Strategic Transformation Plan Final 2-24


Slide 1:
Slide 1 Image information:
Image of the USPS Logo with the words “The Power to Deliver Everywhere *Everyday”.
Image has the words: “Strategic Transformation Plan 2006-2010”.
An image of the booklet called Strategic Transformation Plan 2006-2010, with people of the front of the page.”
End of image information.


Slide 1 text and notes:



Slide 2:
Slide 2 Image information:
Image of the USPS Logo with the words “The Power to Deliver Everywhere *Everyday”.
Image has the words: “What is Transformation?
Incremental Improvement		
Get better				
Improve the process			
Small gains				
Short term				
Transformational Change
Become different
Change the process
Quantum leaps
Sustaining.”
End of image information.


Slide 2 text and notes:

A good place to begin is with the notion of transformation . . .  and how it differs from business as usual.  The Postal Service was making steady improvements on many fronts,  before we ever had a transformation plan.
But we also saw that strategies used to produce incremental improvements that served us so well in the ’80s and ’90s wouldn’t produce the same results in the future.  
Why?  Because those strategies were born when a 5 to 6% annual increase in First-Class Mail volume was as certain as things get.   Then came the Internet.  And, in 2001, the 1-2-3 punch of recession, 9-11, and the anthrax attacks, undermined confidence in the mail.

Getting better at doing the same thing was no longer good enough.  We had to adapt and evolve. 

We couldn’t just adjust our processes.  We had to throw many long-held notions overboard . . . Abandon things that no longer made sense.

Small gains in service and efficiency were nice, but they wouldn’t be enough.  We needed to leap-frog our challengers, not just keep up. 

And if we had any hope of surviving, we had to adopt a longer-term view.  

(NEXT SLIDE)





Slide 3:
Slide 3 Image information:
Image of the USPS Logo with the words “The Power to Deliver Everywhere *Everyday”.
Image has the words: “2002 TRANSFORMATION
Service is improved
CSM high for 16 straight quarters
Creativity in products and pricing 
6th straight year of TFP increases
+5.5M delivery points, 465M fewer workhours
$5 billion savings target ahead of plan
Employee safety and engagement up.”
End of image information.



Slide 3 text and notes:
Since the first Transformation Plan was published in April 2002, we have made many accomplishments that we can be proud of. 

During this period service improved.  You, our customers, took notice:  customer satisfaction was consistently high at 93 or above for 16 straight quarters.

We introduced product and pricing innovations that are generating new levels of customer interest – Repositionable Notes, Flat Rate boxes, online insurance, to name a few.

We are a much leaner, more efficient organization.  2005 was our sixth straight year of Total Factor Productivity (TFP) increases.

5.5 million new delivery points have been added since 2002 with 465 million fewer workhours. Today, we deliver fifty percent more mail than we did two decades ago with the same number of employees and we are providing far better levels of service.

In the initial 2002 Plan, we set a bold target to reduce costs over the 5 years by $5 billion.  We will hit that target almost a year ahead of plan for a cumulative savings of $13 billion.
Among the results we are most proud, are those that directly affect our customers through improved service and those that directly affect our employees – in the areas of employee safety and engagement.

(NEXT SLIDE)




Slide 4:
Slide 4 Image information:
Image of the USPS Logo with the words “The Power to Deliver Everywhere *Everyday”.
Image has the words: “BUT…
Decline in First-Class single-piece 
2M new delivery points each year
Standard Mail growing, contribution is less 
Competition all around
Workforce issues – benefits, flexibility 
Turnover  
Wildcards.”
End of image information.


Slide 4 text and notes:
However, everyone recognizes full well that we cannot rest on our laurels.   There are still challenges and trends that we must address looking forward.

High-contribution First-Class single-piece mail is declining.    Meanwhile, two million new delivery points are added each year – an increase of about 1-1/2 percent.  Volume no longer grows at the same rate as new deliveries.

Growth in Standard Mail is a bright spot, but contribution is 60% less per piece than First-Class Mail.  It takes 3 pieces of Standard to compensate for every piece of First-Class Mail  that’s lost. 

Standard is also more sensitive to economic fluctuations than First-Class.  So when the next recession hits – and it will eventually – advertisers will pull back their budgets, including their money for direct mail.  Whenever businesses hit tough times in the past, they still had to send out just as many telephone bills, or medical invoices, or inventory orders.   But the same won’t be true for catalogs or credit card solicitations.

