• on Oct 1st, 2012 in Post Offices & Retail Network | 29 comments
    The U.S. Postal Service has made improving the customer experience a priority. Postal officials see a positive customer experience as a key to revenue generation because customers are more likely to return if their experience was good. As Deputy PMG Ron Stroman noted to a gathering of postal officials in August, “Our customers have choices, they don’t have to come to us. How people are treated makes all the difference in the world.” Customer service strategies could include something as simple as a menu of services and prices on display in each Post Office. Or, a quick resolution of a customer complaint can turn a negative experience into a positive one. Other efforts might require more substantial changes, such as reconfiguring the retail space or offering extended hours in some locations. In some cases, the Postal Service’s goal of rightsizing its retail network might run counter to the customer experience, at least initially. For commercial customers, a positive customer experience might be entirely different from the retail customer. A simplified or more automated mail acceptance process may appeal to bulk mailers. Changes in service standards might not please all commercial customers, while others may be able to adapt to the changes more readily. New dropship points for mail entry and the changes these can cause to internal processes might stress some mailers. For other mailers, fewer mail entry points might help them gain efficiencies. Given the different needs and expectations of customers, the first step to a successful customer experience would be to know your customers. “One size fits all” might work for the Snuggie®, but not for the Postal Service. Commercial mailers, in particular, have urged the Postal Service to get to know their businesses and operations better. The Postal Service has worked hard over the past few years to reach out to customers and engage them in discussions on improving operations. How can the Postal Service build strong relationships with its customers and encourage customer loyalty? Would consumer and business mailer online rating systems, similar to Yelp, be a useful tool for gleaning information about customer experiences?
  • on Sep 24th, 2012 in Delivery & Collection | 3 comments
    The U.S. Postal Service recently reported that its third quarter delivery service performance results marked “all-time record service performance” across all mail categories. In particular, the Postal Service had significant improvement in delivery performance for its commercial mail products in First Class and Standard Mail. Periodicals’ on-time performance topped 80 percent for the first time since 2010, a major improvement over the 46 percent score from earlier this year. The improved service performance in the third quarter occurred while the Postal Service was in the process of consolidating 46 facilities, which some mailers feared would affect service. But initial reports suggest service has not been overtly disrupted by the consolidations, although the real test could come during the fall and holiday mailing seasons. The Postal Service recently completed this first phase of its network rationalization plan, and is now on a break from consolidation until 2013 after the election season. Postal officials have attributed the improvement in service performance to diagnostic tools that show “pinch points” and help managers to act on that information to reduce cycle times. The Intelligent Mail Barcode full-service data, which identifies many potential problems, is also helping and employees are doing outstanding work often under difficult circumstances. It will be important for the Postal Service to maintain strong service performance as volumes pick up during the fall mailing season and election mail is added to the mix. Further, the second phase of consolidations could begin in February 2013 and could have an impact on service. Finally, mailers report that they are not solely concerned with service scores but that the Postal Service delivers the mail as promised. What has been your experience with service over the past few months? Have you been affected by the consolidations? Are you concerned about phase two of the network consolidation plan?
  • on Sep 17th, 2012 in Finances: Cost & Revenue | 9 comments
    Many international postal operators pay corporate income taxes to their national treasuries. Similar to a private company, these payments appear in the postal operators’ financial statements. Countries whose postal operators pay corporate income tax have essentially made a policy decision: They want their postal service to behave like a private business. This may not be surprising in solidly capitalist countries, such as the United Kingdom, Japan, or Taiwan, but many of these posts are from countries with long histories of centrally controlled economies, such as Armenia, Slovakia, and Croatia. The concept of a corporate income tax is not entirely foreign to the U. S. Postal Service. The Postal Accountability and Enhancement Act requires the Postal Service to compute its assumed federal income tax on the income earned from its competitive products each year. Rather than paying that income tax to the Treasury, however, the Postal Service essentially pays itself. The money is transferred from the Competitive Products Fund to the Postal Service Fund, and can be used to fund the postal network as a whole. Corporate income tax does not necessarily imply privatization either. The postal operators of Germany, the Netherlands, Malta, and Singapore all pay corporate income tax and all are publicly traded corporations. The remaining operators that pay corporate income taxes are, in essence, state-owned. One advantage of the use of corporate income taxes is that the payments to the national treasury are tied to the financial performance of the postal operator. Corporate income tax payments decline during downturns in the business cycle and increase during periods of prosperity. Another advantage is the fact that these national governments have a stake in the sound financial management of their postal operators. In short, they have skin in the game. What do you think? Should the Postal Service pay a corporate tax? Would such a tax encourage a more business-like approach to managing the Postal Service? Or does its public service mission and its current universal service obligations make a corporate income tax unworkable?

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