1. 1 Performance Management Presentation Provide Mail, Courier and Package Screening Services Team Members: Leader: James Spears Members: Tracy Niksich Angela Milton Division of Mail and Courier Services ORS National Institutes of Health Date: January 09, 2004

2. 2 Table of Contents Main Presentation PM Template ……………………………….……………………Slide 4 Customer Perspective……………………….………………….Slide 7 Internal Business Process Perspective……………………………………………………Slide 15 Learning and Growth Perspective……………………………………………………Slide 28 Financial Perspective……………………………………………Slide 35 Conclusions and Recommendations……………………………………………Slide 47

3. 3 Appendix Pages 2-5 of template Customer Perspective NONE……………………………………………. Internal Business Process Perspective IB1: Complete and update process maps of Service Group/Discrete Services IB5: Actual postage used vs. OMAS statements IB6: Percentage of courier items meeting the two hour delivery target Learning and Growth Perspective LG1a: Turnover LG1b: Sick leave usage LG2a: EEO LG2b: ER LG2c: ADR LG3: Awards/Recognition Financial Perspective NONE………………………………………………... Table of Contents (cont.)

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5. 5 Relationship Among Performance Objectives Customer needs and expectations Operational Objectives Internal Business Objectives Learning and Growth Objectives Performance Improvements / Operational Changes Customer Objectives Financial Objectives Performance Feedback

6. 6 Relationship Among Performance Objectives Division of Mail and Courier Service (DMCS) performance objectives have little, if any impact on other objectives DMCS performance objectives refer to well- defined but separate areas of the discrete services they represent

7. 7 Customer Perspective

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10. 10 Customer Scorecard Methodology DMCS did not conduct a survey in FY03. We believe: It was too soon to conduct another survey since countermeasures from the last survey had only been in place for about six months We wouldn’t be learning anything of value concerning contractor-conducted services since we have been in the process of replacing the former mail services contractor We plan to conduct a survey in FY04. There will be a survey sent out to each mail stop through the DMCS delivery network, with questions to be determined at that time

11. 11 Customer Perspective What does the data tell you? IC mail managers provided an excellent means of disseminating information concerning mail service issues, performance improvement initiatives, and postal news IC mail managers were a good source of information about the potential reactions of IC customers to various issues, from postage rate increases to DMCS performance improvement initiatives Positive reaction from the IC mail managers convinced us that the small volume/secure mail initiative should be immediately implemented in full scale (next slide picture)

12. 12 Customer Perspective: small volume/secure mail initiative

13. 13 Customer Perspective What does the data tell you? The small volume/secure mail initiative was the result of a long-term study in response to customer concerns over the physical condition of mail, when received in small bundles, and the difficulty of sorting and keeping small bundles and their contents in delivery sequence for DMCS delivery drivers The solution had to address both these concerns and be relatively inexpensive to use since the solution would be frequently utilized DMCS delivers to over 1100 mail stops, two times per day

14. 14 Customer Perspective What actions are planned? DMCS will continue to schedule a mail managers meeting every four months to keep this communication channel open and viable DMCS will conduct a customer poll in FY 2004

15. 15 Internal Business Process Perspective

16. 16 Internal Business Process Perspective

17. 17 Driver Delivery Times are Consistent

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19. 19

20. 20 Internal Business Process Perspective

21. 21 Internal Business Process Perspective

22. 22 Internal Business Process Perspective

23. 23 Internal Business Process Perspective

24. 24 Internal Business Process Perspective What does the data tell you? Driver Delivery Times: Average variation for driver delivery times is much lower than in FY 2002 (FY02 13-35 min). Times ranged from 4 to 9 minutes between consecutive days Using control charts, the only delivery times that were out of control were the two delivery days following the work days that were cancelled due to the hurricane-related storms in the summer of 2003

25. 25 Internal Business Process Perspective What does the data tell you? Incoming Mail is Sorted Correctly: Two years of quality control samplings and feedback to the mail service contractors have been successful in lowering the primary sortation error rate from 1.06% (FY 2002) to a consistent score of less than 0.30%, with no problem areas

26. 26 Internal Business Process Perspective What does the data tell you? Postage is Correctly Applied to Outgoing Mail: Since the new mail services contractor began operations with increased training in June 2003, the quality sampling error rate has gone from 0.5% to 0.0%. Under the old contract, no one person was assigned to the job, so no one had ownership of the operation. Under the current contract, there is one primary person on a given day, with cross-trained back-ups available as needed

27. 27 Internal Business Process Perspective What actions are planned? DMCS will continue to monitor the work of the contractor in ways that provide creative feedback that increases operational excellence PMP quality goals for incoming mail sortation in 2004 will be adjusted accordingly

28. 28 Learning and Growth Perspective

29. 29 Learning and Growth Perspective

30. 30 Learning and Growth Perspective

31. 31 Percentage of Computer-simulated Bomb Threats Identified

32. 32 Learning and Growth Perspective What does the data tell you? Training: Meeting our training goal shows that training, especially safety training continues to be a priority at DMCS DMCS believes that additional training makes for a safer, more effective organization

33. 33 Learning and Growth Perspective What does the data tell you? X-Ray Clerk Proficiency: X-ray clerks are becoming more proficient at identifying potential explosives, which is due to ongoing training efforts and only somewhat to worker experience, since 100% turnover is taking place each year (two positions) in these contracted positions

34. 34 Learning and Growth Perspective What actions are planned? Training for DMCS will continue at the two training sessions per year minimum, with at least one session devoted to workplace safety Training for x-ray technicians will be increased in order to achieve our goal of 97% for next year

35. 35 Financial Perspective

36. 36 Financial Perspective (cont.)