All of our products have competition. Customers have a myriad of choices. That’s not new, but now much of our competition is Internet–based, with costs that are close to zero.  We’re not the Internet.  We’re a business operated by people.  And our benefit costs are rising faster than inflation.

Our workforce is committed and our leadership is experienced.  But by 2010,  2/3 of our executives and managers will be eligible to retire.   240 thousand craft employees also are eligible.  We’ll have to replace many of them, in a tight labor market, where tomorrow’s employees will demand much greater flexibility 

Then there are the wildcards – budget deficit, potential inflation or recession. And the price of fuel.  In 2005, we spent $1.5 billion for fuel alone. 

(NEXT SLIDE)



Slide 5:
Slide 5 Image information:
Image of the USPS Logo with the words “The Power to Deliver Everywhere *Everyday”.
Image has the words: “WHY HAVE A SEQUEL ??

Because Transformation is continuous 
Because we’ve only scratched the surface
To be ready for anything.”
An image of a sketched mail person walking with a futuristic vehicle behind that person.”
End of image information.


Slide 5 text and notes:
. . . Which helps to explain why the process of transformation must continue.
The horizon’s changed, but it still contains plenty of black clouds.     
There’s also a lot of promise.  We’ve made great strides, but frankly we’ve only really scratched the surface of what we can do.  
Consider a program like Click-N-Ship and free online Carrier Pickup.  We’re getting about 7 thousand requests a day.  But at the same time, more than 7 million customers come to the Post Office – many to perform the same transactions they could have taken care of without leaving their home or office.  
Customers love these services, they’re making us money, and exciting our people – but we’ve still only reached 1/10 of one-percent of the customers who might want to use them.
Lastly, a new plan was necessary to help us clear the decks and focus on the things that matter most -- our core mission to deliver the mail . . .our customers . . .  and our people. 
The best way to respond to any challenge is to be in the strongest possible shape to meet it.
The challenges won’t wait.  And, unfortunately, we can’t expect any credit or benefit for past results. 
If we want to be thought of as a business, we must also understand that our stakeholders will be just as unforgiving of us as Wall Street is to private corporations, where all that matters is last quarter’s performance. 
(NEXT SLIDE)





Slide 6:
Slide 6 Image information:
Image of the USPS Logo with the words “The Power to Deliver Everywhere *Everyday”.
Image has the words: “ALL MAIL (Billions).”
Another image of a graph that has six lines.  On the far right the vertical line has the numbers:
240
230
220
210
200
190
The bottom horizontal line has:
FY04
FY05
FY06
FY07
FY08
FY09
FY010
Between the 230 and 240 lines is the word “Optimistic”.
Between the 220 and 230 lines is the word “Baseline”.
Between the 190 and 200 lines is the word “Pessimistic”.
This has a green line that starts at between 200 and 210 and ends at between 230 and 240.
This has a blue line that starts at between 200 and 210 and ends at between 210 and 220.
This has a red line that starts at between 200 and 210 and ends at between 190 and 200.
At the bottom has the words: “Based on FY 2005 planning scenarios, updated for actual performance”.
End of image information.



Slide 6 text and notes:
This slide shows the consensus estimates for mail volume over the next few years.  It is drawn from the most commonly used economic projections about population trends, business starts, employment, and many other indicators of the market.  The Postal Service projects mail volume based on past experience.
The baseline shows total volume as essentially flat from our current level of 212 billion pieces.  If the chart were to show only First-Class Mail, volume would actually decline significantly.
The optimistic line assumes less diversion and greater USPS growth. The pessimistic line assumes that diversion occurs more rapidly than many now assume.
Although the baseline is considered most likely, there are no guarantees.
We’ve made similar projections on costs.  The rub here is that many costs are increasingly out of our control.  For example, 20 percent of our expenses go toward  health benefit costs for our employees and retirees, which are mandated by law.
One thing that Postmaster General Potter has said over and over is that we can’t worry about what we can’t control – the economy or the price of fuel, for instance.  But we can control how much fuel we use.
On the most fundamental level, the overarching goal of transformation is to do everything within our power to bend our revenue line upward, and push the cost line down – so that we can continue to provide the highest-quality universal service well into the future.
(NEXT SLIDE)




Slide 7:
Slide 7 Image information:
Image of the USPS Logo with the words “The Power to Deliver Everywhere *Everyday”.
Image has the words: “DECLINES IN FCM”.
This has three pie charts.
Blue color represents: “First-Class Mail”.
Gray color represents: “Everything Else”.
The first pie chart has the word “Volume” above it and it shows: 52.5% gray and 47.5% blue.
The second pie chart has the word “Revenue” above it and it shows: 47.3% gray and 52.7% blue.
The third pie chart has the word “Contribution” above it and it shows: 38.0% gray and 62.0% blue.
At the bottom is the words “Data from FY 2004”.
End of image information.


