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Usps-T-29 Before the Postal Postal Rate Commission Submitted 4/8/2005 10:55 am Filing ID: 43430 Accepted 4/8/2005 USPS-T-29 BEFORE THE POSTAL RATE COMMISSION WASHINGTON DC 20268-0001 ____________________________________ POSTAL RATE AND FEE CHANGES Docket No. R2005-1 PURSUANT TO PUBLIC LAW 108-18 ____________________________________ DIRECT TESTIMONY OF MARC D. McCRERY ON BEHALF OF THE UNITED STATES POSTAL SERVICE TABLE OF CONTENTS 1 Page 2 Autobiographical Sketch 3 I. Purpose of Testimony.................................................................................1 4 II. Processing Operations ...............................................................................2 5 A. Letter and Card Mail Processing ...........................................................2 6 1. Preparation.......................................................................................2 7 2. Equipment ........................................................................................3 8 3. Manual.............................................................................................9 9 4. Automation Update ........................................................................10 10 5. Description of Future System Beyond the Test Year .....................11 11 B. Flat Mail Processing ...........................................................................11 12 1. Preparation.....................................................................................11 13 2. Equipment ......................................................................................12 14 3. Processing/Mailflow........................................................................15 15 4. Manual ...........................................................................................16 16 5. Automation/Mechanization Update ................................................17 17 6. Description of Future System Beyond the Test Year .....................17 18 C. Parcels, Bundles, Sacks, and Trays...................................................18 19 1. Parcel Processing..........................................................................18 20 2. Bundle Processing.........................................................................20 21 3. Sack Processing ...........................................................................23 22 4. Tray Processing ............................................................................25 23 5. Description of Future System Beyond the Test Year .....................27 24 D. Allied Operations ...............................................................................27 25 E. The Breakthrough Productivity Initiative (BPI) in Mail Processing .....28 26 F. Future Network Considerations .........................................................29 27 III. Volume and Workhours in Mail Processing .............................................30 1 Direct Testimony 2 of 3 Marc D. McCrery 4 Autobiographical Sketch 5 6 My name is Marc McCrery. I have been the Manager, Operational 7 Requirements within Operations Planning since April 2004. My office serves as the 8 focal point for operations planning related to operational impacts of rate and mail 9 preparation issues. We interface with pricing, finance, mailing standards, and 10 customers to evaluate and implement various internal and external rate and mail 11 preparation changes. Specific responsibilities include assisting in the development 12 of mail preparation standards and rate-related changes to ensure compatibility with 13 operational processing, determining operational impacts resulting from rate and mail 14 classification cases, and preparing the field for the expected changes before 15 implementation. 16 I joined the Postal Service in 1990 as an Industrial Engineer Trainee. My first 17 assignment was to work at the Des Moines, IA Processing and Distribution Facility 18 with the purpose of learning mail processing operations. A large portion of this 19 period was spent supervising automation on Tour 1. This was followed by 20 supervisory responsibilities at a delivery station in Des Moines, IA, followed by 21 project work in the Engineering Technical Unit in Des Moines. My second year of 22 training was spent in Harrisburg, PA working in the ETU primarily supporting the 23 plant on staffing, scheduling, and quality projects. 