LibanPost gets a face-lift under new management

Khalil Daoud, the new chairman and managing director of LibanPost, has set aside a small patch of land outside the company’s headquarters, next to Beirut Airport. “It’s for the employees, so they can grow cucumbers and tomatoes.” he explained. “But they don’t care.” The failed horticultural experiment illustrates how difficult it is to spawn a sense of esprit de corps among LibanPost’s 600 employees, as well as the notion that they have a stake in its success or failure. Only a year and a half ago, after the original LibanPost had folded, many thought they were going to be laid off.

In a bid to bolster consumer confidence, Daoud has started giving the country’s post offices a “rejuvenated look,” by redecorating the offices. LibanPost is now allocating $300,000 to $350,000 a year – about 2% of its roughly $16 million annual budget – to this endeavor, and has spent $300,000 on a new post office off Riad al-Solh Square, in the Beirut Central District.

In addition, the company pays Canada Post $500,000 a year for consultancy services, which include training, and has spent over $1 million this year upgrading its technical capacities. Since he took over LibanPost in February 2002, Daoud has been implementing his vision of an overhauled Lebanese postal system. No easy task, since the country’s postal service was obliterated by the civil war and it was only thanks to local and international courier companies that any post flowed at all during that time.

Daoud said he has had to coax a people grown unaccustomed to using postal services back into the fold. “The core objective was to revamp the mail culture, which was non-existent over here. You had a whole generation without any idea about what a postal administration can offer.”

To this end, LibanPost is attempting to establish itself as a conduit for government services such as passport/residency permit renewals and military service exemptions/postponements. The effort, argued Daoud, bolsters President Emile Lahoud’s anti-corruption drive because it cuts out face-to-face transactions between citizens and government employees, thus reducing the potential for “under-the-table” deals. LibanPost exacts no fees for the renewal services, which it began offering about two years ago. So far, Daoud said, between 75,000 and 80,000 people have renewed their documents through LibanPost. The decision to offer assistance with military service formalities was born, Daoud noted, of his frustration with the time wasted sorting out an exemption for his university-bound son at one of the country’s five military service centers in the Bekaa region. “We had to wake up very early in the morning and when we arrived, there were some 2,000 to 3,000 students in line. We had to wait for several hours.” Initiated at the beginning of the year, the service costs LL6,000, or $4. Every week, the number of related transactions grows by 20% to 25%. LibanPost has processed a total of about 3,000 military service-related requests. In 2004, the company expects an increase to about 25,000 to 30,000 requests.

LibanPost is trying, as well, to foster a retail environment in its post offices by offering stationary products such as greeting cards, postcards, envelopes, packages, newspapers, magazines, Lebanon-themed screensavers, floppy diskettes, books about stamps, prepaid internet cards, credit cards and fuel coupons, bus tickets etc. Post offices also offer fax and photocopy services. “We’re gradually expanding the retail services so that it becomes a one-stop shop for people who are in any case visiting the post office,” said Daoud. On a less enthusiastic note, Daoud bemoaned the paucity of banking-related transactions registered by LibanPost. “So far, we haven’t been very successful with the financial institutions. The bulk of mail from banks consists basically of statements of accounts. Most banks today are not distributing statements of accounts, although [bank clients] pay a quarterly fee for them.”

Before the civil war in 1975, Lebanon’s postal services were under the direct control of the ministry of telecommunications. LibanPost, formed in 1998, is a private company under contract to the Lebanese government to operate the country’s postal services. The ministry of telecommunications and the general-directorate of the post regulate the service, but Daoud said the two institutions do not meddle in LibanPost’s affairs or impose strategy. Revenues are shared, but Daoud said that under the terms of the 15-year agreement he could not disclose the breakdown. Daoud refused to reveal the company’s revenues, but acknowledged that the company is still losing money, and probably will continue to do so until the end of 2003. “Next year, however, we hope to start generating profits. I am 100% convinced that there are ways of making a profit without simply waiting for the government to give us business. In all postal organizations around the world, the government is a major contributor to the well-being of the postal administration – this is not the case in Lebanon,” said Daoud.

LibanPost’s shareholders changed in 2001, and an amendment to the original contract spawned the agreement under which LibanPost in its current form operates. Daoud claimed he was not sure why the previous LibanPost agreement disintegrated, but likened its failure to a “wedding that breaks up – the chemistry didn’t work.” In the belly of the company’s headquarters, video cameras and supervisors monitor employees as they handle the roughly 14 million annual transactions. Mistakes are not tolerated. “We are ruthless with errors,” acknowledged Daoud, from behind the broad desk of his white, spartanly furnished office. “Our clients are like people who go to the same restaurant every day. If one day they find a hair on their plate, that’s it, finished. If we hear of any moral irregularities proved to have been committed by one of our employees, then they are fired on the same day,” said Daoud, explaining that he LibanPost operates a “clean floor” policy. Shortcomings are exposed and discussed during daily, early-morning “debriefing” sessions. “Over the last 18 to 20 months, the quality of the service has been continuously improving,” asserted Daoud.

Nonetheless, in the mail sorting room, boxes full of undelivered letters abound, the envelopes marked in some instances with unintelligible scrawl, or an unidentifiable address – after all, Lebanon has no post code system. Thus, delivering letters in the oft labyrinthine streets of Beirut and its southern suburbs, can be a frustrating, sometimes impossible, task – especially if the envelopes sport addresses such as: “Current resident, 14, Blue Cliff Drive, Lebanon,” or “Ms. ‘X’, Lebanon.” Not surprisingly, the ‘Return to Sender’ stamp is in constant use. According to Daoud, Lebanon’s chaotic or non-existent address system is one of LibanPost’s biggest challenges. “Most of the addresses are either wrong or approximate, like ‘opposite that place,’ ‘next to the mosque,’ or ‘over the petrol station.,’” he lamented. In an effort to push for a postal code, LibanPost has already spent $2 million, but the investment has yet to bear fruit because municipalities will not allow plaques bearing postal codes to be affixed to buildings. “We have sent several reminders on the subject, and nothing has been done,” noted Daoud. An alternative, he said, would be to ensure that every street in Lebanon has a name and every building a number. But because the “ownership” of this initiative lies with the municipalities – of which there are 752 – the process is potentially lengthy. The stack of official approvals that must accompany each act of renaming merely serves to complicate the process. LibanPost’s obstacles, however, do not all arise from bureaucratic red tape. Daoud acknowledged that occasionally mail does go astray, but asserted that only in rare instances is it the fault of LibanPost. Inhospitable janitors or doormen sometimes refuse postmen access to a building, saying they will deliver the letters but do not. “The absence of letterboxes can also contribute to the loss of mail. When letters are left lying in front of doors, perched on walls, or propped up against electricity meters, they are easy prey for dishonest neighbors.”