March 2012


Satisfaction Guaranteed (not!): Redefining "service" — the Postal Way

March 31, 2012

A POSTMASTER'S STORY by Mark Jamison

I want to tell you a story about the state of customer service in today’s Postal Service.  It’s about a solitary incident, a small incident really, but it holds a larger truth.

PS Form 1509, “Recall of Mail,” has been around for years.  It’s a form a customer can fill out to try and retrieve a piece of mail before delivery.  In January, when postal rates were increased, the form and the retrieval process were updated, and the service was introduced as a “new domestic service.”  The form number remained the same, but the service was given a new name — “Sender’s Request for USPS Package Intercept Service” — and now this is something we charge for.

The new service charges a fee of $10.95.  It can be used to stop delivery of any piece of mail that has a special service barcode.  It can be used on anything other than Periodicals or Standard Mail provided the piece has an extra service like Delivery Confirmation or Insurance.  With the growth of sites like E-Bay and person-to-person e-commerce, this really could be a valuable and necessary service.

Form 1509 includes a “Statement of Understanding” that requires the customer’s signature. The statement reads: “I understand that the fee to initiate Package Intercept service is nonrefundable, and that there is no guarantee that the item can be intercepted before delivery. I also understand that the intercepted mail will be redirected back to the sender’s return address and may incur postage due at the applicable price to be paid upon delivery to the sender.”

This bit of legal escapism is an indication, I suppose, that the customer just paid $10.95 for a big maybe.  It really shouldn’t be that difficult to intercept a package, provided the customer starts the process early enough in the cycle.  In a kinder and gentler time, the caveat may have been inserted to encourage customers to try to intercept the package as soon as possible, but these days, when the chase for revenue is paramount, it seems as though the urge to collect revenue trumps accepting responsibility for actually providing the service being paid for.

I received an e-mail early one morning from a customer asking if there was a way to stop delivery of a package.  He said that PayPal had notified him that a payment for some merchandise was likely fraudulent, and he was advised not to ship or to halt delivery if at all possible.

I should note here that as a postmaster serving a rural town, I’ve shared my home phone number and e-mail with many of my customers.  Business hours don’t mean much when you’re dealing with friends and neighbors, so I don’t mind if someone needs to ask a question during off hours.  In this case the customer was trying to get as early a start as possible on retrieving the package.

Modern Times at the Postal Service: Network Rationalization gives more work to idle machines

March 27, 2012

Last Tuesday, David Williams, USPS VP of Network Operations and the man running the Network Rationalization plan, was cross-examined before the Postal Regulatory Commission, which is working on its Advisory Opinion about the mail-processing consolidations and the change in service standards they depend on.  Williams explained “the whole concept” behind the plan like this:

“If you go into anyone of our plants today at this hour, we’ve got about 6,000 delivery bar code sorters.  The vast majority of those machines are sitting on the workroom floor and they’re not doing anything.  They’re just sitting there.  And those machines were purchased to process delivery point sequencing volume, and that operation typically starts at say 11:30 at night and goes to 6 or 7 o’clock in the morning, and it’s that idle time in terms of mail processing equipment for delivery point sequencing that we need to address. 

“Those machines take up a lot of square feet, those machines are sitting idle, and the concept of this network change is to get a full operating use of that equipment so instead of a five-to-six-hour operating window on about 6,000 machines we want to get to a 20-to-16 hour operating window….  It’s that lengthening of the operating window of that equipment which drives a significant reduction in the number of pieces of equipment that we need and therefore the number of square feet that we need, which allows us to reduce the fixed overhead that we have in our network.” (PRC webcast at 1:18:00; written transcript, p. 246)

From Williams’ point of view, then, the Postal Service has invested heavily in machines that are not operating enough hours per day.   Relaxing service standards will enable the Postal Service to make better use of the machines and the facilities that house them, and thereby reduce fixed operating costs.  It’s all about machines and square footage and fixed overhead.

In a few weeks, the Postal Service will begin implementing a plan that will cost 35,000 postal jobs and probably just as many non-postal jobs, displace tens of thousands of workers, cause long commutes, break up families, hurt the economies of over 200 communities, slow down the mail, and drive business away — all so that the Postal Service can give more work to idle machines.

The leaders of the Postal Service call this a “rationalization” plan.  They value the efficient use of machines over things like jobs, families, and community.  They think feeding a machine is more important than feeding a family.  

 

The incredible shrinking cost-saving numbers

Let's say that the Postal Service has a point.  Let’s say that the postal deficit is real (and not a manufactured crisis being caused by payments to the retiree health care fund), and let’s say mail volumes will continue to drop significantly over the coming years (even while the rest of the economy recovers from the recession and resumes growth).  Let’s say that automation in the long run is a good thing (even though tens of thousands of mail-processing jobs may be lost in the short run).   Let’s say that the Postal Service, if it’s to act like a business, should make the most efficient use of its operations (even if that means more work for machines and less work for people).

To justify this line of thinking, the Postal Service should be required to demonstrate that its Network Rationalization plan will in fact save money, and not just a little, but enough to make all the pain worthwhile.  

It's becoming increasingly clear, however, that the Postal Service cannot prove the consolidation plan will realize any significant amount of savings. 

When the Network Rationalization plan was first announced in September, the Postal Service said it would save $3 billion.  When the Postal Service presented its case to the Postal Regulatory Commission in December, they said it would save $2.1 billion ($2.6 billion in lower operating costs, minus $500 million in lost revenue).

Now that the AMP (Area Mail Processing) studies have been completed, we see that 223 of the original 252 facilities have been approved for consolidation.  Nine studies are still underway, but even if most of them are approved, about 10% of the plants will have been removed from the plan.  That presumably means the savings should also be reduced by 10%, so the $2.6 billion becomes $2.34 billion, minus the $500 million in lost revenue, for a net savings of $1.84 billion.

As we learned last week from the secret marketing survey, however, that calculation may seriously underestimate the revenue losses that Network Rationalization will cause.  In order to estimate how much business changing service standards and slowing down the mail would drive away, the Postal Service commissioned a market research study.   When the results came in, the Postal Service didn’t like the numbers, and it commissioned a second round of research to produce more "reliable" data.  (That research, by the way, cost nearly one million dollars.  The rest of the story is here.)

The USPS press release on the secret survey: They still can’t get their story straight

March 24, 2012

Yesterday, the Postal Service issued a press release responding to revelations about a market research survey it commissioned last summer but chose not to tell anyone about.  The press release contains several misleading statements that only serve to compound the Postal Service’s bad faith in keeping the survey secret. 

