mtac briefing may 16, 2002. progression of task force recommendation activities q & a...

MTAC BriefingMay 16, 2002

• Progression of Task Force

•Recommendation Activities

•Q & A

• Progression of Task Force

•Recommendation Activities

•Q & A

ProgramProgram

Task Force ProgressionTask Force Progression

Fall 2001Fall 2001 Spring 2002Spring 2002 Fall 2002Fall 2002Spring 2001Spring 2001

Mailing Industry Task ForceMailing Industry Task ForceCo-ChairmenCo-Chairmen

JOHN NOLAN

Deputy Postmaster General

MICHAEL CRITELLI

Chairman and Chief Executive Officer

Charles Morgan, Company Leader Acxiom

Gary M. Mulloy, Chairman & CEO ADVO, Inc.

Jonathan Linen, Vice Chairman American Express

Nigel Morris, President & COO Capital One

Michael Sherman, President Fingerhut

Hamilton Davison, President & CEO Paramount Cards

Thomas Siebel, Chairman & CEO Siebel Systems, Inc.

Dr. Jerry Swartz, Chairman & Chief Scientist Symbol Technologies

William L. Davis, Chairman, President & CEO R. R. Donnelley & Sons

David Sable, President & CEO Wunderman

Charles Morgan, Company Leader Acxiom

Gary M. Mulloy, Chairman & CEO ADVO, Inc.

Jonathan Linen, Vice Chairman American Express

Nigel Morris, President & COO Capital One

Michael Sherman, President Fingerhut

Hamilton Davison, President & CEO Paramount Cards

Thomas Siebel, Chairman & CEO Siebel Systems, Inc.

Dr. Jerry Swartz, Chairman & Chief Scientist Symbol Technologies

William L. Davis, Chairman, President & CEO R. R. Donnelley & Sons

David Sable, President & CEO Wunderman

Mailing Industry Task Force Steering Committee

Mailing Industry Task Force Steering Committee

Wyoming

$372 million

Wyoming

$372 million

California$63 billion

California$63 billion New York

$65 billion

New York

$65 billion

• $900 Billion Industry• $900 Billion Industry

• 8% of the GDP• 8% of the GDP

Economic ImpactEconomic Impact

• Workforce of 9 Million• Workforce of 9 Million

The Mail MomentThe Mail Moment

StructureStructure

• 4,600 Reports Distributed

• 20,000 Hits on Webpage

• 4,600 Reports Distributed

• 20,000 Hits on Webpage

Seizing OpportunitySeizing Opportunity

Broaden ParticipationBroaden Participation

• 27 Accomplishments• 27 Accomplishments • 41 Planned Actions• 41 Planned ActionsProgress ReportProgress Report

William L. Davis, Chief Executive Officer R.R. Donnelley

John Rapp, Senior Vice President, OperationsUnited States Postal Service


John Rapp, Senior Vice President, OperationsUnited States Postal Service

Preparation and Entry OptimizationPreparation and Entry Optimization

Preparation and EntrySpecific Recommendations

Preparation and EntrySpecific Recommendations

• Facilitate preparation standardization

• Drive greater system efficiency across classes and sub-classes of mail

• Examine mail preparation, containerization, and entry requirements

• Implement MTAC’s shape based rate recommendations

• Evaluate entire value chain

• Facilitate preparation standardization

• Drive greater system efficiency across classes and sub-classes of mail

• Examine mail preparation, containerization, and entry requirements

• Implement MTAC’s shape based rate recommendations

• Evaluate entire value chain

Preparation and EntryActivities


Make Up: Align standard packaging & containerization with USPS processing

• Merge flats to carrier route

• Implement scheme-based entry

• Collect data regarding minimum-piece requirement

• Support co-containerization for destination entry

Make Up: Align standard packaging & containerization with USPS processing

• Merge flats to carrier route

• Implement scheme-based entry

• Collect data regarding minimum-piece requirement

• Support co-containerization for destination entry



Containerization: Introduce optimally designed containers

• Develop flat mail containers

• Set optimum container minimums

• Implement customer prepared three-digit containers only when they add value to USPS processing

Containerization: Introduce optimally designed containers

• Develop flat mail containers

• Set optimum container minimums

• Implement customer prepared three-digit containers only when they add value to USPS processing



Acceptance Points: Align mail entry with networks• NIA is long-term solution

• Explicitly define drop ship entry points

Acceptance Process: Optimize efficiencies between mailers & USPS• Adopt PostalOne!

• BOG Approved $54.1 million in funding for PostalOne! - May 6, 2002

Acceptance Points: Align mail entry with networks• NIA is long-term solution

• Explicitly define drop ship entry points

Acceptance Process: Optimize efficiencies between mailers & USPS• Adopt PostalOne!

