- Botswana Post profitable, finally!
- Operational costs decline
- Balance sheet grows 2.9 percent
After more than a decade of loss making, Botswana Post has finally returned to profitability, making P4.1 million as pre-tax profit, the company announced recently.
“I am happy to declare a profit before tax of P4.1milion which is a first in 10 years, representing 132.7 percent Year-on-Year improvement on our bottom line,” said Cornelius Ramatlhakwane, Chief Executive Officer (CEO) of Botswana Post The development translates into a 2.9 percent growth of the post’s balance sheet.
Under the leadership of the charismatic Ramatlhakwane, Botswana Post further aims to achieve a revenue target of P660 million at an efficient cost income ratio of by the year 2020. The aims however seems to be paying off. The quasi-government institution recorded a cost-to-income ratio of 98.7 percent, an improvement from 102.6 percent (5.3 percent) last year.
“We now have a BotswanaPost that is operationally efficient, profitable, Fit-To-Serve and Fit-For-Growth,” stated Ramatlhakwane.
The cost income ratio shows a company’s costs in relation to its income. To get the ratio, one needs to divide the operating costs (administrative and fixed costs, such as salaries and property expenses, but not bad debts that have been written off) by operating income.
What Ramatlhakwana plans to do is to simply provide affordable convenience through high quality profitable postal and diversified products and services.
Armed with MSc in Strategic Management, Ramatlhakwane upon assuming office in October 2015 was convinced that as a business they were at an “inflection point”, and unless they make critical decisions and take concrete steps, Botswana Post ran the risk of regression in growing its brand. Therefore, the latter part of 2015 and early 2016 and even 2017 was a busy period across all levels for him.
His first strategy was to become amiable. He said during the transition period, they went through sensitive moments as a precursor to the business as seen now and still building towards 2020.
He said the Icon of Excellence Strategy was to everyone both locally and internationally, impactful. At the centre of this Strategy was the realization that Botswana Post in its traditional make up could not survive the onslaught of technology, and the fast-paced developments in people’s lives and how businesses are run in this modern age.
“We needed to assume a different posture, and also in alignment with our national aspirations”. That was when they undertook the SCAN – Performance Improvement and Opportunity Review – intended to inform their strategic disposition into the future.
Ramatlhakwane said Botswana Post needed to re-focus and recalibrate but only if the institution knew what it was dealing with, then would it be able to respond with a better measured and definitive initiative.
Results of the SCAN showed that as a company, Botswana Post revenues were growing, but there was evidence of bleeding as the company continued to make losses. Together with his team, they embarked on an Organization-wide Operational Efficiency and Performance Improvement scan to identify gaps.This operation was aimed at achieving steady growth, improved profitability and efficiency (customer-centricity).“So we needed to answer three questions. Can we become more efficient? Can we increase revenues? Can we improve customer satisfaction?” Ramatlhakwane said they needed to do something in a short space of time to answer these questions and reposition the company on a path to profitability.
INNOVATIVE EXCELLENCE STRATEGY 2017 -2020
The 2017/18 financial year saw the business introduce the new strategy, ‘Executing Innovative Excellence 2017 – 2020’. This is an amalgamation of the work put through from the Performance and Opportunity Scan, results gleaned from the extension of the Icon of Excellence, targeted operational and strategic theme activities introduced in between and the impact of the VC Model.
This has placed the Post on a successful trajectory, becoming real competition that cannot be ignored both as a service provider and strategic co-collaborator to other players in the market.