Postal Service could realize more than 14.3 million workhour savings and avoid costs of over $628 million over 4 years.
The following are excerpts from The Office Of Inspector General’s report on Assessment of Overall Plant Efficiency 2013
This report presents a follow up on the U.S. Postal Service’s progress in reducing workhours based on the workhour recommendation made in a prior report, as well as the results of our assessment of the overall efficiency of the processing and distribution network for fiscal year 2012
In FY 2012, we reported on efficiency levels and mail volume at processing and distribution centers (P&DCs) and processing and distribution facilities (P&DFs) and recommended the Postal Service reduce more than 14 million workhours by FY 2014. The goal of the previous effort was to report on the Postal Service’s efforts to ‘raise the bar’ on productivity levels for those plants that were the least productive in the network nationwide. We took a similar approach in this report.
The Postal Service faces significant financial challenges, ending FY 2012 with a net loss of $15.9 billion and reaching its statutory borrowing limit of $15 billion. Without the expenses associated with the Postal Service Retiree Health Benefits Fund (PSRHBF), the agency would have ended FY 2012 with a net loss of $4.8 billion.2 In addition, the Postal Service ended Quarters (Q)1 and 2, FY 2013, with a combined net loss of $3.1 billion, $2.8 billion of which were expenses associated with the PSRHBF. Without the PSRHBF expenses, the combined loss would have been about $300 million.
We found that the Postal Service had not yet fully adjusted workhours in response to declining mail volume or achieved all possible efficiencies in mail processing operations. Also, management has not evaluated operational efficiency by assessing performance based on median productivity for each plant grouping.
The Postal Service could improve operational efficiency by reducing more than 14.3 million workhours. This would allow the Postal Service to achieve at least median productivity levels in the network and avoid costs of about $628 million
Further opportunities exist for the Postal Service to reduce mail processing workhours by improving efficiency. For example, if the 130 plants with below-median productivity levels in FY 2012 achieved just the median productivity level for each respective plant group,5 the Postal Service could realize workhour savings of more than 14.3 million.
The Postal Service compiles workhour, labor use, and other financial reports for management use by functional category or LDC.14 For example, LDC 11 records workhours in automated letter operations, LDC 12 records workhours in distribution of flat mail on automated and mechanized equipment and LDC 14 records manual sorting of letters and flats. The Postal Service uses LDC 17 to record hours by employees involved in allied operations or mail processing operations other than distribution, and it uses LDC 18 to record indirect/related workhours.
The largest percentage of workhour usage in mail processing operations in FY 2012 was 36.4 percent in LDC 17, and the largest percentage of FHP volume in FY 2012 was 85.2 percent in LDC 11
These operations are recorded in LDC 17 and include mail preparation, presort operations, traying, sleeving, opening, pouching, and platform operations.
12 These operations are recorded in LDC 18 and include rewrap of damaged mail, Express Mail processing, empty equipment processing, office work and recordkeeping, Registered Mail processing, and union steward time.
In addition, as of January 2013, we found that 13,877 employees at plants with below-median productivity levels were eligible to retire. This represents a potential annual reduction of more than 24 million workhours if these employees retired
Potential Sources of Workhour Reductions
We identified six major areas where the Postal Service could realize workhour savings:
- Overtime.
- Stand-By Time.
- Automated and Mechanized Equipment.
- Manual Operations.
- Allied Operations.
- Indirect/Related Operations
We recommend the vice president, Network Operations:
1. Reduce 14,364,398 workhours with an annual associated economic impact of $628,670,104. These workhour reductions are to be completed no later than FY 2018.
2. Periodically evaluate operating efficiency by assessing performance against the median productivity level for each plant grouping.
Management’s Comments
Management agreed with the recommendations and economic impact in the report. Management stated they have made substantial progress in reducing mail processing workhours in the last 5 years. Regarding recommendation 1, management agreed to improve operational efficiency and reduce 14,364,398 workhours by September 2018. Regarding recommendation 2, management stated that productivity targets are established and will be reevaluated periodically
Related link: USPS closures of mail processing plants hit small newspapers hard
Management at all levels need more meetings everyday to tell them how bad they are doing. Less employees on the floor working and shorter window hours. Brilliant…ohh they are already doing that.
