Operational and Financial Performance Across Postal Service Regions
Background
The U.S. Postal Service is undergoing a significant transformation to modernize its network and operations as part of the Delivering for America plan. We have noted variations in impacts to communities across the country, even when the changes themselves have been similar. Differences in workplace culture may help explain regional variations in operational efficiency and service experienced throughout this transformation. As labor makes up 76 percent of the Postal Service’s $89.5 billion annual expenses, the workforce is critical to its modernization success.
What We Did
Our objective was to evaluate operational culture and key performance indicators in places where the performance was varied. We judgmentally selected five low-performing and five high-performing districts for review and conducted site visits and interviews with personnel at facilities in each of these districts.
What We Found
A resilient and engaged workforce is essential for the Postal Service to carry out its Delivering for America plan and achieve long‑term goals. However, the Postal Service has faced workforce and culture challenges for years at low-performing sites that have consistently struggled with employee satisfaction, engagement, attendance, and retention; and costly union grievances. We also identified several ineffective management practices that negatively affected workplace culture and performance, such as non-value-added tasks and inadequate operational oversight.
Although these issues occurred across all facilities, they were more severe at low‑performing sites, widening regional operational and financial gaps and slowing the Postal Service’s progress. We estimate the Postal Service incurred nearly $437 million in annual questioned costs due to facilities operating below the national efficiency average. However, we identified best practices used at high-performing sites, that, if adopted, could improve leadership effectiveness, employee morale and engagement, and operational performance.
Recommendations and Management’s Comments
We made two recommendations to address the issues identified in the report, and Postal Service management disagreed with both. We will pursue the two disagreed recommendations through the audit resolution process. Management’s comments and our evaluation are at the end of our recommendations.