Agenda 1. Overview 2.Sample Design and Methodology 3.Pilot Test Results

®

Webinar 6

Expanded EXFCPresented by

Delores KilletteVice President, Consumer Affairs

and

David WilliamsManager, Processing Operations

Friday, November 7, 2008

®

Agenda

1. Overview

2. Sample Design and Methodology

3. Pilot Test Results

EXFC Expansion

®

Changes to EXFC in FY 2009

Coverage expanded to 891 ZIP Codes*Additional 428 ZIP CodesRepresents 99% of Single Piece First Class

volume

Reflect Modern Service StandardsIncludes Four and Five Day Service StandardImpacts Alaska, Honolulu and Caribbean

*ZIP Code list located on CKM website under Other Educational Material/Resources/Report Information http://blue.usps.gov/caweb/ckm/ckm_ttms_library.htm

EXFC Expansion Overview

®

Changes to EXFC in FY 2009

New kits introduced on October 421 kits; 3 flat kits, 2 postcard kits, 16 letter

kits

Key Characteristic Changes – Additional Flat kitStamped percentage 38.2% to 53.3%Metered volume decreased 61.8% to 46.7%Handwritten percentages increased 19% to

23.7%

Kit descriptions located on CKM website under Other Educational Material/Resources/Report Information http://blue.usps.gov/caweb/ckm/ckm_ttms_library.htm

EXFC Expansion Sample Design and Methodology

®

Increased test mail volume

● Increased overnight volume for PCs with increased coverage and origin-destination ZIP Code pairs

● Additional two and three-five day destinating volume for all PCs

EXFC Expansion Sample Design and

Methodology

Service Standard

Destinating Volume Target per PC

Current EXFC System

Destinating Volume Target per PC

Expanded EXFC System

Overnight 4,785 pieces 4,785 piecesTwo-Day 1,500 pieces 2,285 pieces

Three-to-Five-Day

1,500 pieces 2,685 pieces

® EXFC Expansion – Area Overview

Area# of

New ZIP Codes

Overnight % Volume

Added

Two-Day % Volume

Three-Five Day % Volume Added

Capital Metro 16 10% 13% 8%

Eastern 76 25% 21% 16%

Great Lakes 35 16% 12% 8%

New York Metro

11 10% 6% 9%

Northeast 32 20% 23% 22%

Pacific 15 14% 21% 12%

Southeast 46 23% 24% 13%

Southwest 63 26% 26% 13%

Western 134 30% 40% 19%

Nation 428 20% 21% 14%

®

EXFC Expansion – Pilot Results

Description of Column Contents:

EXFC (463): The official FY08 Q4 results for the established 463 ZIP Codes (without any Expansion ZIP Code results)

New ZIP Codes (428): The results for mailpieces that originated and/or destinated in one of the new 428 ZIP Codes

All ZIP Codes (891): The pilot results of mailpieces that originated and destinated in any of the 891 ZIP Codes

Difference: The results of all 891 ZIP Codes minus the results of EXFC 463

Service Standard

EXFC Codes (463)

New ZIP Codes (428)

All ZIP Codes (891)

Difference (All 891–EXFC 463)

Overnight 96.7 94.0 96.2 - 0.5

Two-Day 94.2 88.9 93.1 - 1.1

Three-Day 92.9 86.4 91.7 -1.2

Pilot Test results located on CKM website http://blue.usps.gov/caweb/ckm/ckm_ttms_report_exfc_pilot_menu.htm

Current EXFC versus Pilot Test PerformanceJuly 1, 2008 – September 30, 2008

®

PC data located at http://blue.usps.gov/caweb/ckm/ckm_ttms_report_exfc_pilot_menu.htm


AreaEXFC ZIP

Codes (463)

New ZIP Codes (428)

All ZIP Codes (891)

Difference (All 891 -

EXFC 463)

Capital Metro 97.3 95.1 97.2 -0.2

Eastern 96.4 94.9 95.9 -0.5

Great Lakes 96.0 94.3 95.7 -0.3

New York Metro 96.4 94.5 96.0 -0.4Northeast 96.6 93.6 96.1 -0.5

Pacific 97.0 94.4 96.6 -0.4Southeast 96.7 93.7 96.2 -0.5Southwest 96.6 93.8 95.8 -0.8Western 97.0 93.1 96.3 -0.7

All nine Areas experienced a score decline when measuring all 891 3-digit ZIP Codes

Southwest has largest change (-0.80)

Area Overnight Results from Q4 FY 08

®




Western has the largest potential change (-2.5)

Area Two Day Results from Q4 FY08

Area

EXFC ZIP Codes (463)

New ZIP Codes (428)