One wonders why they even bothered issuing a press release, rather than ignoring the story and hoping it went away.  But the Postal Service was probably getting inquiries from the media, and someone decided it would be best to refer reporters to a press release. 

The press release will probably raise more questions than it answers, as you can already see in the way Government Executive handled it.  In an article entitled "Postal Service steers attention away from 'flawed' revenue study," GE rehashes the press release but then quotes a staffer for Congressman Gerald Connolly saying that the real reason they abandoned the study was that "they didn't like the results because they would be very inconvenient for them."  

 

The two phases of the market research

The market research was conducted by Opinion Research Corporation (ORC) to determine how mailers would respond to the change in service standards on which the Network Rationalization plan is premised.   The survey showed that slowing down First-Class and periodical mail would cause First-Class to drop by over 10%, periodical mail by nearly 20%, total mail volumes by nearly 8%, and revenues by over $5 billion a year.  

When the folks in postal headquarters saw those results, they decided the survey instrument was “seriously flawed” and ordered a second phase of research, this time making sure the questionnaire and concept statement (the prompt used to initiate the questioning) were constructed in a way to get better, more “reliable” results. 

The results for the phase-2 survey were much more palatable, and this is the research that became part of the Postal Service’s testimony to the Postal Regulatory Commission (PRC) in December as part of the Request for an Advisory Opinion.  Below are the results of the two phases of the market research.

Product
Volume
change
Revenue
Change
Net contribution
change
PHASE-1 RESEARCH
 
 
 
Total Single Piece FCM
-10.3%
-$1,885,906,135
-$751,110,892
Total Presort FCM
-8.2%
-$1,313,212,398
-$867,862,107
Total First-Class Mail
-9.1%
-$3,199,118,533
-$1,618,972,998
Total Standard Mail
-5.3%
-$918,489,304
-$293,014,826
Total Periodicals
-19.7%
$369,478,082
$121,727,275
Priority/Express
-14.4%
-$773,756,417
-$172,990,046
Totals
-7.7%
-$5,260,842,336
-$1,963,277,595
PHASE-2 RESEARCH
 
 
 
Total Single Piece FCM
-2.8%
-$505,382,239
-$201,281,547
Total Presort FCM
-1.4%
-$222,734,587
-$147,198,510
Total First-Class Mail
-1.9%
-$728,116,826
-$348,480,056
Total Standard Mail
-1.4%
-$244,555,898
-$78,024,977
Total Periodicals
-2.1%
-$40,209,556
$13,247,334
Priority/Express
-5.3%
-$326,947,426
-$85,396,035
Totals
-1.7%
-$1,339,829,706
-$498,653,734
Source: Phase-1, released by PRC 3/22/12; Phase-2, Whiteman’s testimony before the PRC, p. 22.

The Postal Service presented two witnesses to provide testimony about the market research — Rebecca Elmore-Yalch, a VP at ORC, and Gregory Whiteman, Manager of Market Research at the Postal Service.  Their initial testimony was extensive, but neither mentioned the existence of an earlier phase of research that had been abandoned.   During the “discovery” part of the PRC’s Advisory Opinion process, several interrogatories were posed that could have provided an opportunity to mention the phase-1 research, but no one did. 

Eventually, the questions became so direct, it was impossible to avoid acknowledging the existence of the phase-1 research, and the Postal Service turned over some data to the PRC, but classified it as “non-public.”  It took some pressure from members of Congress, the postal worker unions, and perhaps others, but finally, on Thursday, the results of the research were made public.  The rest of the materials submitted to the PRC remains “non-public,” and one wonders if the other shoe is yet to drop.

 

The Postal Service issues a press release

Needless to say, yesterday’s press release doesn’t provide any of this background.  Instead, the press release begins as follows: “The Postal Service conducted market survey research related to potential service standard changes.  A questionnaire used in the fall of 2011 asked business customer respondents about a scenario that would never be implemented at the same time.”

The survey was actually conducted in late summer, during August, but that’s a minor error.  It simply reveals that the person who wrote the press release had very little knowledge about what actually happened.

Contrary to what the press release says, the phase-1 survey does not describe “a scenario that would never be implemented at the same time.”  Instead, the concept statement used to initiate the interviews notes that the Postal Service is experiencing an “unsustainable” budget deficit, and it then simply enumerates the changes being considered to address the problem: seeking legislative reform to change government requirements to pre-pay health and pension benefits, eliminating Saturday delivery, and closing small post offices.  The statement then outlines the revisions in service standards being proposed.  (The phase-1 survey is here; the concept statement is on page 11.)

The phase-1 concept statement says nothing about implementing these changes all at once, as part of some overall “scenario.”  It simply says the Postal Service is “exploring several changes.” 

The press release then says, “Specifically, the survey asked whether business customer respondents would lessen their use of the mail if the Postal Service immediately imposed price increases, service standard changes, altered delivery frequency, realigned its network of mail processing facilities and other actions.  Any such contemplated actions, if implemented, would be done so over a phased, five-year time horizon, providing adequate time for planning.”

The truth of the matter is that the survey questionnaire never once mentions anything about a rate increase — not in the concept statement or in the questions themselves.  The words “price” and “rate” and “increase” do not appear anywhere in the survey.

The survey questionnaire also says nothing about doing everything — or anything — “immediately.”  There’s nothing alarming like that in the concept statement. 

Secret market survey reveals USPS plans would cost over $5 billion in lost revenue

March 21, 2012

While hearings before the Postal Regulatory Commission (PRC) are usually pretty mundane events, something totally unexpected happened today.  The Postal Service revealed something it’s been hiding for months — the projected revenue losses its consolidation plan could cause. The numbers are something to behold.

The PRC was holding hearings for its Advisory Opinion about the Network Rationalization plan to consolidate over 200 mail processing plants and to reduce service standards in the process.  Gregory Whiteman, Manager of Market Research at the Postal Service, was answering questions about market research commissioned last summer to determine how much revenue might be lost if the Postal Service reduced service standards and slowed down First-Class mail.  Up until this moment, the Postal Service had been reluctant to say much about this research.  Instead, it has stuck to the testimony it presented to the PRC in December, which was based on a second round of research conducted in October.

The results of this first round of research will officially be released tomorrow morning, but at the hearing, Mr. Whiteman revealed that the research showed that First-Class mail volumes would drop a whopping 10.3%, and total mail volumes would drop by 7.7%.  That translates into $5.2 billion in gross revenue losses, and $1.9 billion in net contribution losses (the contribution loss figures in lower costs for lower volumes).  The breadkown for the market research numbers can be seen here.  (They also show a volume drop for periodicals of nearly 20%.)

