Strategic Transformation Plan 2006— Update Strategic Transformation 2007 Update January 30, 2008

Strategic Transformation Plan 2006— Update  Start with vision – realistic but ambitious  Break it down: priorities  Commit to aggressive targets  Sustain change Transformation

Strategic Transformation Plan 2006— Update  How the law impacts strategy  Update and reinforce goals  Refine key strategies  Set the stage for Update

Strategic Transformation Plan 2006— Update  Generate Revenue  Increase Efficiency  Improve Service  Create a Customer-Focused Culture  Enhance Sustainability

Strategic Transformation Plan 2006— Update  Add value, improve relevance: Intelligent Mail  Collaborate on new applications  Simplify acceptance, expand access  Build on domestic to grow international  Strengthen outreach Generate Revenue

Strategic Transformation Plan 2006— Update Reinforce the value of mail. Responsive to customer needs. Generate Revenue

Strategic Transformation Plan 2006— Update  Flats sequencing  Expand standardization  Efficient, customer-focused network  Streamline processes ─ beyond operations Increase Efficiency

Strategic Transformation Plan 2006— Update Accelerate existing efforts: >$1 billion annual savings. Costs under CPI by class. Increase Efficiency

Strategic Transformation Plan 2006— Update  Quality and consistency at all access points  Updated standards, externally-validated service measurement  Cut UAA in half. Improve addresses and lists.  Move to total mail visibility Improve Service

Strategic Transformation Plan 2006— Update Use data to target opportunity, reduce variability, and drive continuous improvement. Improve Service

Strategic Transformation Plan 2006— Update Create a Customer- Focused Culture  Develop and sustain skills  Minimize distractions  Align compensation and recognition with results

Strategic Transformation Plan 2006— Update Align to new technologies and evolving markets Engagement to ensure viability for future generations Create a Customer- Focused Culture

Strategic Transformation Plan 2006— Update  Improve understanding of the benefits of mail  Improve address and list quality  Help customers go “green”  Expand recycled and recyclable products  Reduce fuel use. Reduce energy use in facilities by 20% Enhance Sustainability

Strategic Transformation Plan 2006— Update Build a conservation culture. Partner with customers, suppliers, and government. Enhance Sustainability

Strategic Transformation Plan 2006— Update What’s Next?

Strategic Transformation Plan 2006— Update  What do you see as growth opportunities?  Where does your business need to be in 5 years? How can we help get you there?  How do we work together to get new customers using mail? We need your thoughts

Strategic Transformation Plan 2006— Update Questions? Your comments questions ideas