All ZIP Codes (891)


EXFC 463)

Capital Metro 96.0 86.5 93.8 -1.2

Eastern 93.3 88.4 92.4 -0.9

Great Lakes 92.8 86.0 91.9 -0.9



®



Three-day Service Standard


Western has the largest potential score change (-2.23)

Area Three-Day Results from Q4 FY08

AreaEXFC ZIP

Codes (463)

New ZIP Codes (428)

All ZIP Codes (891)


EXFC 463)

Capital Metro 94.4 88.3 94.0 -0.5

Eastern 92.5 87.0 91.2 -1.3

Great Lakes 91.5 86.4 90.5 -1.0



®

Final Zero Bundle Results

23 verified zero bundles in core EXFC ZIP Codes of 28,263 bundles inducted

23 verified zero bundles in pilot ZIP Codes out of 2,540 bundles inducted

EXFC Expansion Results

®

Customer Knowledge Management Resources

Service Performance scores are located on the CKM website at http://blue.usps.gov/caweb/ckm/ckm_ttms_report_menu.htm

For questions on Transit Time Measurement System (TTMS) studies you may contact the TTMS team at [email protected]

EXFC Expansion

Impact of EXFC Expansion on October Destinating EXFC Performance

Data Source: EDW/TTMS November 4, 2008

EXFC Expansion

Service Standard

Old EXFC ZIPs

EXFC Expansion

ZIPsGap Total EXFC

Overnight 96.02% 93.20% 2.82 95.53%

2-Day 93.43% 90.07% 3.36 92.77%

3-5 Day 92.04% 85.42% 6.62 91.20%

MHTS Service Gap Between Old EXFC and Expansion EXFC – October 2008

Delivery Unit Processing

Origin Processing

Destination Processing

DeliveryTransport to Delivery Unit

Transport to Destination

Collection

MHTS Measure

EXFC Expansion

Service Standard

Old EXFC ZIPs

EXFC Expansion

ZIPsGap

Total MHTS(Old and

Expanded ZIPs)

Overnight 98.80% 98.29% 0.51 98.69%

2-Day 96.04% 94.64% 1.40 95.71%

3-5 Day 94.43% 89.96% 4.47 93.78%

MHTS Service for Old EXFC vs. Expansion EXFC O/N

95

96

97

98

99

100

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT

EXFC EXFC Expansion Total Service

EXFC Expansion

MHTS Service for Old EXFC vs. Expansion EXFC 2-Day

85

88

91

94

97

100



EXFC Expansion

MHTS Service for Old EXFC vs. Expansion EXFC 3-Day

75

80

85

90

95

100



EXFC Expansion

Composite National O/N EXFC Expansion Impacts

EXFC Expansion

Destinating New Volume = 17.5%

Destinating New Failures = 26.5%

Percentage Point Gap = 9.0

Composite National 2-Day EXFC Expansion Impacts

EXFC Expansion


Destinating New Failures = 27.1% Percentage Point Gap = 7.4

Composite National 3-5Day EXFC Expansion Impacts

EXFC Expansion


Destinating New Failures = 21.2%

Percentage Point Gap = 8.4

Destinating Overnight MHTS EXFC Expansion Impacts

Total Pieces

78%

22%

Old EXFC EXFC Expansion

Failed Pieces

72%

28%


Data Source: MHTS/MIRS October 2008

6 Point Gap

EXFC Expansion

Destinating 2-Day MHTS EXFC Expansion Impacts

Total Pieces

76%

24%


Failed Pieces

71%

29%



5 Point Gap

EXFC Expansion

Destinating 3-5 Day MHTS EXFC Expansion Impacts

Total Pieces

85%

15%


Failed Pieces

77%

23%



8 Point Gap

EXFC Expansion

Originating Destinating

National Percent of Letter Failures Pareto Chart

60.7%

8.5% 7.0% 5.0% 4.5% 2.5% 2.4% 2.4% 2.3% 2.0% 1.2% 1.0% 0.3% 0.1%0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

Failure Category

Per

cen

t o

f F

ailu

res

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

EXFC Service Impact Pareto Chart - Overnight Letters

Last Mile Failure Point Impact = 1.76 Points

Data Source: IBM Root Cause Failure Analysis – Final Quarter IV FY 2008

Last

Mile

Failu

re

Non-S

tand

ard

Depth

of S

ort

Origin

Misc

oded

/Misr

ead

Late

Inc. S

econ

dary

Pro

cess

ing

Non-S

tand

ard

Origin

Pro

cess

ing

No Rea

d at

Des

tinat

ion

Origin

Pro

cess

ing

Delay

Dest.