Losses like that would wipe out nearly all of the $2.6 billion in cost savings the Network Rationalization plan hopes to achieve.  Given that the AMP studies suggest cost savings might be far less than $2.6 billion, the consolidation plan could easily end up losing more money than it saves.

These volume and revenue losses are significantly greater than the numbers provided in initial testimony for the PRC’s Advisory Opinion.  That testimony was based on the second round of research conducted by Opinion Research Corporation (ORC).  That research, which is a central part of the Postal Service's case for consolidation, said the service standard changes would cause a volume loss of 1.7%, a revenue loss of $1.3 billion, and a contribution loss of $500 million.

These new numbers provide circumstantial evidence that when the Postal Service saw the results of what we now know as the Phase-1 research back in late September or early October, it realized the numbers were devastating to their case for the consolidation plan.  It ordered the market research firm to stop the research before finalizing the numbers, and it began work on a new research survey, apparently designed to elicit better, less damaging results. 

"Because we said so": The unassailable logic of postal managers and their salaries

March 19, 2012

BY MARK JAMISON

Last week Kathy Hochul, Representative of New York’s 24th district, where Buffalo stands to lose a mail processing plant employing 700 workers, made a modest proposal — legislation to limit the salaries of the Postmaster General and his executive officers to the level of Cabinet Secretaries.  Her goal was to make a statement: “The Postal Service cannot make the argument that they need to cuts costs and let go hard-working postal workers when their own management team continues to rake in bonuses and make more than the President’s Cabinet.”

The proposal drew an interesting response from Thurgood Marshall, Jr., Chairman of the USPS Board of Governors.  Mr. Marshall argued that the Postal Service needs to pay salaries higher than elsewhere in government in order to attract and retain talented individuals to operate the Service.  It’s the same argument used to justify the astronomically high compensation paid to corporate executives in the private sector.

There are many arguments to be made for and against the huge salaries that have become prevalent in corporate America.  When those arguments are applied to the Postal Service, however, they raise two essential questions: Is the Postal Service more a corporate entity than a government entity?  And is the rationale expressed by Mr. Marshall valid?

The second question seems the easier to answer.  Thirty-eight senior executives of the Postal Service make salaries in excess of those paid to Cabinet Secretaries.  Now Chief Operating Officer Megan Brennan may have an important position, but is it more important than that of Secretary of Defense Leon Panetta, who makes $26,000 less than Ms. Brennan?  (And that doesn’t even take into account the additional $135,000 in bonuses she received in 2011.)

Mr. Marshall says that the Postal Service must pay these salaries to attract and retain competent people.  The problem with that argument is that nearly all of the senior postal executives are postal lifers, people who have spent virtually their entire careers in the Postal Service.

Former Postmaster General Jack Potter rose from carrier to the highest office in the organization.  Our current PMG rose from the position of clerk.  Now I’ll grant that it takes talent and perseverance to progress to the heights of an organization like the Postal Service, and many of these people worked hard to acquire advanced degrees along the way.  But the simple fact is that most of the executives in the Postal Service progressed up through the ranks — and that is the limit of their experience.

When you go down to the next level of the managerial pyramid — district managers, senior plant managers, and so on — the insular nature of management becomes even more apparent.  Those who earn more than $150,000 a year are almost exclusively employees who have risen through the ranks of the organization.  Their experience is almost entirely self-referential, and their professional universe is actually a pretty small place.  

When the Postal Service has sought to bring in outside “talent,” it has often been a disaster.  One only need mention the name Robert Bernstock.  He’s the fellow they brought in from Campbell Soup in 2008 with the hope that he would use his private-sector experience to re-invigorate slumping mail volumes.   During his two years as the President of USPS Mailing and Shipping Services, volumes continued to slump, and Bernstock resigned — under investigation for awarding nearly $5.9 million in controversial no-bid contracts to his former business associates.  When Bernstock left the Postal Service to return to the private sector, Postmaster General Potter commented, “Bob's work will have long-lasting, positive impact on the Postal Service and its customers."

One of the reasons General Motors got into such financial trouble is that senior managers became too insular and incestuous, too thoroughly committed to the GM corporate vision.  They lost the capacity to understand the world around them, thus dooming the organization to failure.

It was a very good year: The salaries of USPS executives

March 17, 2012

The Gannett 2012 salary finder for USPS employees came out this week, and it contains a wealth of information.  You can find the salary, job title, workplace, and year of hire for any postal employee.   That includes all the executives in L’Enfant Plaza. 

Unfortunately, the salary finder doesn’t contain information about bonuses and compensation packages, which for upper echelon executives can add up to almost as much as the base salary.  For example, according to the USPS Form 10-K for 2011 (p. 54), Chief Operating Officer Megan Brennan earned $225,308 in 2011, but brought in a total of 358,996, and Chief Information Officer Ellis Burgoyne earned $220,846 but brought in $508,688.

Even though the salary finder does not provide this kind of information about total compensation, it is still a useful tool and lots of fun.  For instance, here’s one use for the salary finder. 

Back in November, the Federal Times  revealed that "as the U.S. Postal Service was careening toward a record $8.5 billion loss in 2010, it was paying more than three dozen top executives and officers salaries and bonuses exceeding that of Cabinet secretaries."  A list was not available at that time, but using the salary finder, we’ve produced a list of the 38 postal executives earning the highest (base) salary as of February 2012.  You can see the list here.

Searching the salary finder for zip code 20260, the zip for postal headquarters at L'Enfant Plaza, and then sorting by salary, we’ve learned that there are over one thousand employees in HQ who earn $100,000 a year or more.  

We've also analyzed the data for the top 300 salaries in HQ, the 28 Vice Presidents (not all are in HQ), the 49 District Managers, and 57 plant managers.   (There are over a hundred job titles listed on the website, so we probably missed a few other high-paying jobs.) 

There are 415 employees who fall into one of these categories.  You can see a list of their salaries here.  We’ve omitted names as a courtesy, but if you’re curious about anyone in particular, the salary finder can help.

The salaries of these 415 employees range from $103,480 to $276,840, and the average is about $152,500.  Here’s the breakdown:  

Position
Number in group
Average Salary
Average years of service
Top 300 salaries in HQ
300
$151,210
22
Vice Presidents
28
$189,000
25
District Managers
49
$163,135
32
Plant Managers
57
$143,101
29
Combined list
415
$152,428
25
 

The salary finder also provides the date of hire for postal employees, from which we’ve calculated years of service.  Most of these 415 executives and managers have put in a lot of time at the Postal Service, some as many as 44 years.  The median is 28 years, and the average is 24 years.

If you’d like to put some faces on some of the top earners, the USPS website provides an organizational chart — complete with photos — of Postal Leadership, the 37 folks running the show.

