508-9/9/21-mh 

United States Postal Service 

FY2017 

Annual 

Report to 

Congress 

FY2017 Annual Report 

FY2017 Comprehensive Statement 

FY2017 Performance Report and 

FY2018 Performance Plan 

 

Contents

Report Structure and Purpose . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 

FY2017 Annual Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 

Letter from the Postmaster General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 

FY2017 Comprehensive Statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 

Overview of Postal Operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 

Key Financial and Operating Statistics . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 

Employee Compensation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 

FY2017 Performance Report and FY2018 Performance Plan . . . . . . . . . . . . . . . . . . . 13 

Corporate-wide Goals and Targets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 

High-Quality Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 

Excellent Customer Experiences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 

Safe Workplace and Engaged Workforce. . . . . . . . . . . . . . . . . . . . . . . . . . . 18 

Financial Health . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 

Strategic Initiatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 

Additional Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Inside back cover 

Trademarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Inside back cover 

Year References. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Inside back cover 

United States Postal Service — FY2017 Annual Report to Congress 1
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Report Structure and Purpose 

This unifed document consists of three reports: 

1) the Fiscal Year (FY) 2017 Annual Report, including 

a statement from the Postmaster General on our1 

operations, 2) the FY2017 Comprehensive Statement on 

our operations and 3) the FY2017 Annual Performance 

Report and FY2018 Annual Performance Plan 

This document’s purpose is to provide information to 

stakeholders It fulflls the requirements of the following 

articles in United States Code Title 39: 414(f), on the 

reporting of fnancial information related to special 

postage stamps (p 4); 416(f), on the reporting of 

1 The terms “we,” “us” and “our” refer to the United States Postal Service. 

information related to semipostal stamps (p 5); 

2401(e), on the submission of a Comprehensive 

Statement (pp 4–12); 2402, on the submission of an 

Annual Report (pp 2–3); 2803, on the submission 

of an Annual Performance Plan (pp 13–28); 2804, 

on the submission of an Annual Performance Report 

(pp 13–28); 3652(g), on the submission of the 

Comprehensive Statement, Annual Performance Report 

and Annual Performance Plan (pp 2–28); and 3686(d), 

on the reporting of executive compensation in excess of 

Federal Level Executive 1 (p 12) 

FY2017 Annual Report 

Financial and Operational Highlights 

Totals at September 30 Percent change 

FY2017 FY2016 FY2015 FY2017 FY2016 

(in millions, except percentages) 

Mail volume 149,491 154,342 154,321 (3.1)% – % 

Total revenue with investment and interest income $ 69,694 $ 71,530 $ 68,951 (2.6)% 3.7% 

Total expenses $ 72,436 $ 77,121 $ 73,641 (6.1)% 4.7% 

Net loss $ (2,742) $ (5,591) $ (5,060) (51.0)% 10.5% 

Purchases of capital property and equipment $ 1,344 $ 1,428 $ 1,222 (5.9)% 16.9% 

Debt $ 15,000 $ 15,000 $ 15,000 – % – % 

Capital contributions of U.S. Government $ 3,132 $ 3,132 $ 3,132 – % – % 

Defcit since 1971 reorganization $ (61,856) $ (59,114) $ (53,523) 4.6% 10.4% 

Total net defciency $ (58,724) $ (55,982) $ (50,391) 4.9% 11.1% 

(in actual units indicated, unaudited) 

Number of career employees 503,103 508,908 491,863 (1.1)% 3.5% 

Number of non-career employees 141,021 130,881 129,974 7.7% 0.7% 

New delivery points served 1,234,496 1,142,352 1,059,852 8.1% 7.8% 

2 United States Postal Service — FY2017 Annual Report to Congress 
 

 

 

 

 

 

 

 

 

 

 

 

Letter from the Postmaster General 

The United States Postal Service plays a vital role in 

American commerce and binds the nation together 

through secure, reliable, affordable and universal mail 

delivery We delivered 149 billion pieces of mail in fscal 

year 2017, serving 157 million delivery points every 

delivery day, and we recorded annual total revenue of 

$69 7 billion This annual report describes our fscal year 

2017 performance, and our strategies for strengthening 

our organization and improving the way we serve the 

American public 

We achieved high levels of delivery performance and 

customer satisfaction and invested in innovations to 

keep pace in a rapidly evolving business environment — 

all while facing signifcant fnancial burdens due to a 

highly competitive marketplace and the constraints of 

our current business model 

We accelerated mail’s integration with digital and 

mobile platforms, and enhanced mail’s value as a 

marketing and communications channel, for both 

senders and receivers We enabled America’s 

continuing e-commerce growth by giving customers 

unprecedented visibility and competitive shipping 

solutions that reach every door in America every delivery 

day And, we served every community and business in 

America as a self-funded organization that competes 

for every customer The Postal Service receives no tax 

dollars for operating expenses and relies on the sale of 

postage, products and services to fund its operations 

We remain highly focused on the experience we 

create for our customers and on the value we deliver 

in an increasingly digital world We are committed to 

investing in innovation, infrastructure, effciency and the 

644,000 men and women of the Postal Service who live 

and work in every community in America, and to fully 

meet the needs of the American public, today and far 

into the future 

Thank you for reviewing this report and for your interest 

in the United States Postal Service 

Megan J Brennan 

Postmaster General and Chief Executive Offcer 

United States Postal Service — FY2017 Annual Report to Congress 3
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FY2017 Comprehensive Statement 

Overview of Postal Operations 

Mission 

According to Title 39 of the United States Code, “The 

United States Postal Service shall be operated as a 

basic and fundamental service provided to the people 

by the Government of the United States, authorized 

by the Constitution, created by an Act of Congress, 

and supported by its people The Postal Service shall 

have as its basic function the obligation to provide 

postal services to bind the Nation together through 

the personal, educational, literary, and business 

correspondence of the people It shall provide prompt, 

reliable and effcient services to patrons in all areas and 

shall render postal services to all communities ” 

Governance 

By law, we have an 11-seat Board of Governors (the 

“Board”), which consists of our Postmaster General, 

our Deputy Postmaster General and nine independent 

Governors The President appoints these independent 

Governors, with the Senate’s advice and consent The 

Board is required to have a quorum of six members 

to exercise its powers In 2014, the Board issued 

a resolution establishing a Temporary Emergency 

Committee (TEC), consisting of all remaining members 

of the Board, to exercise certain powers reserved to 

the Board in the event that the number of Governors 

in offce is insuffcient to form a quorum At present, 

the TEC consists only of our Postmaster General and 

Deputy Postmaster General For the frst time since we 

began operations as the United States Postal Service in 

1971, there are no presidentially appointed Governors; 

however, three Governor nominations have been sent 

to the Senate and await confrmation For ease of use, 

references to the “Board” or “Board of Governors” 

encompass the TEC as appropriate 

Services 

In fulflling our universal service obligation, we provide 

services to patrons in all areas and communities in the 

United States This includes rural areas, communities 

and small towns where Post Offces are not selfsustaining We use a variety of transportation methods 

to move mail through this large network, including 

highway and air transportation We leverage strong 

partnerships with more than 8,000 suppliers, including 

private carriers for air and surface transportation 

Services are provided through approximately 

31,000 Post Offces, stations and branches; 

approximately 4,000 additional Contract Postal Units, 

Community Post Offces and Village Post Offces; a 

network of commercial outlets; and our website, 

www.usps.com. We deliver to approximately 157 million 

city, rural, PO Box and highway delivery points We aim 

to make our retail locations convenient, accessible and 

cost-effective 

Postal Rates 

Postal rates are established to be fair, equitable and 

affordable Prices and fees are reviewed and approved 

by our Governors and subject to a review process by 

the Postal Regulatory Commission (PRC) In FY2017, 

our retail price for a First-Class Mail stamp ($0 49) was 

the most affordable across all posts in industrialized 

nations 

We offer two categories of products, which are 

classifed for regulatory purposes as market-dominant 

products and competitive products Market-dominant 

products include, among others, First-Class Mail, USPS 

Marketing Mail (more commonly known as Marketing 

Mail and formerly known as Standard Mail) and 

Periodicals Currently, price increases for these products 

are subject to a price cap based on the Consumer Price 

Index for All Urban Consumers Competitive products, 

such as Priority Mail, Priority Mail Express, First-Class 

4 United States Postal Service — FY2017 Annual Report to Congress 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Package Service, Parcel Select, Parcel Return 

Service and some types of International Mail, have 

greater pricing fexibility Our Governors set prices for 

competitive products and the PRC reviews them for 

legal compliance By law, prices for these products 

must cover costs attributable to each product (i e , the 

direct and indirect costs attributable to such products) 

and must contribute a reasonable share (currently 

5 5 percent) of our institutional costs, as determined 

by the PRC 

Semipostal Stamps 

In FY2017, we sold two semipostal stamps, the 

Breast Cancer Research semipostal stamp and the 

Save the Vanishing Species semipostal stamp, both 

mandated by Congress These semipostal stamps 

are postage stamps with a postage value equal to the 

First-Class Mail single-piece, one-ounce stamp rate 

in effect at the time of purchase, plus an amount to 

fund a designated cause By law, revenue from sales 

of semipostal stamps, less the postage paid and 

the reasonable costs incurred by us, are distributed 

to designated agencies to support the designated 

causes 

The Breast Cancer Research stamp generated 

approximately $1 9 million in funds in excess of the 

postage value in FY2017 Of this amount, the Postal 

Service retained $8,875 to cover our costs to sell 

and distribute the stamp Of the remaining amount, 

approximately $1 3 million (70 percent) was given 

to the National Institute of Health and approximately 

$571,000 (30 percent) was given to the Medical 

Research Program at the Department of Defense 

The Save the Vanishing Species stamp generated 

approximately $684,000 in funds in excess of the 

postage value FY2017 We did not deduct any costs 

in connection with these stamps in FY2017 All of the 

funds collected in excess of the postage value were 

given to the U S Fish and Wildlife Service to support 

the Multinational Species Conservation Funds 

United States Postal Service — FY2017 Annual Report to Congress 5
 

 