In reply to MountaineerNation: That is because in the Eastern area you have the Area VP, master of quotes. In the Western PA District you have District Manager that came from Cleveland and was Audit by the OIG and the outcome was hundreds of violations. So what they do, promote him to Pittsburgh. Everyone is afraid to stand up in state that the consolidations do not work.
All residential delivery should be 3 days a week only. Carrier Sam can carry route 1 m/w/f and route 2 on t/t/s with a floater like today. That would eliminate 35% of carriers. Then get rid of the other 10% of time thieves.
Who pays for the waste created by high level ignorant decision makers that bottom line results will be negative as cost exceeds revenue creating continuous debt with no solutions being sought. Who pays for continuous pyramid dollar loss? 5 day street delivery and elimination of cluttered small community post offices is a reasonable means to reduce debt. Craft and management unions as well as political pressure groups must be controlled if the USPS is to survive IN SOME FORM OF EXISTENCE.
Here’s what REALLY happens when a plant closes. I live in Clarksburg, WV. When I used to mail a letter to Fairmont, WV, which is about 20 miles, my letter would go to Clarksburg P&D, get DPS’d and be delivered to Fairmont PO. with minimal manual processing required. Now, the same letter goes to Charleston for processing, then to Pittsburg, PA for DPS and then comes back to Fairmont PO. Aside from spending an additional 440 miles riding up and down interstate 79, Pittsburgh doesn’t have the time or resources to adequately process Fairmonts mail. So, Fairmont gets @ 300-500% more manual mail Due to early processing cut off time! And it’s ususlly LATE! It’s the same for all 265 zips! How’s a carrier supposed to get done by midnight?!
A SAND DIEGO,
So what if we do all this. WHAT is so wrong with it anyways ? Huh ?
This is the new work ethic, and youze peoples betters get use to it.
If I am not making the $26 an hour the older employees are getting, then I will just hang out in the breek room sleeping. Pay me 26 an hour, and I will try an do at least 6 hours of owrk in a 8 hour dayy. Get use to it, you lazy full timer… POS youse are to… Now SAND DIEGO, make me some sandwsiches. You fukkker..
Mail receipt time from plant is a joke. Carriers reporting times moved back to eliminate any wait time resulting in carriers leaving for street delivery 2 hrs. late resulting in returning after dark as not enough carriers to cover all routes and routes are delivered by 3-4 carriers after completing routes. Results in V time and poor customer service. 6 day street delivery is a wasted cost. 195,000
vehicles fuel cost and carrier work hour expense delivering low revenue bulk business mail at a high distribution cost is a waste. Need a new business model to focus on generating revenue parcel market as this is the only green line in revenue generation compared to SPLY. Business model comparable to FED X and UPS. 5 day delivery of all mail classes with a premium charge for expedited Express and priority. V time is costly and is a result of poor planning in higher management echelons. Reality is drastic steps must be taken to reach a breakeven point. Revenue generation must be increased and cost reduced. Operations must be cost effective. Wasted cost with negative returns must be eliminated.
Every time the USPS cuts hours at processing plants it increases ot at the local Post Offices. If they cut any more in North NJ I’ll be making $100,000 a year.
On any given day, in the San Diego MLS P&DC one can observe this:
Mail Handler Assistants (some may still be on probation even) going out unauthorized exits for smoke breaks (whenever they feel like it) Mail Handler Assistants on the clock napping in the break room, Mail Handler Assistants playing games on their cell phones while they are supposed to be grooming mail on the FSS. They prep the wrong zones for the FSS runs, causing loss of productivity when the mail has to be manually sorted. Postal Service Employees also take extra time on breaks, wander the floor when they are sent to work somewhere they don’t want to go, secret smoke breaks, playing on their phones whenever the boss isn’t watching (which is most of the time) If the USPS think they are saving money by hiring scores of useless lazy 22 year olds who don’t consider the USPS a future career and don’t care if they get fired, they are sadly mistaken. Come on OIGs, I dare ya to take a look in San Diego. Oh, yeah, and there are MHAs that actually wear their backpacks while they are working. When regulars are told that we can’t bring anything onto the floor. The opportunity for theft is growing because these new strangers are wandering about unsupervised, rules do not apply to the newcomers. Already, lunches are being stolen from the breakroom, and I am sure more will happen. OIGs, come to the floor and watch how the supervisors are not supervising, because they are too busy appeasing the emperor, correcting clock rings, and getting yelled at in their meetings.