24 Upon leaving the training program in late 1992, I moved to USPS 25 Headquarters as a member of the Facility Activation group, with responsibilities to 26 activate new, large mail processing facilities throughout the country. From that 27 office, I moved to Bulk Mail Center Operations and then to Processing and 28 Distribution Center Operations. During these assignments, I visited dozens of mail 29 processing plants and every Bulk Mail Center within the network. In 1996, I joined 30 the staff of my current office, Operational Requirements and Integration. My 31 responsibilities included developing enhancements to mail preparation requirements 1 and support work on the proposals, testimony, interrogatories, and implementation 2 activities for the R97-1, R2000-1, and R2001-1 rate cases. In 2003, I was promoted 3 to the Manager, Business Mailer Support within Marketing, and then again in 2004 to 4 the Manager, Operational Requirements and Integration. I also had a temporary 5 assignment lasting 3 ½ months in 2004 as the Plant Manager of the Burlington, VT 6 Processing and Distribution Facility. 7 I have a Bachelor of Science Degree in Industrial Engineering from the 8 University of Wisconsin – Madison. 1 1 I. Purpose of Testimony 2 The purpose of my testimony is to provide operational support for various 3 elements of the Postal Service’s proposals. In Chapter Two, Processing Operations, 4 I provide an overview of the Postal Service’s processing operations for the current 5 environment, the test year, and beyond. I specifically address: 6 1. Basic processes by shape; 7 2. Types and capabilities of equipment; 8 3. Equipment deployments and processing changes planned through the test year 9 and beyond; 10 In Chapter Three, Volume and Workhours in Mail Processing, I discuss the 11 relation between long term (e.g. quarter-to-quarter) volume changes and the 12 resulting workhour changes in support of Dr. Bozzo’s (USPS-T-12) calculation of 13 volume variabilities. 14 Finally, I will be sponsoring Sections 1A and 2A of USPS-LR-K-49, 15 Explanation of Cost Reductions, Other Programs, and Corporate Wide Activities 16 which is a Category 2 Library Reference and details the programs and initiatives that 17 we expect will produce operational savings through the test year. I have used 18 pieces of information within this library reference during the development of my 19 testimony. 2 1 II. Processing Operations 2 In this part of my testimony, I provide an overview of our processing 3 operations, with a focus on the equipment and methods used to process mail in 4 today’s environment, changes that are scheduled in the near term, and changes that 5 are being investigated that could impact processing operations further in the future. 6 Since we process letters, flats, and parcels as distinct mailstreams, each one is 7 discussed separately. 8 9 A. Letter and Card Mail Processing 10 1. Preparation 11 Letter mail preparation operations first require that letters and cards are 12 sorted into three separations: barcoded, non-barcoded machinable, and 13 nonmachinable (manual) to the greatest extent possible. Whether volumes are 14 presented in trays, bundles (such as metered mail), or as single pieces (such as 15 collection mail), these separations are necessary for subsequent piece distribution 16 to read an existing barcode, to resolve and print a barcode, or to sort the letters or 17 cards manually. 18 The operation where collection mail is prepared is often referred to as “010,”1 19 and encompasses the culling, facing, and sorting of mail by shape and indicium. 20 This operation is where letters, flats, and parcels are separated for subsequent 21 handling. Bundles and trays of metered letters are forwarded directly to sortation 22 equipment, while stamped mail is first faced and canceled. Hampers of single- 23 piece collection mail are dumped into the dual-pass rough cull feed system for the 24 Advanced Facer Canceller System (AFCS) described further in the following 25 section. This machine culls out non-letter sized pieces (over 6 1/8 inches tall, over 26 ¼ inch thick, and/or over 11 ½ inches long). It faces letters based on the location of 27 the stamp, meter, or Facing Identification Mark (FIM)2, and cancels the stamp. 1 “010” refers to MODS operations 010-013 and 020-022 for volume and workhour reporting. 2 FIM is the series of vertical bars to the left of the postage area such as on courtesy reply (FIM A) and business reply (FIM C) mail indicating the letter is barcoded. 3 1 The volume arrival profile of collection mail into the 010 operation is 2 dependent upon mail arrivals from stations, branches, associate offices, and 3 collection runs. Due to varied distances and demographics, the arrival profile varies 4 by facility, and may vary by day depending on volume, weather, or time of the week 5 or month. The status of the outgoing mail preparation operation dictates whether 6 the subsequent operations will meet the operating plan’s clearance times (the time 7 processing must be completed), since none of the outgoing operations can be 8 finalized until the 010 operation is clear of all mail volume. 9 Letter mail is also received from sources other than collections.
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