Task force gets more time to craft Posta turnaround plan

What you need to know:

The team has an immediate task of aligning the Postal Corporation of Kenya with the changing market trends.
Formed mid last year, the team is expected to come up with new recommendations to steer Posta back to profitability.
Posta has diversified its products over the last few years in efforts to improve its financial position.

Kenyans will have to wait longer for the new look postal services operator after a team assigned to oversee the transformation successfully pushed for extra time to finalise its work.

The Ministry of Information and Communication and Technology (ICT) has published a two-month extension of the term of 12 member task force in the Kenya Gazette.

The team has an immediate task of aligning the Postal Corporation of Kenya with the changing market trends to boost its ability to ward off growing competition.

The task force formed mid last year is expected to come up with new recommendations to steer Posta back to profitability. The task force released interim findings in December calling for greater use of ICT systems to enhance efficiency at the parastatal.

The extension is meant to give the task force additional time to come up with new proposals and chart implementation strategies.

“It is notified for the general information of the public that the Cabinet secretary for Information, Communication and Technology has extended the tenure of the task force for the rationalisation of the current postal network in Kenya to align it with changing market trends and emerging competition,” said ICT secretary Joe Mucheru in the gazette notice.

Posta’s business has taken a beating with the advent of new technology that has seen the parastatal record losses over the past few years.

Posta has diversified its products over the last few years in efforts to improve its financial position.

The parastatal has automated its services such as the recent linking of letter boxes to mobile phone numbers through the new M-Post product. There have also been proposals for Posta to expand into the mobile money business. Early last year, the corporation also launched a registered encrypted mailing service. Individuals subscribe through Posta’s online portal at a cost of Sh350 per month, which allows them to send 25 emails. Firms that have less than 100 employees get 100 emails at Sh500 per user.

The firm is also betting on public transport service as it seeks out a path to profitability in a market that is less interested in sending letter.

The parastatal also took advantage of its clearing and forwarding licence to establish Posta Cargo two years ago to handle and process imported goods for its customers. Initially, it utilised the licence to import stamps and handle customer parcels.

Courier service

The courier business is also riding on the growth of e-commerce in Kenya. Recently, during the Black Friday sale offered by online platforms such as Jumia and Kilimall, Posta experienced a boom in parcels sent.

The firm also said five secondary schools signed up for its new courier service, Travel Lite, which transports student luggage across the country.

Posta is looking to tame its growing wage bill by reviewing its business model and lay-offs.

The parastatal plans to cut 20 per cent of its employees by 2018 in the awake of a revelation that its wage bill accounts to 65 per cent of its revenues.