Service is in the name, so you know it’s important. Indeed, U.S. Postal Service managers place service performance at the top of their priority list – sometimes even over the financial health of the agency, our recent audit report found.
This could be a part of why postal costs continue to rise, even as volumes decline. Managers do what they need to do to keep the mail moving. And yet, the mail isn’t moving fast enough – the Postal Service did not meet national service performance targets for any mail class in fiscal year (FY) 2018. And, over the past five years, the Postal Service met annual service performance targets more than once on only four of its 31 mail products.
There’s a major disconnect here. During the last five years, mail volume decreased by 8.8 billion pieces, or 5.7 percent, yet costs associated with processing, transporting, and delivering mail have increased by about $5 billion, or 13 percent. And, service performance fell short.
What’s going on? It’s not easy to sort out because the Postal Service does not know how much it would cost to meet its current service performance targets or the financial and customer service impacts of reducing the targets, our report found.
And here’s another head-scratcher: about 80 percent of respondents to the FY 2018 Delivery Survey were satisfied with their mail and package delivery. This significant satisfaction rate suggests that USPS’s own service performance targets may not always be aligned with customer expectations.
But you can’t drive changes without a road map, which is what we recommended in our report. The Postal Service should conduct a cost-benefit analysis, including a sensitivity analysis, of current service performance targets. This analysis should evaluate additional costs incurred for extra operational services to meet performance targets, as well as ways to limit extra services when they are not financially feasible.