Slide 7 text and notes:
The biggest immediate challenges to our financial future are the decline in First-Class contribution – which pays our bills – and the continued expansion in our delivery network, which adds costs.  Think of these two factors as the two ends of a vise.
A little less than half of all mail volume is First-Class Mail.
First-Class Mail also produces slightly more than half of all mail revenue, or about $36 billion.  By the way, that’s more than the entire corporate revenue of FedEx last year.     
But it also produces about 2/3 of all contribution.  All postal services have to pay what’s known as their full attributable costs – what it actually costs us to accept, process, transport, and deliver an item from point A to point B. 
But rates are set so that most products make more than enough to cover attributable costs.  The revenue that remains -- called contribution – pays for our infrastructure:  our networks, facilities, vehicles, programs . . .  and us, our salaries and benefits.
So, First-Class pays for almost 2/3 of our infrastructure and overhead.
That means a future that includes a steadily declining First-Class mailstream puts the entire business model in jeopardy.
Now, let’s take a look at the other half of the vise.





Slide 8:
Slide 8 Image information:
Image of the USPS Logo with the words “The Power to Deliver Everywhere *Everyday”.
Image has the words: “+2 MILLION DELIVERIES”.
An image of a map of the USA with two images of two skyscraper buildings, inside of the map.”
End of image information.


Slide 8 text and notes:
Every year, roughly 2 million new deliveries are added to our network -- an increase of 1-1/2 percent.
That’s like taking all the delivery points in Chicago and Manhattan . . . 
and doubling them every 12 months.
Without continued increases in productivity this would mean an additional 3,500 new mail routes every year.  I don’t need to tell you that this kind of infrastructure growth is not sustainable.
(NEXT SLIDE)





Slide 9:
Slide 9 Image information:
Image of the USPS Logo with the words “The Power to Deliver Everywhere *Everyday”.
Image has the words: “+2 MILLION DELIVERIES”.
Another image of a graph that has nine lines.  On the far right the vertical line has the numbers:
88
86
84
82
80
78
76
74
72
There are words that are too small to read beside these lines.
At the very top of this graph towards the far right is the word “Transformation”.
At the far right, the nine lines has:
170
169
168
167
166
165
164
163
162
161
The bottom horizontal line has:
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
There are words that are too small to read beside these lines.
There is a short dash line with a diamond shape in the middle, representing “Delivery Points”.
There is a short dash line, representing “City Routes”.
The short dash line with a diamond shape in the middle, representing “Delivery Points”, goes from the number 80 and climbs over 168.
The short dash line goes from the number 85 to above 80 to above 84 to above 164.
At the bottom it has the words: “What DPS, standardization, and focus can do”.
End of image information.


Slide 9 text and notes:
Fortunately, we have been improving productivity.  This chart shows the number of delivery points and the number of city delivery routes over a ten year period.  The blue highlight shows the time since the 2002 Transformation Plan. 
The black hashed line shows a steady increase in the number of deliveries since 1995 . . With population growth, immigration, new housing starts, and so on.
The blue solid line shows changes in the number of city delivery routes.  Since 2001, the lines have been moving in the opposite direction.
That didn’t just happen.  It’s the product of tight management focus, automation (particularly, delivery point sequencing for letters), and the identification of best practices and standards.
This is basic management, but it has helped us to begin to transform delivery.  Over the period shown, we’re delivered to 10 million additional front doors each day . . . with four thousand fewer city delivery routes.
(NEXT SLIDE)





Slide 10:
Slide 10 Image information:
Image of the USPS Logo with the words “The Power to Deliver Everywhere *Everyday”.
Image has the words: “Strategic Transformation Plan, 2006-2010
USPS “blueprint”

How we intend to respond to strategic challenges

Updated annually.”

