Parcelforce North West Processing Centre, Chorley, Lancashire
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Someone once posted a horse. “It was stuffed,” says Peter Jones, manager of Parcelforce’s new processing centre in Chorley, northwest of Manchester. “But it was obvious what it was, because it looked like a horse wrapped up.”

It is surprising anyone in the year-old warehouse had time to spot the animal. No item is supposed to spend more than three minutes inside the vibrating multicoloured metal framework, filled with carousels, conveyor belts and slides. Between 8pm and 4am, five nights a week, at a rate of up to 14,000 items an hour, lorries feed in packages on one side, which are processed automatically and packed into outbound vehicles on the other, for onward despatch along the “spokes” for which Chorley is a hub.

Chorley stands at one extreme of the modernisation of the Royal Mail, Britain’s five-century-old postal service. It is fast. It is highly automated. It is built for expansion. Most important, managers and staff at Parcelforce – which has long operated as an autonomous express parcel unit within Royal Mail, up against FedEx, UPS and others – are highly sensitive to competition.

If Chorley is a well-oiled postal machine, then the Royal Mail’s outpost in Marple, on the opposite side of Manchester, still looks like the hand-cranked version of the system. The person who has to reconcile these two extremes is Canadian chief executive Moya Greene, 60, the first woman and the first foreigner to hold the office – and the first manager of any sort to run the postal service as a quoted company, following its privatisation a year ago.

Marple’s delivery office is one of 1,400 nationwide. Together, they handle letters and an increasing number of parcels – about 10 times as many as Parcelforce. Inside the bunker-like building, manager Nic Bodnar works the phones in a room squeezed between the small sorting floor and the men’s changing room. Delivery office managers – or “Doms” – such as Bodnar act like Royal Mail’s commanders in the trenches. He is juggling a platoon of 35 postmen and women, or “posties”. At least, it should be 35. On the day I visited in early August, four were off sick, including one bitten by a dog the previous day, and there were three unfilled vacancies. With these resources, the Marple office must deliver mail to an area that stretches from suburban terraced streets, via pretty wooded valleys – known locally as “Little Switzerland” – to hilltop moorland on the edge of the Peak District.

Moya Greene, Royal Mail chief executive

The contrast between Chorley and Marple underlines how the Royal Mail combines industrial production line, social mission, commercial enterprise and national treasure in one institution. Successful privatisation showed that investors saw value in this volatile mix. Moya Greene received much of the credit for the turnround that led to the listing of 70 per cent of its shares. But the next few years will test the Royal Mail and its leader. A pact with the unions to end industrial strife is finite and potentially fragile. The “universal service obligation” – according to which the Royal Mail must deliver six days a week at a set price anywhere in the land – is both a sacred legal duty and a hefty financial burden. The very existence of the company in its current form is threatened by factors beyond its control: aggressive competition from a group of ambitious rivals, including Amazon; wrenching and unpredictable changes in parcel delivery, accelerated by the growth of internet shopping; and the downward spiral in volumes of the items that were for centuries the Royal Mail’s lifeblood: letters.


In 1910, each person in Britain sent more than 110 items of mail, according to Simon Garfield’s elegy to this vanishing world, To the Letter. Twenty-six years later, WH Auden embedded the service in the national psyche with his poem “Night Mail” about the trains that carried “letters of thanks, letters from banks, letters of joy from the girl and the boy”. But while the Royal Mail still carried over 13 billion addressed letters last year, many were what customers would call junk mail – a phrase posties say they are forbidden from using – and volume is forecast to fall at up to 6 per cent a year.

Even by the late 1960s, most staff would still have recognised ex-postie Alan Johnson’s description, in his newly published memoir Please, Mr Postman: “Uniformed civil servants proud to be performing a public service essential to the country’s social fabric”. In 1976, Johnson – who went on to head the postal union and later became a Labour minister overseeing his former employer – still had time to break his shift for a “substantial breakfast” prepared by a grateful farmer on his round in rural Buckinghamshire.

Over the two decades to the late 1980s, though, the business changed more than in the preceding century, according to Johnson. Managers with a more corporate professional style replaced bureaucrats. The group’s telephone arm was privatised as British Telecom (BT) in 1984. The Royal Mail was brought to a point of profitability where the government could have sold its shares to the public. But arch-privatiser Margaret Thatcher balked. In 1987, ahead of a general election, the Conservative prime minister publicly ruled out a sale. She reportedly told a colleague she was “not prepared to have the Queen’s head privatised”.

