Operations Management: NZ Post Case Study Analysis, Abacus Institute

This report provides an in-depth analysis of the operations management of New Zealand Post, focusing on the challenges and issues faced by the organization. The study begins with an executive summary that highlights the impact of the Postal Service Act of 1998 on the deregulation of the postal market. It then discusses the operational issues, including the impact of technology, human resource challenges, infrastructure, and the closure of post shops. The analysis identifies key operational issues, such as the impact of the internet and digital transfers on mail volume, challenges in human resource management, and the need for infrastructure upgrades. The report concludes by emphasizing the importance of dynamic leadership, employee relations, and the need for strategic investments in technology and human resources to ensure the continued success of New Zealand Post. The report also references the importance of frontline leadership in influencing employee engagement and implementing standard procedures in the face of changing industry dynamics and challenges.

Running head: OPERATIONS MANAGEMENT
Assessment 1
OPERATIONS MANAGEMENT
Name of the Student:
Name of the University:
Author Note:

1OPERATIONS MANAGEMENT
Executive summary
The Postal Service Act was implemented in 1998 . Since then, it has been successful in
deregulating the postal service market of New Zealand. Around 2300 employees work in 120
sites as well as regions of the country distributing mail across urban addresses of almost 18
million people.. 535 post owner drivers service belonging to rural areas greater than 200,000
delivery points. It has been recently found that frontline leaderships are one of the highlighting
areas according to the findings as they had been accountable for the consequences. It is also
responsible for influencing the engagement amongst the employees and making new changes.
The Total number of frontline leaders who were engaged are 180. They were responsible for
implementation of standard operating procedures on a regular basis. The sudden increase in
difficulties will be faced in the engagement of the workforce , management of budgets for the
man force, industrial relations, reduction in the mail volumes due to the changing nature of the
sector .

2OPERATIONS MANAGEMENT
Contents
Introduction......................................................................................................................................3
Analysis...........................................................................................................................................3
Discussion on the operational issues...........................................................................................3
Identification of operational issues from case study....................................................................5
Conclusion.......................................................................................................................................6
Reference.........................................................................................................................................8

3OPERATIONS MANAGEMENT
Introduction
There has been almost 170 years of postal service served by New Zealand. Regarding the history
of the introduction of postal services incorporated for the first time in New Zealand, the
merchants of Bay of Island have been delegated with responsibilities of inward as well as
outward mails under the administration of the Postmaster General belonging to South Wales.
First official post has been established in Kororareka in 1840 for the first time, at the time during
the captaincy of Captain Hobson who ruled over the Bay of Islands. Finally, the postal service
established into a successful organisation during the latter part of the 20th century leading to the
progress and success of a flourish industry. It even fulfilled the social, economic, as well as
political need .Along with the setting up of 1700 braches the Postal service Act was passed in
1998 and tiled to the deregulation postal service market of New Zealand which has later
flourished into full competitive market (Nzpost.co.nz. 2019). Apart from being a state owned
enterprise, New Zealand post has an amazing annual turnover inclusive of 43 million NZD.
Government based regulations of New Zealand Post has been included 8 diretors who are non-
executive along with the two shareholding ministers where the ministers of the corresponding
states have owned enterprises along with the ministers belonging to finance. Current 2300
employees of the New Zealand post are spread all over the nation (interest.co.nz, 2019). This
study analyses the various operations instrumental in the proper running of the New Zealand
Post.
Analysis
Discussion on the operational issues
Technology

4OPERATIONS MANAGEMENT
The national post service of New Zealand has been established in 1840. There has been
many technological changes due to reduced letter volumes, or the demand of the stokes for postal
services which has also been considered as very expensive for management. There has been a
significant contrast as New Zealand could deliver more than 1 billion letters per annum and now
the statistics reveal that only 500 million are transported that too there has been a prediction in
the reduction about 15%. According to estimates there will be a reduction in the number of
letters reducing the cost of the postal service owned by the state, loss accounting to almost 30
million dollars per year. Moreover, the company now have raised the price and cut the cost. Over
the past 3-4 years, various postal services have been recognised for coping up for the revenue
loss. Every alternate delivery Day, there has been new methods like electric vehicles which have
led to the reduction in cost. New delivery methods through vehicles for an instance like the
electric vehicles are often successful in reducing the prevalence of postal shop services which
favour the various outsourcing of partners like dairies, chemists, stationary shops. Although
annual costs of about 74 to 84 million dollars have been derived out of the business, but further
cost reduction are often not possible keeping in consideration the present scenario
(Newstalkzb.co.nz., 2019) although processing centres have been reduced considerably.
Human resource challenges
According to the estimations, almost 2300 employees have been employed working in
more than 120 cities where the country is involved in the distribution of more than 1.8 million of
urban addresses. 535 post owner drivers belonging to rural areas are there who provide service to
more than 200,000 delivery points. Apart from high costs being invested in the postal service, it
is a sector involving intensive labour. 70 present or more is currently employed the industry has
faced numerous challenges in the recent years. There has been deregulation of the postal services

