On July 01, 2014 Lisa Bowes, from Intelisent, published a deconstruction of the following announcement by USPS:
The United States Postal Service is planning to resume the rationalization of our network of mail processing facilities which began in 2012.
Lisa’s deconstruction states:
I haven’t done a deconstruction in a while, but this USPS communication has inspired me:
Unfortunately, I have nothing on the “Dear Valued Customer” salutation. Anybody out there feeling valued? Rate increases, uncertainty, inadequate postal systems, exigency, consolidation, churn, change…
(USPS) The Postal Service will provide detailed information about its network rationalization planning in the coming weeks.
(Lisa) One of two things could be in play here…They don’t know and don’t actually have a plan, or it’s a big secret. Or they will blame the unions or that old favorite standby scapegoat SOX.
(USPS) The Postal Service expects the completion of this phase of network rationalization will generate an additional $750 million in annual savings.
(Lisa) Unfortunately USPS estimates are always overstated, with service implications understated.
(USPS) Why are we taking this step now?
(Lisa) Several reasons. Angry about no 5 day from Congress- the timing of this announcement is just not coincidental – and anger at the Staples blowback. I have to confess, I bought in to the Staples rhetoric at first, but the proof is in the pudding, as they say, and that pudding is some rotten.
(USPS) We believe strongly..
(Lisa) This is the part that makes me sad, because I do think the USPS believes strongly. However, I think their arrogance makes them bad listeners, and bad listeners can’t be successful in the long run. I hope I am wrong on that, because I value the postal system.
Lisa’s article is here.
USPS responded to Lisa’s deconstruction with the following statement (but, not via Lisa’s Intelisent blog – why?)
If Lisa Bowes would have spent more time reading the materials the Postal Service provided on its website about Phase 2 of Network Rationalization (http://usps.com/ourfuturenetwo… and less time doing her own “deconstruction,” she would have a much better understanding why the Postal Service is taking this action. First, this is not new. Yesterday’s notification to mailers is a continuation of the network rationalization activity approved by the Postal Service Board of Governors in 2011. The consolidation of 141 mail processing facilities in 2012 and 2013 was highly successful and resulted in annual cost savings of approximately $865 million. After ensuring the efficient operations of our network following those changes, the Postal Service is ready to move forward in January 2015 with Phase 2 of Network Rationalization, which is expected to generate an additional $750 million in annual savings. The reason for moving forward is not a mystery – in the last three years, the Postal Service recorded financial losses of $26 billion and we continue to face significant financial challenges associated with the decline of First-Class Mail volume and revenue, wage and benefit inflation, increasing operating costs, as well as legislative mandates and significant debt pressures. In addition, the uncertainty regarding legislative reform and review of postal rates in the courts continues to delay needed capital investments in network operations and undermine the future financial viability of the Postal Service. Moving forward with streamlining our mail processing operations is part of a broader strategy to position the Postal Service for the future so we can continue to meet our customers’ mailing and shipping needs.
Dave Partenheimer
Manager, Media Relations
U.S. Postal Service
We’ll see if Lisa has a response to USPS.