 

 

 

 

 

 

Key Financial and Operating Statistics 

Financial History Summary 

(in millions) 

FY2017 FY2016 FY2015 

Operating results 

Total revenue $ 69,636 $ 71,498 $ 68,928 

Operating expenses 

Compensation and benefts1 49,108 48,441 47,278 

Unfunded retirement benefts 2,658 248 241 

Retiree health benefts 4,260 9,105 8,811 

Workers’ compensation (797) 2,682 1,760 

Transportation 7,238 6,992 6,579 

All other operating expenses 9,743 9,431 9,157 

Loss from operations $ (2,574) $ (5,401) $ (4,898) 

Investment and interest income, net (168) (190) (162) 

Net loss $ (2,742) $ (5,591) $ (5,060) 

Financial position 

Cash and cash equivalents2 $ 10,513 $ 8,077 $ 6,634 

Property and equipment, net 14,891 15,296 15,686 

All other assets 1,990 1,846 1,694 

Total assets $ 27,394 $ 25,219 $ 24,014 

Retiree health benefts $ 38,160 $ 33,900 $ 28,100 

Workers' compensation liability 17,910 20,039 18,811 

Debt 15,000 15,000 15,000 

All other liabilities 15,048 12,262 12,494 

Total liabilities $ 86,118 $ 81,201 $ 74,405 

Total net defciency $ (58,724) $ (55,982) $ (50,391) 

1 Excludes amortization of unfunded retirement benefits, retiree health benefits and workers’ compensation. 

2 Cash and cash equivalents are unrestricted. 

6 United States Postal Service — FY2017 Annual Report to Congress 
 

 

 

 

 

 

 

 

Revenue, Pieces and Weight Statistics 

(in millions of units indicated; pieces and weights unaudited) 

FY2017 FY2016 FY2015 

First-Class Mail1 

Revenue $ 25,637 $ 27,508 $ 28,412 

Number of pieces 58,747 61,240 62,599 

Weight, pounds 2,863 3,058 3,166 

Marketing Mail2 

Revenue $ 16,626 $ 17,622 $ 17,646 

Number of pieces 78,329 80,885 80,030 

Weight, pounds 7,577 7,961 7,975 

Shipping and Packages services 3 

Revenue $ 19,481 $ 17,427 $ 15,061 

Number of pieces 5,748 5,159 4,539 

Weight, pounds 10,958 9,454 7,739 

International Mail 

Revenue $ 2,723 $ 2,674 $ 2,702 

Number of pieces 1,003 1,005 913 

Weight, pounds 512 484 459 

Periodicals 

Revenue $ 1,375 $ 1,507 $ 1,589 

Number of pieces 5,301 5,586 5,838 

Weight, pounds 1,922 2,058 2,168 

U.S. Postal Service Mail4 

Number of pieces 319 422 356 

Weight, pounds 104 118 114 

Free matter for the blind4 

Number of pieces 44 45 46 

Weight, pounds 20 18 18 

Other services – revenue3 $ 3,751 $ 3,630 $ 3,380 

Change in accounting estimate5 $ — $ 1,061 $ — 

Postal Service totals 

Operating revenue $ 69,593 $ 71,429 $ 68,790 

Number of pieces 149,491 154,342 154,321 

Weight, pounds 23,956 23,151 21,639 

Note: We have reclassified the totals for certain mail categories for prior years to conform with classifications used in the current year. 

1 Excludes First-Class Mail Parcels. 

2 Excludes Marketing Mail Parcels. 

3 See Shipping and Packages Services and Other Services Statistics table on the following page. 

4 No revenue is received or recorded for these categories of mail. 

5 During FY2016, we revised the technique used to estimate our deferred revenue - prepaid postage liability for Forever stamps. As a result of this 

change, deferred revenue - prepaid postage was decreased by nearly $1.1 billion. In accordance with accounting principles generally accepted in the 

United States (GAAP), the change was accounted for as a change in accounting estimate. 

United States Postal Service — FY2017 Annual Report to Congress 7
Shipping and Packages Services and Other Services Statistics 

(in millions of units indicated; pieces, articles and weights unaudited) 

FY2017 FY2016 FY2015 

Priority Mail Express 

Revenue $ 766 $ 809 $ 779 

Number of pieces 30 33 36 

Weight, pounds 34 37 38 

First-Class Packages1 

Revenue $ 3,333 $ 2,782 $ 2,292 

Number of pieces 1,151 1,028 933 

Weight, pounds 453 371 320 

Priority Mail2 

Revenue $ 8,690 $ 8,206 $ 7,664 

Number of pieces 1,042 1,029 1,007 

Weight, pounds 2,615 2,581 2,370 

Parcel Select Mail 

Revenue $ 5,708 $ 4,662 $ 3,364 

Number of pieces 2,836 2,414 1,937 

Weight, pounds 6,347 5,014 3,601 

Parcel Return Service Mail 

Revenue $ 183 $ 168 $ 152 

Number of pieces 69 64 60 

Weight, pounds 195 188 171 

Package Services 

Revenue $ 801 $ 800 $ 810 

Number of pieces 620 591 566 

Weight, pounds 1,314 1,263 1,239 

Total shipping and packages services 

Revenue $ 19,481 $ 17,427 $ 15,061 

Number of pieces 5,748 5,159 4,539 

Weight, pounds 10,958 9,454 7,739 

Other services 

Certifed Mail 

Revenue $ 667 $ 672 $ 669 

Number of articles 199 198 200 

Return Receipts 

Revenue $ 338 $ 359 $ 374 

Number of articles 146 154 158 

USPS Tracking 

Revenue $ 1 $ 1 $ 41 

Number of articles 4,951 4,318 3,550 

PO Box Services revenue $ 964 $ 951 $ 924 

Money Orders 

Revenue 

Number of articles 

$ 147 

87 

$ 153 

90 

$ 159 

93 

Note: We have reclassified the totals 

for certain mail categories for prior 

years to conform with classifications 

Insurance used in the current year. 

Revenue $ 74 $ 79 $ 90 1 Includes First-Class Mail Parcels and 

Number of articles 15 16 19 First-Class Package Services. 

Shipping and mailing supplies 

Revenue $ 109 $ 109 $ 111 

2 Includes USPS Retail Ground 

(formerly Standard Post), which 

is a retail-only product classified 

Number of articles 55 54 55 as Market Dominant. USPS Retail 

Miscellaneous other services revenue 

Total other services revenue 

$ 

$ 

1,451 

3,751 

$ 

$ 

1,306 

3,630 

$ 

$ 

1,012 

3,380 

Ground is priced identically and 

functionally equivalent to Priority Mail 

for shorter mailing distances. 

8 United States Postal Service — FY2017 Annual Report to Congress 
Post Offces and Delivery Points 

(in actual units indicated, unaudited) 

FY2017 FY2016 FY2015 

Post Offces, stations and branches 

Postal Service-managed 

Post Offces 26,410 26,611 26,615 

Classifed stations, branches and carrier annexes 4,967 4,974 4,991 

Total Postal Service-managed 31,377 31,585 31,606 

Contract Postal Units 2,331 2,458 2,504 

Village Post Offces 821 877 874 

Community Post Offces 476 503 536 

Total offces, stations and branches 35,005 35,423 35,520 

Residential delivery points 

City delivery 82,855,611 82,411,214 82,020,625 

Rural 42,805,252 42,065,134 41,378,300 

PO Box 15,954,141 15,926,420 15,894,358 

Highway contract 2,924,386 2,880,500 2,827,085 

Total residential delivery 144,539,390 143,283,268 142,120,368 

Business delivery points 

City delivery 7,690,284 7,664,927 7,633,285 

Rural 1,639,505 1,614,185 1,584,916 

PO Box 3,379,418 3,452,198 3,535,563 

Highway contract 80,079 79,602 77,696 

Total business delivery 12,789,286 12,810,912 12,831,460 

Total delivery points 157,328,676 156,094,180 154,951,828 

Change in delivery points 1,234,496 1,142,352 1,059,852 

Number of Routes by Type of Delivery 

(in actual units indicated, unaudited) 

Route FY2017 FY2016 FY2015 

City 143,937 144,571 143,051 

Rural 75,433 74,724 73,818 

Highway contract route 9,810 9,809 9,908 

Total 229,180 229,104 226,777 

United States Postal Service — FY2017 Annual Report to Congress 9
 

 

Postal Vehicle Inventory 

(in actual units indicated, unaudited) 

Vehicle type FY2017 FY2016 FY2015 

Delivery and collection (0.5–2.5 tons) 205,997 203,853 193,489 

Mail transport (tractors and trailers) 5,379 5,511 5,620 

Mail transport (3–9 tons) 2,080 2,100 2,112 

Administrative and other 7,507 6,357 6,414 

Service (maintenance) 7,034 7,191 4,565 

Inspection Service and law enforcement 2,942 2,884 2,733 

Total 230,939 227,896 214,933 

Real Estate Inventory 

(in actual units indicated, unaudited) 

Real estate inventory FY2017 FY2016 FY2015 

Owned properties 8,448 8,484 8,524 

Owned interior square feet 191,745,056 192,521,396 194,220,092 

Leased properties 23,184 23,214 23,314 

Leased interior square feet 78,335,141 78,735,195 78,144,453 

GSA1

/other government properties 285 285 286 

GSA/other government interior square feet 1,839,972 1,885,956 1,902,726 

1

General Services Administration. 

