Postal Service

The U.S. Postal Service must overcome difficult, if not insurmountable, obstacles if it is to successfully introduce optical scanning into its operations by 1998. Barcoding of letter mail and automatic sorting of letters to homes and businesses, known as "delivery point sequencing," has proven more difficult than the Postal Service expected and lags behind schedule. The savings from automation continue to be small compared to overall labor costs and more difficult to achieve than the Postal Service anticipated.

GAO found that: (1) USPS faces difficult and maybe insurmountable obstacles to successfully completing its automation program by its 1998 target date; (2) USPS problems are compounded by opposition to the expanded zip code and the decentralization of the automation program; (3) barcoding and automatic sorting of letter mail to individual addresses is more difficult than expected and is behind schedule; (4) the shortfall in barcoding is due to optical scanners' difficulty in reading nonstandard envelopes and addresses and the delayed deployment of remote barcoding; (5) current postal incentives favor presorting of mail by mailers, which defeats delivery point sequencing because presorted mail must be merged before delivery; (6) most mailers have no incentive to use barcodes, since they are ineligible for barcode discounts or face cumbersome preparation requirements; (7) because of USPS failure to meet the barcoding target date and to include multiple occupant buildings in delivery point sequencing, carriers have not been able to reduce their in-office hours and adjust their delivery routes; (8) automation savings are small and difficult to achieve; (9) USPS has not reduced its workforce as expected and career employment is increasing rather than decreasing; and (10) more business mail is being diverted to electronic delivery methods, which will likely diminish the benefits of automation.