In its pricing, logistics and financial controls, Canada Post is running like a top.
The Canada Post Group of Companies, as it’s formally known, is consistently profitable. Net income in its latest year was $144 million, a near-doubling over the previous year. The United States Postal Service (USPS), by sharp contrast, reported a loss of almost $4 billion (U.S.) in the fiscal 2018 results it released Nov. 14 – the USPS’s 12th straight year of losses.
In a transformation for the record books, Canada Post reinvented itself, cutting its reliance on a lettermail business that the Internet has been killing off, and becoming a parcel-delivery service tailor-made for the new world of e-commerce.
Unfortunately, there was no parallel reinvention of Canada Post’s labour-relations practices.
In recent years I’ve spoken with about 20 postal workers, mostly letter-carriers and truck drivers. And about 20 of them have brushed off my thanks for their excellent service to complain of stress from overwork, lack of job security, and meddlesome, insensitive supervisors.
There is a cure for this, short of another round of rotating strikes. Canada Post needs a new board chair and a new CEO and top management team focused on building a harmonious workplace.
What we’ve learned in the latest dispute is that even the greatest expertise in logistics, automation efficiencies and financial controls is insufficient to prevent an otherwise estimable enterprise from grinding to a halt because of chronic and widespread disrespectful treatment of employees.
Will Canadian business ever kick its U.S. addiction?
Canada might just be more committed to global trade than any other country, in striking contrast with a Canadian business sector that is perhaps the least intrepid among its world peers.
It’s worth noting that the Americans who cracked global markets were the likes of IBM Corp., Coca-Cola Co., Procter & Gamble Co., Microsoft Corp. and most recently Facebook Inc. and Amazon.com Inc.
Their Canadian counterparts in that role have been politicians: Lester Pearson (the 1965 Auto Pact), Pierre Trudeau (the first “Team Canada” trade missions to China), Brian Mulroney and Jean Chrétien (the Canada-U.S. Free Trade Agreement and its successor, the North American Free Trade Agreement, or NAFTA) and Stephen Harper and Justin Trudeau (the Canada-EU Comprehensive Economic and Trade Agreement, or CETA; the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, or CPTPP; and a renegotiated NAFTA, the U.S.-Mexico-Canada Agreement, or USMCA).
In last week’s federal mini-budget, Ottawa is yet again striving to help Canadian business strengthen and widen its export prowess. The feds are spending $14 billion on accelerated corporate investment writeoffs, and more than $1 billion to upgrade Canadian transportation infrastructure to get Canadian goods to export markets beyond the U.S.
Yet it’s reasonable to wonder if that will do any good.
A recent analysis shows that European exporters to Canada are making much more use of CETA than Canadian businesses. And the federal finance ministry notes that Canada is far behind its G-7 peers in exports to emerging markets, the world’s fastest-growing economies.
The real solution might be federal largesse that is earned only by Canadian firms able to report that more than 30 per cent of their exports are to non-U.S. markets.
Stunning fall of a corporate superstar
The downfall of Carlos Ghosn is a reminder that reputation is fleeting.
A brilliant industrial strategist with an iron gut for risk, Ghosn revived one major automaker, Renault S.A., and rescued another, Nissan Motor Co., that had one foot in the grave.
Ghosn was also an empire builder: The enterprise from which he retired, last year, combined Renault, Nissan and Mitsubishi Motors Corp.
But on Nov. 19, Ghosn was detained by Japanese authorities on suspicions that Ghosn had for years understated his compensation in regulatory filings. That’s a polite way of describing an alleged tax cheat.
It has since been revealed that Ghosn raided Nissan’s treasury to buy at least five homes.
Though he has not been convicted of anything, Ghosn’s reputation is already in ruins. A Japanese press that long fawned over him now dismisses Ghosn as having gone from “hero to zero.”
At the height of his renown, Ghosn was a populist hero in Japan, an exemplar of continued Japanese industrial strength in the shadow of a rising China. He was routinely mobbed for autographs during plant tours, and starred in a series of manga comic books.
But today, Ghosn is a symbol of the widespread moral rot in Japanese industry, notably the auto sector, source of the deadly exploding air bag (Takata Corp.), a quality scandal at Mitsubishi, and the recall last year of 1.2 million Nissan vehicles whose quality approval for years had been conducted by unqualified inspectors.
The global auto industry has lost two giants this year. But the late Sergio Marchionne, who died in July after turning around Fiat SpA and Chrysler Corp., did not leave in disgrace as Ghosn has.
David Olive is a business columnist based in Toronto. Follow him on Twitter: @TheGrtRecession