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Big choices at the Postal Service

I didn't have a chance to read all my newspapers over the weekend, but I was enticed into this story in the WP's Sunday business section:

Saving the Post Office
As Mail Usage Drops, USPS Faces a Whirlwind of Change
Few critics of the U.S. Postal Service realize it has made huge strides in on-time delivery, runs one of the most impressively automated operations in the world and, for now, is bringing in a huge profit.

First off, the Postal Service has been facing these problems for years. For example, here is a story that FCW did in 2004 that says almost the same thing as the WP story. So this has been a looming problem for the Postal Service -- and they know it. They understand that people are going electronic more and using stamps less.

And I have to say that I think the Postal Service is under-appreciated... even though I think USPS is totally wrong to require that users register to use their Web services. (Here is the USPS rebuttal.)

That issue aside, USPS does a generally amazing job... and the WP story has some amazing stats: USPS handles 212 billion pieces of mail to 144 million addresses, 2 million more delivery points than in 2004. No other organization does that... nor would they because it would be difficult to be profitable.

It strikes me that this is one of those areas where we may need to not use a profit and loss statement as a way to measure success. There are other ways to do that for the Postal Service, such as efficiency, which has been moving up as well. But the WP story poses a difficult question:

The structural problems facing the Postal Service are monumental. Despite a tiny uptick last year, first-class mail volume is slowly but steadily eroding as people pay more bills online, send Evites instead of printed invitations and shoot off e-mails rather than write letters. The agency also is facing massive and escalating personnel costs, especially for health care, even as it has embraced automation and reduced staffing needs. And finally, there is the federal government's attempt to change the structure of Postal Service regulation, an effort that postal officials regard as riddled with problems and with favors to private industry.

"It doesn't give us nearly the flexibility we believe we need," said Tom Day, senior vice president of government relations for the Postal Service.

Without making some hard decisions -- and revisions -- in the near term, Nolan and others say, the Postal Service "is on a crash course with cataclysmic change."

What kind of change and when is unclear. Privatization? Shuttered post offices? Dramatically more expensive mail? Less frequent delivery? It could be any of those things -- or none of them. It just depends on how things go.

And this is when people start thinking about the third Postal Service -- the one that delivers possibility six days a week -- a letter from an old friend, a tax refund or an acceptance from the admissions office. This is the post office that brings us the letter carriers we admire, who avoid dogs and leave footprints in pristine snow. It gives the tiniest towns their own proud postmarks. It's the post office that found you even when the address under your name was so incredibly incorrect it was laughable.

Are we willing to say that mail only comes five days a week? Or that the Postal Service does not need to deliver everywhere in the United States? It seems that we have put the Postal Service right between a rock and a hard place -- we want them to operate a profitable business while still meeting all of these requirements that prevent them from running a profitable business.

I'm sure many other agencies can sympathize... or empathize even!

Meanwhile, I just love getting mail! Yes, I love e-mail too, but the mail... ahh!

Posted by Christopher Dorobek on Jan 16, 2006 at 12:15 PM


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