5OPERATIONS MANAGEMENT
in 1998 where it has introduced an increase in the amount of pressure on firms as a result of
operations on universal services (Nzjhrm.org.nz. 2019).
Infrastructure
Considering the urban growth system and its current prevalence in New Zealand, it is
abruptly broken entirely which should be incentivised where forth of cities take place along with
ether flexibility in usage of various tools implemented in the process as well as poorly
incentivised (interest.co.nz, 2019).
Closure of the post shops
According to statistics around 79 shops will be closed regarding the state owned New
Zealand posts as the Kiwi bank will be allowing the plan of establishment of separate branches
across the countries of New Zealand, Johnsville, Petone Stock has already experienced the
shutting down of shops and communities have been alarmed by the services which will be
rendered if the areas. Kiwi bank will be opening according to the administration of the locations.
New Zealand post shop and the e-services will be unavailable (Newstalkzb.co.nz. 2019).
Identification of operational issues from case study
Technology
Inter has a very strong impact on the base and the scenario pertaining to the operations of
the new Zealand Post. Digital transfer, email as usage of such services has changed the increase
in the use of letters. Direct marketing however have been benefitted with increase in amount of
online purchases which has led to the customers receiving the products at home. Although
volume is reduced, the sheer number of items processed has increased. The delivery system has
become difficult to process and bulkier due to diversity of the items.

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Human resource
One of the important areas is frontline leadership where they are responsible of the
factors influencing the engagement of the employee. 180 frontline readers have employed along
with the responsibility of the implementation of standard procedures. According to the changing
nature of the sectors, number of challenges faced increases in the engagement of workforces. The
Industrial relations along with the management inclusive of labour budgets and the deduction of
the volumes pertaining to the number of mails have been observed
(annualreview2016.nzpost.co.nz. 2019).
Operational issues faced by New Zealand post
Various signs showing the reduction in the performance as well as behaviour included
inconsistent performances, lack of confidence in the senior management, leaders who lacked
potential of further development and various issues involving the employee relations which were
not dealt properly along with the issues regarding implementation of new initiatives.
(annualreview2016.nzpost.co.nz. 2019).
Infrastructure
New hardware will be required for the postal services of new Zealand so that the mail
processing system have scope of improvement through the development of latest technology
involved which will eventually lead to a increase in investment and increased amount of resource
allocations (annualreview2016.nzpost.co.nz. 2019).
Conclusion
Through aforementioned paragraphs it is evident that the post of New Zealand is
considered as a important part inclusive of the postal service and has been serving for a long time

7OPERATIONS MANAGEMENT
successfully delivering almost billions of letter per annum. Entire postal service is often
depended on the service receive from the customers and echo are willing to use the services.
With the advent of the internet as well as technological advancements, there has been a burden
on the postal services of the government. Despite being an old industry, there is much less
options for offers for the customers. Over time the whole industry has suffered a major setback
for a variety of reasons. The whole system has become slow paced and hence there is a need to
rejuvenate the systems. The government has invested a lot for the improvements of the system
like innovative strategies and incentives given. Moreover, cars of the battery mail delivery , letter
sorting technologies as well as increase in the number of staffs on delivering the mails at a faster
pace.
Technology or workforce is not the major bottleneck where the administration and leadership is
the main hindrance. Dynamic nature of leadership is important in this context and the entire
postal service has played an important role where they lack the potential and most of the
employees have lost faith in the managers. Employee relations need to be considered and one of
the important facts to be stated. Less number of employees also has led to a challenging situation
where human resource plays important role involving the recruitment of extra employees.

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Reference
annualreview2016.nzpost.co.nz. (2019). NZ Post Integrated Report 2016. Retrieved from
http://annualreview2016.nzpost.co.nz/NZPOST-Annual-Report-2016.pdf
interest.co.nz. (2019). The scale of New Zealand’s infrastructure deficit is 'massive' and can't be
fixed without billions of dollars of private capital – Jason Walls takes a look at how the
Government plans to woo investors. Retrieved from
https://www.interest.co.nz/news/93445/scale-new-zealand%E2%80%99s-infrastructure-
deficit-massive-and-cant-be-fixed-without-billions
Newstalkzb.co.nz. (2019). NZ Post facing challenges in face of letter decline. Retrieved from
https://www.newstalkzb.co.nz/news/business/nz-post-facing-biggest-ever-upheaval-in-
face-of-letter-decline/
Nzjhrm.org.nz. (2019). Case study, New Zealand Post, high-performance work, HRM and line-
manager involvement. Retrieved from
http://www.nzjhrm.org.nz/Site/Case_Studies_/Delivering_High_Performance_in_New_Z
ealand_Post.aspx
Nzpost.co.nz. (2019). History of New Zealand Post | New Zealand Post. Retrieved from
https://www.nzpost.co.nz/about-us/who-we-are/history-of-new-zealand-post
Nzpost.co.nz. (2019). Reconnecting New Zealand | New Zealand Post. Retrieved from
https://www.nzpost.co.nz/about-us/media-centre/media-release/reconnecting-new-
zealand