Dap webinar automation for emerging economies

Evaluating Postal Automation for Middle Income Countries

June 20, 2013

Benefits of Postal Automation

3

Transforming the postal service

from necessity to opportunity

Webinar Outline

� Introduction

� Benefits of Automation for Postal Operators

� Automation for Mail and Parcels

� Trends

� Strategies for Automation

� Automation Maturity Model (AMM)

� Revenue Leakage Protection

� Retail Automation

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� Increased operational productivity and efficiency – Reduced costs

� Reduced labor (levels vary according to automation strategy)

� Improved operations forecasting

� Better labor planning & assignment

� Better vehicle and machine utilisation

� Increased flexibility and adaptability

� Revenue protection

� Increased service quality

� Fewer delivery errors

� More consistent service

� Gateway to new services

� Time-dependent services

� Mailers and Advertising (Contracts – discount – billing)

� Intelligent barcodes (Personalised services)

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Automation for Mail and Parcels

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Automation Technology

� Letter Sorting

� Buffer Systems

� Robotic and Manual Bin Sorters

� Shingle Letter Sequencers (SLS)

� Flat and Registered Mail Compact Sorters

� Flat and Parcel All-in-one Sorters (Plurisorter)

� Parcel Sorters

� OCR,

� Video Coding

� Sorting Address Management

� Track & Trace

� Postal Counter

� International Mail System

� Hybrid Mail

� Postal Hand Held Terminals

� Parcel Terminals

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Trends in Postal Automation (1/2)

� Improved address recognition

� Better, cheaper

� Modular

� Leveraging the information

� Smaller is better

� Lettermail sorting machines more

accessible to operators, mailers

� Machines handle letters and

flats.

� Mailers invest in automation if

they receive incentives

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Solystic MARS sorting machine

Trends in Postal Automation (2/2)

� Tracking and tracing

� Cheaper

� Smarter (Intelligent mail barcode)

� Integrated across value chain

� Kiosks

� No longer an experiment

� Parcel terminals

� Integrated into the distribution

system

� Service diversification

� Returns management

� Cross-border

� Logistics integration

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Operational Components of

Postal Automation

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Address

System

Tracking &

Monitoring

Sorting &

Distribution

Operations

Planning

Enterprise

Integration

Delivery

Management

Platform

Access


Postal Automation

� Foundation of automation program

� Various address approaches – Ongoing improvements

� UPU – EURADIN – World Bank

� Address recognition (Multiple language – script)

� Involve business community

� Sorting and network strategy

� Incremental automation initiative

� Modular network approach

� Centralized or not?

� Incremental approach

� Revenue protection

� Quality management: operations and customer sides

� Scoreboard

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Address

System

Tracking &

Monitoring

Sorting &

Distribution


Postal Automation

� Visibility

� Volume counts - Origin/Destination Data

� Capacity management

� Labor and equipment right-sizing

� Increased flexibility – adaptability

� ERP

� Back-office integration

� Labor management

� Volume counts help route management

� Service-driven delivery (right-day)

�

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Delivery

Management

Enterprise

Integration

Operations

Planning


Postal Automation

� Induction of postal items into the network (Mailers, Government)

� Address correction – moves

� Tracking integration across the supply chain

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Platform

Access

Applications

Infrastructure

• Physical

• Information

• Financial

Network Automation Strategies (1/2)

� Parcel? Mail? Both?� Parcels: Growing market

� Parcel may be easier/simpler but mail may provide more savings in the long run

� Parcel processing network may be split from mail processing network

� Keeping the delivery network for both?

� Introducing new services: Logistics / Ad mail / Hybrid mail

� Future-proofing the Strategy� Implementing an automation strategy takes commitment, time, effort & resources

� Develop a roadmap

� Incremental Approach

� Identify easy wins – high density areas and flows

� Start simple (low depth of sort – a few separations – dense O/Ds)

� Increase automated network over time

� Strong address management program

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Network Topology

� More centralized networks � Trading labor for distance

� Highway-accessible plants

� Mailer induction

� Increasing network flexibility &

adaptability� To reduce cost

� To improve service quality

� Leveraging the private sector� Generate mail volumes

� Providing incentives for automated mail and plant induction

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Network Topology

� More centralized networks � Trading labor for distance

� Highway-accessible plants

� Mailer induction

� Increasing network flexibility &

adaptability� To reduce cost

� To improve service quality

� Leveraging the private sector� Generate mail volumes

� Providing incentives for automated mail and plant induction

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Automation Maturity Model (AMM)

� Assessment of current postal automation readiness

� Chart a technical, organizational, and operational transformation path

ADR ORGMKT NET

AddressInfrastructure

Mail & ParcelMarket

Postal Network

OrganizationalReadiness

• Country Address

System

• Address Data

• Postal Code

• Readability Issues

• Address Change Mgt

• Mail/Parcel Volumes

and O/D Pairs

• Mail/Parcel

Characteristics

• Advertising Market

• Mail Service Providers

• Regulatory Envrmt

• Service Requirements

• Operational Tempo

• Network Topology

• Cost Factors

(transport, labor)

• Performance

measurement

• Planning

• Organization

Commitment

• Financial Posture

• Skills

• Change Management

Automation Maturity Model:

Maturity Levels

Maturity Level

Name Maturity Characteristics

5 Pioneering Breaking new ground, industry-leading innovation

4 Optimizing Optimizing postal automation to benefit entire organization; may reach beyond organization; increased automation

3 Integrating Integrating postal automation across the organization; realizing measurably improved performance

2 Enabling Investing based on clear strategy; implementing projects to enable enterprise-wide automation (may be compartmentalized)

1 Initiating Taking the first steps, exploring options, conducting experiments, and developing a postal automation vision

0 Default Default level (status quo)

Revenue Leakage

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Combating revenue leakage

Definition*

� Combating revenue leakage consists of

engaging in activities that help a Post:

� Collect all the postage revenue owed to it, and

� Curb the sources/reasons of leakage.

