Background

The North Bay Processing and Distribution Center is in the San Francisco District of the Pacific Area. During fiscal year (FY) 2019, it manually processed 17.7 million letters, almost 800,000 flats, and 1.2 million parcels. Mail is processed manually when its dimensions or address quality prevent it from being processed on mail processing equipment. It is much more cost effective for mail to be processed on mail processing equipment. In FY 2019, the average productivity for letters processed on mail processing equipment was 7,299 mailpieces per hour while the average productivity for manually processed letters was 1,163 mailpieces per hour.

We selected the North Bay P&DC for review based on our analysis of manual letter productivity as measured by the Management Operating Data System (MODS). The Postal Service uses MODS data to plan workload, forecast workhours and mail volume, track mail processing activities, evaluate the efficiency of facilities, and estimate staffing requirements. In addition to its operational uses, the Postal Service uses MODS workhour data to calculate totals for many of the cost pools within the Clerks and Mail Handlers Cost Segment. Postal Service management and the Postal Regulatory Commission rely on accurate and precise product cost estimates to set postal prices and to reliably determine whether revenue for products and mail classes cover attributable costs. The North Bay P&DC’s FY 2019 manual letter productivity of 4,165 mailpieces per hour was significantly higher than the national average productivity of 1,163 mailpieces per hour.

Our objective was to assess the North Bay P&DC’s manual letter processing operations.

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