• BOG Approved $54.1 million in funding for PostalOne! - May 6, 2002


John Rapp, Senior Vice President OperationsUnited States Postal Service


John Rapp, Senior Vice President OperationsUnited States Postal Service

Network OptimizationNetwork Optimization

Network OptimizationSpecific Recommendations

Network OptimizationSpecific Recommendations

• Optimize the USPS logistics network to reduce total system-wide costs

• Focus on presenting mail at the most efficient point in the most efficient manner to realize cost savings

• Adopt USPS’ network optimization effort (NIA) as part of Task Force’s vision

• Optimize the USPS logistics network to reduce total system-wide costs

• Focus on presenting mail at the most efficient point in the most efficient manner to realize cost savings

• Adopt USPS’ network optimization effort (NIA) as part of Task Force’s vision

Network OptimizationStrategic Goal

Network OptimizationStrategic Goal

Network Optimization mandates shifting our focus from optimizing the performance of a particular product or lane to optimizing the performance of the entire postal logistics network and value chain.

Network Optimization mandates shifting our focus from optimizing the performance of a particular product or lane to optimizing the performance of the entire postal logistics network and value chain.

Network OptimizationNetwork Integration & Alignment (NIA)

Objectives

Network OptimizationNetwork Integration & Alignment (NIA)

Objectives

• Reduce combined (USPS and Customers’ costs)

• Increase operational effectiveness and service responsiveness

• Improve consistency and predictability of service

• Reduce combined (USPS and Customers’ costs)

• Increase operational effectiveness and service responsiveness

• Improve consistency and predictability of service

Network OptimizationActivities

Network OptimizationActivities

• Test baseline model through summer

• Conduct mailer input workshops

• Evaluate network alternatives

• Explore workshare alternatives

• Report on model results and network strategy at Fall NPF

• Test baseline model through summer

• Conduct mailer input workshops

• Evaluate network alternatives

• Explore workshare alternatives

• Report on model results and network strategy at Fall NPF

Improve Address Quality

Charles Morgan, Company LeaderAcxiom Corporation

Charles Bravo, Sr. Vice President, Chief Technology OfficerUnited States Postal Service

Improve Address Quality

Charles Morgan, Company LeaderAcxiom Corporation

Charles Bravo, Sr. Vice President, Chief Technology OfficerUnited States Postal Service

Address Quality Specific Recommendation

Address Quality Specific Recommendation

• Require more frequent use of move update and address matching software

• Provide data on undeliverable mail to mailers

• Require more frequent use of move update and address matching software

• Provide data on undeliverable mail to mailers

Address Quality Progress to Date


Develop Federal Register Notice which recommends:• Require list reprocessing for automation rate mail

every 90 days• Require ZIP+4 directory updates monthly• Use Move Update product within 90 days of

mailing• Extend Move Update requirements to more

classes

Develop Federal Register Notice which recommends:• Require list reprocessing for automation rate mail

every 90 days• Require ZIP+4 directory updates monthly• Use Move Update product within 90 days of

mailing• Extend Move Update requirements to more

classes

Federal Register Notice to be released in May



National Change Of Address (NCOA) Data Test

• Validating accuracy of NCOA

• Involves 10 large mailers

• Take place April through July

• Report results at fall NPF

National Change Of Address (NCOA) Data Test

• Validating accuracy of NCOA

• Involves 10 large mailers

• Take place April through July

• Report results at fall NPF



UAA Tracking and Analysis• Bank One, Prudential

• First class campaign of 5 million pieces

• Zip+4 coded, Move Updated

• Expect 5-10% return mail rate

Findings• Which shouldn’t have been mailed?

• Which should have been delivered?

UAA Tracking and Analysis• Bank One, Prudential

• First class campaign of 5 million pieces

• Zip+4 coded, Move Updated

• Expect 5-10% return mail rate

Findings• Which shouldn’t have been mailed?

• Which should have been delivered?

Address Quality Activities

Address Quality Activities

• Improve compliance with Address Change Service-prepared mail handling procedures

• Support phase II proof-of-concept testing of Address Element Correction process

• Redesign and update CASS Form 3553

• Secure USPS support for preprinting ACS codes on envelopes

• Improve compliance with Address Change Service-prepared mail handling procedures

• Support phase II proof-of-concept testing of Address Element Correction process

• Redesign and update CASS Form 3553

• Secure USPS support for preprinting ACS codes on envelopes

Intelligent MailIntelligent Mail

Michael Critelli, Chairman and CEOMichael Critelli, Chairman and CEOPitney BowesPitney Bowes

