the mail, which might not show up on the P&L statement for that particular product, but undoubtedly helps the overall bottom line of the Postal Service.
One thing I heard at the Symposium I attended, held in conjunction with the Mailers Technical Advisory Committee meeting in August, was that it is easy to customize offerings. The Postal Service already does this to some extent by offering some products, such as Dinero Seguro, only in some post offices around the country. Digital tools now permit "individualization" of offerings. Software makes it simple to individualize an offering and earn a small extra contribution from a variety of customers. But again, the USPS has provided just what the customers want, and perhaps, it made mail more attractive than an alternative communications vehicle for those customers.
Or as one postal sage reminded me, the pursuit of uniformity and size/scale is sooo 20th century. The "curse" of size and continental scope should no longer be a curse. Look at what McDonald's has done around the world. It provides its standard McDonald's menu everywhere, but then regionalizes it as well. It's a huge organization operating in all corners of the world and still can turn its operations on a dime. This is the type of innovative and nimble approach the USPS needs to take.
The last thing I'd like to offer in defense of small ideas is that they train USPS managers and employees to operate like a competitive business. Providing what postal customers want, even if it only moves the needle by a few million dollars, is training USPS employees to manage and operate in a competitive market. I firmly believe the day is coming when the postal monopoly protections won't exist, or at the least, won't look the same as they do today. In any event, the Postal Service already faces considerable competition from the ever-evolving e-commerce world. If the Postal Service won't give its customers what they want because it would only yield a few million dollars, it has no chance of surviving - no matter what its new business model eventually looks like.
Kate Muth is President of Muth Communications, a writing, editing and consulting firm. Contact her at katemuth@comcast.net.
