U.S. Postal Service

This report provides information on the status of the U.S. Postal Service's efforts to launch Delivery Point Sequencing--the automated rather than manual sorting of letters in the exact order that carriers deliver them. Manual sorting of letters by carriers is one of the Postal Service's most costly letter distribution operations. GAO (1) determines the Postal Service's goals for Delivery Point Sequencing implementation, its projected letter carrier workhour savings, and the extent to which the Service has achieved these and (2) identifies any remaining issues that may affect the Service's ability to achieve its 1998 Delivery Point Sequencing goals, including any steps that the Postal Service has taken to address these issues.

GAO noted that: (1) in its 1992 Corporate Automation Plan, USPS initially scheduled DPS implementation to be completed by fiscal-year-end 1995; (2) the 1992 Plan included DPS goals and benchmarks for: (a) DPS equipment deployment; (b) barcoded letter volume; and (c) delivery zone and carrier route implementation nationwide through fiscal year (FY) 1995; (3) in addition, USPS based its analyses that supported investments in DPS sorting equipment on achieving: (a) a certain DPS letter volume to carrier routes; and (b) specific carrier workhour savings; (4) however, implementation fell behind schedule, and USPS acknowledged that it had been overly optimistic in its DPS expectations; (5) in April 1994, the Postmaster General announced that the barcoding goal had slipped from 1995 to fiscal-year-end 1997; (6) in its 1996 Plan, USPS extended the DPS completion date to the end of FY 1998 and revised associated goals and benchmarks; (7) USPS has identified and was addressing several issues that have affected its efforts to achieve its DPS implementation goals, benchmarks, and carrier workhour savings; (8) to increase volumes of barcoded letters and letters sorted in delivery sequence, USPS has taken several actions; (9) while USPS has achieved some success in addressing issues affecting DPS implementation and achievement of DPS goals, it has been less successful in resolving its disagreements with the National Association of Letter Carriers (NALC), the labor union representing city carriers, regarding DPS implementation; (10) in 1992, USPS and NALC agreed to work together to implement DPS and signed six memoranda of understanding, which were to resolve past disputes and provided a plan for DPS implementation; (11) not long after the memoranda were signed, disagreements developed between USPS and NALC regarding certain aspects of the memoranda; (12) NALC filed national level grievances regarding DPS implementation instructions, and the parties settled most of their disagreements; (13) however, one disagreement went to national arbitration, and the arbitrator decided in NALC's favor and instructed the parties to work together to resolve their differences; (14) in addition, many city carriers GAO spoke with said that although they generally saw benefits in DPS, they were concerned about its effect on their daily work; and (15) in contrast, USPS officials said that while DPS has changed the way carriers deliver mail, the changes have not adversely affected customer service.