Real Estate Inventory Actions 

(in actual units indicated, unaudited) 

Real estate inventory actions FY2017 FY2016 FY2015 

Lease actions (alternate quarters, new leases and renewals) 3,927 5,050 6,206 

Property disposals1 18 27 16 

New construction2 69 52 22 

Repair and alteration projects (expense) 53,694 53,466 51,584 

Repair and alteration expense totals (rounded) $ 217,000,000 $ 245,000,000 $ 215,000,000 

Repair and alteration projects (capital) 4,598 5,102 6,981 

Repair and alteration capital totals (rounded) $ 389,500,000 $ 314,000,000 $ 347,000,000 

1 Total partial and complete property sales (does not include non-property sales such as right-of-ways/easements, sale of rights, defaults, installment 

payments, etc.). 

2 Includes the build-out of pre-existing spaces that we did not previously own (alternate quarters), the new construction of leased or owned space 

and the expansion of existing spaces. 

10 United States Postal Service — FY2017 Annual Report to Congress 
Employees 

(actual numbers, unaudited) 

FY2017 FY2016 FY2015 

Headquarters and HQ related employees 

Headquarters 3,252 3,098 2,916 

Headquarters – feld support units 3,581 3,640 3,710 

Inspection Service – feld 2,439 2,411 2,379 

Inspector General 1,067 1,134 1,142 

Total HQ and HQ related employees 10,339 10,283 10,147 

Field employees 

Area offces 825 821 851 

Postmasters/installation heads 13,641 14,398 14,506 

Supervisors/managers 25,281 24,832 23,754 

Professional administration and technical personnel 4,580 4,526 4,468 

Clerks/nurses 128,256 130,178 125,609 

Mail handlers 39,307 39,405 38,046 

City delivery carriers 166,569 170,885 164,378 

Motor vehicle operators 8,147 7,723 6,658 

Rural delivery carriers – full-time 69,462 68,261 67,044 

Building and equipment maintenance personnel 31,366 32,307 31,136 

Vehicle maintenance employees 5,330 5,289 5,266 

Total feld employees 492,764 498,625 481,716 

Total career employees 503,103 508,908 491,863 

Non-career employees 

Casuals 922 1,633 1,727 

Postal support employees 26,823 26,368 29,312 

Non-bargaining temporary 304 355 367 

Rural part-time 59,655 53,183 50,640 

Postmaster relief and leave replacements 2,368 3,626 4,839 

City carrier assistant 44,486 40,436 37,767 

Mail handler assistant 6,463 5,280 5,322 

Total non-career employees 141,021 130,881 129,974 

Total employees 644,124 639,789 621,837 

United States Postal Service — FY2017 Annual Report to Congress 11
 

 

 

 

 

 

 

 

 

 

 

 

 

Employee Compensation 

The law requires us to provide compensation and 

benefts to employees at a level comparable to the 

private sector We continue to pursue this goal for all 

of our employees In addition, we support, develop 

and provide a wide range of tools and development 

resources that assist employees in reaching their full 

potential 

The Board establishes executive offcer compensation 

and benefts, subject to the requirements and limitations 

of federal law Although our governing law provides 

that executives should be compensated at a level 

comparable to the private sector, we do not have 

the resources to achieve this level of compensation 

Compensation for our executive offcers remains 

signifcantly below that of similarly-ranked senior 

executives in the private sector 

In most circumstances, we cannot compensate 

our executives more than the rate for Level 1 of the 

Executive Schedule ($205,700 in Calendar Year 2016) 

Under certain programs, we can award bonuses or 

other rewards, which raise the level of compensation 

beyond this limit; however, compensation is still limited 

by federal law 

Because Calendar Year 2015 had 27 pay periods rather 

than the usual 26, some performance-based payments 

for FY2015 were paid in Calendar Year 2016 As a 

result, some individuals received performance-based 

payments for both FY2015 and FY2016 in Calendar 

Year 2016 FY2015 and FY2016 performance-based 

payments were determined when we still had a 

Governor appointed by the President and confrmed by 

the Senate

 In accordance with legal reporting requirements, 

the following table reports Calendar Year 2016 

compensation information including 1) our executives 

compensated in excess of Federal Executive Level 1 in 

Calendar Year 2016, 2) the amount of bonus or other 

payments that caused pay to exceed Level 1 of the 

Executive Schedule in Calendar Year 2016, including 

some FY2015 performance-based payments that could 

not be paid in 2015 due to the extra pay period and 

3) the Calendar Year 2016 compensation in excess of 

Level 1 of the Executive Schedule The terms “bonus 

or other payment” in the second column of the table 

are statutory terms that represent various amounts 

which are a part of an executive’s total compensation; 

these amounts are predicated on the Postal Service’s 

maintenance of a performance appraisal system 

that makes meaningful distinctions based on relative 

performance 

Calendar Year 2016 

Calendar Year compensation in excess 

2016 bonus or of Level 1 of Executive 

Executive name other payment Schedule 

Michael J. Amato $31,111 $18,834 

Megan J. Brennan 79,429 79,429 

Susan M. Brownell 19,900 10,817 

Robert Cintron 25,242 20,914 

James P. Cochrane 71,520 71,520 

Joshua D. Colin 28,514 28,437 

Joseph Corbett 54,825 54,825 

Guy J. Cottrell 21,603 13,911 

Dean J. Granholm 26,942 26,865 

Gregory G. Graves 24,914 13,860 

Luke T. Grossmann 22,487 8,385 

Linda M. Malone 24,042 20,514 

Thomas J. Marshall 60,523 60,523 

Kevin L. McAdams 20,547 8,162 

Maura A. McDevitt 32,165 30,459 

Pritha Mehra 19,843 7,796 

Julie S. Moore 23,714 23,524 

Shaun E. Mossman 23,642 21,620 

James A. Nemec 12,692 4,649 

Sharon D. Owens 20,946 9,347 

Edward F. Phelan, Jr. 24,842 22,246 

Gary C. Reblin 30,948 22,465 

Nancy L. Rettinhouse 31,246 25,846 

William C. Rucker, III 27,014 26,937 

Tom A. Samra 23,578 16,385 

Kristin A. Seaver 55,692 55,692 

Kelly M. Sigmon 18,620 3,295 

Jacqueline K. Strako 28,714 28,637 

Ronald A. Stroman 66,673 66,673 

Douglas A. Tulino 32,553 27,250 

Giselle E. Valera 17,300 1,600 

Tammy L. Whitcomb 19,872 19,603 

David E. Williams, Jr. 66,683 66,683 

Jeffrey C. Williamson 60,523 60,523 

Note: Legislation requires reporting compensation in the last full calendar year. 

This does not align with our fiscal year, which is from October to September. 

12 United States Postal Service — FY2017 Annual Report to Congress 
 

 

 

 

 

 

 

 

 

 

 

 

 

FY2017 Performance Report 

and FY2018 Performance Plan 

Corporate-wide Goals and Targets 

To better fulfll our mission, we have four strategic areas 

of focus, which are: 

 Deliver a World-Class Customer Experience 

 Equip, Empower and Engage Employees 

 Innovate Faster to Deliver Value 

 Invest in our Future Platforms 

In order to assess our efforts to achieve these strategies, 

we measure our performance through progress against 

corporate performance outcomes: 

 High-Quality Service 

 Excellent Customer Experiences 

 Safe Workplace and Engaged Workforce 

 Financial Health 

For each of these outcomes, the following subsections 

describe the indicators and measures used to assess 

our progress, a report of our performance in FY2017 

and our plan for FY2018, including indicator targets The 

table on the following page shows our performance from 

FY2014–FY2017 and our targets for FY2017–FY2018 

for each indicator 

These targets are aligned with the FY2018 Integrated 

Financial Plan (IFP), which includes our planned revenue 

and expenses for FY2018 Every fscal year, we develop 

a budget and plan that we intend to be suffcient for 

our feld offces to meet their non-fnancial performance 

outcomes We design all of our corporate-wide targets 

to be achievable given the planned fnances in the IFP 

Furthermore, the measure “Controllable Income (Loss),” 

one of our indicators for the outcome “Financial Health,” 

is based on planned expenditures and revenues for 

every program activity (i e , budget item contributing 

to controllable income [loss]) outlined in the IFP 

Controllable income (loss) is a non-GAAP (accounting 

principles generally accepted in the United States) 

measure defned as total revenue less controllable 

expenses and one-time accounting adjustments 

Controllable expenses consist of compensation and 

benefts; transportation; depreciation; supplies and 

services; and rent, utilities and other controllable 

expenses They do not include non-controllable 

expenses, discussed further in a subsequent section 

In the subsection “Controllable Income (Loss),” we 

provide the planned revenues and expenditures for 

FY2018, as well as actual revenues and expenditures 

for FY2017 This plan yields a target controllable loss 

for FY2018, which is our target for the FY2018 IFP, for 

the reasons discussed in that subsection 

We developed the budget in the IFP to be consistent 

with our planned work hours, which are used in the 

calculation of the targets for the measure “Deliveries per 

Total Work Hours, % Change ” 

United States Postal Service — FY2017 Annual Report to Congress 13
 

FY2014–FY2017 Results and FY2017–FY2018 Targets for Corporate-wide Performance Outcomes 

Corporate 

Performance FY2018 FY2017 FY2017 FY2016 FY2015 FY2014 

Outcome Measure Target Actual Target Actual Actual Actual 

Single-Piece First-Class Mail 

Two-day 96.50 94.72 96.50 94.66 93.28 94.90 

Three-to-fve-day 95.25 85.57 95.25 83.66 76.56 87.70 

Presort First-Class Mail 

High-Quality 

Service Overnight 96.80 96.46 96.80 96.16 95.74 97.00 

Two-day 96.50 95.58 96.50 95.05 93.56 96.40 

Three-to-fve-day 95.25 93.16 95.25 91.68 87.78 92.20 

First-Class Mail Letter and Flat Composite1 96.00 93.29 96.00 92.34 89.44 93.58 

Marketing Mail and Periodicals Composite2 91.80 91.44 91.00 90.01 86.77 88.35 

Customer Insights Composite3 80.93 88.30 89.00 87.62 85.73 84.65 

Business Service Network (BSN) 96.73 96.25 96.73 95.13 94.32 94.05 

Point of Sale (POS) 90.42 88.53 90.42 86.38 86.28 81.59 

Excellent Delivery 86.33 83.22 82.67 76.26 77.49 79.55 

Customer Customer Care Center (CCC)4 69.17 86.80 86.80 85.18 76.00 74.00 

Experiences Enterprise Customer Care (eCC)5 70.00 3.78 3.44 5.19 NA NA 

Large Business 78.00 76.75 NA 75.88 74.61 NA 

USPS.com 66.33 NA NA NA NA NA 

Business Mail Entry Unit (BMEU) 95.00 NA NA NA NA NA 

Safe Workplace Total Accident Rate 15.00 15.43 15.00 16.09 16.44 15.97 

and Engaged 

Workforce Engagement Survey Response Rate6 75 46 51 30 47 51 

Financial Controllable Income (Loss) ($ in billions) (1.40) (0.81) 0.10 0.61 1.19 1.35 

Health Deliveries per Total Work Hours, % Change 2.1 (0.5) 0.6 0.1 (1.1) 1.0 

Note: NA indicates that no data was collected or that no target was set for the relevant indicator and year. 

