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Request for Comments on the Strategic Transformation Plan 2006-2010

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Postal Service.


Request for comments.


This Notice addresses the Postal Service's Strategic Transformation Plan 2006-2010.

By law, beginning in 1997, the Postal Service TM is required to publish a five-year plan outlining its goals, targets, and strategies, and to update and revise its five-year plan at intervals of no less than 3 years. In support of its strategic planning process, the law requires the Postal Service to solicit and consider the ideas, knowledge, and opinions of those potentially affected by or interested in its Five-Year Strategic Plan.

In addition, at the request of Congress, in 2002 the Postal Service prepared a comprehensive plan for the structural transformation of the postal system to meet the challenges of serving the American public. This first Transformation Plan covered the years 2002-2006. A major component of the next Five-Year Strategic Plan, covering 2006-2010, will be the extension of the Postal Service's Transformation Plan through the same period. This notice asks for public comment concerning the development and drafting of the Postal Service's combined document, the Strategic Transformation Plan 2006-2010.


Comments must be received by May 15, 2005.


Those responding are requested to e-mail their comments to Those wishing to send written comments should mail them to USPS Office of Strategic Planning, Stakeholder Feedback, 475 L'Enfant Plaza, SW., Room 5142, Washington, DC 20260-5142. All stakeholders are encouraged to view the Postal Service's Web page dedicated to soliciting comments on its Strategic Transformation Plan 2006-2010 located at​strategicplanning/​2006-2010.htm. Stakeholders are requested to review the content of this Web site before submitting comments.

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George R. Bagay (202) 268-4159.

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Five-Year Strategic Plan Statutory Background

The Government Performance and Results Act of 1993 (GPRA), Public Law 103-62, was enacted to make Federal programs more effective and publicly accountable by requiring agencies to institute results-driven improvement efforts, service-quality metrics, and customer satisfaction programs. Other statutory goals were to improve Congressional decision-making and the internal management of the United States government. Because of the Postal Service's position as an independent establishment of the Executive Branch of the government of the United States, section 7 of the law amended the Postal Reorganization Act to insert similar provisions for performance management in the Postal Service. (See 39 U.S.C. 2801-2805.)

Section 2802 of title 39, United States Code, requires the Postal Service to update and revise its strategic plan at least every 3 years. This plan must contain:

(1) A comprehensive mission statement covering the major functions and operations.

(2) General goals and objectives, including outcome-related goals and objectives, for the major functions and operations.

(3) Descriptions of how these goals and objectives are to be achieved and of the operational processes; skills and technology; and the human, capital, information, and other resources required to meet the goals and objectives.

(4) A description of how the performance goals included in the annual performance plan required under section 2803 will be related to the general goals and objectives in the strategic plan.

(5) An identification of the key factors external to the Postal Service and beyond its control that could significantly affect the achievement of its general goals and objectives.

(6) A description of the program evaluations used in establishing or revising general goals and objectives, with a schedule for future program evaluations. (See 39 U.S.C. 2802(a).)

The law also requires annual performance plans linking the organizational goals in the Strategic Plan with ongoing operations. Finally, the law requires the preparation of annual performance reports, which review and compare actual performance with the performance targets stated in the annual plans. (See 39 U.S.C. 2804.)

In order to include public participation in this planning process, the statute provides that the Postal Service, as it develops each new iteration of the Strategic Plan, “shall solicit and consider the views and suggestions of those entities potentially affected by or interested in such a plan, and shall advise the Congress of the contents of the plan.” (See 39 U.S.C. 2802(d).)

Transformation Background

On April 4, 2001, the Comptroller General of the United States advised the House of Representatives Committee on Government Reform that the Postal Service “faces major challenges that collectively call for a structural transformation if it is to remain viable in the 21st century.” He called on the Postal Service, in conjunction with all stakeholders, to prepare a comprehensive plan identifying “the actions needed to address the Service's financial, operational, and human capital challenges and establish a time frame and specify key milestones for achieving positive results.” On June 14, 2001, the Chair and ranking members of the Committee on Governmental Affairs and its Postal Oversight Subcommittee wrote to Postmaster General John E. Start Printed Page 20192Potter asking that a Transformation Plan be developed. The Postal Service presented this first Transformation Plan covering the years 2002- 2006 to Congress in April 2002. The Transformation Plan has made possible a number of successes to date: postal rates have remained stable since mid-2002, debt has declined by $9.5 billion, and a total of $4.3 billion in incremental annual savings have put the service well on its way to five straight years of productivity gains. At the same time, the Postal Service has achieved record customer satisfaction levels, provided record end-to-end service performance, and developed innovative postal products and services including Click-N-Ship®, Negotiated Pricing Agreements (NSAs), and Priority Mail® flat-rate boxes.

Following up on the April 2002 Transformation Plan, the Postal Service published two Transformation Plan Progress Reports, one in November 2003, and one in November 2004, and incorporated a discussion of Transformation Plan progress into its annual Comprehensive Statement on Postal Operations to Congress. All of these Postal Service plans and documents, along with other key Postal Service transformation, planning, and financial documents, can be found online at​strategicplanning.

To maintain this significant momentum, the Postal Service plans to extend its ongoing transformation by developing the Strategic Transformation Plan 2006-2010 with the participation of its stakeholders. This plan will focus on Postal Service-wide organizational strategies along with detailed cross-functional strategies engineered to enhance value to our customers. Publication is planned for September 30, 2005, with subsequent annual updates.