I got idea….outsource processing to china…would prob be faster at least.
Lets just close the post office Who needs it anyway with UPS and FEDEX and My Friends From Pitney Bowes ,they can pick up the slack .How many weeks a year would you like your mail delivered 26? Oh and you can pick it up yourself at our convienient locations ,One in every state ,Yours Truly
Darrel Issa
Remember what former PMG Marvin Runyon said:
“I am going to peel back the layers of this organization like an onion until you cry”.
Looks like the crying has begun (see above). One writer says we are understaffed while another says tour 1 is like the Night of the Living Dead, run by zombie EAS types.
OIG is taking a cheap shot here – they know mgmt can’t shut down unneeded plants fast enough and move people to where they are needed. Too many hoops to jump thru. It’s a no brainer that productivity is going to suffer. Once again, these guys are Masters of the Obvious. Pretty nice gig – to get paid for writing what everybody already knows is going on w/out recognizing the constraints of the situation. I’d like to see one of these OIG types go into a plant, raise productivity and cut staff while meeting or exceeding service standards. And oh, in your spare time, figure out how to consolidate plants and ops w/out missing a beat. Get real. Arm chair quarterbacks.
shut down for sale, problems solved!
Its sad to see everyone has an idea to fix the post office by cutting people, service standards. Shutdowning plants, get rid of union jobs. It’s a sad day when all anyone wants is a quick fix. Stop the FEHB prefunding, let half of management go, and stop the big mailer discounts. Wow problem solved and I’m not even a college graduate and I can see the problems, and how to fix them. But alas I’m not rich or have my hand out to give it all away for penny’s on the dollar.
What a crap of sh–!!! Most of the people in the distribution centers, don’t do there jobs!! They are usually sleeping outside reading or just sitting on you no what!! I know I use to work in one!!! Get rid of those people and some lazy a– supervisors, and some people in the offices who sit there and count numbers for nothing!!! Alot of waste in the post office including in the union where people just hide out give me a break. These people are just around to get over. There are some people in the post office that do there jobs, but alot DON’T!!! Reward the people that do and get rid of the other and don’t wait action now!!!
We are understaffed across the board. If you want to cut the overtime then you need to hire people to replace the people who retired and quit. I realize that it is hard to get people to work third shift with the wonderful pay, job security, and benefits that you are offering now. We had some real good workers (PSE’s) who quit after they found out that they had been lied to during orientation. We are working one person on a machine most days on first pass, and sometimes all of second pass. Our supervisor is doing a good job trying to get people to where they need to be with a skeleton crew.
That’s right management has until 2018 to save these hours. Its being done only on paper. Close one plant, USPS saves hours. Reports will not reflect extra hours for plants gaining work. Extra logistics will not count!!! The old adage comes to mind- “Figures don’t lie – Liars figure”.
When the USPS accept that they have piss poor management skills, then they can start to try to fix things.
how about we get rid of all letter carriers, mailhandlers, and postal clerks and just keep all mismanagement. they can look out the window and watch the UPS and FDX trucks roll by. this will make my stock go up even more. FDX $120.00 a share, UPS $92.00 a share USPS $0.00 a share. OIG will have more time to pick their nose.
@northlander, because tht wood make to much sense, and would leave to much time to make sandwsiches….like, daaaah !!!
Why not have bulk mailers stop using string and rubber band and move into the 21 st Century with strapping.This would stop jamming the APP’S Machine, destroying mail,and the use of employee’s to re-wrap mail and improve productivity.
And who’s goings to make the sandwsiches for the AIP, OIC, CIA, DSM, NDC, the OIM, the church going PTA members ??? I ask, whooooo…
But who is going to make the sandwsiches for the OIP ?