1 For our FY2014–FY2017 results and FY2017–FY2018 targets, we report the First-Class Mail Letter and Flat (FCLF) Composite in lieu of the First-Class Composite, 

which we reported in previous Annual Reports to Congress. FCLF Composite does not include First-Class Mail parcels. FCLF Composite numbers are based on the 

externally-measured quarterly service performance data that we file with the PRC pursuant to Part 3055 of Title 39 of the Code of Federal Regulations; they do not 

include mitigating factors used internally for compensatory purposes. 

2 For our FY2014–FY2017 results and FY2017–FY2018 targets, we report the Marketing Mail and Periodicals Composite in lieu of the Standard Composite, which we 

reported in previous Annual Reports to Congress. 

3 In FY2017, the Customer Insights Composite was based on BSN, POS, Delivery, CCC and eCC. In FY2018, the Customer Insights Composite will be based on BSN, 

POS, Delivery, CCC, eCC, Large Business, USPS.com and BMEU. 

4 The FY2018 target is based on satisfaction with both live agents and our Interactive Voice Response System, while the FY2014–FY2017 actuals and FY2017 target are 

based on satisfaction with live agents only. Because of this change in measurement, the FY2018 target is not directly comparable to the FY2017 target. 

5 The FY2018 target is based on customer overall satisfaction with the handling of eCC cases, while the FY2014–FY2017 actuals and FY2017 target are based on the 

percentage of cases that were reopened. 

6 In FY2015–FY2017, and for the FY2018 target, we used the Postal Pulse survey. In FY2014, we issued the Voice of the Employee survey. We did not use the response 

rate to measure employee engagement at that time, and the results of the Voice of the Employee survey are not directly comparable with the results of the Postal Pulse 

survey. For FY2018, we chose a stretch goal in excess of results to date to emphasize the importance of this measure. 

14 United States Postal Service — FY2017 Annual Report to Congress 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

High-Quality Service 

FY2017 saw an improvement in performance for all of 

our service metrics As part of our efforts to continuously 

improve our performance, we have developed new 

performance composite metrics and updated our 

targets for FY2018 We measure the speed and reliability 

of the delivery of our market-dominant products as part 

of our commitment to deliver high-quality service We 

use a third-party contractor to measure performance 

for several categories of mail This sampling system 

measures the time from when mail is deposited in a 

designated postal facility to when a carrier delivers it to 

a home, business or PO Box Below we describe the 

categories of mail for which we measure performance 

Single-Piece First-Class Mail. The measures for 

Single-Piece First-Class Mail represent the performance 

of Single-Piece First-Class Mail letters, postcards 

and fats throughout the fscal year and performance 

of Single-Piece First-Class Mail parcels received 

until September 8, 2017 (Beginning in September 

2017, we classifed all mailed First-Class Mail parcels 

as competitive products ) The indicators show the 

estimated percent of total mail by service standard 

(Two-day and Three-to-Five-day) that was delivered on 

time We combined the on-time scores for 1) letters, 

postcards and fats and 2) parcels To do so, we 

weighted the two scores by the estimated volume of 

each mail type 

Presort First-Class Mail. The measures for Presort 

First-Class Mail represent the performance of 

commercial presorted First-Class Mail letters, postcards 

and fats delivered throughout the fscal year The 

indicators show the estimated percent of total mail by 

service standard (Overnight, Two-day and Three-to-Fiveday) that was delivered on time 

First-Class Mail Letter and Flat Composite. We 

began using the First-Class Mail Letter and Flat (FCLF) 

Composite in FY2017 This category is the weighted 

average of the performance of Single-Piece First-Class 

Mail and Presort First-Class Mail across all service 

standards, weighted by volume 

FCLF Composite replaces First-Class Composite, which 

was reported through FY2016 FCLF Composite differs 

from First-Class Composite in that FCLF Composite 

does not include First-Class Mail parcels The change 

had little impact on the indicator; parcels represented 

less than 1 percent of overall First-Class Mail and 

service performance for parcels is similar to that of 

letters and fats 

Marketing Mail and Periodicals Composite. We 

began using Marketing Mail and Periodicals Composite 

in FY2017 This category is a composite indicator of the 

percent of all Marketing Mail and Periodicals that were 

delivered during the year within the service standard 

established This includes Marketing Mail letters, 

Marketing Mail fats and Periodicals Approximately 

two-thirds of mail volume in this composite is Marketing 

Mail letters, and the remainder Marketing Mail fats and 

Periodicals; the indicator includes substantial volumes of 

both types of mail 

The Marketing Mail and Periodicals Composite replaces 

the Standard Composite, which was reported through 

FY2016 The Marketing Mail and Periodicals Composite 

indicator is comprised of all measured Marketing Mail 

and Periodicals of all entry types, while the Standard 

Composite indicator included only Marketing Mail 

that was entered at destination network distribution 

centers or sectional center facility entry points As a 

result of additional products in both Marketing Mail and 

Periodicals, and the addition of mail that travels through 

the entire postal network rather than destination entry 

mail only, the Marketing Mail and Periodicals Composite 

scores are lower than the prior Standard Composite 

scores 

FY2017 Performance Report 

Our focus on continuous improvement has allowed us 

to improve performance on all of our service targets in 

FY2017 We have developed robust service diagnostics 

tools in recent years, leveraging enhanced-visibility data 

Over the past year, we created or overhauled numerous 

dashboards to provide us with the tools we need to 

drive performance and improve service effciencies 

We use these tools daily to proactively identify and 

resolve systemic issues impacting service across all 

our products We also trained employees on the use 

of diagnostic tools through formal classes, webinars 

and BlueTube internal training videos In addition, we 

conduct meetings on an ongoing basis with area and 

district offces to thoroughly review opportunities to 

improve service We use tools such as Lean Six Sigma 

to continuously improve operations throughout our 

network 

United States Postal Service — FY2017 Annual Report to Congress 15
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Marketing Mail and Periodicals Composite, we 

both improved over FY2016 and met our FY2017 target 

Temporary disruptions in any of the mail distribution, 

network transportation or delivery processes can 

negatively impact service performance These 

disruptions contributed to us missing our FY2017 

targets in the Single-Piece and Presort First-Class Mail 

targets These delays were sometimes the result of 

natural disasters and weather events and negatively 

affected otherwise high-quality service 

FY2018 Performance Plan 

The target for Marketing Mail and Periodicals Composite 

will increase in FY2018 to 91 80 Targets for FY2018 

for Single-Piece First-Class Mail and for Presort FirstClass Mail are the same as for FY2017 In FY2018, 

Single-Piece First-Class Mail scores will include data 

for only letters, postcards and fats We will not include 

First-Class Mail parcels because we now classify them 

as competitive products We will calculate all other 

measures in the same manner as in FY2017 

We will continue to implement operational, technological 

and training initiatives, which began in FY2017, to 

improve the mail delivery process and achieve our 

targets in FY2018 We will implement improved software 

to generate better daily operational plans We will also 

continue to develop and deploy more precise tools, 

such as Informed Visibility, to scan and track mail at 

every step of the mail-handling process 

We will also improve the training of feld personnel in 

mail handling This includes familiarizing all employees 

with the mail processing activities throughout postal 

plants to help them better identify and understand 

operational ineffciencies We will keep employees 

engaged through daily huddles, where they will discuss 

the day’s workload We will improve procedures and 

deploy new technologies to improve the effciency 

of our mail-handling and delivery processes We will 

increase operational maintenance and the presence of 

maintenance personnel to reduce ineffciencies due to 

equipment failure 

In addition, we will implement other operational 

changes This includes increasing the amount of 

advanced mail (i e , mail that is processed ahead of 

schedule), ensuring that all late arrival mail is captured 

and improving delivery point sequencing procedures to 

make delivery operations more effcient 

Excellent Customer Experiences 

We improved on all of our measures of customer 

experience in FY2017 The Customer Insights (CI) 

measurement system provides a comprehensive view 

of the customer experience across the most frequently 

used customer contact channels In FY2017, we based 

the CI Composite score on the following subcategories 

Business Service Network (BSN) survey. The BSN is 

a dedicated nationwide network that provides support 

to qualifed business customers for service issues, 

information and requests The BSN survey measured 

businesses’ overall satisfaction with their BSN account 

representative 

Point of Sale (POS) survey. The POS survey measured 

the customer’s overall satisfaction with experiences at 

retail locations 

Delivery survey index. The Delivery survey index was 

comprised of two components: the Carrier survey index 

score (weighted 95 percent) and the PO Box survey 

score (weighted 5 percent) The Carrier survey index 

was based on four equally weighted categories: 

1) overall satisfaction with the letter carrier, 2) mail 

delivered to the correct address, 3) mail delivered in 

good condition and 4) carrier friendly and courteous 

In each category, residential customers are weighted 

85 percent and small and medium business (SMB) 

customers are weighted 15 percent The PO Box 

survey score is based only on overall satisfaction, and 

residential and SMB customers are weighted equally 

The results of the survey were statistically valid at the 

national, area and district level 2 

Customer Care Center (CCC) survey. This survey 

measured customer satisfaction with our customer 

care centers It was based on a question to assess 

customers’ overall satisfaction 

Enterprise Customer Care (eCC). This measured 

the percentage of cases that customers reopened A 

lower percentage is a better outcome, since reducing 

the number of times a customer reopens a previously 

submitted inquiry drives customer satisfaction 

Customers open cases via the eCC application on 

USPS com or by calling the Customer Care Center and 

speaking with an agent We calculated the percentage 

2 A 90 percent confidence level with a 5 percent margin of error required a 

minimum number of 270 respondents at the district level annually. In each 

case, we exceeded this threshold. 