Dithering by successive governments – and fragile industrial relations – left the Royal Mail vulnerable. Allan Leighton, who became chairman in 2002, and chief executive Adam Crozier stabilised the group, cutting costs sharply (Auden’s travelling sorting offices were decommissioned in 2004). But their confrontational approach led to some acrimonious disputes, including wildcat walkouts and national strikes, sometimes forcing it to seal postboxes.

Elsie Ives sorts letters addressed to 'Santa Claus' at the General Post Office, St Martin’s-le‑Grand, London, 1960. Despite a downward spiral in volumes, Royal Mail still carried more than 13 billion addressed letters last year, although many were 'junk mail'

In 2008, Richard Hooper, a patrician former deputy chairman of Ofcom, the UK communications regulator, laid out the options for Royal Mail in an independent review for the government with the starkly self-explanatory title “Modernise or Decline”. Political interference, poor industrial relations, a regulatory straitjacket and a looming pension deficit were blighting the service. In 2009, when the company was being flayed by strikes and bleeding cash, the then Labour government withdrew plans to sell a stake. By the time Moya Greene entered Royal Mail’s Thames Embankment headquarters as chief executive, on Thursday July 15 2010, Hooper’s alternative doomsday scenario was looking ever more likely.


Supporters and critics make Moya Greene sound like one of the unstoppable coast-to-coast Canadian freight trains that were part of her first big deregulation challenge when she was the civil servant leading talks to privatise the Canadian National Railway Company in the early 1990s. Born in Newfoundland, the island off the eastern coast of Canada, and educated in classics and law, Greene is said to be typical of those who come from modest backgrounds in the country’s Atlantic provinces: outspoken and down to earth, but also frank and fair.

Gord Feeney, who, as chairman, appointed Greene as Canada Post’s chief executive in 2005, says people can bristle at her candour “but she gets to the core of the issue fast. I liken it to taking a Band-Aid off: if you play around with it, it hurts, but if you zap it off, you can get on with the show.”

Her reputation as an ice-blue-eyed cost-cutting machine preceded her as she crossed the Atlantic. Some staff at Canada Post, hostile to the possibility of privatisation, had dubbed her Darth Vader after the coldly cruel Star Wars villain. The Communication Workers Union (CWU) had endured years of cuts by senior managers but one union official says of Greene: “Our intelligence was that she was worse than what we had before.”

In person, Greene gives little away. She agreed to be interviewed for this article but has limited her press appearances in the UK – a change of policy compared with her Canada Post days, when she once talked about her love of cooking to The Globe and Mail while preparing a meal, “chic in a silk shift” in her Toronto condominium. Divorced with a grown-up daughter, she quietly remarried earlier this year but declines to go into detail. As a result, she admits that snippets of information about her off-duty habits – she is a keen walker, who once tackled a stretch of the pilgrims’ route to Santiago de Compostela, and a reader of poetry – tend to get blown out of proportion.

Her focus, a word people who know her deploy often, is firmly on the business. She spends at least 15 per cent of her time out in the field. As soon as we have settled down on her office’s cream sofas – which she says hardly get used – she starts extolling postmen and women as “the most respected people in the country . . . It’s certainly not the bankers, it’s not the lawyers, it’s not the executives like me.”

Opened in 2013, the Lancashire operation can sort up to 14,000 items an hour

The fire that her former chairman Gord Feeney identified is not obvious but Greene’s composed intensity and determination to make her views clear are. If she thinks a question is based on a false premise, she does not let it go, saying, “May I correct you there?” or “I would take issue with that characterisation.”

She vigorously promotes the Royal Mail line about the need for Ofcom to shelter the service from unfair competition. The watchdog should now have “a duty that leans much more toward the protection of the incumbent participant, than it does the encouragement of new players”, she says. But only when criticisms levelled at her by the Canadian Union of Postal Workers are brought up does she go on the attack, flashing back that it is “a highly politicised . . . Marxist-Leninist organisation”. Its British counterpart, on the other hand, she describes in more emollient terms as “very strong, but an industrial union”. In the UK, she adds, “of course, unions have political aspirations as well, but for the most part, the issues have been all about the business, all about the work lives of our people and that’s something that I can have some impact on. I’m not going to establish the new order.”

Order of a different kind was exactly what she sought to establish after joining Royal Mail. Greene says it was “running out of cash, [which] concentrates the mind immediately” – and made her wonder “why anybody thought we would have been able to privatise [it] in 2009”. A new government of Conservatives and Liberal Democrats was in power, whose coalition agreement committed them to seek private capital for Royal Mail. With five years to the next general election, Greene says she realised “I’ve probably got a three-year window to accomplish this, and there are some very, very, very big blocks that have got to look different than they do today.”