Charles Bravo, Sr. Vice President and Charles Bravo, Sr. Vice President and Chief Technology OfficerChief Technology Officer

Tom Day, Vice President, EngineeringTom Day, Vice President, EngineeringUnited States Postal ServiceUnited States Postal Service

Michael Critelli, Chairman and CEOMichael Critelli, Chairman and CEOPitney BowesPitney Bowes

Charles Bravo, Sr. Vice President and Charles Bravo, Sr. Vice President and Chief Technology OfficerChief Technology Officer

Tom Day, Vice President, EngineeringTom Day, Vice President, EngineeringUnited States Postal ServiceUnited States Postal Service

Intelligent Mail Specific Recommendations

Intelligent Mail Specific Recommendations

• Create a real time web-based service measurement

• Develop delivery predictability programs

• Upgrade existing recognition technology

• Create a real time web-based service measurement

• Develop delivery predictability programs

• Upgrade existing recognition technology

Intelligent Mail Activities


• Implemented Confirm

• Enabled all automated letter & flat sorting equipment to read PLANET Code

• Expanded the use of Information-Based Indicia (IBI)

• Upgrading camera technology on letter sorting equipment

• Implemented Confirm

• Enabled all automated letter & flat sorting equipment to read PLANET Code

• Expanded the use of Information-Based Indicia (IBI)

• Upgrading camera technology on letter sorting equipment



• Begun testing parcel sorting machines equipped to read IBI and Delivery Confirmation codes

• Prepared the Confirm rate case

• Finalized common postal-and-industry Confirm reports

• Evaluating feasibility of adding IBI capability to flat-sorting machines

• Begun testing parcel sorting machines equipped to read IBI and Delivery Confirmation codes

• Prepared the Confirm rate case

• Finalized common postal-and-industry Confirm reports

• Evaluating feasibility of adding IBI capability to flat-sorting machines



• Complete a high level strategy for “intelligent mail”

• Work with USPS to determine contents & symbologies and impact

• Promote gathering of samples, perform pilot tests and assist in validation of value

• Support USPS deployment of equipment & “intelligent” mail program

• Complete a high level strategy for “intelligent mail”

• Work with USPS to determine contents & symbologies and impact

• Promote gathering of samples, perform pilot tests and assist in validation of value

• Support USPS deployment of equipment & “intelligent” mail program



• Leverage collateral benefits

• Promote publishing ISO coding standards

• Determine linkage with address quality

• Explore ways to make mail more predictable

• Investigate means of expanding to personal use

• Ensure balance between value & investment

• Leverage collateral benefits

• Promote publishing ISO coding standards

• Determine linkage with address quality

• Explore ways to make mail more predictable

• Investigate means of expanding to personal use

• Ensure balance between value & investment

Enhanced Payment Systems and Commercial Credit Options

Gary Mulloy, Chairman and CEOADVO

Bob Pedersen, Vice President, TreasurerUnited States Postal Service

Enhanced Payment Systems and Commercial Credit Options


Bob Pedersen, Vice President, TreasurerUnited States Postal Service

Payment Systems & Credit OptionsSpecific Recommendations

Payment Systems & Credit OptionsSpecific Recommendations

• Provide business mailers with flexible payment terms

• Modernize and upgrade payment systems

• USPS offer one-source access and tracking of all financial transactions

• Explore at-home payment options

• Provide business mailers with flexible payment terms

• Modernize and upgrade payment systems

• USPS offer one-source access and tracking of all financial transactions

• Explore at-home payment options

Payment Systems & Credit OptionsActivities


USPS offer one source of access and tracking of all financial transactions

USPS offer one source of access and tracking of all financial transactions

Payment Systems & Credit OptionsPostalOne!

Payment Systems & Credit OptionsPostalOne!

Industry NEEDS

N – National Permit Number

E – Establish / Modify Mailing Accounts

E – Electronic & Enhanced Payment Flexibility

D – Detailed On-Line Reporting

S – Simplified Easy to Use Systems

Industry NEEDS

N – National Permit Number

E – Establish / Modify Mailing Accounts

E – Electronic & Enhanced Payment Flexibility

D – Detailed On-Line Reporting

S – Simplified Easy to Use Systems



Conduct Proof of Concept Tests:

• PIN-based debit card

• Expand CAPs availability for BRM

• Support the offering of credit terms by intermediaries

Conduct Proof of Concept Tests:

• PIN-based debit card

• Expand CAPs availability for BRM

• Support the offering of credit terms by intermediaries

Payment Systems & Credit OptionsProof of Concept Test


PIN-Based Debit CardPIN-Based Debit Card



Expand CAPS Availabilityfor BRM

Expand CAPS Availabilityfor BRM



Third Party Credit Third Party Credit

Pricing Strategy


Steve Kearney, Vice President, Pricing and ClassificationUnited States Postal Service

