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Postal Service drives toward tech future

Mar. 19, 2014 - 06:00AM   |  
By ANDY MEDICI   |   Comments
(U.S. Postal Service)

The Postal Service has cut its workforce by more than 320,000 employees since fiscal 2000 and wants to cut an additional 85,000 over the next few years in order to trim costs and increase efficiency.

Legislation that the Postal Service claims would allow them to save billions by ending Saturday letter delivery and making other changes is stalled in Congress; and its plan to shift hundreds of millions of costs on to Medicare is in limbo. But the Postal Service is investing hundreds of millions of dollars on upgrading its network, collecting data and automating more of its systems in order to become a key player in an increasingly digital age.

Jim Cochrane, the chief information officer at the Postal Service, sat down with Federal Times and other reporters at the National Postal Forum March 18 to talk about how the Postal Service it is transforming itself into a more responsive, digital organization. Following are edited excerpts.

On the goals of the Postal Service:

I think itís important to begin [by saying] that our goal set is a lot different [from] other federal agencies. I sit my team down, and there are a lot of goals on performance, on system availability and spending, but our core goal and number one goal is to generate revenue. That is not a goal we share with the Department of Defense or different agencies. The second goal is to drive efficiency, and the third one is world-class service. We are a service company, we are a delivery company and a logistics company, and we want to do that at the highest levels against the standards that we set. And the final one is customer experience, and that is a newer one we are really getting focused on. All of those interactions become real important.

On Big Data and the future of delivery:

We are committed to the mail. We think mail has an opportunity, in particular [the] direct mail business. Like all advertising, itís going through a period of profound change, whether itís TV or radio or magazines. We think direct mail fits, and fits well, with the digitization of how people communicate. We call it the digital reflection, as hard copies move through our network. We [are] collecting data all the way and trying to marry that up so we can help them stack messages and approach customers in an omni-channel way, whether itís online or TV or direct mail or radio. So a lot of our strategies are really to improve our intelligence on our mail stream ó we want to have a smart mail stream, an intelligent mail stream. We are making significant progress on that. We have invested pretty heavily in technology to improve our analytics around mail. So like [for] a lot of companies, the challenge of big data is real. We are approaching 30 petabytes of data in storage, and itís only going to continue to grow. Exponentially itís growing. The challenge is to harness all that data and make information out of it and take all that information and make good analytics.

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But we have a lot of data. We are like a lot of companies where we have made significant inroads in analytics. We focused operationally at first and very successfully used data to manage service and drive performance across the enterprise. It has really given us some excellent insights. We are very predictive. We scan a pallet when it arrives from a retailer, and we measure that. We measure cycle time on that pallet until it ends up on our sorters. So we are measuring all through the process and predictive waves and sending alerts so every plant manager in the country gets alerts for when a pallet is sitting too long. That helps give us the reliability our customers expect.

On sharing data with private companies:

We are a federal agency so we protect [data]. The security of that data ó itís personal ó so we donít ever share it. I can say that from the data we have we know what mail goes into your houses and we know what catalogs you get. But we donít share any of that. We donít use it ourselves. Our states donít allow for it. We do use it for understanding workload and for understanding where the growth is in communities. We actively evaluate on a weekly basis where we donít deliver successfully on a first attempt. Where we have to leave you one of those orange cards. We are always trying to drive that down. For us, if we can get 1 percent better on what we deliver on first attempt, we have eliminated 37 million packages where someone has to get in their car and drive to a post office.

On upgrading IT to deliver better customer service:

Our plan on the package side is to deliver packages as many as seven days a week. Maybe not universally but to probably 80 percent of the U.S. population we think we can be efficient in Sunday delivery. I think some of the work we have done with Amazon, doing Sunday delivery with them, has been a significant shift in our core competency. We are at 152 million doors but on Sunday we have to reinvent how we do delivery. We had to design dynamic routes but we are making good progress on that. We are designing about 2,000 dynamic routes and growing. Itís a major metro initiative. I think what it tells us is that as good as we are, even we had to step back and say thatís our core competency but Sunday we have to do it different. So we had to relearn differently. It wasnít just delivery. We had to fix our technology. We really are making a billion-dollar bet on the future in the shipping business. We replaced all our tracking systems in the last two years. We increased tracking events five times. Customers are getting a significant amount of events from where they were three years ago. We took latency out and improved the experience.

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On mobile devices and integration:

We are in the process of deploying our next generation handheld device. We are reluctant to call it a scanner because itís going to be so much more. Itís going to be our letter carriersí work aid. They are going to sign into that device. They are going to inspect their vehicle on that device. They are going to look at when people move and vacancies, all that can be put on the device. We had to make significant investments in our infrastructure. We also deployed scanners in all our processing centers and continue to upgrade old technology. We are exploring replacing all of that technology. We have a lot of work to do from a technology perspective. We have more work to do with our sorters, which are mostly into our processing centers. We need to take a step back to put technology in post offices to sort parcels. Our goal is to by the end of the year to have technology at every post office to scan a package and resolve where that route is going to be. Technology has been a great aid in our effort to re-platform ourselves from a delivery perspective. There is a lot of investment going on, and we think we are really investing for the future. We are growing, and we donít think thatís going to change. We are going to add billions of packages to our network.

We are taking a hard look at all our mobile applications to improve the customer experience. We think we can do a little more work on how customers interact with us. We have deployed a lot of technologies and in-sourced our call centers so we can have postal employees working there that are knowledgeable about our products and services to talk to our customers, and we have to continue to enhance that. As we build out some of this infrastructure with our next generation device, we want our agents at our call center to be able to text the letter carrier on their route that there is an issue or problem that needs to be addressed. Once again we are leveraging technology to improve the experience. My job is to understand the technology thatís out there: where it is, where is the market going, what are the market needs, where are we behind, where can we improve our capability or our footprint. I think I have the best job in the Postal Service. You really have an opportunity to bring technology to a lot of significant problems. So itís very rewarding to build stuff that people use that immediately brings value.

On cybersecurity:

We have re-architected many of our systems to make them more stable, particularly where we do revenue transactions. Cybersecurity is always an important issue, so we are in the process of updating our PCI compliance, which is with the credit card industry, but thatís relentless. Itís neverending and itís a never-ending battle that we fight, just like every other company in the United States. Itís a big part of it. You have to keep it reliable, you have to keep it secure. The secure part is really part of our brand on the e-commerce side. We have the inspection service as a valued partner, so when there is some fraud ó and there are always bad guys out there ó they are a valued partner that we work with closely to help combat some of the fraud that does take place. There is no shortage of things to do.■

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