She acted fast and with radical intent. Donald Brydon, the former City of London investment manager who took over from Leighton as Royal Mail’s chairman in 2009, remembers how, confronted with the tangle of constraints imposed on the group by regulators and legislators, the new chief executive exclaimed: “They do what? We have got to change the law.” Greene recalls, “You couldn’t introduce a new product. You couldn’t change a term in any contract. You couldn’t even take products out of the market that nobody wanted unless you consulted competitors and your regulator approved.” Brydon gives credit to Greene’s predecessor Crozier for laying the foundation for change but says that, as an outsider, the plain-spoken Canadian could “say things that others, trapped inside the incremental approach, could not”. To do so, she adopted a strong “command and control” approach, according to one former adviser.

Emily Pang, Greene’s former chief of staff at Canada Post, who took on the same role at Royal Mail in 2011, says the chief executive told senior managers: “Don’t think on [the regulator’s] terrain, because by thinking incrementally, you’re thinking in their framework.”

Peter Jones, processing centre manager

Within nine months of arriving, Greene had declared that the “phantom shares” (derided by staff as “phoney shares”) her predecessors had issued to staff as incentives were worthless. She rallied a team of executives to carry out a project with the title “Regulatory Breakthrough”. The cover page of the plan prepared by McKinsey, the consulting firm, showed a brick wall crumbling, with blue sky visible through the gaps but, the adviser says, “At the first meeting, Moya made it quite clear – breathtakingly clear – that her objective was to end up with no regulation.”

Her approach to industrial relations was similarly direct. Shortly after taking over, she telephoned Billy Hayes, the Liverpudlian ex-postie who heads the CWU and is strongly opposed to privatisation. “Why do you want the government as owner when they’re so bad at it?” she asked. “Because I can vote for the government,” Hayes responded.

Undeterred, Greene continued to approach the union differently from her predecessors. She has consistently aimed to avoid open conflict.

Former messenger boy Dave Ward, Hayes’s deputy and the union’s main point of contact with Royal Mail senior management since 2003, says: “[Leighton and Crozier’s] view was that we were there to add value to their business: we got on well, provided we were agreeing with what they did. With Moya, it was genuinely that she would listen to your views and adjust her own thinking.”

The improved relations made many rank-and-file workers sceptical, though. Within the executive team, there was also a feeling Greene could have been more confrontational. “We talked often about whether there should be an equivalent to Wapping for Royal Mail,” says one person involved in preparations for privatisation, referring to the aggressive strategy Rupert Murdoch pursued to break the hold of the unions over the newspaper business in 1986-87. But even as tension with the union increased in summer 2013, Greene’s approach was, she says, to “keep talking”, because “as long as you’re talking, you’re not disrupting the customer”.

The control room. Parcels are processed five nights a week, from 8pm to 4am

In a vivid illustration of the philosophy in action, on Monday June 17 last year, she, Brydon, Ward and Hayes sat down for dinner at the modernist-style Skylon restaurant in London’s Royal Festival Hall, to talk about the union’s alternatives to privatisation. But the evening turned into an informal occasion – and a richly symbolic one. Siouxsie Sioux, the punk singer whose songs provided part of the soundtrack to Wapping and the miners’ strikes of the 1980s, was playing in the adjacent concert hall as Brydon, the City grandee, Royal Mail’s chief executive and the two former posties chatted about mutual union acquaintances, football, family and the destiny of one of the UK’s largest employers.

The union kept up its threat of a national dispute – which would have been the first for four years and the first since Greene took over. Days after last October’s flotation, members of the CWU voted to walk out. In the event, though, the group and the union agreed a legally binding deal. It includes a pay rise of more than 9 per cent over three years and a commitment not to impose any compulsory redundancies. With its emphasis on “delivering cultural change” and innovations such as joint training for local-level union reps and managers, it seems to embody the spirit of that dinner.


Now Moya Greene is joining battle with rivals in a fight she claims will define Royal Mail for the coming decades. She has gone on the attack, alleging that “cherry-picking” by direct delivery services, led by TNT Post – rebranded last month as Whistl – could undermine the viability of the sacred universal service obligation. Whistl’s uniformed posties, now to be found on the streets of Liverpool, London and Manchester, pose the most visible challenge. But a greater threat to Royal Mail’s purpose and future comes in parcels, where an ambitious Amazon, fast-growing independent parcel couriers and click-and-collect services offered by other retailers are jeopardising the group’s growth forecasts.

