Chapter 2: Postal Operations
E. Mail Distribution
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a. Sorting Technology

During 2002, the Postal Service completed deployment of 353 CSBCS stacker modification kits that had begun the prior year. This 21- or 25-stacker addition provides the CSBCS with the capability of sorting to a greater number of delivery points even though the volume of mail in the route (or combination of routes) may not have changed. Bin overflows, manual processing requirements, processing costs, and delays in getting mail to the carrier have been reduced.

The 300 existing Integrated Data Systems (IDS) were upgraded this year. This upgrade allows the continuous collection of data from all mail processing equipment, including flats sorters, small parcel and bundle sorters, as well as material handling equipment in a facility. This expanded capability allows Postal Service managers to better match equipment and staffing to workloads, which improves productivity and reduces operating costs. The data collected also provides more accurate information on mail volumes and equipment utilization. More accurate volumes by destination and avail-ability for dispatch make it possible to reduce transportation costs. Equipment utilization data also provides the basis for activity-based costing models to better control operating costs within the Postal Service.

b. Undeliverable-As-Addressed Mail

During 2002, the Postal Service awarded a contract for the production and installation of Phase I of the Postal Automated Redirection System (PARS). PARS automates the handling of undeliverable-as-addressed (UAA) letter mail more efficiently than today’s process. The UAA mail is intercepted earlier in the sorting process, resulting in a reduction in not only total handlings and processing costs but, at the same time, improving service. The system notifies mailers of patrons’ address changes electronically for mailers that subscribe to this service and provides hard copy notification for mailers who do not subscribe. Both services generate revenue for the Postal Service. The system also automates processing of change-of-address forms.

Phase I includes 53 processing plants and 86 Computerized Forwarding System (CFS) sites which forward nearly one-fourth of all forwarded letters. PARS Phase I deployment is expected to begin in July 2003 and end in May 2004. The Postal Service expects to complete Phase II, which covers deployment to the remaining sites, by the fall of 2006.

c. Advanced Facer Canceller System Upgrade

The Advanced Facer Canceller System (AFCS) is the primary letter canceling machine used in our processing and distribution centers. During 2002, the Postal Service awarded a contract to enhance the capabilities of 358 of our 1,086 AFCSs by equipping at least one at each major processing facility with a video facing modification kit.

These kits will enable the AFCS to process mail that does not have phosphorescence in the stamp, indicia, or meter mark. This modification will allow mail that is rejected by the AFCS to avoid the expensive manual handling required today to face and cancel the rejected mail. Deployment was expected to begin in November 2002.

d. Flat Mail Automation
1. Automated Flat Sorting Machine 100

An important addition to our automation processing capability has been the automated flat sorting machine (AFSM) 100. The enhanced features of this machine have enabled us to expand the benefits of automation to the flats mailstream. These features include three automatic feeding stations yielding a throughput of over 17,000 pieces per hour, OCR reading with online video encoding (i.e., real-time keying) of OCR rejects, and a tray take-away system with adaptability to robotic handling systems. This enhanced processing equipment has provided additional flat sorting network capacity. A second phase, deployment of 362 machines that primarily replaced our older and less capable FSM 881s, was completed in April 2002. Phase II software enhancements have increased the system read rate to nearly 90 percent. This includes the Secondary Address Reader (SAR) enhancements tested during 2002 but not yet deployed. The final testing phase and hardware deployment for SAR is currently underway. The Postal Service also expects to begin deployment of OCR improvements in early 2004 that will further improve the machine’s performance.

2. Flat Mail Video Coding Operation at Remote Encoding Centers

The deployment of the AFSM 100 production equipment has provided the processing plants with the capability to process OCR-rejected flat mail pieces using the AFSM 100 flat mail video coding systems (VCSs). The rejected mailpiece images are lifted at the machine and sent to the VCS where a keyer views and processes the images online. The AFSM 100 VCSs were initially installed in the processing plants. At one time, Postal Service plants managed over 200 individual video coding rooms. However, recent advancements in the technology have made it possible to key images off-site in near-real-time at RECs. Consequently, most plants have relocated their video coding operation to the RECs, where flats are keyed more efficiently. This relocation also eliminated the need for individual plants to manage and staff the coding function.

During 2003, the Flats Remote Encoding System (FRES) program will be deployed. It will further improve the efficiency of the AFSM 100 REC keying operation by reducing the number of flats keyers required, and by managing and balancing their workload. In addition, this effort will allow us to consolidate and streamline the flat mail video coding operation, providing increased productivity and improved service.

3. Automated Flats Feeders and Optical Character Readers for Flat Sorting Machine 1000

During 2002, we started deploying automated flats feeders and optical character readers (AFF/OCR) on all flat sorting machine (FSM) 1000s. The FSM 1000 can process mail, such as newspapers and poly-wrapped material, which cannot be handled by our primary flat sorter, the AFSM 100. The AFF/OCR modification provides higher machine throughputs and lower staffing requirements. These installations should be completed during 2003. Also during 2003 we expect to begin deploying OCR improvements that will enhance the machine’s performance.

e. Parcel Automation

The increase in barcoded package volume is driving efforts to improve processing efficiency in parcel sorting operations. Deployment of Singulate, Scan, Induction Units (SSIUs) continued during 2002 as we deployed 14 SSIUs to seven bulk mail centers (BMCs). Each BMC will receive two SSIUs to improve the singulation process and automate induction of barcoded parcels onto the BMC sortation equipment (i.e., secondary parcel sorter). The device allows parcels to be sent, one at a time, through a dimensioning unit, a weigh-in-motion scale, and then through a scanning tunnel that will read the package barcode. Then, packages are inducted automatically onto the sorter. This is greatly reducing the labor needed to process parcels. When deployment ends in late 2003, 19 BMCs will be using SSIUs in their daily processing operations.

During 2002, the Postal Service continued to develop a next-generation sorter that will take advantage of the latest technology to distribute small parcels and bundles. This new equipment, known as the Automated Package Processing System (APPS), will automate the existing package processing network by providing automatic package singulation and address reading through an optical character reader/bar code reader/video coding system (OCR/BCR/VCS). The APPS includes automated container unloading to support the high throughput requirements. The system will be compatible with the Postal Service’s Information Platform and will support in-route tracking of Delivery Confirmation codes. Competitive tests were completed in April 2002 and a contract for 74 production systems is expected to be awarded in late September 2002. Delivery is expected to begin in February 2004 and end in June 2005.

f. Business Mail Acceptance

The Postal Service has automated the labor-intensive process of evaluating bulk mailing eligibility for worksharing discounts. The Mailing Evaluation Readability and Lookup Instrument (MERLIN) verifies nearly all mail preparation requirements for both letters and flats. It produces all reports necessary for mailing acceptance and provides images of preparation problems for the mailer to support process improvements. A total of 1,203 units have been purchased under this program. By the end of 2002, 346 MERLINs had been deployed. Deployment will continue through 2003 and should be completed in early 2004.

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Chapter 2 Table of Contents

A.  Public Perceptions, Customer
     Outreach and Mailer Liaison

B.  Product Development

C.  International Mail

D.  Mail Volume and Service

E.  Mail Distribution

F.  Delivery Unit Operations

G.  Stamp Services

H.  Licensing Program

I.  Commercial Sales

J.  Retail Programs:
     Building the Core

K.  Pricing and Classification

L.  Marketing Technology and
     Channel Management

M. The Internet:
     Transforming the Way We Connect
      with Our Customers

N.  Technology

O.  Operations Planning

P.  Financial Management