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Korea Post improving services in globalizing world

CEOs of global 10 postal services discuss strategies to strengthen cooperation in Barcelona


Korea Post is stepping up efforts to improve the quality of international delivery services in collaboration with other national postal service providers.

On Wednesday, the Kahala Posts Group ― an association of 10 postal services ― held a strategy meeting in Barcelona, where the attending chief executives of the postal services discussed ways to strengthen collaboration and to improve the quality of their services.

Aside from Korea, members of the Kahala Posts Group include postal services of Australia, China, France, Hong Kong, Japan, Singapore, Spain and those of the U.K. and the U.S. The group is named after the location of its first meeting, Kahala, Hawaii, in June 2002. 
President of Korea Post Kim Myong-ryong (fourth from right) poses with representatives of postal services that are members of the Kahala Group in Barcelona on Wednesday. (Korea Post)
President of Korea Post Kim Myong-ryong (fourth from right) poses with representatives of postal services that are members of the Kahala Group in Barcelona on Wednesday. (Korea Post)

One of the main topics of discussion at this year’s meeting was improving the quality of express mail services.

The first six original members of the group ― the postal service providers of Korea, Australia, China, Hong Kong, Japan and the U.S. ― have been providing guarantees on packages sent using express mail services since July 2005. Under the guarantee, customers sending packages abroad using the service are given a full refund if the package arrives a day or more after the scheduled date.

Since then the guarantee service has expanded along with the growth of the group.

In 2006 postal services of Spain and the U.K. joined the group, followed by those of France in 2007 and Singapore in 2008.

Spanish and U.K. postal services adopted the guarantee in February 2009, while those of France and Singapore joined the other members of the group in providing the guarantee in the following year.

At this year’s meeting, the postal chiefs agreed to cooperate in meeting the target of 96 percent success rate in making express mail deliveries on time, and to address issues arising from air freight sections of related services.

Through such activities, Korea Post is hoping to improve the quality of services provided, as well as to increase revenues generated from express mail services.

According to the Ministry of Knowledge Economy, which oversees operations of Korea Post, 75.5 percent of packages sent using express mail services is accounted for by those bound for member nations of the Kahala Posts Group.

Regarding the targets for express mail services’ volume and revenues, the ministry said that improvements in service quality are projected to raise the volume by 4.4 percent and revenues by 6.3 percent compared to last year.

Last year, about 6.2 million packages were delivered using express mail services raising sales of about 243.4 billion won ($229.5 million).

The Kahala Posts Group also plans to increase the number of member postal services, and set up a taskforce for issues related to setting up new services for electronic commerce.

Postal services slated for joining the group this year are those of Brazil, Thailand and Vietnam.

“Improving the quality of express mail services and developing an international delivery service for electronic commerce will provide practical support for small- and medium-sized enterprises,” president of Korea Post Kim Myong-ryong said.

“We will continue to strengthen ties with Kahala Posts Group.”

In addition to seeking ways to collaborate with other members of the Kahala Posts Group on a delivery system for electronic commerce businesses, the Korea Post is also with the Electronics and Telecommunications Research Institute on such a system for Korean businesses.

According to the Ministry of Knowledge Economy, Korea Post and ETRI are working on a system local electronic commerce businesses can use to send goods to overseas customers.

“Once the system is completed, small- and medium-sized electronic commerce businesses will be able to send goods overseas using the 3,700-post office network,” the ministry said.

Korea Post efforts at collaborating with foreign postal services, however, are not limited to the activities of the Kahala Posts Group.

Since 2007, Korea Post has been cooperating with postal services of central Asian countries to improve the quality of their services.

The committee was established in 2007, and initially included Korea, Kazakhstan and Mongolia. The committee was then expanded to include Kyrgyzstan in 2008.

Korea’s SK C&C, the IT services arm of the SK Group, was involved in the first two stages of Kazakhstan’s postal service modernization project, and exported equipment worth about 9 billion won to the central Asian country between 2008 and 2010.

Korea Post’s international collaborations have also led to exporting of Korea’s IT systems, and aided local firms from entering central Asian markets.

As part of related plans, Korea Post hopes to facilitate a local firm being selected to carry out the third stage of Kazakhstan’s postal service modernization project, which is estimated to be worth about 10 billion won.

While the Korea Post has put much effort into improving its standing in the global market in recent years, it has not let things slide in Korea.

In May, Korea Post announced plans to upgrade its postal and banking services to prepare for market consolidations with the coming of more free trade pacts.

Delivering a two-year plan, its president Kim Myong-ryong stressed the importance of providing better services as a state-run agency connecting supply chains and circulating money across the country.

“With less than a month left until the Korea-EU FTA takes effect, concerns are rising over the postal business facing an open market,” Kim said, addressing more than 500 branch heads gathered for the announcement in May.

“Facing uncertainties, it is important to focus on upgrading services by making the best use of our more than 3,650 branches and 45,000 workers.”

Kim proposed the restructuring of its supply chain network and upgrading of equipment needed to raise the efficiency of delivery and tracking. He also promised to provide an example of a well-run public agency by strengthening feedback and incentive systems.

Korea Post is one of few state-run postal service agencies in the world to have posted consecutive years in the black. It ranked first in the public service category of the Korean Customer Satisfaction Index for 12 consecutive years.

By Choi He-suk  (cheesuk@heraldcorp.com)
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