An image of the booklet called Strategic Transformation Plan 2006-2010, with people of the front of the page.”
End of image information.


Slide 10 text and notes:
This new Plan builds on the strong foundation of the 2002 Transformation Plan, and will be our blueprint for the next five years. 

It takes the results of the original Plan and raises the bar.

It describes the major challenges and opportunities ahead of us and outlines how we intend to respond to them, regardless of legislative reform.  

The Strategic Transformation Plan is flexible.  It will be updated every year to address the changing environment and also to report progress.

(NEXT SLIDE)






Slide 11:
Slide 11 Image information:
Image of the USPS Logo with the words “The Power to Deliver Everywhere *Everyday”.
Image has the words: “STAKEHOLDERS:
Stay focused on basics
Improve service 
Reduce redundancy
Employee development 
Better workplace
Add value to core products
Be more convenient, more responsive, easier to use.”
There are four images of:
Person standing near a computer
Two ladies standing and talking
A woman and
A man putting packages into a van.”
End of image information.


Slide 11 text and notes:
Our first step in developing the Plan was to check with our stakeholders – our employees, customers and partners in the mailing industry. You may have responded to our call for feedback. Over 1400 responses were received.

You and other stakeholders want us to…

. . . continue to stay focused on the basics.  You …

. . . recognized that service has improved, but believe we can do better.

. . . noted that we have cut costs, but believe there are still more opportunities.

. . .  appreciated how our people have grown under Transformation . . . but also see that we need to keep up with technology and rising customer expectations.

. . . acknowledged that we’ve made our products better and more accessible . . . but believe we can provide more value and become even quicker, easier, and more convenient.

Our stakeholders acknowledged that we are doing a better job responding to their needs.  But we were reminded that we have to do more than merely keep up.  To succeed we have to anticipate future needs and create more value each year.
(NEXT SLIDE)





Slide 12:
Slide 12 Image information:
Image of the USPS Logo with the words “The Power to Deliver Everywhere *Everyday”.
Image has the words: “STRATEGIC GOALS”.
There is an image of a light blue oval and inside this oval at the very top is the words:
“Generate Revenue”.
Directly in the middle of this oval, under “Generate Revenue” is the words “Best value Best run, and Best place to work”, with arrows point to the up, down, right, left.
Directly to the left of this middle “Best value Best run, and Best place to work”, with arrows point to the up, down, right, left, is the words “Improve Service.”
Directly to the right of this middle “Best value Best run, and Best place to work”, with arrows point to the up, down, right, left, is the words “Reduce Costs.”
Directly beneath of this middle “Best value Best run, and Best place to work”, with arrows point to the up, down, right, left, is the words “Achieve Results with a Customer-Focused, Performance-Based Culture.”
End of image information.



Slide 12 text and notes:
The Transformation Plan responds to this input and what the postal industry faces by continuing to focus on the basics – often, in very new ways.

Our vision is to be the Best Value for customers . . . The Best Run communications and delivery operation . . . and because postal people produce these results, the Best Place for our employees to work.

To get there, the Postal Service has four broad strategies:

Generate revenue.  Create new value through the power of mail to continue to fund universal services.  

Continue to reduce costs to keep services affordable.  

Achieve results with a customer-focused, performance-based culture.  Have our employees fully focused on serving our customers and growing the business.

And, of course, continue to improve service for all products across all access points.

Next I will share our top-line strategies to achieve each of these.

(NEXT SLIDE)





Slide 13:
Slide 13 Image information:
Image of the USPS Logo with the words “The Power to Deliver Everywhere *Everyday”.
Image has the words: “STRATEGIC GOAL
Increase Revenue
Cover single-piece FCM decline with growth in other segments of FCM and other products
Reduce Costs
$1B out each year with standardization and customer partnerships.  Work differently, not just harder
Achieve Results with a Customer-Focused, Performance-Based Culture
Accelerate focus on the customer and performance
Improve Service
Service is good, but will be even better.”
End of image information.



Slide 13 text and notes:
We will increase revenue to more than cover single-piece First-Class Mail decline, with growth in other segments of First-Class Mail and from other products – direct mail and packages.

We commit to taking another $1 billion in costs out of the system each year by thinking differently -- not just working harder -- to accomplish our objectives.

We achieve our greatest successes when we engage our workforce and industry partners.  Therefore, we will continue to change the culture to one focused fully on our customers and performance of the business.

