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FY 2012 Comprehensive Statement on Postal Operations Postal Facts

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FY 2012 Comprehensive Statement on Postal Operations Postal Facts FY 2012 Comprehensive statement on Postal operations Postal Facts Fundamental Critical for Adaptable A Competitive Universal the Economy Business Service Successfully Core of an changing to meet Virtually all Connecting revenue now businesses and $800 million the needs of the comes from households dollar industry country for customers who everywhere with eight million 237 years employees have alternatives Secure and Technologically Trusted Sophisticated One of the most Manages an respected adaptable organizations for infrastructure of privacy and high-speed mail security (Ponemon sorting equipment, Institute) logistics networks and delivery routes, linked by sophisticated Convenient information More retail technology locations than McDonald’s and Starbucks combined. Reliable Record performance across most service categories Effective Builds relationships, Sustainable helps customers Working with do jobs important colleagues in the to them, and postal industry and supplements federal sector to other channels deliver mail at the lowest cost with minimal impact to Efficient A Bargain Customer- Relevant the environment Focused The world’s most One of the lowest New technologies “Most improved” productive postal rates for postage connect mail and for customer service — in the developed the Internet and satisfaction reduced costs by world let people send (American $1.1 billion in mail from mobile Customer FY2012 devices Satisfaction Index) 26 2012 AnnuAl RePort To CongRess United StateS PoStal Service executive summary Provide Transparency, Accountability Provide Direction for the Future and Trust Although the report is focused on providing performance This report provides information to assist stakeholders in information for the past year as a supplement to the Annual evaluating the performance of the Postal Service in 2012. Report to Congress, the document should also provide It combines information required by the Postal stakeholders with information on how Postal initiatives and Reorganization Act (PRA) of 1970, the Government programs are setting the stage for future improvements. Performance and Results Act of 1993, and the Postal Stakeholders should see: Accountability and Enhancement Act (PAEA) of 2006 into a The Postal Service has a portfolio of high priority single document for convenience and consistency. strategic initiatives that are focused on significant Stakeholders should see that: change; and, The Postal Service is an adaptable and highly capable Continuous improvements in daily operations provide organization; the foundation for future successes. The Postal Service mission, goals and strategies, and In addition, stakeholders should understand that emerging vision define its role and value; trends in technology, business and customer behavior can Despite an extremely difficult current financial situation, provide scenarios for future opportunities for mail, the mailing there are positive longer-term opportunities increasing industry and the Postal Service to remain relevant in the the value of the Postal Service to customers; future. The Postal Service has a well-developed plan to restore The document also provides references for more detailed financial stability, and a disciplined process to implement information. that plan effectively; The Postal Service made significant progress on its non- financial goals in FY 2012. United StateS PoStal Service 2012 AnnuAl RePort To CongRess 27 28 2012 AnnuAl RePort To CongRess United StateS PoStal Service Introduction The Postal service is an Adaptable organization The Postal Service has a long history of successfully (See The United States Postal Service: An American adapting to the changing needs of the nation, even as History, 1775-2006, http://about.usps.com/publications/ technology has changed the way people communicated and pub100/welcome.htm.) did business. Changing Needs of the Nation Economic recession, slow recovery Technological innovations and changes in consumer Expanding behavior economy with limited direct competition Internet Adoption Number of Delivery Points l Employees of Posta Number 1970 1980s 2003 2006 2012 USPS Challenges Population and Increasing Workload Disruptions (9/11, Recession and Economic Growth Anthrax and Economy) Increasing Workforce Slow Recovery Increasing Subsidy Mail Diversion Emergence of Retiree Health Lack of Investment Direct Competition Legislative and Benefits Pre-payment Service Decline Rate Regulation Regulatory Limitations Requirement • Business Model • Mechanization • Productivity • Operational and Change (PRA) and Automation Enhancements Infrastructure • Self-supporting • ZIP Code/Presort • Service Quality and