Both corporate financial performance goals for 2010 will be changed for 2011. The 2010 performance measures will continue to be measured for comparison and trend purposes with previous years. The replacement goals are more relevant and actionable below the national level as described in more detail below.
This includes all postage, fees, and other funds obtained from the sale of products and services. It is being replaced as a corporate goal in 2011 by Operating Income.
Roughly 80 percent of revenue comes from commercial customers, and in 2010 these customers, especially those in the financial services and retail industries, were still dealing with impacts from the recession and persistent high rates of unemployment. As a consequence, mail volume and revenue continued to decline this year, though at a slower rate than in 2009.
The Postal Service accounted for these factors in its 2010 plan, and although revenue did decline this year, it exceeded the 2010 target. In addition to new price incentives and more targeted advertising, the result is based on consistently solid service performance in all categories, combined with stable prices, which helped reinforce the continued value of mail.
Total Factor Productivity (TFP) compares outputs, such as deliveries made, with resources used, including capital, labor, and materials at the corporate level. It is being replaced in 2011 by Deliveries per Work Hour.
Despite a 3.5 percent decline in mail volume, significant efficiency gains were achieved in 2010, improving TFP 2.2 percent compared to 2009. This marks the ninth year of productivity growth since 2000. Productivity gains are a result of effective workforce management, efficient use of supplies and services, including transportation, and maximizing the return on automation investments.
Work hours were reduced by 75 million, or 6.0 percent, despite an increase of approximately 740,000 delivery points. Non-personnel expenses were reduced by 2 percent, even as service and customer satisfaction scores reached record levels. The greatest source of the work hour savings were the buy-outs offered to the clerk and mail handler craft employees in 2009. This incented more than 20,000 career employees to retire or take an early out at the beginning of the fiscal year, October and November. Overtime reductions, attrition, and reduced non-career employees also contributed to the reduction.