37. 37 Financial Perspective What does the data tell you? Unit Costs: Labor costs for contracted discrete services are fixed by contract and increase when Bureau of Labor statistics job classification standards are raised. Nothing can be affected by DMCS management in the near term Labor costs for the FTE centered discrete services are fixed by Congress. Nothing can be affected by DMCS management in the near term Unit costs for “Scan Incoming Packages” are decreasing due to the increase and projected future increase in parcel volume in this area The only way to decrease unit costs in the long term is to maximize throughput and minimize down time. Since down time is very low, efforts must be made toward increasing efficiency such that volume increases will not increase total costs

38. 38 Asset Utilization Measures

39. 39 Financial Perspective What does the data tell you? Asset Utilization: Hours of downtime are centered in “Process and Deliver Incoming Mail” because the other discrete services are performed only when there is work of that nature available to be done “Process and Deliver Incoming Mail” uses the most work hours each day, and is what most employees are doing unless something else arises and work hours are needed in another area

40. 40 Financial Perspective (cont.)

41. 41 Total Savings vs. USPS Parcel Post

42. 42 Total Savings vs. USPS Parcel Post

43. 43 Financial Perspective What does the data tell you? Alternative Ground Shipping: The alternative ground shipping program has far exceeded expectations by doubling the savings from the previous FY ($140,000 vs. $70,000) While savings closely track volume, savings are greatest on medium-sized parcels (20-70 lbs)

44. 44 Financial Perspective What does the data tell you? Awareness of the alternative ground program was raised by means of flyers and by keeping IC mail managers aware of the savings potential and actual savings at each mail managers meeting Efforts to increase volume through awareness began to pay off in March 2003

45. 45 Financial Perspective What actions are planned? DMCS continues to employ more effective ways to utilize the work hours we’re paying for through applied technology (such as the additional PacTrac system, anti-fatigue mats, specialized safety cutters for mail bundles) and by minimizing sortation errors through a comprehensive quality control program (which minimizes rework) Although the NIH community continues to grow and spread out geographically, DMCS has not needed to increase contractor personnel to accommodate these changes

46. 46 Financial Perspective What actions are planned? The alternative ground program will continue, as it has been extremely effective at saving money vs. USPS Parcel Post, while providing superior service DMCS will continue to try and capture any remaining internal parcel business that can result in savings for NIH

47. 47 Conclusions

48. 48 Conclusions from PMP Meetings with the IC Mail Managers have helped improve service and understanding The reduction of average delivery time variation has resulted in better service for our customers DMCS Quality Control program has resulted in improved service Ongoing training continues to be a key part of DMCS customer service improvement Current x-ray clerk training is very effective Technology has improved service and slowed contractor cost increases

49. 49 Conclusions from PMP: Improvements Expenses have been avoided by using technology to get work done more effectively Anti-fatigue mats have been installed in the sortation areas to prevent worker fatigue, which can lead to lower production Safety cutters have been provided to more easily cut the straps on bundles of mail, which used to be a time- consuming task Small delivery bundles of mail are now placed in special plastic bags and heat sealed to facilitate sortation and delivery to mail stops An added PacTrac system has enabled DMCS to process the larger number of accountable mail pieces currently received in less time to ensure that delivery trucks will never have to wait for accountable mail DMCS quality control program has reduced sortation error from 1.06% (FY2002) to 0.30% (FY2003)

50. 50 Conclusions from PMP: Improvements The alternative ground shipping program has far exceeded expectations by doubling the savings from the previous FY ($140,000 vs. $70,000) due to excellent service and promotional efforts

51. 51 Appendix

52. 52 Appendix Pages 2-5 of template Customer Perspective NONE……………………………………………. Internal Business Process Perspective IB1: Complete and update process maps of Service Group/Discrete Services IB5: Actual postage used vs. OMAS statements IB6: Percentage of courier items meeting the two hour delivery target Learning and Growth Perspective LG1a: Turnover LG1b: Sick leave usage LG2a: EEO LG2b: ER LG2c: ADR LG3: Awards/Recognition Financial Perspective NONE………………………………………………...

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57. 57 Internal Business Process Perspective

58. 58 Appendices: Block Diagram

59. 59 Appendices: DS1 Process Chart

60. 60 Appendices: DS2 Process Chart

61. 61 Appendices: DS3 Process Chart

62. 62 Appendices: DS4 Process Chart

63. 63 Appendices: DS5 Process Chart

64. 64 Internal Business Process Perspective

65. 65 Appendices: Process Measures

66. 66 Internal Business Process Perspective

67. 67 Internal Business Process Perspective

68. 68 Internal Business Process Perspective What does the data tell you? Increase understanding of process: All process maps are updated and agreed to by NIH management, contractor management, and contractor employees as an actual representation USPS billing is accurate: There was no discrepancy in USPS OMAS reporting this year ORS Courier delivery is timely: All parcels entrusted to the ORS courier service were delivered within the two hour window

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70. 70 No data was available from Human Resources from FY2003 with which to generate comparative studies Conclusions from Turnover, Sick Leave, Awards, EEO/ER/ADR Data