If at first you don’t succeed, try revising the survey

March 15, 2012

Last summer the Postal Service hired Opinion Research Corporation (ORC) to do market research on how customers might respond to changes in service standards (slowing down the mail), as well as plans to close thousands of post offices, eliminate Saturday delivery, and seek legislative reforms on pensions and the retiree health care fund.  The purpose of the research was to provide data on which to base estimates of potential losses in mail volumes and revenue.

In her testimony before the Postal Regulatory Commission (PRC) for the Network Rationalization plan to consolidate over 200 mail processing plants, ORC's Rebecca Elmore-Yalch described the two components of the research. The qualitative research, conducted in August 2011, evaluated customer attitudes, while the quantitative research, conducted in October-November, focused on exactly how much less business mailers might do with the Postal Service if the mail slowed down.

Although the witnesses for the Postal Service were reluctant to mention it, we’ve learned from testimony that there was another quantitative study, done back in August or September, at about the same time the qualitative research was being done.  The Postal Service now says this phase-1 quantitative research was “abandoned” before it was completed, "with the result that no analysis of its preliminary results was pursued."  The Postal Service paid ORC over $430,000 to do the work, but it never analyzed the results.

The Postal Service has given the PRC the data for both phases of the quantitative research, but they are classified as “non-public” library references.  The Postal Service testimony (USPS-T-12, p. 22) includes calculations of lost volume and revenue for the phase-2 quantitative study, but not for phase-1.

The Postal Service says that because it didn’t complete the study there are no results to look it.  But when the existence of the other market research was first revealed in testimony by Gregory Whiteman, Manager of Market Research at the Postal Service, Whiteman stated, "In short order, the Postal Service plans to file two documents summarizing this research and its results." 

The PRC docket contains the market-research instruments — the concept statements and questionnaires — that were used for all three studies (the qualitative and both quantitative).   It’s worth taking a closer look to see how they were constructed and how they were changed for the phase-2 survey.  From the looks of things, it seems that the second time around, the Postal Service wanted to elicit responses that would result in less significant impacts on mail volumes and revenues. 

The Case of the Missing Market Research Study

March 13, 2012

The Postal Service’s Big Hurry to consolidate 223 mail processing plants may be running into serious speed bumps.  The AMP studies don’t add up to anything like what the Postal Service says it will save nor do they reveal where most of the 35,000 eliminated positions will come from. 

Now there’s news of a market research study on potential revenue losses the downsizing initiatives may cause that the Postal Service chose not to tell anyone about — and that it still wants to keep under wraps.

News of this other research was first revealed back in February, in testimony by one of the Postal Service witnesses for the Advisory Opinion on the Network Rationalization plan being conducted by the Postal Regulatory Commission.  Last week the Postal Service gave the PRC the data from this market research, along with a request to keep the materials “non-public.”  The Postal Service is also saying that because the research was “abandoned” before completion, there are no calculations on lost volume and revenues to look at. 

That's not sitting well with the participants in the Advisory Opinion process, and we're going to be hearing a lot more about this missing market research study.  Next week, witnesses for the Postal Service will be cross-examined before the Commissioners, and the market survey is sure to come up.

In the meantime, today Congressman Gerald E. Connolly of Virginia filed a Motion for Termination of Non-Public Status with the PRC.  The Congressman argues that "customers and policy makers should have the opportunity to review information on the likely revenue impact from these proposed reductions in service and facilities," and if the market research contains information that would help Members of Congress "to better understand the ramifications of these proposals," the material should not be classified as "non-public."  As Congressman Connolly writes in his motion, "the public has a right to know about possible revenue impacts from these proposals."

 

The two phases of market research

In preparing its case to the PRC on the Network Rationalization plan, the Postal Service commissioned market research to determine how much the revised service standards and slower First-Class mail would affect mail volumes and revenues.  The qualitative research was conducted in August 2011, using focus groups and in-depth interviews with mailers large and small.  The quantitative research was done later, in October.  The results were incorporated into testimony presented to the PRC in December, when the Request for an Advisory Opinion was submitted. 

While the qualitative research took a broad look at various factors — closing post offices, eliminating Saturday delivery, legislative proposals to change the pre-funding of retiree health care, as well as the plant consolidations and changes in service standards — the quantitative research presented in the testimony focused solely on the change in service standards. 

The research showed that mail volume would decline by 1.7% — nearly 2.9 billion pieces a year.  Just to put that in perspective, the Boston Consulting Group (BCG) has projected that diversion to the Internet would cause mail volumes to decline 1.5% a year through 2020.  In other words, the plant consolidation plan would impact mail volumes even more than the Internet.

This 1.7% decline in volumes translates to a revenue loss of $1.3 billion (2% of annual revenues).  That loss is adjusted to reflect the lower costs of processing lower volumes, resulting in a net “contribution” loss of $500 million.  That amount is then subtracted from the total cost savings of $2.6 billion that the Postal Service hopes to realize from the plant consolidations, leaving us with a net savings of $2.1 billion.  [USPS-T-12, p. 22]

The accumulating evidence in the PRC’s docket on Network Rationalization suggests that the market research presented in December was actually the second round of quantitative research.   The first phase was done months earlier, back in August or September, and rather than focusing solely on service standards, it encompassed the broader range of issues that the qualitative research examined, like the plan to close post offices and eliminate Saturday delivery.

The story on the market research and how the Postal Service prepared and shared the plan to optimize the processing network is worth examining in detail, so here are a couple of timelines to help put the pieces of the puzzle together.

Great minds think alike, and so do USPS District Managers

March 12, 2012

Over the past few days, Postal Service District Managers across the country have submitted “opinion” pieces to their local news media, and somehow they all stumbled upon the same words.  At least thirteen DMs have written one of these “opinions,” and they’re all the same, almost word for word.

The Postal Service pulled the same PR stunt a few months ago at Christmas time, when almost 30 DMs each “authored” the same opinion piece and letter to the editor for their regional news publications.  We’ll keep track to see how many weren’t embarrassed enough the first time around and were willing to do it again.

“America needs a financially stable postal service to best adapt to a changing marketplace and evolving mail needs,” begin the District Managers.  That’s why the Postal Service is proposing a “significant consolidation of its national network of mail processing facilities” — reducing the total number of facilities from 461 to a little more than 200 by the end of 2013.

From there on, the piece is all spin designed to exaggerate the Postal Service’s financial problems in order to justify the downsizing.  The piece points, for example, to declining mail volumes — 212 billion in 2006, 168 billion in 2011, and a projected 130 billion by 2020.  There’s no mention of the recession as the cause for most of the lost volume, and no explanation why the Postal Service has decided things will get even worse than the 150 billion that its consulting firm, Boston Consulting Group, projected for 2020.

