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Runyon To The Rescue At The Post Office

In Business This Week


They don't call him Carvin' Marvin for nothing. Marvin Runyon, 67, earned his nickname as the cost-slashing chairman of the Tennessee Valley Authority by axing programs and personnel. Now, he's taking on a bigger challenge: the U.S. Postal Service. On May 5, President Bush named Runyon to head the $44 billion agency, which faces escalating costs, rising competition, and disgruntled customers. But Runyon, who began 37 years ago at Ford Motor as an hourly production worker and rose to head Nissan Motor's widely praised U.S. car business, is undaunted. "I want to prove that government can run as efficiently as business," he says.

Runyon has experience tackling a hidebound bureaucracy. During four years at TVA, he trimmed the work force by 40%, to 21,000, culled the number of management layers to 8 from 13, and eliminated nonessential programs. Meanwhile, the amount of power the TVA generated during his tenure grew by 7%.

In his new job, Runyon will have much less flexibility than he did at the TVA, which sets its own rates. The Postal Service, however, must first get O.K.'s from two other panels. While he relied heavily on debt restructurings to lower the TVA's financing costs, he must worry now about managing labor costs, which account for 83% of expenses at the 740,000-employee organization. Worse still, the Post Office ran a $1.5 billion deficit in fiscal 1991. Given those problems, even Runyon may have trouble putting his stamp on the Post Office.EDITED BY HARRIS COLLINGWOOD

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