SECTION 1: INTRODUCTION

MEETING THE CHALLENGE

From implementation of the 2002 Transformation Plan through September 2004, the Postal Service reduced its career employee complement by 68,000. During the same period, new operational efficiencies improved cumulative total factor productivity by over 5 percent. In addition, approximately 1.8 million delivery points were added each year to the universal delivery network.

Despite the increasing workload, service performance has reached record levels during transformation. On-time service for overnight First-Class Mail service attained a record breaking 96 percent during postal quarter III 2004— the best overnight delivery score in the history of the external First-Class measurement program, which began in 1989. Postal Service customers have benefited from record service performance, and employees report improved satisfaction on the Voice of the Employee survey. As this Transformation Plan Progress Report shows, the Postal Service's transformational journey is well underway.

COMMITMENT TO TRANSFORMATION

The commitment of the Board of Governors and postal management to the Transformation Plan begins with strategic direction from the Board of Governors and the Executive Committee. Their decisions then flow through the organization at all levels. The integrated process that enabled development of the Transformation Plan across the various functional areas continues as the 2002 Transformation Plan is implemented. The Office of Strategic Planning facilitates the effort to ensure integration of transformation implementation plans.

Since publication of the Transformation Plan, the Postmaster General and Executive Committee have conducted regular, formal reviews of transformation strategies. The Postal Service budget process, the Comprehensive Statement, and the Five-Year Strategic Plan, FY2004-2008 have all been aligned with the strategies, goals, and objectives outlined in the Transformation Plan. Cross-functional meetings at all levels of management have ensured and will continue to ensure that postal managers understand the 2002 Plan's interdependencies, structure, and milestones. All of these results have been and will continue to be communicated to the President, Congress, Government Accountability Office, Office of Inspector General, Postal Rate Commission (PRC), and other appropriate executive agencies, as well as major stakeholders and the general public.