“In just the past financial quarter,” the DMs go on to say, “the Postal Service lost $3.3 billion and is projecting steep losses for the remainder of the year.”  The DMs don’t mention that during the first quarter, the Postal Service actually showed a $200 million profit.  They don’t explain that the loss of $3.3 billion was due almost entirely to unnecessary payments to the retiree health care fund — a double payment, in fact, since the Postal Service skipped the payments last year.

The piece then says, “No one is to blame.  Times have just changed.”  As usual, it’s all about the Internet: Don’t blame us, say the District Managers, blame Facebook and Twitter.  Postal management would thus have us believe they didn’t see e-diversion coming and just got caught off guard.  We’ll see how that kind of excuse goes over with shareholders when the Postal Service is privatized.

“In spite of all this,” write the District Managers, “the demise of the Postal Service is greatly exaggerated.”  That’s strange to hear, since it’s the Postal Service that is doing most of the talking about its imminent demise if Congress doesn’t give it permission to dismantle itself.  The opponents of the downsizing are the ones trying to calm down the rhetoric and advise caution.  But it’s hard to get that message out there when the Postmaster General and his team are going around telling everyone how bad things are and feeding the media frenzy with shocking headlines about multi-billion dollars losses.

There’s one interesting note at the end of the “opinion” piece.  The District Managers say that there’s a moratorium on closings until May 15, “to give Congress and the Administration the opportunity to enact an alternative plan.”  Does that mean the Postal Service might not proceed with the post office closings and consolidations if Congress and the White House come up with something better?  Is the threat of post office closings and plant consolidations just a way of blackmailing our elected leaders? 

One wonders how the editors at all of these news outlets would feel if they knew that the “opinion” piece they published was not written by someone in their area, but by an anonymous person in postal headquarters in Washington, DC. 

Perhaps we should let them know.  If your local news source has published one of these pieces, why not write a letter to the editor responding to the argument in the piece and noting that it wasn’t even written by the person whose name appears on it?  Or just give the editors a phone call and let them know what’s up.

Here’s a list of the “opinion” pieces we’ve discovered so far, with the name of the District Manager whose name appears as the author of the piece.  If you come upon another, hit the contact link at the top and we’ll add it to the honor roll.  

More AMP Studies Released: Network Rationalization not looking very rational

March 9, 2012

Yesterday the Postal Service released more AMP studies, and we’re getting a clearer picture how much the Network Rationalization plan to consolidate about 230 mail processing plants will save and where the eliminated positions will come from.  Not surprisingly, the savings look to be a lot less than the Postal Service has been saying, and it’s still a mystery where 34,000 positions will be eliminated.

The impressive mountain of data the Postal Service submitted to the Postal Regulatory Commission (PRC) in December described an abstract plan of how the new processing network would operate.  (The Postal Service has even applied for a patent on the "facility optimization" system it apparently employed in developing the Rationalization plan.)  Based on this abstraction, the Postal Service calculated how much money the new network would cost to operate compared to the current network.  The Postal Service estimated $2.6 billion in total savings, minus $500 million in lost revenue due to the reduced service standards caused by the new network alignment, for a net savings of $2.1 billion a year.

The PRC asked the Postal Service to provide a copy of the AMP study for each of the 264 mail processing facilities studied for possible consolidation, and yesterday the Postal Service submitted a file with 184 of the studies.  It’s not clear why the file is missing 80 studies, but presumably the complete file will be made available to the PRC soon.  You can find links to the 184 studies on PostalMag.com, and you can download the .zip file with all the studies, here.

[CORRECTION: The Postal Service was not required to do AMP studies on all 264 facilities — 52 facilities were annexes and mail processing operations within customer service facilitis, and these may be closed without an AMP process.  The Postal Service conducted 212 AMP studies, so 28 were missing from the file given to the PRC, not 80.] 

Now that we can see the actual AMP studies for over 80% of the 223 facilities approved for consolidation, there’s not much need to speculate and extrapolate to envision how much the total savings will be.  These AMP studies describe the reality on the ground and not an abstract computer simulation conceived in postal headquarters.  After reviewing these studies, the Network Rationalization Plan is looking more like a rationalization than a plan.

These 184 studies provide the clearest picture yet of how much money will be saved by Network Rationalization and where the eliminated positions will come from.  As with our two previous exercises along these lines (the first using the PowerPoint presentations at 70 public meetings and the second using 134 AMP studies), the numbers just don’t add up to anything like what the Postal Service has been saying. 

[UPDATE: On March 30, the Postal Service released a table summarizing the results of 203 AMP studies.  The table is here, and the spreadsheet is here.)

Here’s a table summarizing the latest data (you can download the Excel spreadsheet with all the data here):

Savings Category
Savings for 184 AMP studies
Extrapolated to 223 facilities approved
Mail Processing Craft Workhour Savings
$452,729,346
$568,052,053
Non-MP Craft/EAS + Shared LDCs Workhour Savings (less Maint/Trans)
$34,423,258
$43,795,369
PCES/EAS Supervisory Workhour Savings
$121,068,008
$152,007,734
Transportation Savings
$54,992,609
$89,779,925
Maintenance Savings
$291,084,546
$360,833,851
Space Savings
-$1,551,318
-$1,880,130
Total Annual Savings
$961,749,357
$1,223,499,936
Net Contribution Loss   $500,000,000
Total Savings   $723,499,936

The Postal Service says the plan will save $2.6 billion, minus $500 million in net lost revenues, for a net savings of $2.1 billion.  The AMP studies indicate the plan will save $1.2 billion, minus $500 million in lost revenue, for a total of $720 million in savings — one-third of what the Postal Service has said.

The Postal Service says the plan will eliminate 34,000 positions.  The AMP studies give us an idea of where 15,000 positions will come from, but the other 19,000 remain a mystery. 

Type of Position
Actual for 184 AMPs
Estimated for 223 approved
Craft Position Loss
11,938
14,468
PCES/EAS Position Loss
436
528
Total Position Loss
12,374
14,997

Then there’s the issue of how these positions are going to be eliminated.  The no-layoff clause in union contracts means that the positions will need to be eliminated through attrition, and that’s exactly what the Postal Service says will happen.  But how quickly can 34,000 positions be eliminated through attrition?  The recent history of attrition suggests that it may take quite a while. 

From 2000 to 2010, the total workforce complement (including career and non-career) went from 901,238 to 671,687, a drop of 25%, or 2.5% a year.  For the past five years, the rate has been 3.3%, and FY 2010 reflected a drop of 6%.