Ady Fielding, Royal Mail’s cheerful delivery director for northwest England, says the date that sticks in his memory is not October 15 last year, the first day of trading in shares of the newly privatised group, but November 6. That was the day TNT competition began in Manchester’s central “M” postcode with the objective of “changing the face of mail” in the city, as proclaimed in its marketing posters featuring attractive young people in brown-and-orange “Postie” T-shirts.

Pressure on letter mail is not new to Fielding. Over the past seven years, as he has tried to match people to volatile demand, he says he has not recruited any full-time staff. But the impact of direct competition over the “last mile” of delivery was stark and immediate. “Ten per cent of Manchester’s mail has gone and it isn’t coming back,” he says.

John Alexander, postman, sorting mail

Royal Mail posties say that in the early weeks of direct competition, they bore the brunt of customer complaints about TNT misdeliveries. They say they occasionally picked up bundles of TNT mail that the inexperienced couriers had just dumped into Royal Mail postboxes. Some of the more lurid accusations may be apocryphal and Whistl’s chief executive Nick Wells says you are bound to have a few problems when mobilising a new workforce.

Greene is pressing Ofcom for an early inquiry into its direct delivery rivals. But on paper, Royal Mail remains hugely dominant. The regulator is likely to demand stronger evidence that it is increasing efficiency and not simply trying to shield itself from upstart rivals. Whistl boss Wells says Greene and her staff have “an unhealthy fixation with competition” and have taken only “baby steps” in modernisation when “they need to take giant steps”. Greene hotly denies this charge. Royal Mail has cut the number of mail centres – which redistribute letters and parcels around the country – from 69 to 40 in the past six years, almost in line with the 2008 Hooper targets. Sorting and sequencing of letters has been automated and the number of staff has dropped, through voluntary redundancies, from just over 160,000 in the UK business at the end of the Crozier era to about 148,000.

At Mount Pleasant, central London’s main mail centre, what once looked like “chaos”, in the words of one manager there, is now recognisably a modern production line. Exhortatory slogans and pictures of some of the London landmarks to which Royal Mail delivers adorn the walls of the sorting floor, detailed charts monitoring productivity are pinned up near work stations, and “yorks” – the wheeled metal trolleys in which mail and parcels are transported – are neatly arranged by destination.

But the further you go from the mail centres, the more obvious the obstacles to improved efficiency become. The costs linked to putting boots on the ground around the country, to deliver the last letter to the farthest-flung address, are harder to cut. “Downstream access” (DSA) deals mean Royal Mail has to carry rivals’ mail based on a fixed price, overseen by Ofcom, guaranteeing competitors a margin.

Last month, someone using the pseudonym “Conman” laid out a bleak future for the Royal Mail on RoyalMailChat, which styles itself as “the Independent Postal Workers Website”. Conman, whose profile suggests he works in a mail centre, said the group was “going downhill fast”. He wrote that by 2016 – the group’s 500th anniversary – “TNT will be sorting and delivering all the mail from all DSA customers in every city in Great Britain. Amazon will be delivering its own packets and parcels. Mail centres will be empty. Delivery Offices will attempt to survive on door to door items. Royal Mail will then be taken over by a company like TNT or Amazon. The share price will rocket”.

Conman is not a lone militant sceptic. One person who worked closely on privatisation points out that if the decline in letters is not offset by better growth in parcels, “you could see the complete unravelling of Royal Mail” within five or 10 years.

The group is striving hard to avoid this. It is piloting Sunday delivery in the area around London. It is offering to deliver parcels to neighbours when the recipient is out. It is battling retailers’ click-and-collect initiatives by refurbishing the offices where customers can pick up their parcels.

Competition in parcels is, however, only likely to grow. Amazon is a longstanding customer of Royal Mail but also, as Nick Landon, Royal Mail’s head of parcels, points out, “the only company that has the scale to do it by themselves”. The ecommerce group’s scrapping of free delivery on orders below £10 and greater use of alternative delivery services hit Royal Mail’s parcel revenues in the first three months of this financial year. Adding to the pressure, this week Amazon launched “Pass My Parcel” – a same-day delivery initiative that would use a newspaper distributor to take parcels to collection points in newsagents and convenience stores.