Cut Overtime!…with mail processing consolidation all over the network, add retirements and not posting new bids. Every processing plant has a employee shortage. Two-Three day mail becomes 5 day or more….and you want to cut overtime. Ok BRAIN DEAD or WALKING DEAD management, TRY IT!
The salient question, to my mind is this: why is management given until 2018 to make a correction? If there is, indeed, such poor productivity in some of these mail processing facilities then management should immediately get to work to find out what the pronem is and fix it. Giving them 4+ years to fix the problem is like saying “hey guys, by the way, if you get a chance try to get your productivity up”. If they can’t get the problem fixed any sooner than 4+ years maybe they should ask the folks doing the work for suggestions. We’ve got plenty!!!!
That means more pushes is coming.
We still useing vtime
Let me address these issues 1 at a time. Overtime…stop requiring it even though we are buried in mail shifted to us from closed plants. Stand by time…what stand by time we run balls to the wall because of work shifted to us from other plants. Automated equipment, yeah we have that. Manual operations…are they wanting to eliminate them? Good luck, we process Priority mail. There are flat rate boxes which weigh in excess of 60 lbs. Machines cannot process them, nor can they process round tubes, or pieces more than 24″ long. We get plenty of these each night. As for indirect and allied operations, I have no idea what they are talking about. They have added a ton of work to us without adding any excess people to help out, if anything we have lost people. My night starts at 11 pm and I may get to take a 5 minute break before I go to lunch at 6:45 am, when our dispatches are finally gone. At 7:15, I may get to chill for the last 15 min, unless the next shift is short. If they are, then it’s back in the barrel until 9:30 am.
I am just a grunt. But did any of those business MBAs think that maybe we are too busy to be swiping every hour as the Supervisor moves us around from operation to operation trying to get this stuff out the door? I know, the numbers can’t be wrong, they’re on the computer . . .
The Problem isn’t the work force or pricing. The Problem is the Public Private Partnership.
The USPS PAYS Pitney Bowes to sell stamps for them online & presorting mail. Reality is that the Volume of First Class is dying. Bulk and Flats can no longer be subsidized by First Class.
Pitney Bowes and the rest of this partnership should eat up some of these cost, or send the volume back to the processing plants.
Just cut the subsidies to bulk mailers saving $14 – $18 billion per year.
Problems solved.
We hear of offices not being able to get mail out before dark, some businesses are lucky if they get mail more than two or three times a week, and management in its infinite wisdom has most offices starting their letter carriers at ridiculous hours, just to save a little office undertime. Obviously, serving the customer like those new commercials indicate the Service is all about, they care little if anything about the customer outside the direct mailers. So what if carriers are out after dark? So what if much of downtown San Antonio is lucky to get mail at all because the management is too fucking bullheaded to start their carriers at a reasonable time? And now they talk about cutting hours at the plants? What a great idea. Then we can come in at 10:00 because they can’t get the mail worked.
The Service never listens to craft or floor level supervisors where the actual work goes on, and they definitely don’t listen to the customer. These are much more pressing problems than shifting numbers around trying to get a bonus they do not deserve. I’m just positive my opinion will be read and seriously considered by a high ranking manager.
I just go too slow, my old bones can barely get going in the morning.
HOW MUCH COULD WE SAVE IF WE ELIMINATE THE OIG?? Why don’t we just close up shop and then we can eliminate ALL workhours? The OIG is worthless, I wonder how much it cost them to tell management what they already knew? I wonder what contractor got kickbacks for doing the work for the OIG?
Are you kidding? we still have many OTs opportunity.
If they eliminated THE OFFICE OF INSPECTOR GENERAL they could save another 5 or 6 million…..Aren’t there enough law enforcement agencies already without the POSTAL SERVICE HAVING THEIR OWN….Would love to see a published accounting of cost and affect of our PRIVATE JOHN LAW…….
Could save even more by drastically riffing the bloated, corrupt, unethical, and unnecessary EAS/mgmt. ranks.
And it wouldn’t affect operations one bit in doing so.