Service is good, but will be better, more consistent, more accessible, and easier for all products and across all access points.  

 (NEXT SLIDE)




Slide 14:
Slide 14 Image information:
Image of the USPS Logo with the words “The Power to Deliver Everywhere *Everyday”.
Image has the words: “INCREASE REVENUE

Create more customer value with products and services
Customize and simplify pricing
Enhance access and ease of use
Aggressive sales, promotions, and outreach.”

An image of a business man holding a package and the words “If You Click It, We Will Come” at the top.
End of image information.


Slide 14 text and notes:
How will we increase revenue? 

We’ll create more value by simplifying our product and service offerings and by making mail more intelligent through use of technology.  Our goal is to provide clear choices, and to better differentiate our products -- particularly First-Class and Standard Mail – andl take advantage of our first mail/last mile strengths by being at the American public’s doors everyday.

We’ll customize and simplify pricing . . . evolving to annual price adjustments for commercial mailers while simplifying prices for consumers.  We will price to value – not just based on costs, continue to use negotiated service agreements and pursue volume pricing.

We’ll expand access to our products and services – through all channels.  This includes simplifying our mail acceptance regulations and processes, to make them more automated and less paper-based.  And we’ll provide greater visibility through the value chain from mail piece production and printing through to delivery.

We have great products and access.  However, we have to make sure that everyone knows all that we have to offer them.  We’ll use our 700,000 employees, our sales force, and expanded Industry outreach with existing and new groups to grow awareness and build the business.

(NEXT SLIDE)





Slide 15:
Slide 15 Image information:
Image of the USPS Logo with the words “The Power to Deliver Everywhere *Everyday”.
Image has the words: “REDUCE COSTS

Standardization
Invest in equipment and technology
Customer partnerships
Rationalize facility / transportation networks
Optimize business practices
Standardization
Invest in equipment and technology
Customer partnerships
Rationalize facility / transportation networks
Optimize business practices.”
An image of a woman sorting mail.
End of image information.


Slide 15 text and notes:
In reducing costs, standardization remains key to most cost-saving strategies.  We learned a lot from our Breakthrough Productivity Initiatives and supply-chain management efforts.  And we still see opportunities to replicate best practices.  Our largest cost center is delivery and we’re placing new emphasis there . . . more mail will be sorted in delivery sequence . . . we’ll use technology and data to design more efficient routes . . . and reduce vehicle expenses.
We’ll continue to invest in equipment and technology. We’ll complete deployment of the Postal Automated Redirection System for letters and expand it to flats.  We’ll begin the move to automated flats sequencing.     We’ll also streamline material handling with the Integrated Dispatch and Receipt system. 
Our customer partnerships (the PCC is a good example) are essential.  Joint efforts are required to reduce undeliverable-as-addressed mail by 50 percent. We’ve also set targets to have 95 percent of letters delivery point sequenced -- which again depends on address quality -- and to reduce costly flats bundle breakage. 
Rationalizing the facility and transportation networks will eliminate redundancy and take advantage of more ground transportation . . . to consolidate several single-product networks into one multi-product network.
We’ll also seek cost savings in support functions where there are still more opportunities, including information technology, supply chain management, and shared services. 
(NEXT SLIDE)




Slide 16:
Slide 16 Image information:
Image of the USPS Logo with the words “The Power to Deliver Everywhere *Everyday”.
Image has the words: “ACHIEVE RESULTS WITH A CUSTOMER-FOCUSED,    PERFORMANCE-BASED CULTURE

Engage employees
Develop and manage talent
Market-based compensation
Make complement more flexible.”
An image of a man sorting packages.
End of image information.


Slide 16 text and notes:
An important change from the initial Transformation Plan is the emphasis on engaging employees to focus on performance and serving our customers.

Through Customer Connect and Business Connect our employees are letting small and medium sized customers know how the Postal Service and the mail can help build their business.  We’ll build on these successful outreach efforts.

Performance will be recognized and rewarded. Our workplace will continue to become safer and more inclusive.  We’ll resolve workplace issues quickly, fairly, and at the lowest level possible. 

We’ll make sure that hiring, training, and development are aligned with our emerging needs.  We’ll ensure that we have tools in place to deploy our people where our customers need them.  We’ll identify tomorrow’s leaders and provide them with the skills they need.