Pricing Strategy


Steve Kearney, Vice President, Pricing and ClassificationUnited States Postal Service

Pricing Strategy Specific Recommendation

Pricing Strategy Specific Recommendation

• Adopt competitive pricing strategy

• Predictable price increases at or below inflation

• Streamline rate making process

• Examine customized pricing procedures

• Protect Citizen’s access to low cost First-Class Mail

• Adopt competitive pricing strategy

• Predictable price increases at or below inflation

• Streamline rate making process

• Examine customized pricing procedures

• Protect Citizen’s access to low cost First-Class Mail

Pricing Strategy Activities


• Streamlined rate-setting

• Targeted Pricing

• Pricing Strategy

• Streamlined rate-setting

• Targeted Pricing

• Pricing Strategy



• Support USPS/PRC conference

– Ratemaking Summit - May 28, 2002

• Design & implement targeted pricing initiatives

• Evaluate pricing proposals in Transformation Plan

• Support USPS/PRC conference

– Ratemaking Summit - May 28, 2002

• Design & implement targeted pricing initiatives

• Evaluate pricing proposals in Transformation Plan

Consumer Gateway Services

Dr. Jerry Swartz, Chairman and Chief ScientistSymbol Technologies

Nick Barranca, Vice President, Product DevelopmentUnited States Postal Service

Consumer Gateway Services

Dr. Jerry Swartz, Chairman and Chief ScientistSymbol Technologies

Nick Barranca, Vice President, Product DevelopmentUnited States Postal Service

Consumer Gateway Services Specific Recommendations

Consumer Gateway Services Specific Recommendations

• Create a merchandise returns service• Increase convenience by providing 24/7

access • Define consumer’s needs to support the “mail

moment”• Pilot a program using “print to Web” links

• Create a merchandise returns service• Increase convenience by providing 24/7

access • Define consumer’s needs to support the “mail

moment”• Pilot a program using “print to Web” links

Consumer Gateway ServicesActivities


Increase convenience of returning merchandise by exploring:

• Integration of barcodes on outgoing parcels and return labels

• Carrier pick-up program

• Flat rate packages

Increase convenience of returning merchandise by exploring:

• Integration of barcodes on outgoing parcels and return labels

• Carrier pick-up program

• Flat rate packages



Expand consumer access 24 by 7, and at additional locations by:

• Adding self-service technology / kiosks

• Analyzing results of Mail Item Retrieval System pilot

• Studying electronic cash at door - debit / credit

Expand consumer access 24 by 7, and at additional locations by:

• Adding self-service technology / kiosks

• Analyzing results of Mail Item Retrieval System pilot

• Studying electronic cash at door - debit / credit



Enable web portal for print-to-web transaction:

• Identify provider, either USPS or third party

• Study feasibility

Enable web portal for print-to-web transaction:

• Identify provider, either USPS or third party

• Study feasibility

Implement Industry Council

Michael Critelli, Chairman and CEO Pitney Bowes Inc.

David Sable, President and Chief Executive OfficerWunderman New York

Implement Industry Council

Michael Critelli, Chairman and CEO Pitney Bowes Inc.

David Sable, President and Chief Executive OfficerWunderman New York

Implement Industry Council Specific Recommendations

Implement Industry Council Specific Recommendations

• Foster industry standards

• Develop targeted advertising and a marketing program

• Provide public policy leadership

• Foster industry standards

• Develop targeted advertising and a marketing program

• Provide public policy leadership

Implement Industry Council Activities


• Support an industry-wide Transformation Plan effort

• Develop and launch an advertising & marketing program

• Enhance the coordinated government relations strategy

• Establish a CEO level council

• Provide standards development leadership

• Support an industry-wide Transformation Plan effort

• Develop and launch an advertising & marketing program

• Enhance the coordinated government relations strategy

• Establish a CEO level council

• Provide standards development leadership



• Establish CEO Council as legal entity

• Further develop marketing strategies

– Participate in special events

– Stimulate media coverage

• Pursue development of unified standards

• Expand participation & acquire funding

• Establish CEO Council as legal entity

• Further develop marketing strategies

– Participate in special events

– Stimulate media coverage

• Pursue development of unified standards

• Expand participation & acquire funding

Mailing Industry Task Force

Mailing Industry Task Force

ProductRedesign

ProductRedesign

Mail SecurityMail Security

Transformation PlanTransformation Plan

Strong and Vital Industry Strong and Vital Industry

All Available at www.usps.comAll Available at www.usps.com

mtac briefing may 16, 2002. progression of task force recommendation activities q & a...

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