16 United States Postal Service — FY2017 Annual Report to Congress 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

score by identifying the number of cases that were 

resolved in any particular month and reopened within 

90 days 

FY2017 Performance Report 

In FY2017, our CI Composite score improved to 88 30, 

while our target was 89 00 We achieved our targets in 

the Delivery and CCC subcategories but did not meet 

our targets in the BSN, POS and eCC subcategories 

For FY2014–FY2016, we calculated the CI Composite 

score as a weighted composite of its components 

In FY2017, the CI Composite consisted of fve 

subcategories (weights given in parentheses): BSN 

(30 percent), POS (20 percent), Delivery (20 percent), 

CCC (20 percent) and eCC (10 percent) To generate the 

composite score, we mapped the raw score for each 

category to a scale with values ranging from 1 to 15 We 

took the weighted average of these scaled scores, and 

then mapped the score to another scale ranging from 

75 to 99 

The CI Composite score is not easily comparable 

across years, due to continuous improvement 

strategies implemented each year, resulting in changes 

in components, weighting and indexing However, 

CI subcomponent scores, other than Delivery, are 

comparable from year to year Delivery survey scores 

are a composite of the scores from residential and 

SMB customers; they are not directly comparable from 

year to year because the weighting of residential and 

SMB customers changes The following table shows 

unweighted and unindexed subcomponents of the 

delivery score SMB customer satisfaction increased 

in FY2017 while residential customer satisfaction 

decreased marginally: 

Delivery Overall Satisfaction 

Customer FY2017 FY2016 FY2015 FY2014 

SMB 73.35 72.60 74.65 81.40 

Residential 79.44 79.93 80.32 77.70 

We have increased the percentage of mail that is 

properly scanned every year over the last several years 

To address delivery complaints resulting from improper 

scanning, we made scanning nomenclature and menus 

more intuitive to our carriers We continue to work 

to improve the scanning menu options and to make 

messages to customers on package status clearer In 

addition, we used GPS technology to determine where 

and when a carrier scanned a package as delivered 

Because of these measures, we were able to reduce “I 

received someone else’s mail” misdelivery complaints 

in FY2017 However, misdelivery complaints that “my 

mail was returned to sender” increased Addressing 

this issue will require additional and broader work with 

scanner menus, which is in progress 

We also used a combination of teleconferences with 

these offces, reports and electronic surveys to identify 

the root causes of multiple customer experience issues, 

change-of-address (COA) complaints and misdelivery 

complaints We identifed poorly performing districts 

and delivery units in these complaint categories Some 

units failed to process COA orders on a daily basis and 

some printing devices used to keep track of COAs were 

not functioning properly Better tracking and reporting of 

problem units allowed us to decrease COA complaints 

in FY2017 

Survey data provides information on the reasons 

for failing to meet our targets in the BSN, POS and 

eCC subcategories We outline this information in the 

following paragraphs 

BSN survey. The number one reason customers 

contacted their BSN representative was to ask about 

their package’s status, and we are developing software 

to address this issue 

eCC survey. Analysis of eCC survey data shows that 

some customers had long wait times before being 

contacted about their complaint or were not contacted 

at all Because we found that customers have a more 

positive experience when we contact them within 

one business day of their submitting an issue, we are 

increasing emphasis on prompt initial contact and issue 

resolution 

POS survey. POS survey data shows that the primary 

drivers of customer satisfaction at retail locations are 

staff effciency, staff knowledge and acceptable wait 

time Our POS score improved through FY2017, though 

we did not achieve our target In FY2017, we developed 

communications to our employees that addressed 

managing our retail locations, engaging our employees 

and continuing the Postal Proud messaging that we 

developed in FY2016 We improved the customer 

experience by conducting offce-level reviews to 

streamline the package pick-up processes 

United States Postal Service — FY2017 Annual Report to Congress 17
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FY2018 Performance Plan 

In FY2018, we will include new subcomponents in the 

CI Composite, and the methods for calculating existing 

subcomponents will change Subcategories of the 

CI Composite will be (weights in parentheses): BSN 

(10 percent), POS (10 percent), Delivery (20 percent), 

CCC (20 percent), eCC (15 percent), USPS com 

(5 percent), Large Business (10 percent) and Business 

Mail Entry Unit (BMEU) (10 percent) We will base the 

score for each subcomponent on a survey question 

assessing overall satisfaction The composite score will 

be a simple weighted average of the component scores 

 Methods for calculating the BSN and POS 

subcomponents will remain the same as in FY2017 

 Delivery will no longer be a weighted composite and 

will be based on a single overall satisfaction question, 

assessing satisfaction with mail and package delivery 

 We will modify CCC to include satisfaction with our 

newly introduced Interactive Voice Response (IVR) 

system The score will be a weighted composite 

of overall satisfaction with live agents (weighted 

25 percent) and with IVR (weighted 75 percent) 

 We will modify eCC to use the eCC survey, which 

we distribute to customers after we have resolved 

an eCC case The score will also be based on 

overall satisfaction with service regarding the issue 

prompting the case This change is to better capture 

customers’ overall satisfaction with the eCC process 

 We will base the USPS com score on respondents’ 

satisfaction with the USPS com website 

 The Large Business survey is an online survey of 

a panel of respondents from large commercial 

businesses (with 250 employees or more) We 

will issue it quarterly beginning in FY2018 The 

survey will assess satisfaction with all experiences 

their businesses have had with us We will target 

individuals with infuence over shipping solutions 

 The BMEU survey will assess business customers’ 

satisfaction with their Business Mail Entry Unit 

Based on our root cause analysis of delivery-related 

issues, as well as analyses of survey data, several 

improvements are underway, including the development 

of new scanning and case tracking platforms and 

improved employee training These initiatives, which 

began in FY2017, will help us to meet our FY2018 

targets in all subcomponents of CI 

To address package status inquiries for BSN customers, 

in the frst quarter of FY2018 we will implement an 

integrated technology platform that will allow agents 

to access a single repository of information to fnd a 

customer’s package This will increase BSN capacity, 

reduce resolution time and improve customer service 

To ensure that we address eCC customer concerns, 

we will prioritize prompt and reliable issue resolution by 

exploring new trainings, processes and technological 

upgrades 

We will increase the number of POS survey respondents 

through a handout that encourages customers to 

respond and advertises our Informed Delivery program 

We will also deploy redesigned training for our newly 

assigned Sales and Service Associates that is focused 

on enhancing the customer experience 

Safe Workplace and Engaged Workforce 

Employee Safety 

We improved employee safety in FY2017 by continuing 

to make it a top priority Prevention is the guiding 

principle for occupational safety and health legislation 

To avoid accidents and occupational diseases, we have 

adopted standard requirements for safety and health 

protection at the workplace 

Risk assessment and management are fundamental 

to the prevention and control of risks to safety and 

health in the workplace This includes taking into 

account all relevant risks, checking the effciency of the 

safety measures adopted, documenting the outcomes 

of the assessment and reviewing and updating the 

assessment regularly 

We use the total accident rate as our measure of safety 

This is the total accident count for the year, multiplied by 

the approximate number of work hours per employee 

(2,000), multiplied by 100 and divided by the yearly 

number of work hours This yields, approximately, 

the annual accident frequency per 100 employees 

This rate uses the same calculation developed by the 

Occupational Safety and Health Administration (OSHA) 

for OSHA Illness and Injury (I&I) rates but expands on 

18 United States Postal Service — FY2017 Annual Report to Congress 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

it to include accidents that do not result in medical 

expenses, days away from work or restrictions from 

performing full duty Using the total accident rate is an 

industry best practice 

By tracking and monitoring the total accident rate, we 

are able to capture every accident, including OSHA 

recordable accidents (OSHA I&I), non-recordable 

accidents and motor vehicle accidents We calculate 

indicators for each of these categories as quickly as 

possible so we can implement prevention strategies 

designed to eliminate accidents and reduce the severity 

of impact on both the employee and the agency 

FY2017 Performance Report 

In FY2017, our total accident rate was 15 43 This 

was a signifcant improvement over last year’s rate of 

16 09 Total accidents for FY2017 decreased by more 

than 3,000 compared to FY2016, despite a slightly 

larger complement Nonetheless, we did not meet our 

aggressive accident rate target of 15 00 The table 

below shows accidents by type in FY2017 and FY2016: 

Accident Count by Type 

FY2017 FY2016 

OSHA I&I 37,074 37,393 

Non-Recordable 51,961 56,153 

Motor Vehicle1 29,461 29,120 

Total 89,035 93,546 

1 Motor vehicle accidents are included in both the OSHA I&I and non-recordable 

accident counts. 

