Chapter 2 Postal Operations

page 36 of 74

Chapter 2
postal operations

The Postal Service also expects Priority Mail volume to decline slightly due to continued changes in the structure and competitive nature of the package services market. The Postal Service thinks that Express Mail volume will stabilize after four years of decline because of higher prices charged by its competitors and the improvements it has made in this service. On the other hand, technological and demographic changes continue to cause declines in Periodicals. The growth the Postal Service projects in Package Services is based on projected increases in both Bound Printed Matter and Media Mail volumes, even though it expects a decline in Parcel Post.

Forecasts through 2006 are given by class of mail in the following table.

**Table 2-1 Volume**
(Pieces in Millions)	FY 2004 (Actual)	FY 2005	FY 2006
First-Class Mail	97,926	95,361	92,865
Priority Mail	848	811	757
Express Mail	54	54	52
Periodicals	9,135	8,825	8,684
Standard Mail	95,564	98,838	101,493
Package Services	1,131	1,139	1,150
International	843	883	866
Other*	602	566	580
Total	206,106	206,476	206,448

*Volume of mail sent by the Postal Service, Mailgrams, and free matter for the blind and handicapped are included in the Other category.

2. Service Performance

First-Class Mail service performance results are measured through the Transit Time Measurement System (TTMS), which measures service performance from the time mail is entered into the system at an induction point until the time it is received in the home or small business. TTMS is independently administered by IBM Consulting Services under a contract with the Vice President and Consumer Advocate.

Fig. 2-1 First-Class Mail Volume and Total U.S. Employee Payroll Employment

Figure 2-1, line chart showing relationship of first class mail volume and total U.S. payroll employment.

The main goal of TTMS is to measure service performance from the customer's point of view. The information gathered determines the effectiveness of system performance in satisfying customer requirements. The External First-Class (EXFC) measurement system, the major component of TTMS which has been in existence since 1990, is an external measurement system of collection box to delivery point performance. EXFC continuously tests a panel of 463 three-digit ZIP Code areas selected on the basis of geography and volume density from which 90 percent of First-Class Mail volume originates and to which 80 percent destinates. EXFC is not a system wide measurement of all First-Class Mail performance. The independent EXFC system reported national overnight performance of 95 percent for 2004. National service performance for two- and three-day service standard was reported as 91 and 89 percent, respectively.

3. Customer Satisfaction

The Customer Satisfaction Measurement (CSM) process provides reliable and actionable information to Postal Service managers by identifying opportunities for improvement and focusing on overall customer satisfaction. CSM is composed of three components:

CSM-Residential (CSM-R) — measures residential household customer satisfaction.

CSM-Business (CSM-B) — measures business customer satisfaction.

CSM-Event-Based (CSM-EVB) — measures event-based customer satisfaction.