That day, the 126-year-old Beimen Post Office was lit up against the colors of the sunset sky, and it did look like a giant diamond that has been polished up and is shining brightly once again. Undoubtedly no one at the ceremony that night was happier than Chunghwa Post Co. Ltd. Chairman Philip Ong.
Bringing the JP Tower concept to Taiwan
It all needs to backtrack to November 2013 when Ong assumed the role of chairman. At that time, he did something unprecedented in the 30-year history of Chunghwa Post by taking a trip to Japan to meet with the president of Japan Post Holding Co. Ltd. During this visit, he inspected JP Tower, a combined commercial and residential landmark structure located next to Tokyo Train Station, which was built as part of a renovation of the Tokyo Central Post Office.
Ong is now planning to apply for a change in zoning for the land behind BPO to construct a combined residential and commercial structure to be named CHP Tower, or Chunghwa Post Tower.
To illuminate a historic structure and to launch a new building project … these are things that the old Chunghwa Post would never have done. But it should not come as a shock, for over the past year many people have noticed that their neighborhood post office has been going through changes—rejuvenating changes.
If one lives in Taiwan, one can hardly fail to have noticed that the nation’s 1,324 post offices have made changes as large as eye-catching new exterior signs, as small as the chairs customers wait in, and as far-reaching as the service ambience. All have made the post office a more comfortable place to visit. It seems like Chunghwa Post, an institution with 119 years of history behind it, is young once more. Credit goes mainly to Ong.
After retiring in 2012 from a position as the ROC representative in India, Ong was first recruited into the financial sector, and then invited by former Minister of Transportation and Communications Yeh Kuan-shih to take over the job of chairman of Chunghwa Post.
“At first when Yeh came to me, I thought he just wanted me to reorganize CHP’s finances a bit. Only later did I find out there had been a huge misunderstanding.” After taking over at CHP, which provides some banking functions as well as postal services, Ong—who had previously served in the Ministry of Finance and the Financial Services Commission—flipped through the account books and discovered that CHP’s coffers were overflowing with cash, holding over NT$5 trillion (US$157.8 billion) in deposits, NT$700 billion-plus in its life insurance fund and sitting at the top of the assets list in the financial sector.
Three noes: commercial products, loans, insurance brokering
This discovery caused Ong to reset his thinking to square one. He found out that not doing something is actually harder than doing something, and is in fact even more important.
At his first meeting as chairman, the 55-year-old Ong announced CHP’s three noes: no selling commercial products, no making loans and no offering brokerage services for insurance.
The three noes are in place because the post office has a universal service obligation. For example, said Ong, one can mail an ordinary letter from any address in Taipei to any other address in Taipei for NT$5, and for the same price you can also send it all the way to Fangliao at the other end of Taiwan or Wuqiu in the outlying Kinmen County, regardless of the actual cost of doing so.
The Ministry of Transportation and Communications holds 100 percent of CHP shares, so it is still a state-run enterprise. The post office’s original purpose was to provide public services, and to make these available to everyone. Ong wants to retain that initial spirit by focusing on CHP’s three core businesses: postal services, savings and life insurance. Although outsiders are always calling for privatization of state-run enterprises, Ong said, “As long as I am chairman, CHP will not move toward privatization.”
But while the three noes have a Zen-like wisdom, they require courage and strategic thinking.
Take for example no selling commercial products. In December 2014, all of the kiosks and display cases in the special retail areas in CHP branches—areas which seemed to be making money—were removed, terminating sales of products like facial cleanser masks, gift and souvenir boxes, and special local agricultural products.
“In the past so many items were being sold that post offices no longer seemed like post offices, and our image was being eroded,” Ong said, adding that acting as an agent for private-sector goods could damage the relationship of trust between the post office and its customers.
After removing physical products, Ong placed interactive touch screens in post offices. If one needs something, just go to a screen and buy it from CHP’s e-commerce site, PostMall.