We’ll look at private-sector models to learn if there are better ways to deliver employee benefits.  And we’ll help employees take advantage of benefits that make their money work harder by using pre-tax dollars.

As our workload and network evolves, we will evolve as well.  Planning tools developed under transformation are being used by complement planning teams in every district to become more flexible.  
(NEXT SLIDE)





Slide 17:
Slide 17 Image information:
Image of the USPS Logo with the words “The Power to Deliver Everywhere *Everyday”.
Image has the words: “IMPROVE SERVICE

Timely end-to-end service for all classes of mail
High quality at all customer access points
Maintain privacy, security, and trust.”
An image of a program on a machine.
End of image information.


Slide 17 text and notes:
More revenue, cost reductions, and engaged employees don’t mean much without service.

Timely and reliable end-to-end service is critical for all products.   “Visibility” will drive service improvement across the entire mail value chain from piece production all the way through delivery. 

Better address quality and equipment performance improvements will drive new levels of excellence.  We’ll make it easier for customers to update address lists.  We will eliminate quality gaps and make sure all mailers experience the high levels of service. 

Improving service also means providing a consistently positive experience at every customer contact point.  It means making our services available when and where they are needed – online, at the Post Office, on the phone and with our carriers.

We’re extending retail hours at thousands of Post Offices.  We will continually enhance our online offerings.   By expanding access options we will provide better service, increase revenues and reduce costs. We will build awareness of new access channels . . . 

. . . all the while maintaining privacy, security, and trust.

(NEXT SLIDE)





Slide 18:
Slide 18 Image information:
Image of the USPS Logo with the words “The Power to Deliver Everywhere *Everyday”.
Image has the words: “BALANCE”.
There is an image of a light blue oval and inside this oval at the very top is the words:
“Revenue”.
Directly in the middle of this oval, under “Revenue” is the words “Improve Address Quality”, with arrows point to the up, down, right, left.
Directly to the left of this middle “Improve Address Quality”, with arrows point to the up, down, right, left, is the words “More mail to intended recipients more quickly.”
Directly above the words “More mail to intended recipients more quickly” is the word “Service”.
Directly to the right of this middle “Improve Address Quality”, with arrows point to the up, down, right, left, is the words “Fewer handlings.”
Directly above the words “More mail to intended recipients more quickly” is the word “Costs”.
Directly beneath of this middle “Improve Address Quality”, with arrows point to the up, down, right, left, is the words “Better meet customer needs.”
Directly beneath the words “Better meet customer needs” is the word “Results”.
End of image information.



Slide 18 text and notes:	
The Plan is very integrated.  Many of the goals address all four strategies in some way.  Here are a few examples.  We want to improve address quality to reduce the amount of undeliverable-as-addressed mail by 50 percent. 

This is mail that requires forwarding or has insufficient address information to code to delivery point and costs us over $1 billion a year. 

Why?  Because improving address quality will provide better value to customers if all of their mail can be delivered to the intended recipient– increasing their return on investment on the mailing.

Better addressing leads to more Delivery Point Sequencing (DPS) volume, and less manual handling – thereby reducing costs.

Better service will result as recent customer moves will be captured before the piece is produced and reduce the time to delivery . . . 

. . . and employees will be better able to meet our customers needs and can take pride in the product and their performance.

How?  – by moving to online Change of Addresses, automation software improvements, Postal Automation Redirection System, and new Address Management Services products for mailers.
	
(NEXT SLIDE)






Slide 19:
Slide 19 Image information:
Image of the USPS Logo with the words “The Power to Deliver Everywhere *Everyday”.
Image has the words: “BALANCE”.
There is an image of a light blue oval and inside this oval at the very top is the words:
“Revenue”.
Directly in the middle of this oval, under “Revenue” is the words “Leverage First Mile /Last Mile”, with arrows point to the up, down, right, left.
Directly above this middle “Leverage First Mile /Last Mile”, with arrows point to the up, down, right, left,” is the words “Competitive advantage”.
Directly to the left of this middle “Leverage First Mile /Last Mile”, with arrows point to the up, down, right, left, is the words “Brings the post office to the door.”
Directly above the words “Brings the post office to the door” is the word “Service”.
Directly to the right of this middle “Leverage First Mile /Last Mile”, with arrows point to the up, down, right, left, is the words “Uses existing operations.”
Directly above the words “Uses existing operations” is the word “Costs”.
Directly beneath of this middle “Leverage First Mile /Last Mile”, with arrows point to the up, down, right, left, is the words “Builds on relationships.”
Directly beneath the words “Better meet customer needs” is the word “Results”.
End of image information.