FY2018 Performance Plan 

Our FY2018 target for the total accident rate is 15 00 To 

achieve this, we will continue to focus on prevention and 

a proactive approach to safety through efforts designed 

to address the most frequent hazards of the workplace, 

such as dog bites, extreme weather, distracted driving 

and improper lifting 

We will also focus on the importance of leadership in 

maintaining a culture of safety Our safety initiatives 

will assist our plants and Post Offces in establishing 

effective accident reduction plans, enlisting the 

cooperation and support of our employee partners 

and taking steps to address motor vehicle accidents 

through training, engineering controls and consistent 

communications In addition, we will continue programs 

that acknowledge leaders who demonstrate exceptional 

commitment to creating a safe work environment 

Employee Engagement 

Our employee engagement score increased in FY2017 

Engaging workplaces are ones in which individuals and 

teams are enabled to thrive, perform at consistently high 

levels and achieve positive organizational outcomes, 

such as fewer safety incidents, reduced absenteeism 

and higher customer satisfaction In FY2017, we 

continued to prioritize creating and sustaining an 

engaged workforce 

Central to this effort is providing leaders with the 

tools, information and resources they need to assess 

engagement strengths and opportunity areas for 

their teams and take action to improve their work 

environments To this end, we have focused on 

delivering targeted engagement training for leaders and 

providing support for employee feedback and action 

planning 

FY2017 Performance Report 

In FY2017, we continued to deliver engagement 

training to all executives, managers and non-bargaining 

employees across the organization We accelerated 

the delivery of the instructor-led training “Creating an 

Engaging Workplace at USPS” (CEW) to increase the 

number of leaders trained in the benefts of employee 

engagement and how to understand and improve it 

By the end of the year, more than 38,000 leaders had 

completed the training 

We measured levels of employee engagement using 

the Postal Pulse survey, a 13-question instrument 

developed by Gallup, Inc measuring 12 elements of 

engagement plus overall employee satisfaction We 

administered the Postal Pulse survey to our entire USPS 

workforce in August and September, FY2017 

Our key corporate metric is the employee response 

rate, or the percentage of employees who responded 

to the survey questions Our FY2017 response rate of 

46 percent represents a signifcant increase from the 

prior year response rate (30 percent), but below the 

goal of 51 percent To increase employee engagement, 

and so increase the employee response rate, we have 

strengthened training initiatives, as described in the 

following Performance Plan 

United States Postal Service — FY2017 Annual Report to Congress 19
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

We also calculated the grand mean engagement score, 

or the average of mean scores on the 12 engagement 

elements, on a scale of 1 to 5 In FY2017, our grand 

mean engagement score was 3 25, slightly above the 

3 24 score obtained in FY2016 3 

FY2018 Performance Plan 

Our FY2018 Postal Pulse survey response rate target 

is 75% To achieve this goal, employees will receive 

increased training in engagement In addition to CEW 

training for all managers, executives and non-bargaining 

employees, we will provide on-site coaching for select 

leaders to reinforce the principles of creating engaging 

workplaces Concurrently, we will pilot a version of 

engagement training with craft employees, beginning 

with those employees who have taken on lead roles 

(e g , safety captain) This training’s goal will be to raise 

engagement awareness and encourage participation 

in the feedback process The evaluation of the pilot will 

inform the size and scope of further implementation 

3 While both the grand mean and survey response rate are key performance 

indicators to measure our engagement objective, targets are not set for the 

grand mean. Driving to a grand mean engagement score does not incent 

managers to encourage honest survey feedback. Driving high response 

rates, however, is important because it increases the availability and number 

of employee feedback reports. This, in turn, allows local leaders to receive 

engagement data specific to their teams, for which they can create action 

plans. 

Financial Health 

Controllable Income (Loss) 

In FY2017, our total revenue was $69 7 billion and 

total expenses were $72 4 billion, resulting in a net 

loss of $2 7 billion This was $1 5 billion less than the 

$4 2 billion net loss planned in the FY2017 IFP The 

lower-than-anticipated net loss was primarily due to a 

$2 2 billion reduction in workers’ compensation liability 

(mostly caused by an increase in interest rates), which 

was partially offset by a revenue shortfall of $1 0 billion 

We use controllable income (loss), rather than net 

income (loss), to assess our fnancial performance 

The following table details the elements of net income 

(loss) and controllable income (loss) and shows planned 

revenues and expenses by category for FY2017 and 

FY2018, as well as actual data for FY2014–FY2017: 

20 United States Postal Service — FY2017 Annual Report to Congress 
FY2018 

Plan (IFP) 

FY2017 

Actual 

FY2017 

Plan (IFP) 

FY2016 

Actual 

FY2015 

Actual 

FY2014 

Actual 

First-Class Mail 24.8 25.6 26.0 26.6 27.2 27.6 

Marketing Mail 16.2 16.6 17.7 17.6 16.9 16.9 

Shipping and packages 21.4 19.5 19.0 17.3 15.0 13.5 

International 2.7 2.7 2.8 2.7 2.7 2.9 

Periodicals 1.3 1.4 1.4 1.5 1.5 1.6 

Other1 3.8 3.9 3.8 3.7 3.5 3.9 

Revenue2 $ 70.2 $ 69.7 $ 70.7 $ 69.4 $ 66.8 $ 66.4 

Temporary Exigent Surcharge 0.0 0.0 0.0 1.1 2.1 1.4 

Total revenue with investment income $ 70.2 $ 69.7 $ 70.7 $ 70.5 68.9 $ 67.8 

Compensation and benefts 3 50.7 50.5 50.7 53.2 51.8 50.4 

RHB normal cost

4 3.5 2.8 2.9 – – – 

Transportation 7.3 7.2 7.2 7.0 6.6 6.6 

Depreciation 1.7 1.7 1.6 1.7 1.8 1.8 

Supplies and services 3.0 3.0 3.0 2.8 2.7 2.6 

Rent, utilities and other 5 5.4 5.3 5.2 5.2 4.8 5.0 

Controllable expenses $ 71.6 $ 70.5 $ 70.6 $ 69.9 $ 67.7 $ 66.4 

Controllable income (loss) $ (1.4) $ (0.8) $ 0.1 $ 0.6 $ 1.2 $ 1.4 

RHB pre-funding – – – (5.8) (5.7) (5.7) 

RHB normal cost actuarial revaluation4 – (0.5) – – – – 

RHB unfunded liability amortization (1.2) (1.0) (2.9) – – – 

FERS unfunded liability amortization (0.9) (0.9) (0.2) (0.2) (0.2) – 

CSRS unfunded liability amortization (1.7) (1.7) (1.2) – – – 

Workers’ comp. fair value and other non-cash adjustments – 2.2 – (1.3) (0.4) (1.2) 

Change in accounting estimate 6 – – – 1.1 – – 

Net income (loss) $ (5.2) $ (2.7) $ (4.2) $ (5.6) $ (5.1) $ (5.5) 

Revenue and Expenses 

(in billions) 

1 Includes investment and interest income. 

2 Excludes an FY2016 change in accounting estimate of $1.1 billion due to a reevaluation of prepaid postage and a temporary exigent surcharge in FY2014, FY2015 

and FY2016. Includes investment income. 

3 Excludes RHB pre-funding, normal cost, amortization and actuarial revaluation; non-cash adjustments to workers’ compensation liabilities; and FERS and CSRS 

unfunded liabilities amortization, which are excluded from controllable expenses. Includes RHB premiums (FY2014–FY2016) and workers’ compensation cash 

expenses. 

4 Total RHB normal cost in FY2017 was $3.3 billion, of which $2.8 billion was classified as a controllable expense. The remaining $0.5 billion was classified as an 

RHB normal cost actuarial revaluation. 

5 Includes interest expense. 

6 During FY2016, we revised the technique used to estimate our deferred revenue - prepaid postage liability for Forever stamps. As a result of this change, deferred 

revenue - prepaid postage was decreased by nearly $1.1 billion. In accordance with GAAP, the change was accounted for as a change in accounting estimate. 

United States Postal Service — FY2017 Annual Report to Congress 21
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FY2017 Performance Report 

For FY2017, we had a controllable loss of $0 8 billion, 

compared to our planned controllable income of 

$0 1 billion This result was primarily attributable to a 

shortfall in revenue 

Revenue 

Revenue includes funds received from the sale of 

postage, mailing and shipping services; passports; 

PO Box rentals; gain on the sale or outlease of 

property; and interest and investment income Our 

FY2017 total revenue of $69 7 billion was $1 0 billion 

less than planned, largely due to higher-than-expected 

First-Class Mail diversion and an unexpected drop in 

Marketing Mail 

First-Class Mail primarily consists of single-piece and 

presort letters and cards Revenue from First-Class 

Mail was $25 6 billion, $0 4 billion below plan, due to 

continued and accelerated migration of consumers to 

electronic communication and transactional alternatives 

Marketing Mail consists of mail that we do not require 

customers to mail as First-Class or Periodicals and 

may include advertising, newsletters, catalogs, small 

marketing parcels and other printed matter Revenue 

from Marketing Mail was $16 6 billion, $1 1 billion below 

the planned amount This shortfall was due to a decline 

in volume of 2 6 billion pieces from FY2016, compared 

to the slight increase that was planned in the IFP This 

decline was unexpected, given the relative stability of 

Marketing Mail volumes in recent years, the overall 

health of the economy and the impact of the 2016 

election, which provided a boost in volume in the frst 

weeks of FY2017 

Shipping and Packages consists largely of competitive 

services that can be priced to refect current market 

conditions These include Priority Mail and Priority Mail 

Express, business-oriented services such as Parcel 

Select and Parcel Return and First-Class Mail parcels 

and certain other package delivery services Revenue 

from Shipping and Packages was $19 5 billion, 

$0 5 billion above the planned amount, due to 

e-commerce growth and the successful implementation 

of various marketing and sales campaigns 

International Mail includes services that enable 

customers, both domestic and abroad, to send 

international mail and packages, with either standard 

or express delivery options The majority of our 

International Mail revenue is generated from outbound 

services that allow customers in the U S to send 

mail and packages to other countries Revenue from 

International Mail was $2 7 billion, just below our plan, 

as larger-than-expected declines in letter mail volume 

were largely offset by growth in packages, which earn a 

signifcantly higher revenue per piece 

Periodicals mail is comprised primarily of newspapers, 

magazines and other periodical publications whose 

primary purpose is transmitting information to an 

established list of subscribers or requesters Revenue 

from Periodicals was $1 4 billion, in line with our plan 

Decreases in hard-copy reading and shifts of advertising 

away from print have depressed this segment for several 

years 

Other revenue includes ancillary services, such as 

Certifed Mail, PO Box services and Return Receipt 

services, and money order and passport services Other 

revenue was $3 9 billion, slightly above plan, due to 

a variety of factors affecting the various categories of 

service 

Controllable Expenses 

Controllable expenses excludes certain items that 

we consider non-controllable, discussed in the “NonControllable Expenses” section Our ability to affect the 

