1. ® Webinar #10 Commercial First-Class Mail and Standard Mail Measurement Presented by Tom Day Senior Vice President, Intelligent Mail and Address Quality Dave Williams Manager, Processing Operations Friday, January 16, 2009

2. ® 2  Overview of First-Class Mail and Standard Mail measurement  Interim solution  Long-term solution  Measurement Challenges  BMEU Seeding Results  Operational Issues Agenda for Today’s Discussion Commercial Mail Measurement

3. ® 3 Essentials of Service Measurement:  Three data points required:  “ Start-the-clock”; when the mail entered USPS network  “Stop-the-clock”; when did USPS effect, or in some cases attempt, delivery  Established Service Standard for comparison Service Measurement - Essentials

4. ® 4 Hybrid Approach:  Will take effect with the implementation Intelligent Mail (specific release date to be determined)  Applies to:  First-Class (Pre-sort)  Standard  Periodicals (future)  Supplements mail scans from internal Intelligent Mail® system with externally collected data Commercial Mail Measurement

5. ® 5 Origin Processing Destination Processing Delivery Acceptance Transport to Delivery Unit Transport to Destination Delivery Unit Processing Stop-the-Clock External reporters scan IMb on mail at delivery Visible through Intelligent Mail, up to final MPE Operation Code or other scan event  External Measurement  External Reporters will scan live mail  Contractor will calculate delivery service performance factor for each mail class  Factor combined with IM data to form end-to-end measurement Hybrid Measurement Approach Delivery Factor External Stop-the-Clock Commercial Mail Measurement

6. ® 6 Commercial Mail Interim Approach  Will use “first processing scan” at point of entry as a proxy for Start-the-Clock  Processing scan on USPS automated equipment clearly demonstrates the mailing has been entered into USPS Network  As Mailers/USPS demonstrate capability, we will transition to container scans at entry Commercial Mail Measurement

7. ® Manifest Created Mailer Facility Origin Entry at BMEU Last MPE ScanStart-the-Clock USPS Processing Facilities DPS / Flat Sorter scans BMEU arrival time recorded by Clerk PostalOne! Delivery External Reporters scan IMb on all mail they receive Stop-the-Clock (delivery factor calculated)

8. ® PostalOne! Start-the-Clock Manifest Created Mailer Facility Verification time recorded by Clerk Origin Entry at DMU Last MPE Scan USPS Processing DPS / Flat Sorter scans Delivery External Reporters scan IMb on all mail they receive Stop-the-Clock (delivery factor calculated)

9. ® 9 Standard Mail Measurement challenges  Destination Entry Saturation Mail  Home Depot method by carrier route  750 sites scanning when saturation mail arrived  Scanning static barcode for the last delivery date (if in-home specific dates requested)  Scanning static barcode when last pieces are taken to the street or delivered to a po box  Additional sites in quarter 2 Commercial Mail Measurement

10. ® 10 Standard Mail Measurement challenges  Carrier route bundles (future)  Density mailings  Container scanned when arrived at unit  Random bundle scanning when delivered Commercial Mail Measurement

11. ® 11 IMAQ BMEU First-Class Mail Seeding Trend Commercial Mail Performance First-Class Mail

12. ® 12 IMAQ BMEU Seeded Commercial First-Class Mail 30 Day Period Ending January 9, 2008 Commercial Mail Performance First-Class Mail Pieces% On TimeTargetGap Overnight2712688%96.5%8.5% 2 Day2490286%94.0%8.0% 3 - 5 Day2467369%92.7%23.5%

13. ® 13 IMAQ BMEU Standard Mail Seeding Trend Commercial Mail Performance Standard Mail

14. ® 14 Commercial Mail Performance Standard Mail

15. ® 15 Operational Issues

16. ® 16 Discussion of Operational Impacts EXFC Overnight Letter Service Impact FY 2009 Quarter I 2.09 % point impact 0.11 % point impact 1.55 % point impact

17. ® 17 Impact of Processing and Transportation Delivery Unit Processing Origin Processing Destination Processing Delivery Acceptance Transport to Delivery Unit Transport to Destination Collection Collections / Acceptance Processing and Transportation Last Mile % On- Time EXFC Overnight Letters 0.11%1.55%2.09%96.25% Discussion of Operational Impacts

18. ® 18 Collections / Acceptance Processing and Transportation Last Mile % On- Time EXFC Overnight Letters0.11%1.55%2.09%96.25% IMAQ BMEU Overnight Letters0.00%12.00%2.09%85.91% Delivery Unit Processing Origin Processing Destination Processing Delivery Acceptance Transport to Delivery Unit Transport to Destination Collection Impact of Processing and Transportation Discussion of Operational Impacts

19. ® 19 Collections / Acceptance Processing and Transportation Last Mile % On- Time EXFC Overnight Letters0.11%1.55%2.09%96.25% IMAQ BMEU Overnight Letters0.00%12.00%2.09%85.91% EXFC 2 Day Letters0.08%5.20%1.85%92.87% IMAQ BMEU 2 Day Letters0.00%14.00%1.85%84.15% EXFC 3 Day Letters0.06%11.71%1.48%86.75% IMAQ BMEU 3 Day Letters0.00%31.00%1.48%67.52% Impact of Processing and Transportation Discussion of Operational Impacts

20. ® 20 Summary of Key Points  Everything counts  Scanning  Secure BMEU hand-off procedures  Operating plan and 24 hour clock adherence discipline  Standardized mail flows in place  High levels of machine and operator method quality  Right mail on the right network at the right time Commercial Mail Measurement

21. ® 21 ANY QUESTIONS??

22. ® Webinar #11 Friday, January 23, 2009 “Periodicals Measurement” ̶̶ Presented by Lizbeth Dobbins and Maryellen Clarke SAME TIME SAME WEB ADDRESS SAME CONFERENCE NUMBER SAME PASSCODE