®

Letter Automation History

Bill GalliganSenior Vice President, Operations

MTAC MeetingJanuary 31, 2008

Agenda – Letter Automation HistoryAgenda – Letter Automation History

Four Decades of Change

DPS Today

Next Steps

1960s – 1970s - Mechanization1960s – 1970s - Mechanization

• MPLSM• Mark II facer cancellers

ZIP Code

• Presort mandatory for 2nd & 3rd class mail

• Central Forwarding System (CFS)

• Discounts for presorted 2-C

• Discounts for presorted & CR-RT 3rd class mail

1963

19781967

1979

ZIP Code • Discounts offered for pre-sorted FCM

1963

1960

1976

1970

934 MPLSM deployed CFSMark II facer canceller

1980s – Mechanization & Early Automation1980s – Mechanization & Early Automation

• AMS organization instituted• SLOCR Phase 1 (applied 5-

digit barcode)• BCS Phase I

• MLOCRs (applied 9-digit barcode)• MPBCS• Mark II converted to Micro-marks• Micro-mark Alhambra Mod• ACS• CFS II

• CASS (optional)• Corporate Automation Plan• Pre-barcode discounts• Carrier in-office time exceeds ½

workday

1982

1981 1987

• ZIP + 4 Code instituted• Work-share discounts for FCM -

presort & ZIP + 4 Barcodes

1983

1988

• CR-RT discounts for FCM

• CLASS

1989

• M-36 Cancellers

1984 1986

• SLOCR Phase II (applied 5-digit barcode)

• SLOCR Multi-line conversion (applied 9-digit barcode)

• BCS Phase II• NCOA

BCS SLOCR MLOCR

1990s – Automation & Barcode Sorting1990s – Automation & Barcode Sorting

1992

1991 1993 1995

1990

• Office of Automation Integration

1994 1996 1998

1997 1999

• MLOCR/ISS (applied 11-digit barcode)

• WABCR• DBCS• Delivery point barcode• RBCS 2 pilot sites• MASS certification• 1st tabbing requirements

• RBCS 25 sites / 17 contactor RECs

• MPBCS / OSS• AFCS• Sector segment• CASS (required)

• AFCS / ISS• Delivery point sequencing

• AMS II• RBCS Phase 2• RECs converted to USPS

• Reclassification: bundles to trays• CR-RT only in non-DPS zones• RBCS 120 plants / 55 RECs

• DPS for High-rise• CSBCSs• Recognition programs

• RCR• HWAI• HIP• RIP

• Decommission MPLSMs• REC consolidations

• Move Update• FastForward

a

JOHN DOE987 BLOSSOM RDATLANTA GA 30302-4567

XYZ COMPANY1234 PEACH TREE STATLANTA GA 30303-3421

BULK RATE

U.S POSTAGE PAID

Washington, DC

PERMIT NO. 56

JOHN DOE987 BLOSSOM RDATLANTA GA 30302-4567

XYZ COMPANY1234 PEACH TREE STATLANTA GA 30303-3421

BULK RATE

U.S POSTAGE PAID

Washington, DC

PERMIT NO. 56

Remote Encoding Center Delivery Barcode Sorter (DBCS)Advance Facer Canceller System (AFCS)

2000s Automation & Standardization2000s Automation & Standardization

2002

2001 2003 2005

2004 2006 2008

2007 2009

• DIOSS• DBCS-EC• Planet codes• Confirm• MERLIN

• WFOV

• PARS• Last MPLSM

decommissioned

• Move Update for standard mail• REC decommissioning (8 RECs

remain)• DQI – Phase II (high-rise & handwritten

encode improvements)

• Intelligent Mail Barcode• CASS Cycle M

•SuiteLink

• CASS / MASS Cycle L • DPV• LACSLink

• eUARS• Eliminated CR-RT

2000

• DQI – improve encode rates

• DSMART

• BDS• NCOA Link• ID code sort

MERLINDelivery Input/Output Subsystem (DIOSS) Biohazard Detection System (BDS)

• PARS Phase II• MLOCR Replacement

DPS TrendDPS Trend

DPS Letter and Cased Volume History (City Delivery)

0.0

10.0

20.0

30.0

40.0

50.0

60.0

70.0

80.0

90.0

100.0

1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008YTD

Fiscal Year

Per

cent

Cased Letter %

DPS Letter %

85.99%

Cased Letters

DPS Letters

• FY 2007 USPS Sequenced 130 Billion Letters

• Resulting in Over $5 Billion Annual Savings

DPS Today & ImpactsDPS Today & Impacts

DPS Letters

Non-DPS

DPS Letters 86%Non-DPS

Letters 14%

Key Impacts of Non-DPS

1. Operational Processes

2. Technology Capabilities

3. Mail Piece Characteristics

Next StepsNext Steps

DPS Letters

Non-DPS

DPS Letters 86%

Non-DPSLetters 14%

Technology

• DQI Phase II

High-rise

Handwritten

• AFCS 200

Mail Piece Characteristics

• Letter Size Booklets & Folded Self Mailers

Federal Register Notice of Intent: February 2008

• Automation & Machineable Letter Standards

Federal Registers FY 2008

• Value Stream Mapping

• Define, Measure, Analyze, Improve, Control (DMAIC)

• Operational Industrial Engineers

Standardization / Continuous Improvement

ConclusionConclusion