amount of controllable expenses is limited by various 

legal requirements, including our universal service 

obligation, our collective bargaining obligations and our 

obligation to participate in federal benefts programs 

This section describes the various categories of 

controllable expenses and their performance in FY2017 

Compensation and benefts expenses include salaries, 

basic retirement and employee health beneft expenses 

for our active employees and worker’s compensation 

cash outlays These expenses were $50 5 billion, 

$0 2 billion less than planned, largely due to a 

higher-than-anticipated portion of the workforce being 

comprised of newer, less expensive employees 

RHB normal cost expense is the expense we incur to 

fund retirement health benefts for our active employees 

Our normal cost of $2 8 billion was $0 1 billion less than 

planned due to a revision in the normal cost calculation 

by the Offce of Personnel Management (OPM) (OPM 

subsequently revised the normal cost calculation to 

$3 3 billion; this increase of $0 5 billion was classifed 

as a non-controllable expense, as described in the 

“Non-Controllable Expenses” section ) 

22 United States Postal Service — FY2017 Annual Report to Congress 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Transportation expenses include the costs we incur to 

transport mail and other products between our facilities, 

including highway, air and international transportation 

contracts, plus contract delivery services Transportation 

expenses do not include the compensation and benefts 

of employees responsible for transporting mail and other 

products between our facilities or to delivery points 

The non-personnel costs of transportation to delivery 

points, excluding contract delivery services, are included 

in rent, utilities and other expenses Total transportation 

expenses were $7 2 billion, in line with our IFP In 

FY2017, we negotiated more favorable rates from some 

of our contract air carriers, which favorably impacted 

our fnancial results Highway transportation costs were 

pressured by infationary cost increases 

Depreciation expenses allocate the cost of long-lived 

assets to the periods in which they are used These 

assets include items such as buildings, equipment, 

vehicles, leasehold improvements and capitalized 

software Depreciation expenses were $1 7 billion, 

$0 1 billion more than the IFP This variance is 

largely attributable to higher-than-expected building 

depreciation resulting from improvements being made to 

older facilities with shorter remaining depreciable lives 

Supplies and services expenses include minor 

equipment, spare parts, furniture, services, cost of sales 

and offce supplies. Supplies and services expenses 

in FY2017 were $3 0 billion, in line with the planned 

amount 

Rent, utilities and other expenses includes the cost 

of leasing buildings, utilities, building repairs and 

alterations, vehicle fuel, information technology, interest 

expense and all other miscellaneous items These items 

collectively cost $5 3 billion, which was $0 1 billion more 

than our plan Vehicle fuel and maintenance expenses 

for our delivery feet and information technology services 

largely accounted for the higher-than-expected spend 

FY2018 Performance Plan 

In FY2018, we plan for a $1 4 billion controllable loss, 

driven by modest revenue growth, infationary and 

contractual cost increases and an anticipated increase 

in the controllable portion of the RHB normal cost of 

$0 7 billion 

Revenue 

Revenue is planned to increase by $0 5 billion This 

increase is driven entirely by increases in shipping and 

packages First-Class Mail revenue is estimated to 

decrease by $0 8 billion due to continued electronic 

diversion, slightly offset by an anticipated 1 9 percent 

price increase Marketing Mail revenue is estimated 

to decrease by $0 4 billion, as we expect the decline 

in volume to continue but at a slightly reduced rate 

Shipping and Packages revenue is estimated to increase 

by $1 9 billion, due mainly to continued volume growth 

and market price increases International revenue is 

estimated to increase marginally, due to volume and 

price increases Periodicals revenue is estimated to 

decrease by $0 1 billion and is not expected to rebound, 

as electronic content continues to grow in popularity 

Other revenue is estimated to decrease by $0 1 billion 

Controllable expenses 

Compensation and benefts expenses are planned to 

increase by $0 2 billion, primarily due to contractually 

required wage increases The impact of these wage 

increases will be mitigated by a larger portion of newer, 

less expensive employees We also plan to reduce the 

number of work hours through increased effciency 

RHB normal cost expense is planned to increase by 

$0 7 billion over the FY2017 controllable amount due to 

the ongoing impact of changes in actuarial assumptions 

implemented by OPM in FY2017 Transportation 

expenses are estimated to increase by $0 1 billion, 

largely due to growth in package volume and infationary 

pressures Depreciation and supplies and services 

expenses are expected to remain fat Rent, utilities and 

other expenses are estimated to increase by $0 1 billion 

due to normal infationary pressures 

Non-Controllable Expenses 

Our fnancial results are signifcantly impacted by 

expenses that are not refective of our operational 

decisions and are subject to large fuctuations that 

are outside our control We label these expenses 

“non-controllable ” Fluctuations in these expenses are 

caused by changes in actuarial assumptions, such 

as interest and infation rates, and employee and 

retiree demographics We can only infuence these 

expenses over the long-term by changing the number of 

employees or compensation rates, and this effect is very 

small and gradual compared to the impact of external 

factors For example, a 1% change in 10-year treasury 

rates can cause an increase or decrease in workers’ 

compensation liability of approximately $2 billion 

United States Postal Service — FY2017 Annual Report to Congress 23
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-controllable expenses include revaluations of the 

Postal Service Retiree Health Benefts (RHB) Fund 

normal cost by OPM; the amortization of our unfunded 

RHB liabilities; the amortization of our unfunded 

liabilities for our participation in the Federal Employees 

Retirement System (FERS) and Civil Service Retirement 

System (CSRS); and non-cash expenses related to the 

changes in our liability for participation in the federal 

workers’ compensation program We exclude these 

items from the calculation of controllable income (loss) 

and explain them in the following paragraphs 

The RHB normal cost revaluation expense of $0 5 billion 

in FY2017 accounts for the increase in the RHB normal 

cost charged by the OPM over its previous estimate 

Our 2017 IFP included $2 9 billion for RHB normal 

cost as part of compensation and benefts, included 

in controllable expenses, based on projections from 

OPM During FY2017, OPM revised its normal cost 

calculation, frst to $2 8 billion, and then to $3 3 billion 

As this $0 5 billion increase in RHB normal costs was 

due to changes in the actuarial assumptions by OPM, 

we treated this amount as non-controllable There is no 

plan for a normal cost revaluation expense in FY2018 as 

we cannot predict calculation changes by OPM 

OPM calculates the RHB unfunded liability amortization 

expense to allow us to meet our unfunded liability 

obligations in the RHB program The 2017 IFP included 

$2 9 billion in expense, based on the most recent OPM 

data available at the time we published the IFP This 

amount is based on the assumption that OPM would 

require that the entire $52 1 billion unfunded liability 

be amortized The actual billed amount in FY2017 

was $1 0 billion This lower amortization requirement 

was based on an unfunded liability that did not include 

the $33 9 billion in previously billed, but unpaid, 

RHB prefunding Rather, OPM states that the entire 

$33 9 billion that was unpaid as of September 30, 2016, 

and remains unpaid, is due currently and that only the 

remaining $18 2 billion unfunded liability should be 

amortized Based on the latest available information, 

the FY2018 IFP includes a $1 2 billion expense for RHB 

unfunded liability amortization 

OPM calculates FERS and CSRS unfunded liability 

amortization payments to allow us to meet our unfunded 

liability obligations in the FERS and CSRS programs We 

consider these expenses non-controllable because the 

amount depends on actuarial assumptions, including 

interest and infation rates, over which we have no 

control FY2017 planned expenses for FERS and 

CSRS amortization were $0 2 billion and $1 2 billion, 

respectively, based on the most recent data available 

at the time we published the IFP The actual charged 

amounts in FY2017 were $0 9 billion and $1 7 billion, 

respectively, largely due to changes in economic 

assumptions by OPM Our FY2018 IFP includes CSRS 

and FERS amortization expenses equal to their actual 

FY2017 values 4 

GAAP requires us to record our September 30, 2017 

workers’ compensation liability based on the prevailing 

interest rates on that date The adjustment to the liability 

is non-controllable, as it is a function of events taking 

place in the general economy and well outside our 

control We do not plan for this adjustment in our IFP, 

as we cannot predict future interest rates In FY2017, 

we recorded a reduction in the workers’ compensation 

liability of $2 2 billion, which is largely the result of 

prevailing interest rates being higher than the prior year 

Deliveries per Total Work Hours, % Change 

Deliveries per total work hours (DPTWH) is a measure of 

our overall effciency It is calculated by multiplying the 

total possible deliveries by the number of delivery days 

and dividing that product by total work hours We target 

our percent improvement in DPTWH from year to year 5 

We adjust work hours to refect changes in workload 

compared to the prior year This adjustment accounts 

for changes in the network size (the addition of delivery 

points) and changes in the mix of mail types (for 

example, a package usually contributes much more to 

workload than a letter or fat) The adjustment ensures 

that DPTWH is comparable from year to year 

Finally, the percent change in DPTWH is calculated 

by comparing the current year DPTWH (based on 

adjusted work hours) with prior year DPTWH (based on 

unadjusted work hours) The following table shows how 

the annual percent change in DPTWH is calculated: 

4 OPM periodically notifies us regarding its revaluation of unfunded CSRS and 

FERS retirement benefits. OPM calculates these obligations using governmentwide data, rather than Postal Service-specific economic and demographic 

assumptions. In October 2017, OPM issued a new rule announcing its intent to 

calculate future unfunded retirement FERS obligations using Postal Servicespecific demographic assumptions. The new rule did not mandate the use 

of government-wide versus Postal Service-specific economic assumptions, 

however. 

