• on Apr 3rd, 2015 in Strategy & Public Policy | 0 comments

    In the sage words of Yogi Berra, “If you don’t know where you’re going, you will wind up somewhere else.” So, where does the U.S. Postal Service want to go? Well, by 2016 it hopes to end up a lot closer to solvency. And to get there, it developed the Delivering Results, Innovation, Value and Efficiency (DRIVE) management process.

    DRIVE is a portfolio of strategic initiatives the Postal Service is implementing to meet ambitious performance goals and close its $20 billion financial gap. Each initiative is made of specific projects, goals, and milestones all leading toward a broad, overarching goal. The Postal Service began its DRIVE initiatives in 2011.

    So, how are the DRIVE initiatives working out? Well, the 19 initiatives are in various stages of development, funding, and implementation, and the Postal Service has about $2 billion in available capital to support all of them. The Postal Service said it generated $4.9 billion in new sales opportunities and cut $868 million in costs through DRIVE. It also reported that it has revitalized its Priority Mail package service and reduced its facilities footprint by more than 3 million feet.

    We’ve been keeping an eye on this process and have completed three DRIVE audits. Our reports looked at overall management of DRIVE (DP-AR-13-008), Initiative 6 (DP-AR-14-001), which aims to improve employee availability, and Initiative 42 (DP-AR-14-005), which focused on marketing new and existing services.

    Our first audit found DRIVE program management compares favorably to best-in-class program management practices – but there are opportunities for improvement. The other two reports reviewed specific initiatives and urged improvements, such as setting more aggressive goals, promoting accountability, and accurately measuring achievement. For example, one of the goals of Initiative 42 was to increase shipping and mail revenue by $5.2 billion in fiscal year 2014. As of May 2014, the Postal Service reported reaching $3.4 billion of that goal; however, we found the Postal Service does not have the capability to measure goals against recorded sales. A separate DRIVE initiative is intended to improve this ability to accurately measure goals.

    We are looking at other DRIVE initiatives, as well. But we would like to hear your thoughts on the value of this management tool.

    Do you believe the initiatives discussed here are improving the Postal Service?

    What DRIVE initiatives would you like to see the Postal Service pursue?

    Do you think these initiatives are the best way for the Postal Service to reach solvency? If not, what should it do instead? 

  • on Jul 11th, 2011 in Strategy & Public Policy | 17 comments
    The American marketplace is experiencing constant changes in the ways that companies conduct business and communicate with customers. Like other businesses, the Postal Service must also innovate to stay relevant. The Office of Inspector General plans to examine innovation processes currently used by major U.S. corporations to learn about best practices/processes. The essence of innovation is to identify a problem and develop solutions. For example, Google and Facebook are successful because their websites meet needs of people to manage and organize vast amounts of information and social relationships available on the Internet. The Postal Service has enjoyed some success with innovative products. Its Priority Mail Flat Rate products have become popular, shipping 350 million boxes over the last 6 years, with revenue of $1.2 billion in fiscal year 2010. This product met the need to simplify the shipping process and was relevant to both consumers and business. What should the Postal Service do to identify business opportunities and customer needs in order to create solutions that lead to financial success and customer satisfaction? Also, what experience(s) have you had with Postal Service innovation? This topic is hosted by the OIG’s Planning and Strategic Studies Directorate.
  • on Feb 22nd, 2011 in Labor | 35 comments
    [dropcap style="font-size: 60px; color: #9b9b9b;"] A [/dropcap]sk postal employees about the Postal Service’s Pay-for-Performance (PFP) program and you’ll hear a wide range of opinions as to why they think the program is not working. Many believe the program is unfair and can be subject to manipulation, The IBM Center for The Business of Government, Dr. Carl DeMaio, president of the Performance Institute, Dr. David Norton, president of the Palladium Group and co-founder of the Balanced Scorecard Collaborative, and organizational performance guru Jay Schuster cited the Postal Service’s PFP program as a model because it links individual contributions to organizational success. According to Postal Service officials, the PFP program’s foundation is a balanced scorecard of objective, independently verifiable measures of service, employee engagement, and financial performance. Performance indicators are measured at national, district, business unit, and individual levels. In its 2010 Comprehensive Statement of Postal Operations and Annual Report, the Postal Service stated the PFP program continued to drive organizational achievement as measured by a 2.2 percent increase in Total Factor Productivity (TFP) in 2010 compared to 2009.This marked the ninth year of positive TFP growth since 2000. The current PFP program evolved over a 12-year period and became the only basis for annual salary increases and lump sum awards for executive and administrative employees beginning in 2004. In implementing its PFP program, the Postal Service joined the ranks of many private sector firms where pay for performance is a standard feature for management and executives. In September 2010, many readers commented on our blog about the Postal Service’s PFP program. Comments expressed various opinions and perspectives about the program. Some said the PFP program is “broken” because it’s easy for postal management to manipulate. Others say PFP would be a great thing if the goals were reasonable and within the control of the manager. Many suggested scrapping the program altogether for a variety of reasons. For example, some said established goals are unrealistic and are changed often throughout the year so you end up chasing a moving target; others that the reporting system has no accountability factor and results are falsified; and still others that the ratings are changed or manipulated even when goals are achieved so that you get less of a raise. The OIG plans to initiate a review of the Postal Service’s PFP program. We would like to hear more about your thoughts on the subject. This topic is hosted by the OIG’s Human Resources and Security Audit Team.

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