“The Path Forward” of the Postal Service
Filed under Strategy & Public Policy
Tags: action plan, Delivery, financial crisis, postal service, Postmaster General
On March 2, Postmaster General John E. Potter presented a 10-year “action plan” to meet the challenges faced by the Postal Service as it encounters declining mail volumes combined with increasing overhead costs. The plan comes as a product of a yearlong study by the Postal Service and a number of leading consultants to identify and analyze over 50 different actions that could help counter the changing marketplace.
The Postmaster General warned that if the Postal Service continues to operate as it is, it will run a cumulative debt of $238 billion over the next 10 years. Even if the Postal Service institutes every conceivable control within management control – product and service actions, productivity improvements, workforce flexibility improvements and purchasing savings – it can only shrink the debt to $115 billion.
Loading ...In order for the Postal Service to continue its primary mission of affordable and reliable delivery, it will need the kind of flexibility that only legislative changes can provide. The Postmaster General outlined key areas:
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1. Retiree Health Benefits Prefunding – The Postal Service currently would shift from prepaying its fund to paying premiums as they are billed, as other government agencies and private companies operate.
2. Delivery Frequency – The Postal Service would consider 5-day delivery and other adjustments that would allow it to operate more efficiently.
3. Expand Access – The retail network would be examined in order to close unproductive outlets and expand the postal presence in other retail channels, including online.
4. Workforce – In order to have greater workforce flexibility, the Postal Service would need to shift workers and better utilize part-time employees in the workforce.
5. Pricing – The prices for postal products need to reflect demand and market-dominant products should be limited by a single price cap.
6. Expand Postal Products and Services – Given the evolving needs coming from technological and consumer change, the Postal Service is looking to streamline the process involved with rolling out new products and services.
7. Oversight – The current oversight model has encumbered the Postal Service with a number of agencies and commission as with authority as well as Congress. The roles and processes of oversight need to be clarified to allow for efficient operations.
What do you think? Are the actions mentioned above enough for the Postal Service to remain viable in the future? Would you suggest further steps?
This topic is hosted by the OIG’s Risk Analysis Research Center (RARC).
21 Responses to ““The Path Forward” of the Postal Service”
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April 28th, 2010 at 9:29 pm
What a debt! Nice post, thank you.