There are 150,000 workers in the mail-processing network.  If 6% of them left the service each year, it would take nearly five years to eliminate 34,000 positions and reach the goal of $2.1 billion in savings.  Basically half of the excessed workers would have to quit or retire over the next few years. 

Now, it may be that the Postal Service will be able to accelerate the rate of attrition with its Network Rationalization plan.  Excessing workers to a facility a hundred miles away will surely make life difficult and push workers to quit or retire.  There may be financial incentives coming soon as well. 

But with an unemployment rate over 8% and good-paying jobs hard to come by, how many postal workers are really ready to leave their jobs?  Indeed, the Five-Year Business Plan released by the Postal Service a couple of weeks ago identified several “significant risks” in the plan, and one of them was simply, “Employee attrition may be too slow, which will drive up costs.”

As noted in the previous posts on this subject, it may be that the AMP studies do not capture much of the cost savings that may be realized with the new network configuration, and there may be other places where a significant number of positions can be eliminated.  Perhaps this method of calculation is simply flawed.  But at this point, it is really up to the Postal Service to offer an explanation about why the AMP studies don’t add up to what it’s been saying.

If an explanation doesn’t come soon, the Postal Service is going to lose a lot of credibility, and so will anyone in Congress who supports the consolidation plan.  If the Postal Service proceeds with the consolidations in June, before the PRC finishes its Advisory Opinion, that credibility will decline even further — a lot faster than falling mail volumes.

(Photo credits: Processing plants approved for consolidation in Fayetteville NC;  Kalazamoo MILafayette IN; and Binghamton NY.)

"We must not be rushed into false choices": Two Congressmen call for sanity

March 8, 2012

The leaders of the Postal Service are in a big hurry to dismantle the postal system, and there are plenty of people in Congress ready to help.  Fortunately, there are a few lawmakers who recognize the value of a robust Postal Service, and they don’t want to be rushed into making false choices.

Earlier this week, two of the saner people in Washington, Congressmen Gerald E. Connolly (D-VA) and Don Young (R-AK), wrote a letter to Congressional leaders urging legislation that would maintain rural post offices, preserve six-day and next-day delivery, and address the Postal Service’s deficit in a sensible way — by addressing overpayments to the pension and retiree health benefit funds and by giving the Postal Service more freedom to innovate.

The letter comes at a crucial moment because the Postal Service is getting ready to implement post office closings and plant consolidations when the moratorium ends on May 15.  Apparently postal executives are envisioning a kind of Postal D-Day, an all-out assault with “mass closures” of post offices and one to two hundred plant consolidations happening all at once. 

The latest evidence of the Big Hurry came on Tuesday at the hearing for the nomination of Tony Hammond as a commissioner on the Postal Regulatory Commission.  Senator Tom Carper spent most of the time — and it was an embarrassingly short hearing for such an important appointment — not asking Hammond questions but complaining that the PRC was moving too slowly on its Advisory Opinion about the plant consolidations.  (You gotta love it when a senator complains that another part of the government is not acting with sufficient "urgency" and endangering its "legitimacy.")

The PRC won’t be done with its work until late summer or early fall, and by then the Postal Service hopes to have many if not most of the consolidations completed.  Yesterday, we learned one of the reasons they’re in such a rush. 

The Postal Service doesn’t want the consolidations to mess up voting-by-mail, so it’s going to suspend consolidations from early September until after the elections, and then it's the holiday season, so no time for consolidations then either.  That means if they don’t get started on consolidations until after the Advisory Opinion is completed in September, they won’t be able to begin implementation until January.  That’s why Carper and the Postal Service are amping up the volume on their talk of a “dire” emergency and trying to make the PRC irrelevant.  (The attack on PRC Chairman Ruth Goldway over her travels is part of the same effort.)

The letter from Connolly and Young advises caution and calm, and it calls for an approach to postal reform that's much more sensible than most of what we've been hearing.  “We recognize the need for USPS to restructure its business model but believe that we must not be rushed into false choices which could accelerate the decline of the Postal Service, with negative impacts both for our constituents and the trillion dollar private sector mailing industry which depends on the Postal Service,” write the Congressmen. 

The letter points out that “closing thousands of rural post offices would save less than 1% of the Postal Service’s annual operating budget,” but it “would have a devastating impact on communities where the post office is the center of a community and a primary means of communication.”  It would make much more sense, write the Congressmen, to restructure the $5.5 billion annual Retirement Health Benefit (RHB) prefunding requirement.  That would save much more money than closing post offices, without any negative impact on mail service.

Connolly and Young also note that eliminating Saturday delivery, even using the Postal Service’s cost-saving analysis (which the PRC says was significantly overstated), would save far, far less than what postal employees — and by extension, postal customers — have overpaid into the FERS retiree pension plan.  Simply returning some of the $10 billion in overpayments would help the Postal Service more than going to five-day delivery, which would undermine its competitive advantage and slow down the delivery of important communications and products like medicines.

The Congressman also criticize the plan to consolidate processing plants, which will end next-day mail service.  It would be much better, they say, to give the Postal Service more freedom to innovate new products and services, “in partnership and not competition with other businesses,” the way they do in many foreign countries.

The Congressmen end the letter by urging their fellow legislators to develop a new business model for the Postal Service that closes the budget gap “while continuing robust mail service to all areas of our nation.” “By considering reforms which save money without damaging service cuts, particularly for rural areas,” write Connolly and Young, “we can maintain fidelity to the Postal Service’s Constitutional mandate, create opportunities for business growth, and perhaps obviate the need to lay off hundreds of thousands of our neighbors who work for the Postal Service.”

It’s good to know there are at least a few adults in the room.  Let's hope that a significant number of lawmakers join Connolly and Young and sign on to the letter.  You can see their letter here.  

UPDATE: Connecticut Congressmen Chris Murphy and Rosa DeLauro have also written a letter to House leaders advocating postal reform that focuses on retiree health care and pension overpayments rather than closing plants and post offices.

(Image credits: D-day postal coverChoice sign)

More numbers on the AMP studies, and they still don’t add up, not even close

March 7, 2012

When the Postal Service announced the Network Rationalization plan to consolidate 250 area mail processing plants (AMPs) back in September, they said it would save $3 billion a year.  When the Postal Service presented its case to the Postal Regulatory Commission in December, they said it would save $2.1 billion.  Now that we can see the final AMP studies for more than half the facilities, it looks like the Postal Service may not save anything at all.

A few days ago the National Postal Mail Handlers Union (NPMHU) published the AMP studies for 134 facilities approved for consolidation.  Though heavily redacted, these reports contain a lot of numbers on cost savings and eliminated positions, along with a narrative explaining the savings and staffing changes. 

