Myopic Unions

The Royal Mail's managers have stepped back from the brink and are not going to play the Grinch this Christmas.  Unfortunately, the workers have not and are now on strike with threats that regular stoppages could continue for some time.  This is an abuse of politicians' willingness to waste money and puts the lie to the notion that people working in the public sector have some kind of special public-service ethos superior to that found in the private sector.


Strikes in the postal service are also an incredibly myopic strategy as they undermine the Royal Mail's business in the long-term by encouraging customers to stop using an unreliable postal service.  Blogger FreeBornJohn writes:

"I am adding new instructions to all communications with my customers.
Until now, some have paid by internet banking (bacs) and some by
cheque-in-the-post. I'm going to change my system. All invoices and
correspondence from my business already go by email. Now I'm going to
alter the terms of business so there's a surcharge (small) for cheque
payment, or a discount for bacs, depending how you want to look at it.
I anticipate I'll be getting more than 95% of payments electronically
by the end of this month.

This isn't because I'm anti-Union
(although I am), it's because I don't want to be inconvenienced by the
mail service and have the opportunity to make alternative arrangements.

I won't be the only one doing this. Yet again, a trades union is committing suicide."

He also makes a telling analogy with an earlier postal strike that destroyed Royal Mail business by encouraging adoption of the fax machine.  For firms operating in competitive markets it is imperative that Royal Mail unions do not have the power to undermine their ability to serve their customers.  Many can stop using the Royal Mail and when it cannot guarantee reliable delivery they will.  In the medium to long term the members of the Communication Workers Union will regret this strike more than anyone.

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