As a nation, we need to know how we can best structure our postal system in the years ahead to meet evolving needs. The Postal Service has a mission to serve every address in a growing nation. Its networks, with associated costs, are constantly expanding to accommodate new deliveries roughly equivalent to those for the cities the size of Chicago and Baltimore, year after year. Until recently, during a long period of strong economic expansion, the Postal Service benefited from growing mail volumes, with increasing postage revenue sufficient to pay for the expanding network, and kept postage rates in line with inflation. Because of the successes achieved as a result of the April 2002 Transformation Plan, the Postal Service has improved its productivity during this period at an unprecedented rate. Nevertheless, changes in competition and technology suggest that, while a system for delivery of hard-copy mail will still be important, the volume of mail in the system may not grow enough in the future to keep pace with the growth in infrastructure required to serve an ever-growing number of addresses. The Postal Service currently lacks many of the tools that private businesses have to deal with revenue deficiencies. In addition, its service responsibilities prevent abandoning unprofitable locations or new addresses.

Discussion of the Postal Service Mission, Vision, and Objectives

In 1970, Congress enacted the Postal Reorganization Act, transforming the former Post Office Department into the United States Postal Service. The intent was to ensure that the former department became a self-sustaining Federal entity, operating more like a business. The Postal Reorganization Act states that the Postal Service will have the “basic and fundamental” responsibility to provide postal services to bind the nation together through the personal, educational, literary, and business correspondence of the people. Prompt, reliable, and efficient postal services must be extended to patrons in all areas and to all communities.

The objective of transformation was stated in the April 2002 Transformation Plan and the Strategic Plan 2004-2008. The plans acknowledge the assistance of the full range of stakeholders in the postal industry and a firm commitment to all stakeholders, especially our customers. In order to maintain our financial viability and fulfill our universal service mission, we commit that we will:

  • Foster growth by increasing the value of postal products and services to our customers;
  • Improve operational efficiency; and
  • Enhance the performance-based culture.

It is for the purpose of maintaining its transformative vision and momentum through the Transformation Plan 2006-2010 that we ask stakeholders once again to share their views on the future of the nation's mail service.

Solicitation of Comments

Although all comments and feedback are welcome, we are seeking current, updated suggestions and commentary rather than resubmission of material already provided as part of previous stakeholder outreach efforts. Comments can be especially helpful to the Postal Service in analyzing external trends that will shape the demand for postal services over the next five years. The following fundamental changes have previously been identified as likely to reshape the delivery services marketplace:

Changing Customer Needs

With access to more information and options than ever before, customers have a broad range of choices for delivery of messages, money, and merchandise—our three businesses. Customer requirements for postal services and entrenched network structures and service patterns may be changing. The Postal Service's Strategic Transformation Plan 2006-2010 is intended to meet these changing customer requirements while continuing to transform the Postal Service into an organization that is “easier to use” and more responsive to customer needs. The Postal Service intends to “partner” with customers and industry participants to add value to customer transactions.

Eroding Mail Volumes

Electronic alternatives, particularly bill presentment and payment, pose a definite and substantial risk to First-Class Mail” volume and revenue within the next 5-10 years. This could, in turn, have a negative impact on First-Class Mail rates.

Rising Costs

Despite major gains in efficiency and productivity through automation, the costs of maintaining an ever-expanding postal network are increasing, especially costs outside the direct control of the Postal Service, such as retirement and health benefit liabilities.

Fixed Costs

Universal service requires a significant infrastructure to deliver postal services. Almost half of current Postal Service costs are spent on these resources, and that level does not change when volume or productivity increases or decreases. This makes cost containment most challenging.

Merging of Public and Private Operators into Global Networks

Former national foreign postal services, some privatized, have entered the U.S. domestic market.

Increasing Security Concerns

Rising security concerns require sophisticated countermeasures.

Are these factors still relevant? Which ones are relevant and which are not? Are some more important than others? Is the rate of change for each factor increasing or decreasing? Are there Start Printed Page 20193other factors that warrant consideration? What are they? In developing the Strategic Transformation Plan 2006-2010, the Postal Service would like to receive stakeholders' views and comments on these and other long-term external changes, issues, and trends.

The Postal Service also invites comment on its long-range organizational goals, or objectives, published most recently in the Preliminary Annual Performance Plan for 2005 as part of the FY 2004 Comprehensive Statement on Postal Operations. The Postal Service has employed long-range goals, or objectives, as part of a strategic planning process for over two decades, along with systematic performance assessments. The Postal Service has developed a disciplined process to establish goals, objectives, indicators, and targets; assign resources to programs that support achievement of the targets; implement the programs; and review performance. Stakeholder input will also support and enhance the performance process.

The United States Postal Service maintains a Web page dedicated to soliciting comments on its Strategic Transformation Plan 2006-2010:​strategicplanning/​2006-2010.htm. Stakeholders are requested to review this Web site, and may submit emails or send written comments. Interested parties are encouraged to complete the survey presented on the Web page, and, if desired, respond to the following questions included on the survey:

  • If there were one change you could write into Transformation 2006-2010 for the Postal Service, what would it be?
  • What is most important to your organization in the next five years, and how can the Postal Service best help you?
  • What should the Postal Service look like in five years? What are the most important changes that should be made?
  • What is the proper balance among the multiple goals of the Postal Service (universal service, financial self-sufficiency, public services, cost management and productivity, workplace and workforce improvement, effective products and services, responsive customer support)?
  • What information should the Postal Service be providing to stakeholders?
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Stanley F. Mires,

Chief Counsel, Legislative.

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[FR Doc. 05-7750 Filed 4-15-05; 8:45 am]