Slide 19 text and notes:	
Lastly, let’s take the strategy to more fully develop our first mile / last mile capabilities.  

We deliver to 143 million doors each day, and we have a trusted retail presence in every community.  Our ability to connect customers is very hard to match.

First-mile innovations like online Carrier Pickup, and Parcel Return Service and for the last mile like Hold for Pickup, are built on existing operations.  They help add business while minimizing costs.

Of course, these services only strengthen the already close bond our people have with their customers.  We’ve shown that we can directly involve employees more in the business and still maintain good relations with our unions and  management associations. 

And, perhaps more than anyone, our customers appreciate what last mile / first mile means.  We’re there for them everywhere, every day, with 20 times the number of daily deliveries of our closest competitor.  

How? – Click N Ship, Carrier Pickup, leveraging our being everywhere, every day. Expanding online products

We learned from Transformation that we are very capable of working on multiple fronts: We have proven that we can reduce costs without reducing service. 

(NEXT SLIDE)




Slide 20:
Slide 20 Image information:
Image of the USPS Logo with the words “The Power to Deliver Everywhere *Everyday”.
Image has the words: “SELECT TARGETS

1. Annual commercial price adjustments
2. Expanded service measurement
3. Simplified package offering.  Enhanced tracking
4. 25% of air transportation to ground
5. Retail workload standards in all POS offices
6. 20 million online COAs
7. 95% DPS letters, reduce carrier office time by one hour 
8. Cut misdelivery complaints by 50% annually
9. Continue safety gains.”
End of image information.


Slide 20 text and notes:



Slide 21:
Slide 21 Image information:
Image of the USPS Logo with the words “The Power to Deliver Everywhere *Everyday”.
Image has the words: “COMMITMENTS

Reduce another $5 billion      in tandem with aggressive measures to grow the business
Advances in service, productivity, and employee engagement
Tight focus on core products to ensure universal, affordable services continue.”
An image of a mailman delivering a package to a lady. 
End of image information.



Slide 21 text and notes:
No one can dispute that this organization has the vision and the capability to tackle the most daunting challenges.  We have proven that since 2002.  Our new Plan raises the bar several notches higher.  

That’s how it should be.  Because if our experience under Transformation tells us anything, it’s that we’ve only scratched the surface.

We commit to reducing another $5 billion . . . in tandem with equally aggressive measures to grow the business over the next five years.

We will continue to provide new advances in service, productivity, and employee engagement.

And we will stay focused on core products to ensure that affordable, universal services continue.

At the most fundamental level, the Strategic Transformation Plan is a statement of the Postal Service’s continuing commitment – to our customers, to our stakeholders, and to one another.  

(NEXT SLIDE)





Slide 22:
Slide 22 Image information:
Image of the USPS Logo with the words “The Power to Deliver Everywhere *Everyday”.
Image has the words: 
“Best value . . .           
in the marketplace 
Best run . . .  
communications and delivery service
Best place . . .          
to work .”
An image of the booklet called Strategic Transformation Plan 2006-2010, with people of the front of the page.”
End of image information.


Slide 22 text and notes:
…by providing the best value in the marketplace . . .

. . .The best run communications and delivery service . . .

. . . and the best place for our people to work.

(PAUSE)

So that’s a short summary of the purpose and content of the plan.  

. . . Are there any questions? 

(NEXT SLIDE)




Slide 23:
Slide 23 Image information:
Image of the USPS Logo with the words “The Power to Deliver Everywhere *Everyday”.
Image has the words: “WANT TO READ THE FULL PLAN ?”
An image of the “United States Post Office Webpage.”
This has three points that is circled on this image.
The first one is circled in red and it’s the “ABOUT USPS & NEWS” link, from the top navigational menu.
The second one is circled in green and it’s the “Strategic Transformation Plan 2006-2010” link, from the far left navigational menu.
The third one is circled in blue and it’s the “Read the Strategic Transformation Plan 2006-2010” link, at the very bottom of this image.
End of image information.


Slide 23 text and notes:
In closing I highly encourage you to read our new Transformation Plan – all 65 gripping pages.  It is located on http://www.usps.com/