• on Oct 8th, 2012 in Delivery & Collection | 10 comments
    The digital revolution has changed communications, and with it, the operations and finances of the U.S. Postal Service. It also has brought deep changes in the way we design networks and analyze systems. Many organizations rely on mathematical modeling to test ideas before they become operational, conserving money and time. The Postal Service, facing limited capital and resources, has also adopted this practice. It is discovering how important these tools are for assessing strategies for designing the future mail network. The Office of Inspector General has explored some of the main components of the postal supply chain - retail, mail processing and transportation, and delivery – using a systems modeling approach. This approach has allowed the OIG to use objective methods to determine how the network could be redesigned to meet current needs and future demands. This research also helps us to understand some of the challenges in developing information-based decision models for the Postal Service. A primary challenge in any modeling effort is collecting the necessary information. Without this data, the model cannot fully assess the efficiency of the operations it is modeling, and develop an optimal network solution. Postal information systems can be a complex array of the hundreds of highly varied and specialized information systems that are often developed and maintained under separate contracts. Simplifying this landscape also could enable more insightful analyses to better guide decision makers. As the Postal Service considers how it can best serve the public through its products and services, modeling efforts can help it to evaluate different proposals for change. As we develop better efficiency standards with more rich data sources, we can not only better evaluate the efficiency of operations and system design, but we can better explore how operations may be changed to meet the needs of new environments.
  • on Jan 24th, 2011 in Mail Processing & Transportation | 8 comments
    The Postal Service established International Service Centers (ISCs) in 1996 to become more competitive in the international mail market. ISCs distribute and dispatch both incoming and outgoing international mail. The ISC network has facilities located in five major cities: New York, Miami, Chicago, Los Angeles, and San Francisco. The Postal Service hoped that ISCs would improve service and provide the structure needed to support new products and increase revenue. However, International Mail volume has not increased as projected by the ISC marketing and sales plan. During the period FY 2007 to FY 2010, International mail volume declined by approximately 29 percent (from 858 million to 609 million mailpieces). Although the Postal Service reduced expenses by nearly $6 billion in fiscal year (FY) 2009 and by almost $789 million during the first three quarters of FY 2010, the reductions have not been sufficient to offset declines in mail volume revenue. Consequently, the Postal Service is reviewing its mail processing and retail networks to remove duplication and make them more efficient to reflect current mail volumes. In light of international mail volume declines and the Postal Service’s current financial condition, does the Postal Service still need a separate network to handle international mail? Are there other options the Postal Service could pursue to increase International mail volumes and revenue? Please share your comment(s) on how to make the ISC network more profitable, effective, efficient and economical. This topic is hosted by the OIG’s Network Processing Audit Team.