• on Dec 28th, 2009 in Mail Processing & Transportation | 14 comments
    When people try to discover whether the Postal Service is operating more efficiently or not, they often talk about TFP. What is TFP? TFP stands for Total Factor Productivity. It measures the ratio of the Postal Service’s outputs to its inputs, in other words, how much output the Postal Service produces with the inputs it uses.

    The useful thing about TFP is that it measures only the quantity of items produced and used — not their price. Why is this important in a productivity measure? It measures solely how efficiently the output is produced. As an example, consider a painting business. If the price of the paint the company must buy falls, the business will be more profitable, but its total factor productivity has not changed. If the business finds a new painting method that only uses half as much paint, it also becomes more profitable. However, in this instance, it is also producing the same output with fewer inputs, and its TFP has increased.

    For the Postal Service, inputs are labor, materials, and capital. Outputs include mail volume and special services. Since the Postal Service is a network industry, the total number of delivery points is included in the final workload measure.

    The table below shows the Postal Service’s input, workload, TFP growth rates, and net income from 2000 to 2009. TFP increases do not always result in positive net income, because profitability is affected by other items like the price of inputs. Although TFP increased from 2000 to 2007, TFP declined in 2008 and 2009. As the table shows, the Postal Service cut inputs significantly in 2008 and 2009, but it was not able to cut them enough to offset the declines in workload.

    chart showing input growth, workload growth, tfp growth, and net income from 2000 to 2009

    If the decline in mail volume moderates, will the Postal Service be able to return to TFP growth? Also, what is your opinion of the TFP measure? Business Mailers Review recently reported that there are discussions at the Postal Service about whether to move away from TFP and use another productivity measure such as deliveries per hour. What do you think? Are there other productivity measures that you believe would be more appropriate for the Postal Service?

    This topic is hosted by the OIG's Risk Analysis Research Center (RARC).

  • on Dec 21st, 2009 in Post Offices & Retail Network | 20 comments
    Last Monday was predicted to be the busiest day of the year for Post Offices™ across the country. Have you visited a Post Office recently? If so, we would like to hear your story.

    Why were you there? What worked well? What didn’t work well?

    Has your local Post Office adopted any best practices that should spread across the country? Are there any low-cost improvements that would improve the retail experience?

    Please share your thoughts in the comments below. Keep in mind that Pushing the Envelope will not publish comments that contain personally identifiable information, so please don’t include any names in your story.

    This topic is hosted by the OIG's Risk Analysis Research Center (RARC).

  • on Dec 14th, 2009 in Delivery & Collection | 31 comments
    Did you know that one in seven people in the United States change their address each year? Naturally, this creates a tremendous challenge for the Postal Service, which strives to maintain a high-quality repository of current addresses.

    Change-of-address requests can be made in person at local Post Offices using a hardcopy form (PS 3575), or electronically using the Internet. They can even be made over the telephone. By far, the most popular way to change one’s official address is still using the hardcopy form, but those contemplating a move should consider their options carefully.

    While the Postal Service’s change-of-address process generally works properly, our audit found that improvements are needed in the way hard copy requests are processed, authorized, and validated. Although Postal Service employees should reject and return orders with no signature, in some cases change-of-address orders without a proper signature slipped through. We also saw signature mismatches and occasions when Postal Service employees rather than customers signed or initialed the forms.

    Is there a better way? We think there is. Our audit also examined the Internet and telephone change request systems. We found that these electronic alternatives are not only much more convenient for the customer, they are also far more effective in ensuring that only authorized and validated change-of-address requests are processed. Digital requests can be electronically matched against customers’ credentials quickly and efficiently. This results in a more secure environment, which is important because mail diverted to another location based upon unauthorized change-of-address orders is a major contributor to identity theft — America’s fastest growing crime.

    There has to be a catch, you say. Well, there is. This service costs $1. We think it’s a bargain! To change your address online, go to moversguide.usps.com. To change your address by telephone, call 1-800-275-8777.

    You should know the Postal Service does have systems in place to protect customers against unauthorized address changes. If a change of address has been submitted for you, the Postal Service will follow up with a Move Validation Letter. This letter is sent to your current address and notifies you that a request has been made to forward your mail to a new address. If you did not request to change your address, you should inform your local Post Office immediately as a potentially fraudulent situation may exist. In our audit, we found that the Postal Service generally sends these letters in a timely manner. Recently, the Postal Service has taken steps to further improve the timeliness of these letters, ensuring that they are processed within 3 to 10 days.

    What do you think about the Postal Service’s change-of-address process? How can it be improved?

    This topic is hosted by the OIG's Information Technology audit directorate.