Misc

oded

/Misr

ead

Destin

ation

Miss

ent

Colle

ction

Delay

No Rea

d at

Orig

in

Origin

Miss

ent

Recei

ved

1st D

PS P

ass/Not

2nd

DPS Loo

ping

EXFC Expansion

MHTS Service Predictor

Delivery Unit Processing

Origin Processing




Collection

Collection Factor

MHTS Service

Last Mile

Factor% On-Time

EXFC Overnight Letters 0.08 98.80% 1.76 96.96%

EXFC Expansion

Old EXFC Impacts for Letters – October 2008

Data Source: * IBM Root Cause Failure Analysis – Final Quarter IV FY 2008

MHTS service from MIRS – October 2008

EXFC Expansion

Service StandardCollection

FactorMHTS

ServiceLast Mile Factor *

Predicted Service

Actual Service Difference

Overnight 0.06 98.80% 1.76 96.98% 96.52% 0.462 Day 0.06 96.04% 1.55 94.43% 94.21% 0.223-5 Day 0.05 94.43% 1.22 93.16% 92.89% 0.27

EXFC Expansion Impacts for Letters – October 2008

Data Source: * IBM Root Cause Failure Analysis – Final Quarter IV FY 2008

MHTS service from MIRS – October 2008

EXFC Expansion


FactorMHTS

ServiceLast Mile Factor *

Predicted Service




FactorMHTS

Service

Estimated Last Mile

FactorPredicted Service



Last Mile Impacts

Get mail in DPS – automate volumes

Connect rejects / rework volumes from DPS

Reduce At Risk volumes - machine and operator quality

Dispatch trucks on time 0400 – 0900

Connect hot case - timely customer service distribution

CollectionDelivery Unit Processing

Origin Processing




EXFC Expansion

EXFC Expansion

Expansion EXFC Impacts on Total EXFC Expansion MHTS Failures

Data Source: MHTS/MIRS October 1 – 30, 2008

Districts Sites Sort ProgramsOvernight 48.5% 24.6% 7.9%2 Day 40.0% 19.4% 6.6%3 Day 40.1% 18.9% 7.9%

Bottom 10

Districts Sites Sort ProgramsOvernight 78.0% 38.9% 13.3%2 Day 71.7% 34.5% 12.5%3 Day 68.6% 33.7% 13.5%

Bottom 25

What If Overnight Flats were at 96.50% On-Time?October 2008

Mail ShapeOld EXFC

ZIPs

EXFC Expansion

ZIPsTotal EXFC

Letters 96.54% 93.80% 96.06%

Flats 89.79% 85.75% 89.10%

Total 96.04% 93.21% 95.55%

What If Flats were at 96.5% On Time? 96.54% 93.99% 96.09%

Data Source: EDW/TTMS November 5, 2008

EXFC Expansion

EXFC Service Impact Pareto Chart – Overnight Flats

National Percent of Flat Failures Pareto Chart

32.5%

18.6%

11.9% 11.8%6.3% 5.0% 4.6% 4.5% 3.0% 1.1% 0.6%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Failure Category

Per

cen

t o

f F

ailu

res

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Originating DestinatingData Source: IBM Root Cause Failure Analysis – Final Quarter IV FY 2008

Last Mile Failure Point Impact = 3.22

Last

Mile

Failu

re

Origin

Miss

ent

Late

Inc. S

econ

dary

Pro

cess

ing

Non-S

tand

ard

Origin

Pro

cess

ing

Origin

Misc

oded

/Misr

ead

No Rea

d at

Des

tinat

ion

Origin

Pro

cess

ing

Delay

Dest.

Misc

oded

/Misr

ead

No Rea

d at

Orig

in

Destin

ation

Miss

ent

Colle

ction

Delay

EXFC Expansion

Key Actions

Collection box management process in place

Standardized mail flows in place for all mail

Operating plan and 24 hour clock adherence discipline for all mail

High levels of machine and operator method quality

Service responsive transportation

Timely customer service distribution

EXFC Expansion

Questions?

[email protected]

Do you have questions about any of the presentations?

Do you have suggestions to make them more informative?

Do you have ideas for new presentations?

WE WANT TO HEAR FROM YOU!

Next Week

Friday, November 14, 2008 at 11:00 a.m. ET

First-Class Mail Measurementand Operational Impacts

Presented by –

Tom DaySenior Vice President, Intelligent Mail & Address Quality

and

David WilliamsManager, Processing Operations

Have a good weekend!

Agenda 1. Overview 2.Sample Design and Methodology 3.Pilot Test Results

Documents

Transcript of Agenda 1. Overview 2.Sample Design and Methodology 3.Pilot Test Results