USPS Product Information MTAC Jim Cochrane Vice President, Product Information February 17, 2011

Product Information – Meet the Team

Enhance USPS Business Value  One barcode per piece  Capture workload by product  Improves cost modeling  Reduce labor costs  Transportation analytics  Enhances ability to offer new products and services  Allows for delivery efficiencies  Service analytics Product Information IMb/IMpb Getting to World Class

Create Customer Value  Foundational for shipping: Why not mailing?  Track all volume  Seamless acceptance  Improves customer experience  Provides data to support marketing initiatives  Manage business processes, service measurement and logistic providers Product Information IMb/IMpb Getting to World Class

When you barcode a letter, you receive a discount When you barcode a package, we make you pay Value of Information Core to the product or value with a charge? Barcode Intelligence

Testing Status 01/29/ /28/2011 Full-Service Volume Service Performance Measurement

Full-Service Volume Growth Service Performance Measurement Full Service Volume has seen a 59% growth from Q2-FY10 to Q1-FY11

Intelligent Mail vs. FS Volume Growth Q1 FY11 had marginal increase in IMb adoption from POSTNET bar code Service Performance Measurement

Full Service Statistics PQ1, FY 2011 Service Performance Measurement

Full-Service Customer Sites Approved For Production 631 Full-Service Postage Statements Finalize 539,877 Full-Service Total Piece Volume 45,696,935,719 Full Service Production Trends Service Performance Measurement May 2009 – January 2011

Moving Forward USPS  Stabilize Performance  Robust reporting capabilities  EXFC report-type quality (depth of failure analysis per piece level)  Increase number of Certified Mailers Customer  Improve value for customer  Refocus on IMb, move off of SPM  Simplify start-the-clock process Service Performance Measurement

Full Service Certification Update Container Yields  Certified mailer container yield is twice that of non-certified mailers  Streamlined review checklist for standard & periodicals mailers  System Change Requests  Feb - CSA Verification Errors will be corrected to STC – Origin Yield: +20%  June - SV Unload Scans will generate STC - Drop Ship Yield: +15% Data based on Containers with Mailing Date of 1/22 – 1/28

Mailers continue to fail certification; BMS working with mailers to identify required updates to their software and operations to address key issues Other Errors include: MID Verification Errors and Invalid Entry Point Errors Full Service Analytics Container Level Mail Quality Errors

Full Service Certification Update Certified Mailer Monitoring  Measured weekly against 8 metrics  Mailers that fail metrics related to direct inputs to STC are decertified  Decertified mailers eligible for recertification after confirming issue(s) addressed Certified Mailer Monitoring Process Identify Issues/ Failures Communicate Issues to BMS Confirm issues are resolved Perform Census Analysis Certified Mailers Weekly Monitoring Strategy

 Transportation fields used in CSA association will not be used in the future  CSA Type  Recurring Appointment ID  Arrival Time  Dispatch Time  CSA Trip ID  Stronger reliance on USPS scans to Start-the- Clock  Scan all 99Ms upon arrival at USPS  Resolves pallet to FAST appointment challenges Start the Clock Changes

Proposed CAT- CET

 Completed Value Stream Mapping of package and mail flows  On-going process capability analysis  Rolled Throughput Yield on all processes Using LSS to Drive Performance P.O. to Plant Orig. Plant to Dispatch Transportation Dest. Plant to Dispatch Plant to P.O.P.O. to Delivery 99.5% 99.8% 99.5% 99.8% 98% 99.5% 99.8% 99.5% 99.8% 99.5% 99.8% = 95.5% = 97% Lean Six Sigma Approach Measure All Processes Service Performance Measurement

Full Service Analytics Rolled Throughput Yield

On-Time Goal GAP Analysis Rolled Throughput Yield

Infrastructure Initiatives

Proposed 6-Digit Mailer ID IMcb (1) NOTE: The Serial Number field shall be padded with leading “ - “ characters or dashes (ASCII value 0045) if the mailer-defined value is less than the required 12 characters. For example, if the mailer opts for a container identifier of “123456”, a value of “ ” should be encoded. 6-digit Mailer ID Format Field No. Field Description Field Size Character Position Logical Values Allowable Values 1Application Identifier21-2Numeric“99” (Only) 2Type Indicator13Alpha“M” (Only) 3Destination Facility ZIP54-8Numeric 4Mailer ID69-14NumericUSPS-assigned ID with the leading digit ranging from “0” through “8” 5Serial Number AlphanumericMailer-defined (1) Intelligent Mail Container Barcode

Proposed 9-Digit Mailer ID IMcb Intelligent Mail Container Barcode

Proposed IMcb Placard  Destination Facility 5-Digit ZIP  Human Readable Intelligent Mail Container Barcode

 Flexible scanning solution  Provide enroute scans on all Priority Mail  Enhanced technology to handheld IMDs  Integration of hands-free imager (Ring Scanner)  Increases visibility, productivity, and operational efficiency Package Barcode Reader Program Infrastructure Initiatives Fills the gap where MPE is not used

An Integrated Approach Electronic Mailing Information Electronic Centralized Payment Scan at Entry Induction Electronic Advance Notification Unique Barcodes Mail Preparation Electronic In-Process & Performance-Based Mail Verification Total Visibility Barcode Intelligence

Passive Scan Infrastructure Active Scan Infrastructure Scan Infrastructure Infrastructure Initiatives

Final Thoughts  Full Visibility Process Map  IMpb update  Full Service ACS challenge

Questions?