Public sector
Overview
Leaders in non-profit organizations and government face many of the same demands and challenges as those in the private sector. However, rather than focusing on profit maximization, we have helped stakeholders across government agencies, armed forces and non-profits allocate resources more efficiently to drive the core mission. DPO&Co hires leaders for business and society that are globally-minded and adept at collaborating across industries and sectors.
CASE EXAMPLE
6-Week Diagnostic: Led Managerial cost methodology benchmarking for US Postal Service that compared against two major competitors and the leading practices for three other regulated industries
Situation
- Costing system was primarily designed to meet regulatory requirements at a time when USPS was breaking even and mail volumes were growing
- Dynamics changed such that USPS operated at a $5.5B deficit with shrinking volume
- Amazon and other large customers were driving increasingly more customer-specific contracts and it was unclear whether these were profitable or not without a customer level costing method
- USPS decided it was time to move from a top-down to bottom-up cost estimating methodology
Approach
- Reviewed alternative costing systems employed by select foreign posts, competitive parcel firms and other regulated industries such as rail, energy and telecommunications
- team deployed a framework that examined each company on four dimensions: Business Overview, Objectives and Governance Structure, Business Uses & Reporting, and Costing Methodology
- Conducted desk research and over 25 targeted interviews with current and former executives and industry Subject Matter Experts
Impact and Results
- 35-page best-practices benchmarking report and PowerPoint presentation, segmented by foreign postal services, private parcel competitors and other regulated industries
- Clearly defined business need for a bottom-up costing methodology, with highlighted benefits for Finance, Sales & Marketing, Operations, IT and HR stakeholders
- Potential "To be" state for activity based costing methodology with example activity flow documents, system requirements, employee engagement requirements and advantages/disadvantages of approach