Mail Services: Past, Present and Future
By: Chris Malone, Director, Shared Services Printed in: EMS Newsletter
Expense Management Solutions is recognizing its 10th anniversary by offering both a retrospective and prospective view of advisory and consulting services in corporate real estate, shared services, and supplier relationship management. Reflecting on how the industry has transformed during the past decade helps us learn from the past and move to the future through a unique perspective. Our next few newsletters will look back and forward at how these changes impact you and your business. This month we focus on the mail services industry.
Important changes in geographic thinking and workflow processing combined with rapid advances in technology and increased reliance on outsourcing have change the face of mail services in the last 10 years.
In 1997, a first class stamp cost $.33 and the United States Postal Service delivered an average of 24 pieces of mail per week for every household. In 2007, a first class stamp costs $.41, and the United States Postal Service delivers an average of 6 pieces of mail per week for every household.
1997 was the first year that people who ordered by mail had sales tax added on purchases from out of state companies. Yahoo.com was launched as a free email service.
Incoming physical security and chain of custody were issues faced mainly by governmental entities in New York and Washington, DC. Most companies used internal employees to deliver mail, and their mail centers were located onsite at corporate facilities. No distinction was made as to the types of mail delivered, with employees routinely receiving their personal magazine subscriptions and other third class mail at work. Interoffice mail was the most common method of communication between a company’s employees. And, automation was largely confined to postage meters and outgoing presort machines
Then real estate costs skyrocketed, the internet gained widespread acceptance, usage, and availability, and the country was awakened by the events of September 11, 2001.
Now mail security is paramount in most major organizations, not just those in large metropolitan areas. Chain of custody for every piece of mail is critical to ensure the safety of the employee population. The threat of contaminated mail comes from other sources besides international terrorists, including dissatisfied clients and disgruntled former employees. Also, as with every part of the organization, pressure is on mail managers to reduce the cost of mail services throughout the process. Companies are replying to this challenge with demand management, sourcing, and outsourcing.
Demand Management
Today employees rely mainly on email for interoffice communications, greatly reducing the number of interoffice deliveries. Additionally, corporations are no longer willing to deliver third class mail and employee personal subscriptions due to cost and security reasons.
Sourcing
Corporations are moving their mail centers offsite. Opening contaminated mail in a corporate building poses grave danger to the occupants. Offsite mail centers are designed with highly specialized air filtration and flow systems that minimize the risk of releasing potential contaminates into air ducts, protecting the employee base.
Outsourcing
Organizations are relying more than ever on outsourced relationships with mail services suppliers. As corporations have increased geographic spread, mail services suppliers have improved their ability to provide global services without the necessity of multiple vendors. Corporations have leveraged the opportunity to move mail management to a variable cost model, while improving their access to more expertise, and retaining control on service levels.
Mail services suppliers are providing comprehensive reengineering of mail processes including implementation of automation for everything from routing to digitization of incoming mail. Organizations value access to expertise, technology, and best in class processes that suppliers offer.
In cases where corporations have existing supplier relationships, mail managers are renegotiating services to leverage volume, implement performance metrics, and place fees at risk based on suppliers’ ability to perform.
In the years ahead outsourcing of mail services will become the norm. Suppliers will continue to improve their offerings through technology, and mail centers will continue to move offsite. Processes such as digitization will become more widely accepted and used. The very way people think of “communication” will continue to change significantly.
