The game of the reorganization of the Romanian Post Office cost Romania millions of Euros

• After toying with two restructuring strategies over the last four years, the State owned Postal office is seeing increasing losses

• 2010 could be the second year where the company runs into the red

The political experiments with the reorganization of the Romanian Post Office are costing us millions of Euros, while it is sinking deeper into debt.

Every two years, the reorganization of the Romanian Post Office begets an analysis in the Government, in order to either choose a new consultant, or to draw up a new strategy from scratch.

And the results are getting increasingly worse.

In 2009, the Romanian Post Office posted losses for the first time since 1990.

Four years ago, the Tăriceanu government approved a contract with the reputed firm Roland Berger Strategy Consultants, which was supposed to deliver the turnkey restructuring program in exchange, in exchange for a payment of 1.8 million Euros.

Two years later, the same Tăriceanu government approved the strategy proposed by the consulting firm. The payment was made according to the contract, but the implementation of the project was delayed.

A new government with new priorities comes along, and decided it wanted a new strategy.

After heated discussions, in June 2010, the Boc government accepts the need for a new restructuring strategy.

In exchange for more money, naturally.

Sources from inside the company claim that 2009 was a disastrous year for the Post Office, caused by the repeated politically motivated changes in management changes, both at its headquarters and in the territory.

And this is illustrated by the company"s earnings in 2009.

The outlook for this year is even gloomier, and apparently the losses have already exceeded 70 million lei in the first semester of 2010.

Our sources claim that the new strategy will make the Post office even more overstaffed, in order to satisfy the needs of the political cronies over the country, which will automatically increase employee expenses and will implicitly affect the company"s earnings.

The project drawn up by Roland Berger included a detailed analysis of the company"s status and suggested concrete reorganization measures, with clear stages and clear deadlines.

Now, in a reply sent to BURSA, the management of the Romanian Post Office claims that the aforementioned project no longer fits the current situation, blaming the financial crisis, but conceded that most of the proposals of the former consultant will be kept. "The current economic context generated by the economic crisis, the need to implement a set of efficient measures on a company-wide scale, measures intended to mitigate the negative effects of the crisis, as well as the need for better market positioning, have led to a reconsideration of the initial strategy and the launch of a reorganization and modernization process of the main lines of business of the Romanian Post Office. Thus, "The modernization and reorganization strategy of the National Company "Poşta Română S.A.", which was approved by way of the government ordinance on June 17th, 2010 kept most of the measures included by the program devised by Roland Berger in 2008, in order to reach the overall objective, while at the same time correlating them with an additional set of measures which need to be implemented under the current circumstances. Moreover, the economic circumstances taken into consideration at the time the Government Ordinance no. 1134/2008 was enacted, have changed significantly in the interim. Defining a new modernization and reorganization strategy also took into account the fact that the Romanian Post Office failed to capitalize on the opportunities of the market, which has caused it to suffer major losses in the main business segments."

The fact that most of the measures proposed in the old reorganization plan were kept, makes it even harder to understand why a new strategy would be needed, instead of simply adapting the old one to the current circumstances.

Since the reply of the company"s management does not specify which measures will be kept and which suggestions of the old strategy need improvement, no pertinent comparison between the two of them can be made.

Meanwhile, the politicization of the institution is becoming ridiculous, and the money spent on various goods and services could make it win the undesirable record of being the company with the largest number of fines paid for fraudulent public procurement bids.

Meanwhile, we have a new minister of communications, who may very well go for yet another restructuring strategy of the Romanian Post Office.