If you add up the numbers for these 134 facilities and then estimate what the total cost savings for all 223 facilities slated for consolidation would be, you end up with a total savings of $874 million.  If you subtract the $500 million in lost revenue the Postal Service anticipates the reduced service standards will cause, you're left with $374 million in savings for the entire Network Rationalization plan.

Imagine that.  Over 200 communities suffering a big economic hurt when the plants close, tens of thousands of workers excessed and displaced, some 34,000 positions eliminated, First-class mail moving much more slowly, and the Postal Service inflicting immeasurable harm to its brand and reputation.  And for what?  A paltry $374 million a year? 

 

The numbers on cost savings

A few days ago we looked at a sampling of the AMP presentation materials the Postal Service used at 70 public meetings.  These materials contain rough estimates about how much would be saved in consolidating each facility and how many positions would eventually be eliminated through attrition. 

Adding up the savings for the 70 consolidations and extrapolating for the 252 plants in the original Network Rationalization plan produced a sum of about $1.3 billion — about half of what the total savings the Postal Service says the Network Rationalization would achieve (before deducting the $500 million revenue loss).  The numbers just didn’t add up.

Now that the NPMHU has published the final AMP studies for 134 facilities, we can get a much better idea of how the cost savings would shake out.  These reports don’t just provide rough estimates.   Postal management looked very closely at the operations in each case, the reports are lengthy, and the numbers should be reliable — they are being used, after all, to justify closing or consolidating each facility.    

Here’s a summary of the cost savings for the 134 AMP reports, with an extrapolation to 223, the number of facilities thus far approved for consolidation.  (There are a half dozen others still under study, and the rest were disapproved.  The list is here, and the table on which this summary is based is here.)

Category
Total for 134 facilities
Extrapolated to 223 facilities
Mail Processing Craft Workhour Savings
$245,926,218
$409,265,273
Non-MP Craft/EAS + Shared LDCs Workhour Savings (less Maint/Trans)
$17,924,238
$29,829,142
PCES/EAS Supervisory Workhour Savings
$63,804,416
$106,181,976
Transportation Savings
$42,163,316
$70,167,309
Maintenance Savings
$156,709,110
$260,792,026
Space Savings
$361,380
$601,401
 
Total Annual Savings
 
$525,673,138
$874,814,252

As the table indicates, the annual cost savings for the 134 plants comes to just over $525 million.  Extrapolated to the 223 plants approved for consolidation, we come up with a total annual cost savings of about $874 million.

That's about a third of the $2.6 billion the Postal Service says the consolidation plan would save.  Where is the other $1.7 billion coming from?

Questions for Mr. Hammond: The Senate considers a nomination to the PRC

March 5, 2012

Tomorrow the Senate’s Committee on Homeland Security and Governmental Affairs will hold a hearing on the nomination of Tony Hammond as a Commissioner on the Postal Regulatory Commission (PRC).  The senators are likely to use the opportunity not only to explore Hammond’s positions on a number of key issues but also to express their own views, as Senators are wont to do.  If they can overcome their penchant for posturing and stay focused on the issues, perhaps the committee will pose some tough questions and have a serious conversation with Hammond about the future of the Postal Service. 

(The hearing is broadcasted here.)

For several months now, the PRC has been functioning with four of the five commissioners it’s supposed to have.  In December, President Obama nominated Hammond to fill the fifth spot.  It’s a short appointment to finish out the term of Commissioner Dan Blair, running just until November 2012.  But the appointment comes at a critical moment in postal history, and if confirmed — as surely he will be — Hammond would be the obvious choice for a regular four-year appointment later in the year.

The law says that no more than three commissioners can belong to the same political party.  There are currently two Democrats (Ruth Goldway and Nanci Langley) and two Republicans (Mark Acton and Robert Taub).  Hammond is a Republican.

It’s not exactly clear why Obama nominated Hammond.  Perhaps he did not want to use the political capital that might have been required to get a more controversial Democratic candidate though a Senate confirmation.  Or there may be some Washington custom at work, in which the political parties take turns choosing commissioners, so Obama chose Taub (but why?) and now the Republicans get to choose Hammond.  Who knows what the President was thinking?

In any case, Mr. Hammond is definitely a partisan.  From 1989 to 1994, he was the director of the Missouri Republican Party, and in 198 he was Director of Campaign Operations for the Republican National Committee.  Hammond was involved with postal matters during the ten years he served on Capitol Hill on the staff of Southwest Missouri Congressman Gene Taylor, a Republican and the Ranking Member of the Post Office and Civil Service Committee.

Hammond also has a perspective on postal matters that was shaped by his experiences as the Vice President of a direct marketing business.  He probably has a particularly sympathetic understanding of issues facing direct marketers and the big stakeholders.

Hammond has served previously on the PRC, from 2002 to 2010, twice as its Vice-Chairman.  He certainly knows the issues and should be well prepared for the questions tomorrow.

What will Hammond be asked?  Here are some suggestions:

The role of the Postal Service: What role you do envision for the Postal Service in the 21ST century?  What should its mission be?  Should the Postal Service act “like a business” or should it act like a “public service”?  If something in-between, where on the spectrum should it be?  Do you think the notion of the Postal Service “binding the country together” still makes sense in the 21ST century, or should we leave that to other modes of communication and let the Postal Service move further down the path to privatization?

The numbers on Network Rationalization just don't add up

March 4, 2012

The Postal Service says closing about 250 processing facilities will eliminate 34,000 positions and save $2.1 billion a year.  But the numbers on cost savings and affected positions that postal managers presented at the public meetings for each facility don't add up to anything like that.  The estimates provided at those meetings appear to have downplayed how many jobs would be lost, and they also raise the question, Will the Network Rationalization initiative really save as much as the Postal Service says?

In presenting its case for the plant consolidation initiative to the PRC, the Postal Service provided a lot of data about its operations and the savings it hopes to achieve by closing over half its processing facilities.  The numbers are apparently derived by modeling what the future network would look like, calculating how much it would cost to operate, and then figuring how much closing the plants would save in labor, fuel, lease costs, and so on. 

How the Postal Service arrived at its cost saving estimate is very difficult for non-experts to understand since it involves very complex calculations and a thorough knowledge of the nuances of the mail stream.  But the basic principle is not hard to grasp.  Eliminating 34,000 positions would save about $2 billion a year (figured at $60,000 per position for salary and benefits).  Another half billion would be saved in non-labor costs, but there would also be a half billion dollar loss in revenues due to the reduction in service standards.  That leaves us with about $2.1 billion in total savings.

The PRC docket on Network Rationalization is filled with page after page of details about how the cost savings would be achieved, but there’s no plant-by-plant breakdown.  The Postal Service has been very reluctant to provide any detailed financial data about individual plants.