� Leakage stems from one of four main risks

� Counterfeit (e.g., illegal issues, fake imprints)

� Bypass mail (e.g., mail inducted

without any form of payment)

� Shortpaid or underpaid (e.g., mail

tendered with insufficient postage)

� Problems related to billing or

postage collection

(e.g., bad cheques; accounting errors)

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* Source: UPU Consultative Committee – Postal Revenue Protection Working Group

Sources of leakage – three dimensions

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Mail Preparation and Point of Induction

Paym

en

tC

hannel

� Revenue leakage varies

depending on:

� The payment channel

� The product type (shape/weigh)

� The preparation of the mail and

its point of induction

� The multiplicity of options

increases the exposure to

revenue leakage

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Stamps

On

lin

e

Stamps Meters

Mete

rs

Permit

Meters Permit Permit

Residential mailers Small business mailers Large mailers

Single

Piece

Bulk

Mail

On

lin

e

Solutions must be adapted based on

the highest payback.

Oth

er

Oth

er

Lab

els

Lab

els

35%

65%

80%15%5%

Darker = intrinsically higher risk channel

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A broad choice of automation technology is available

Evidencing

• Deployment of digital meters in smaller emerging markets• Anti-fraud security measures (special inks, holograms…) for stamps

Acceptance/verification

• E-documentation • Sorters/counting machines for piece count (for sampling, verification

or terminal dues purposes)• Modular dimensions/weight/data capture solutions for use in post

offices

Processing

• Lower-end sorters suitable for mid-tier posts• Large CFC with on the fly weighing of parcels or letters

• Capability to trace back an item to a specific sender

Billing/reconciling software solutions

(e.g., USPS Permit RP project)

Retail Automation

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The retail branch provides a source

of rich customer experience

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Richness of Experience

Fre

qu

en

cy o

f U

se

• Complex transaction handling

• One-to-one marketing & sales

• Local community branch svcs

• Customer service & issues

resolution

• Financial planning and

advising

Technology in the retail branch

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Digital Signage

Kiosks

Technology BarSmart Layouts

Retail Automation - Kiosks

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� Purchase stamps and/or label (individual, sheets).� Print on demand. No need to tie up large amount of cash for stamps on

consignment -- print on demand sheets of postage

� Weigh items and access all available tariffs by class of service.� Shop rates. Compare the cost of different services.

� Select advanced features such as delivery confirmation, signature confirmation,

etc..

� Print postage/labels.

� Mail domestically or internationally.

� Keep track of expenses. Print out a receipt for accurate record keeping for shipping transaction.

� Cost-effectiveness. A single kiosk can serve thousands.� Convenience. Self-service functionality and open 24/7.� Savings. No staff required.� Customer convenience. Intuitive and simple to use.

Retail Automation – Point of Sale

Systems

� Automation of many branch functions

� Increased revenue opportunities by

adding new services � Government services

� Postal financial services

� Third-party services

� Revenue protection � Accountability helps combat leakage

� Integration across channels to extend the

reach of post office and retail environments:� Supporting franchises and corporate customers

through remote and self-service solutions

� Branding� Securing brand awareness in a franchised

network

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Integration of Postal Counter

Services

Retail Software

Suite

Point of Sale

Systems

Kiosks

Business Intelligence Reporting

PO BoxesCustomer Web Portal

Postal Financial Services

Philately

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� Integration across customer channels

� Branches, Web, Kiosks

� Unified view of the customer across products/services

� Customer intelligence via business intelligence

reporting

� Business data for marketing and product analysis

� Integrated management of cash, stamps, and supplies inventories

� Streamlined processes across a dispersed network of branches

� Scalability from a micro post office to a large

business centers

� Customization of services based on type of branch

Last Mile Automation

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Last mile automation – Parcels

terminals

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� The e-commerce boom is pushing the rise of parcels

terminal networks:� DHL: 2,500 PackStations in 1,600 cities.

� Integer.pl: 16,000 easyPack terminals in Europe by the end of 2016

� Itella Group: 350 stations by 2015

� Post Denmark expanding from 131 to 200 “Døgnposten” units

� Nightline plans : 400 “Parcel Motels”

� Consumers delivery/pickup expectations are on the rise

� UPS My Choice� FedEx’s Delivery Manage� DHL’ Control Cockpit� GLS Germany’s FlexDelivery Service

� The convenience of anywhere/anytime e-commerce is met

by the convenience of anywhere/anytime pickup at reduced costs

Last mile automation – e-fulfillment

support

� Mobile software solution to support last mile B2C deliveries. Generates customer alerts, initiating the negotiated delivery process. � Recipients negotiate delivery windows, ensuring timely

receipt, minimized delivery costs and heightened

customer satisfaction.

� End-to-end visibility from mailer/shipper via carrier to recipient. Use of wireless technologies and ‘intelligent agents’ to provide a personalized delivery solution.

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� Accurate determination of recipients availability

� Increase in productivity

� Increase in number of successful first-time deliveries

� Substantial reduction in costs and labor

� User preferred delivery times facilitates more efficient delivery routes

� Potential to negotiate reduced delivery charges with third-party local couriers


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Transforming the postal service

from necessity to opportunity

34

> insight > action > transformation