In the last quarter, Canada Post reported a $104 million loss in revenue. The chief culprit?  The Crown Corp readily points to the drop in transaction (paper) mails over the past decade. Not so fast! Perhaps the real problem lies in the company’s incompetent accounting and operations management.

Since the Digital Revolution swept through the Canadian households in the last decade, Canadians have rapidly taken up emails as the default means of communication. Canada Post’s management accounting must have foreseen the doom of its traditional business model from the revenue trends. Being based 51% on transaction mail meant low margins but heavy costs – vehicles, retail locations, and mailmen. However, they failed to communicate the urgency of this situation.

Image taken from CBC news

After years of revenue dip, finally Canada Post announced their plan for a makeover. The decision is to shift the main focus toward parcel delivery to capitalize on the growth of e-commerce. At the same time transaction mail services will be downsized.

The lesson here is simple,  if the values offered don’t align closely with the values sought by consumers, then the company model must be changed, and changed fast. Waiting is not a viable solution.