There may be a good reason for that.  When you look at the numbers for cost savings on each plant, they just don't seem to add up to the Postal Service's estimate of total cost savings.  And we're not just talking about a minor discrepancy.  We're talking about over a billion dollars a year, nearly half of what the Postal Service says it will save.

At each of the public meetings held in the communities where plants were studied for consolidation, the Postal Service gave a PowerPoint presentation that included some financial estimates, but they were very sketchy.  In some cases, the presentation simply provided the total amount that would be saved and the number of positions that would be eliminated, with no other details.  In other cases, the presentation broke down the cost savings into four main categories —mail processing work-hour savings, mail processing management savings, maintenance savings, and transportation costs — but no additional details were provided.

Getting anything more out of the Postal Service in the way of financial analysis has been virtually impossible.  Even elected officials have run into a wall.  One wonders what the Postal Service doesn’t want us to see.

Last summer, for example, Congressman Steve King (R-Iowa) tried to get the study report on the plant in Sioux City, and got nowhere.  His staff spent weeks exchanging emails and phone calls with the Postal Service, and when he finally got the study, the key information was blacked out.

Then Sioux City officials filed a Freedom of Information Act request to get the information.  The Postal Service said it would provide the report, but it would cost $831,143.16.  Yep, you read that right, over $800K to get a copy of the report — and the Postal Service wanted half the money upfront.  

Congressman Connolly Defends PRC Chairman Goldway as Advocate of Innovation

March 2, 2012

A GUEST POST BY CONGRESSMAN GERALD E. CONNOLLY

The Washington Post recently published an article about the travel expenses of Postal Regulatory Chairman Ruth Goldway.  The author of the article seems to have missed that the reason for Ms. Goldway’s travel is to pursue positive business model reforms for the Postal Service.  These innovative reforms are connected directly to her travel and her exchange of ideas with postal systems in other countries. 

Here in America, the Postal Service earns three times less money from innovative non-postal products and services than its European postal system counterparts.  Partially because Ms. Goldway has learned from best practices overseas, she has been an articulate advocate for innovation that would allow the Postal Service to earn more revenue rather than focus myopically on downsizing. 

For example, Ms. Goldway has explained how far-reaching reforms to the Postal Service vehicle fleet could reduce maintenance and fuel costs while generating revenue through creative vehicle-to-grid contracts with utilities.  This is the kind of fresh thinking we need to reinvigorate a moribund, shrinking Postal Service. 

If Postal Service management shows no interest in innovation while Congressional partisans wish to dismantle the Postal Service for political reasons, it is more necessary than ever that Ms. Goldway and her PRC colleagues learn from international postal best practices.  It is a shame that more postal officials are not interested in such innovations.

[Gerald E. Connolly (VA-11) is a member of the Federal Workforce and Postal Service Subcommittee on the Oversight and Government Reform Committee.]

(Photo credit: Congressman Connolly)

Postal workers give management a vote of "No Confidence" on VOE survey, but who's listening?

March 2, 2012

The results of the Voice of the Employee (VOE) survey for FY 2011 were made public this week, and there's some bad news for postal headquarters.  Two-thirds of the employees responding to the survey could not say they trusted senior management to ensure the success of the Postal Service.  That’s a loud vote of “no confidence,” and it’s probably just the tip of the iceberg.

The Postal Service conducts the VOE, as the cover story for the most recent issue of Postal Bulletin explains, as a “measure of employee engagement" —  "the extent to which people enjoy and believe in what they do, and feel valued for doing it.”  The 2011 survey had 35 questions about things like diversity, communication, and safety.

The question about trusting management was worded like this: “I am confident in the ability of senior management to make the decisions necessary to ensure the future success of the Postal Service.” 

The responses were overwhelmingly negative.  Only 32% of employees said they had a "favorable" view of senior management's ability, while 47% had an unfavorable opinion.  Some 22% were neutral on the question, which isn't much of an endorsement either.

This means nearly half of those surveyed have little or no confidence that senior management knows what the hell it’s doing, and fewer than a third are confident that management can get the job done.  Think maybe workplace morale is down?

The survey is voluntary, so one can only speculate about what the results would have been if every employee had participated.  Many of the most disillusioned workers probably just tossed the thing in the trash.  Plus, many of those surveyed replied early in FY 2011, before the plans to close up to 3,652 post offices and 250 plants were announced.  (It’s not been possible to locate the results of surveys in years past, so we don’t whether this unfavorable rating represents a significant departure from previous surveys.  That question may also be a new one on the survey, since some earlier versions don’t include it.)

The Postal Service surveys 25% of the workforce at a time, and about half reply, so in the first quarter of FY 2011, for example, 76,000 employees — 54 percent of those surveyed — responded, and in the last quarter of 2011, 71,000 replied.  A copy of the survey is available here, the results for FY 2011 are here, and the original Excel document with the results can be downloaded here.

While results of the survey in years past are not readily available online, the Postal Service does publish what it calls the “performance indicator.”   This index is calculated by averaging employee responses to eight key questions on the survey:

Issue
Survey Question
Strategic Direction
I am aware of current business conditions facing the Postal Service.
Trust
I am confident in the ability of senior management to make the decisions necessary to ensure the future success of the Postal Service.
Contribution to USPS Growth
Rate the quality of the service provided by your office/facility to your customers.
Communication
Rate your immediate supervisor on communicating regularly to keep you informed.
Diversity and Respect
The Postal Service values diversity of backgrounds, talents and perspectives.
Commitment
I feel personally responsible for helping the Postal Service succeed as a business.
Personal Safety
I receive information to perform my job safely.
Work Effort and Quality
I understand how the work I do impacts the service the Postal Service provides.

The averages over the past decade, since the survey began in 1999, have been fairly consistent, with about 63% giving the USPS a favorable rating.  (The index results for 1999 – 2002 are here; 2001 – 2004, here; and 2005 – 2010, here, p. 38.)

Historically, there have been many issues and controversies with the survey.  In 2005, for example, there were allegations that postal workers who elected not to complete the survey were called to a supervisor’s office where they were verbally asked questions similar to those asked on the VOE Survey.  At around the same time, the APWU called for a boycott of the VOE because it believed postal management used selective responses to justify regressive contract proposals.  In 2009, the National League of Postmasters voted not to support it because of the deteriorating working condition of postmasters.

The Postal Service likes to boast about the fact that it conducts the VOE survey, it uses the covers of Postal Bulletin to encourage employees to respond, it rewards managers for a high response rate, and it apparently thinks that its 63% approval rating is pretty good.  It will be interesting to see what HQ has to say about its dismal rating on the Trust Senior Management question. 

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