Ex-postie Alan Johnson believes Royal Mail will still be around in a decade but fears that, under commercial pressure, it will be very different: “I bet you in 10 years’ time there won’t be a Saturday delivery, rural customers will have to go to a central point or their mail will get delivered every three days: and then I think we will have lost something.”

Like Whistl, Amazon – which says that it “evaluates all carrier options” – seems to be targeting densely populated areas, leaving Royal Mail to deliver to the rest. In the mainly rural Lancaster postcodes delivery director Fielding says the number of Amazon parcels handled is up; 20 miles down the M6 motorway in urban Preston, it has dropped sharply. Automation along Parcelforce lines could help cut costs further but also trigger conflict at mail centres such as Mount Pleasant, where most smaller packages are still hand-sorted.

Greene herself steers clear of criticising Amazon but she angrily sums up the challenge from Whistl et al like this: “This is not the kind of competition that drives efficiency. It basically is taking a mail bag – that is getting smaller in size anyway – out of the Royal Mail mailbag and just tipping it over into somebody else’s mailbag, without our ability to compete on price, while our postmen and women still have to go up that same path.”

Howard Booth, postman

Come December, Howard Booth – a young-looking 52-year-old – will have been going up that path for 35 years. Working out of the Marple delivery office, he does a round that includes farmhouses and converted barns looking out over Manchester, the Cheshire plain and west to the Welsh hills.

Describe Booth’s round to non-posties and they usually draw a glib comparison with Postman Pat, the children’s cartoon about a smiling postman who lives in a rural idyll reminiscent of that described by Alan Johnson in his memoir. The modern reality is different. Booth loves his job but he doesn’t stop to share gossip. He is constantly on the move, driving the van a few yards between addresses in some spots and a mile in others. He runs up to the door of most houses, dropping letters and parcels into a bewildering variety of places, including one mailbox made out of an old red BT phone box. One way Royal Mail could save costs would be to accelerate the replacement of more full-time staff with part-timers – but Booth says a newcomer would struggle with the obscure outlying addresses on his round.


How many of Moya Greene’s achievements are down to her is open to debate. A new government opened the way for privatisation and took the looming liabilities of the pension scheme off the group’s hands. Steps to remove the most onerous regulatory constraints were already under way when she joined. But her experience in public and private sectors – and her shock value as an outsider in a male-dominated British bastion – made her the right person to lead the charge to privatisation in 2010. The question is whether she is right for the next phase of growth as a listed company.

At the moment, her pact with the union is holding. But if the regulator insists on further improvements in productivity, Greene may be forced to take a harder line. She believes there are strong reasons why a dispute is unlikely and undesirable: “Just the hint of a work stoppage is enough for us to see traffic switch and I think our union, and certainly the people who work at Royal Mail, know that.”

Post van driven by Howard Booth on one of Marple's rural routes, fulfilling Royal Mail's 'universal service obligation'

Even so, the Royal Mail is still far from being in a sustainable position. Duncan Campbell-Smith, author of Masters of the Post, a 2011 history, says that by failing to privatise the business earlier, and allowing competitors to take chunks out of its market before the group had modernised itself, previous governments may have condemned it to irrelevance. In 15 years, according to Campbell-Smith, people may say, “It’s a shame what happened to the Royal Mail. If only something had been done” in the 1990s.

Now Greene can finally operate without significant government interference, she can disprove this theory. But with investors also dictating the pace and competitors stepping up the pressure, the stakes and risks are higher than they were four years ago.

Meanwhile, staff on the front line, despite Greene’s efforts to reach them in person and through the group’s extensive, almost Orwellian, internal communications, have the sceptical attitude of soldiers who have seen countless leaders, and their plans for victory, come and go. Many could go on performing their tasks in the same way, knowing that fewer hands may mean more overtime and that the requirement to deliver everything, at the same price, to anywhere means they will be the last to lose their jobs. As one London-based postie puts it: “The worst thing that happens in our [delivery] office is somebody says, ‘We’ve been told we have got to be more efficient.’ Workers turn round and say, ‘What do you mean?’”

Asked what he thinks about Greene, Howard Booth shrugs: “In our office, there’s probably a negative attitude to anybody higher than the manager.” As a summary of the difficulty any chief executive will face bringing further vital change to the borders of the Royal Mail’s sprawling, centuries-old empire, it is hard to beat.

Andrew Hill is the FT’s management editor

Photographs: Christopher Nunn; Dan Burn-Forti; PA

This story was amended to correct an erroneous reference to Adam Crozier

Copyright The Financial Times Limited 2018. All rights reserved.