5 The indicator “Deliveries per Total Work Hours, % Change,” was referred to 

as “Deliveries per Total Work Hours, % SPLY” in the FY2016 Annual Report to 

Congress. 

24 United States Postal Service — FY2017 Annual Report to Congress 
 

 

 

 

 

 

 

 

 

 

 

Deliveries per Total Work Hour Calculation 

FY2018 FY2017 FY2017 FY2016 FY2015 FY2014 

Plan Actual Plan Actual Actual Actual 

Work hours (millions) 1,141 1,164 1,157 1,158 1,128 1,107 

Less adjustment to work hours based on earned workload1

 (millions) (4.0) (5.4) 2.0 18.0 — — 

Adjusted work hours (millions) 1,145 1,169 1,155 1,140 1,128 1,107 

Total deliveries (millions) 47,835 47,604 47,532 47,366 46,829 46,480 

Deliveries per total work hours (unadjusted) 41.9 40.9 41.1 40.9 41.5 42.0 

Deliveries per total work hours (adjusted) 41.8 40.7 41.2 41.6 41.5 42.0 

Deliveries per total work hours, % change2 2.1% (0.5)% 0.6% 0.1% (1.1)% 1.0% 

1 We updated the DPTWH calculation method in FY2016 to recognize the impact of earned hours from changes in mail mix and the impact of Sunday delivery. 

2 The percent change in DPTWH is the percent difference between current year DPTWH (based on adjusted work hours) and prior year DPTWH (based on unadjusted 

work hours). 

FY2017 Performance Report FY2018 Performance Plan 

Package volume and delivery points grew in FY2017; The FY2018 DPTWH target of 2 1 percent assumes 

however, letter and fat volumes decreased signifcantly we will capture work hour reductions from declining 

The number of deliveries grew by approximately 231 mail volume and from operational initiatives to improve 

million, which is the net result of the addition of about effciency Some of these initiatives are described in 

1 2 million new delivery points and a decrease in non- the “High-Quality Service” and “Excellent Customer 

Sunday delivery days by one (from 304 to 303), as well Experiences” performance plans, and others are listed in 

as a small impact from increased Sunday deliveries The the section “Strategic Initiatives ” 

FY2017 plan anticipated a 0 6 percent improvement 

in DPTWH However, in FY2017, DPTWH decreased 

by 0 5 percent Our large network makes it diffcult to 

adjust work hours due to sudden, unexpected changes 

in volume A rapid decrease in volume during the year 

contributed to us missing the DPTWH target 

United States Postal Service — FY2017 Annual Report to Congress 25
 

 

 

 

 

 

 

 

 

 

 

Other Productivity Measures 

Total Factor Productivity (TFP) measures how 

effciently we use our resources 6 An increase in 

TFP indicates that the ratio of work completed 

to the resources used is increasing and we 

are operating more effciently Work completed 

depends on three primary components: 

1) the number of delivery points, 2) mail volume 

weighted by product type and 3) miscellaneous 

output (such as other services we provide, 

including passport services) 

Labor productivity measures the effciency of 

labor An increase in the labor productivity index 

indicates that more workload is being handled per 

unit of labor 

Labor productivity increased for the eighth year in 

a row in FY2017 TFP has increased signifcantly 

since FY2009, though it decreased slightly in 

FY2017 This decrease was largely attributable to 

a decline in mail volume, increased transportation 

expenses and increased investments A number 

of factors, including the decline in mail volume 

in recent years, has made it more challenging to 

generate additional productivity growth 

For both indices, resource usage is based on 

the constant-dollar amounts of labor, capital 

and materials used Because some productivity 

improvements take years for the effects to 

be realized, it is more informative to consider 

changes in TFP and labor productivity over a 

period of years, rather than year-to-year The 

following chart starts with the cumulative TFP and 

labor productivity improvement from 1971 to 2007 

and then shows the cumulative change each year 

since then: 

6 We use DPTWH rather than TFP as our primary indicator for two 

reasons: 1) DPTWH is easier to understand and target at the area and 

district level and 2) DPTWH can be calculated in a more timely manner 

than TFP, allowing us to more quickly assess our performance. 

Total Factor Productivity and Labor Productivity, Cumulative Change 

Since 1971 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

26 United States Postal Service — FY2017 Annual Report to Congress 
 

 

 

 

 

 

 

 

 

 

Strategic Initiatives 

We have established strategic goals as described in our 

FY2017–2021 5-Year Strategic Plan To achieve these 

goals, we have implemented a portfolio of strategic 

initiatives and a rigorous portfolio management process 

This process is based on well-established methods to 

apply strategic and fnancial rigor to decision-making 

and to navigate signifcant organizational changes 

Each strategic initiative has a unique set of measures to 

track performance The portfolio of initiatives is dynamic 

and changes as priorities and resources change, and as 

programs are completed or adjusted based on external 

events 

The changes to our initiatives from FY2017 to FY2018 

fall into the following categories: 

1. New: Initiative was created in FY2018 to address an 

emerging business need 

2. Continued: Initiative continued into FY2018 with 

minimal changes from FY2017 

3. Moved: Initiative was closed and its activities were 

incorporated into the relevant business unit’s normal 

operations 

4. Refned: Initiative was modifed to achieve greater 

alignment with organizational goals and the current 

business environment 

5. Combined: Initiative was combined with one or more 

similar initiatives to more accurately refect the current 

business environment and provide greater alignment 

organizationally 

The following table shows the strategies from our 5-Year 

Strategic Plan, corporate-wide goals and the strategic 

initiatives implemented in FY2017 and planned for 

FY2018: 

United States Postal Service — FY2017 Annual Report to Congress 27
FY2017 Corporate Outcomes Supported FY2018 Corporate Outcomes Supported 

Strategies 

from the 

FY2017– 

FY2021 

5-Year 

Strategic 

Plan 

FY2017 

Strategic 

Initiatives 

Highquality 

service 

Excellent 

customer 

experiences 

Safe 

workplace 

and 

engaged 

workforce 

Financial 

health 

Change 

from 

FY2017 

to 

FY2018 

FY2018 

Strategic 

Initiatives 

Highquality 

service 

Excellent 

customer 

experiences 

Safe 

workplace 

and 

engaged 

workforce 

Financial 

health 

Build a 

Deliver 

World-Class 

Customer 

World-Class 

Customer 

Experience 

X X X

Combined 

Build a 

World-Class 

Customer 

Experience 

X X X

Create a 

World-Class 

Social Media X X X

Experience Platform 

Build a Build a 

World-Class 

International X X Continued World-Class 

International X X X 

Platform Platform 

Equip, 

Empower, 

& Engage 

Employees 

Build a 

Culture of 

Engagement 

X X X X Refned 

Build a 

World-Class 

Employee 

Experience 

X X 

Deliver a Safe 

Workplace X X X X Moved 

Accelerate Accelerate 

Innovation Innovation 

to Maximize X X X X Continued to Maximize X X X X 

Business Business 

Innovate 

Value Value 

Develop an 

Innovation X X X X Moved 

Faster to 

Deliver 

Value 

Framework 

Accelerate 

Innovation 

to Maximize 

Customer 

Value 

X 

Combined 

Accelerate 

Innovation 

to Create 

Customer 

Value and 

Maximize 

Revenue and 

Proft 

X X X X 

Implement 

Informed 

Delivery 

X X X X 

Optimize 

Network X Continued 

Optimize 

Network X X 

Platform Platform 

Optimize 

Delivery 

Platform 

X X X 

Combined 

Delivery 

Structure 

Rationalization 

X X X X Optimize 

Retail and 

Customer X X X 

Invest in Service 

Our Future 

Platforms 

Platform 

Build a Build a 

World-Class 

Package 

Platform 

X X X Continued World-Class 

Package 

Platform 

X X X 

Build a Bench 

of Effective X X X X Moved 

Leaders 

Effectively 

Leverage 

Complement 

X X Moved 

FY2017 and FY2018 Strategic Initiatives 

28 United States Postal Service — FY2017 Annual Report to Congress 
 

 

 

 

 

 

 

Additional Information 

For more information on our programs and policies, 

please visit usps.com 

Trademarks 

The eagle logo, the trade dress of USPS packaging, 

the letter carrier uniform, trade dress of the round top 

collection box and the postal truck and the following 

word marks are among the many trademarks owned 

by the United States Postal Service®: BlueTube®, 

Certifed Mail®, First-ClassTM, First-Class Mail®, FirstClass Package®, Forever®, Informed Visibility®, Parcel 

Select®, PO BoxTM, PO BoxTM, Post OffceTM, Postal 

Pulse®, Postal ServiceTM, Priority Mail®, Priority Mail 

Express®, Priority Mail Express International®, Priority 

Mail International®, Standard Mail®, Standard PostTM, 

United States Postal Inspection Service®, United States 

Postal Service®, U S Mail®, U S Postal Service®, 

USPS®, USPS BlueEarth®, USPS Marketing Mail®, 

USPS Retail Ground®, USPS Tracking®, usps com®, 

Village Post OffceTM, and ZIP CodeTM 

Year References 

All references to a specifc year or “the year” refer to 

the Postal Service fscal year ending September 30 

However, specifc month and year references pertain to 

the calendar date