2006 Highlights

• Increased Total Factor Productivity for the seventh consecutive year.

• Adopted the 24-Hour Clock, establishing standards for the movement of mail across all operations.

• Introduced data-driven process control to identify redundancies and root causes of quality problems.

• Completed multiple automation equipment upgrades; added new capability and capacity.

• Consolidated airlift contracts and applied performance-based metrics to transportation suppliers.

• Conducted successful live mail testing of the Flats Sequencing System.

• Began consolidation of Human Resources transactional work into a shared services environment. Employees now able to access their personnel records and perform many benefits and personnel transactions 24/7.

2007 Priorities

• Reduce the billions of pieces of undeliverable-as-addressed mail. Make addresses complete, correct, and up-to-date.

• Reduce costs by $1 billion.

• Expand Lean Management and Six Sigma process design and control in operations.

• Increase the amount of delivery-point sequenced (DPS) letters. Improve adherence to delivery in-office and street performance standards.

• Run pre-production flats sequencing system (FSS) in a live operation. Develop down-stream delivery processes for flats processed in sequence.

• Continue realignment of facility and transpor-tation network to coincide with the evolution in the composition of mail and customer mailing patterns.

• Maximize the use of ground transportation.

• Reduce energy costs by addressing fuel price and consumption.

• Finalize consolidation of Human Resource transactional work into a shared services environment.