As for loans, unlike banks, which are eager to give out loans to increase profits, and despite the fact that CHP does provide some banking services, Ong wants CHP to only accept deposits so as not to compete with the private sector. Also, regardless of the size of the deposit, all will be accepted and there will be no discounts on the rate of interest.
“What the ROC needs is ‘green mountains,’ it doesn’t have any shortage of banks,” Ong said. When referring to “green mountains,” Ong is using a Chinese expression that means something uplifting and solid, and specifically he is referring to CHP’s NT$5 trillion in deposits—akin to a backstop for the whole financial system.
Regarding insurance, ROC Life Insurance Association Chairman Paul Hsu said, “CHP has the ideal situation to handle microinsurance, and luckily Ong is also very committed to this.” Microinsurance is aimed at building a safety net for the disadvantaged in society. Even if the upper limit on the insured amount is only NT$500,000, this can still be of critical value in a crisis.
The profit margins on microinsurance are also microsized, so commercial insurance firms are reluctant to get into this line. Ong does not want CHP to provide brokerage services on behalf of commercial insurance companies, regardless of the fees that could be earned, because he wants to be able to continue to offer simplified life insurance under the conditions of coverage for all with no physical exam required.
“Who knows best where there are seniors living alone, where the weakest in society can be found? Our postmen.” Ong envisages Taiwan’s more than 9,000 postal workers becoming goodwill ambassadors. Even as they journey to every corner of the country to deliver mail, they can also deliver boxed meals or look in on the elderly to make sure they are OK, and also bring to them the notion of insurance, which could directly impact their lives and protect their interests.
On another front, the nation’s 1,324 post offices are steadily undergoing a major face-lift.
“Ong wants CHP to be our post office, to be like an extension of the family living room,” said then CHP President Wang Chang. It is not merely that the exterior signs have been completely changed, even the old hard plastic chairs are being replaced with soft high-class seating chairs like those on the high-speed railway.
Many post offices have even set up senior-friendly spaces with, for example, lower counters or a sofa area, in hopes that the elderly will be more willing to come to the post office.
“The post office is really different. It’s got a much more vibrant spirit about it,” Hsu said when he saw staff looking very happy as they worked busily. He could not help but pull one aside to ask why. Unexpectedly, the staff member told him, “It’s because the chairman makes us feel we are all on one team.”
Bringing assets to life, performing public service
“Ong has a lot of creative ideas. He was the one who came up with combining stamps, pop culture and public service into one,” said Chen Yi-ju, head of the Publicity Department at Yu-Cheng Social Welfare Foundation, which works on behalf of the mentally challenged. Last September, Ong asked well-known lyricist Vincent Fang to lend his name to collector’s sets of stamps featuring antique porcelain with blue-and-white patterns. The sets have the poetic lyrics to “Blue and White Porcelain” printed across the top and are signed by Fang.
In the end, the 10 limited edition sets sold for NT$1.06 million, with the public-service revenues shared between Yu-Cheng and Taiwan Foundation for Rare Disorders.
This was not the first time Ong used CHP as a platform for public service. Last summer the post office helped small farmers from Dashu District of Kaohsiung City sell the yuhebao variety of lychee, saving them the hassle of dealing with brokers.
By insisting upon access for all and social responsibility, it seems like Ong is doing things that cost money. But he is not worried, because CHP has a platoon of money-earners on its side.
One such goose laying golden eggs is turning existing assets to more profitable use. Many post office branches sit on prime real estate, and in recent years CHP has become a major player in renting out space, bringing in about NT$200 million in revenue per annum.
Another example the Taipei Dongmen Post Office, located at Dongmen metro station. The post office is situated in a high-rise building that was built over the metro station as an integrated project on the site of the old post office. In the new building, the first and second floors are used by CHP, while floors three through seven are rented out and operated as a business hotel, earning about NT$10 million per year.
The new-look, youthful CHP is here to stay. The 2015 Asian International Stamp Exhibition, held in Taipei in April, proved it, as Philip Ong gave visitors from Taiwan and other participating countries a clear look at the future.
[by Lin Rang-jun / tr. by Phil Newell]