Optimization • Internal Leadership • Costing & Pricing Customer Satisfaction • Revenue Generation Development • Management Improvements • Legislative Relief • Labor Negotiations Process Innovations • Workplace Improvements Actions Postal Operational Transformation Postal Path to Reorganization Act Innovations Plan Accountability Financial and Enhancement Stability Act Since the enactment of the Postal Reorganization Act The current situation is challenging, but not one that of 1970, the Postal Service has changed its business and cannot be solved. Innovation and continuous improvements operating model, introduced innovative services and focused in service and productivity plus collaboration with industry on productivity and delivery quality. and legislative changes can provide a path to stability Postal employees can be proud of the performance of as outlined in the Five-Year Business Plan, released in the organization and the progress that has been made. February 2012. Customers, Postal suppliers and business partners have benefitted from improvements. United StateS PoStal Service 2012 AnnuAl RePort To CongRess 29 Our Mission, Vision and Goals Remain Relevant Our mission of providing universal delivery service connecting The goals of providing high-quality service, generating the nation was established in the Constitution. It has been net income and improving the workplace have provided the foundation of Postal policy for 237 years. The vision has consistency in focusing our continuous improvement efforts. always been one of adapting to the changing needs of the The strategic performance metrics are based on these nation. basic goals. Strategic Goals and Strategies The Postal Service provides a reliable, efficient, highly trusted and unique MISSION universal service that connects people and helps businesses grow. VISION The Postal Service will continue to improve its services and its capability to adapt to the changing needs of customers in the digital age. STRATEGIC GOALS AND STRATEGIES The Postal Service is a channel connecting Strengthen The Postal Service should be a platform senders and receivers. Our channel should the Business for innovation and growth as traditional be reliable, trusted and easy to use. to Consumer products are improved, enhanced with Channel new technology and integrated into the digital age. PROVIDE HIGH- QUALITY SERVICE Businesses and consumers should have Improve the Provide relevant services that meet the high quality experiences at every point of Customer needs of different customers in contact with the Postal Service, both as competitive markets. Experience senders and receivers. GENERATE NET INCOME The Postal Service will provide innovative The capabilities and skills acquired in this Compete for new services for the growing eCommerce market will be adapted to help grow other retail environment. the Package postal products and services. Business IMPROVE WORKPLACE AND WORKFORCE Our operating infrastructure and processes Treat employees with dignity and respect. will become dramatically more efficient to Become Provide employees with a safe workplace reduce costs and create the necessary a Leaner, and with the skills, tools and processes financial margins to sustain the business Smarter, Faster that enable them to achieve organizational and to make improvements for the future. Organization and personal goals. Innovative use of new data will enhance productivity and flexibility. CORPORATE RESPONSIBILITY The core strategies are linked to the mission, vision and The strategies will create a more efficient and effective goals. They define the focus for change initiatives necessary organization that is more relevant to customers, responsive to respond to the current and future business environment. to the competitive marketplace and more innovative in all it does. 30 2012 AnnuAl RePort To CongRess United StateS PoStal Service The Short-Term Business Environment is Challenging Even strong organizations are having trouble as a result of The short-term financial crisis has captured stakeholder the recession and the slow, uneven economic recovery. Most attention and most are aware of the current situation and its are making significant changes driven by new technology, causes, and many are aware of some of the cost reduction and rising fuel and healthcare costs. initiatives our organization has been pursuing. Business Environment Has Short-Term Challenges and Longer-Term Opportunities Even the strongest businesses are having trouble in the slow, unevenly growing economy. $82.5 $77.5 $72.5 $67.5 DOLLARS (BILLIONS) $62.5 2004 2005 2006 2007 2008 2009 2010 2011 2012 Universal Service Requirements and Legacy Infrastructure Cost Revenue Trends Trends Constantly increasing delivery High fixed costs of excess operating points, often in less-densely capacity, aging facilities and equipment,
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