Chapter 5:  2002 Performance Report
G.  Voice of the Business Performance Goals:  Financial Performance
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Generate financial performance that ensures commercial viability of the Postal Service as a service provider in a changing, competitive market place, and generate cash flow to finance high-yield investments for the future while providing competitively-priced products and services.

Performance Subgoal 1: Improve overall business performance.
As stated in the plan, 2002 indicators and target for this subgoal are:

  • Improve Area Productivity over a “hurdle” rate.
  • Improve Performance Cluster Productivity over a hurdle rate.

In 2002, the Postal Service:

  • Achieved Productivity over the hurdle in seven of nine areas.
  • Achieved Productivity at the performance cluster (PC) level over the hurdle rate in 51 of 85 PCs.

Performance Subgoal 2: Control costs by achieving productivity gains.
As stated in the plan, the 2002 indicator and target for this subgoal is:

  • Achieve a Total Factor Productivity (TFP — a measure of total resource usage efficiency, including capital) gain of 1.0 percent. In 2002, the Postal Service:
  • Exceeded the target for TFP growth, achieving TFP growth of 1.1 percent. This achievement is equivalent to $713 million. The growth of TFP in 2002 was brought about by managed restraint on resource usage. Workhours declined by 4.9 percent, materials use was reduced by 0.9 percent, and total resources use was reduced by 2.9 percent. The TFP target is an outgrowth of the productivity gain implicit in our budget and must be determined through calculations based on actual figures.
  • Achieved the Output per Workhour productivity goal of 2.0 percent. Actual Output per Workhour was 2.2 percent. When mail volumes were lower than anticipated in 2002, management reduced all resource usage, including the labor use component of TFP, which was reduced by 4.0 percent. This ameliorated the impact of lower volume growth rates on the Output per Workhour productivity factor.

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Chapter 5 Table of Contents

A.  Introduction

B.  Year in Review

C.  The Planning Process

D.  The Three-Voice Structure
     and Performance Goals

E.  Voice of the Customer Performance
     Goals:  Growth

F.  Voice of the Employee Performance
     Goals:  A Motivated, Productive
     and Inclusive Workforce

G.  Voice of the Business Performance
      Goals:  Financial Performance

H.  Evaluation of 2002 Performance
     and Changes to Goals and Subgoals
     in the 2003 Plan