OFFICE OF

INSPECTOR

GENERAL

UNITED STATES POSTAL SERVICE

Corporate Succession Planning 

Program

Management Advisory Report

Report Number HR-MA-14-006

April 23, 2014
BACKGROUND:

U.S. Postal Service workforce 

demographics are rapidly changing and 

a large percentage of its executives 

could soon retire. Specifically, in fiscal 

year (FY) 2012, 35 percent of Postal 

Service executives were eligible to retire 

and that number will grow to 49 percent 

within 3 years. To ensure continuity of 

expertise in executive positions, the 

Postal Service must identify and 

develop talented individuals to fill future

vacancies. It uses its Corporate 

Succession Planning (CSP) program to 

identify and develop top performing 

employees for new or expanded 

executive roles.

About 30 percent of potential 

successors are eligible to retire now, 

and 73 percent will be eligible in the 

next 7 years. In FY 2012, management 

revised the program from a 

self-nominated to an 

executive-nominated program and 

expanded it to include top performers 

early in their career progression. 

About every 2 years, management 

nominate new employees to the 

program and measure the program's

success by the availability of qualified 

successors when vacancies arise. In FY 

2013 with a goal of 95 percent, the 

Postal Service filled 94 percent of 

vacant executive positions with 

candidates from the CSP program. Of 

the remaining 6 percent, 4 percent were 

postal employees not in the program 

and 2 percent were external hires.

Our objective was to assess the CSP 

program and determine whether Postal 

Service officials are effectively 

managing it to identify and develop 

potential leaders for executive

management positions.

WHAT THE OIG FOUND:

The Postal Service has established a 

CSP program that includes many best 

practices for successful organizations; 

however, it can improve the program.

Generally, the Postal Service effectively 

administers the CSP program to identify 

and develop potential leaders to fill 

executive management positions. 

However, we found that 289 days after 

the approval deadline, management had 

not approved 621 of the 3,624 

developmental activities we reviewed

(17 percent). This occurred because 

some managers did not make approving 

these activities a priority. These delays 

hinder potential successors’ ability to 

develop skills they need for leadership 

positions.

WHAT THE OIG RECOMMENDED:

We recommended management 

enhance controls to ensure potential 

successors' developmental activities are 

approved in a timely manner.

Link to review the entire report

April 23, 2014

Corporate Succession Planning Program

Report Number HR-MA-14-006
April 23, 2014

MEMORANDUM FOR: JEFFREY C. WILLIAMSON

CHIEF HUMAN RESOURCES OFFICER AND EXECUTIVE 

VICE PRESIDENT

E-Signed by Michael A. Magalski

VERIFY authenticity with eSign Desktop

FROM: Michael A. Magalski

Deputy Assistant Inspector General 

 for Support Operations

SUBJECT: Management Advisory Report – Corporate Succession

Planning Program (Report Number HR-MA-14-006)

This report presents the results of our review of the U.S. Postal Service’s Corporate 

Succession Planning Program (Project Number 13YG029HR000).

We appreciate the cooperation and courtesies provided by your staff. If you have any 

questions or need additional information, please contact Lorie Nelson, director, Human 

Resources and Support, or me at 703-248-2100.

Attachment

cc: Corporate Audit and Response Management
Corporate Succession Planning Program HR-MA-14-006

TABLE OF CONTENTS

Introduction ..................................................................................................................... 1

Conclusion ...................................................................................................................... 1

Best Practices ................................................................................................................. 2

Individual Development Plan Approval............................................................................ 3

Other Matters .................................................................................................................. 4

Recommendation ............................................................................................................ 5

Management’s Comments .............................................................................................. 5

Evaluation of Management’s Comments......................................................................... 5

Appendix A: Additional Information ................................................................................. 6

Background ................................................................................................................. 6

Objective, Scope, and Methodology ............................................................................ 7

Prior Audit Coverage ................................................................................................... 8

Appendix B: Management’s Comments .......................................................................... 9
Corporate Succession Planning Program HR-MA-14-006 

1 

Introduction

This report presents the results of our self-initiated review of the U.S. Postal Service’s 

Corporate Succession Planning (CSP) program (Project Number 13YG029HR000). Our 

objective was to assess the CSP program and determine whether Postal Service 

officials are effectively managing it to identify and develop potential leaders to fill 

executive management positions. See Appendix A for additional information about this 

audit.

Because the Postal Service's workforce demographics are rapidly changing, it must 

identify and develop talent for future executive positions. According to postal officials, in 

fiscal year (FY) 2012, 35 percent of Postal Service executives were eligible to retire. 

They estimate that number will increase to 49 percent within 3 years. To fill the 

expected vacancies, the agency must make the most of its human capital. The Postal 

Service uses the CSP program to identify and develop top performing employees for 

new or expanded executive roles. 

In FY 2012, management revised the program from a self-nominated to an 

executive-nominated program and expanded it to include top performers early in their 

career progression. About every 2 years, management nominate new employees to the 

program and measure the program's success by the availability of qualified successors 

when vacancies arise. In FY 2013, with a goal of 95 percent, the Postal Service filled 94 

percent of vacant executive positions with candidates from the CSP program. Of the 

remaining 6 percent, 4 percent were postal employees not in the program and 2 percent 

were external hires.

Conclusion

We found the Postal Service has established a CSP program that includes many best 

practices, but it can improve the program. The Postal Service’s CSP program 

addresses strategic vision, top leadership support, early career development, diversity, 

and retention, which are recognized by the U.S. Government Accountability Office 

(GAO) as best practices for successful organizations. Generally, the Postal Service 

effectively administers the CSP program to identify and develop potential leaders to fill 

executive management vacancies. Potential successors stated that the program met 

their expectations and was effective in developing them into leaders. However, we 

found that management did not always timely approve developmental activities because 

approving these activities was not a priority. These delays hindered potential 

successors’ ability to develop skills they needed for leadership positions. 
Corporate Succession Planning Program HR-MA-14-006

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Best Practices

The Postal Service incorporated best practices for successful organizations as identified 

by the GAO.

1 The Postal Service CSP program includes:

 Receiving active support from top leadership – Postal Service executives identify

desired skills and competencies for anticipated positions or talent pools. Executive 

managers2 and officers nominate top talent for the CSP program and develop top 

performing employees. The executive leadership team (ELT)3 ― after discussions 

with executive managers and officers ― selects candidates for the program. Also, 

executive managers must participate in the CSP program via a robust individual 

development plan (IDP)

4 that addresses their development needs.

 Linking to strategic planning – The Postal Service uses Delivering Results, 

Innovation Value and Efficiency (DRIVE)5 initiatives to improve business strategy 

development and execution. DRIVE focuses on strategic initiatives the Postal 

Service will implement to meet its performance and financial goals. The Leadership 

Identification and Development DRIVE initiative includes a talent management 

strategy that identifies and develops the next generation of top performing leaders at 

all levels of the organization. The CSP program is part of the DRIVE initiative.

 Identifying talent from multiple organizational levels, early in careers or with critical 

skills – Postal Service executives identify potential successors based on leadership 

skills needed for the future of the organization. Potential successors must show 

leadership commitment to growth and development and certain managerial 

competencies, productivity, and business results. The Postal Service’s Leadership 

Development and Talent Management (LDTM6

) team has focused on strategies that 

identify, assess, and develop the next generation of leaders at all organizational

levels. The Postal Service has programs7 that develop leadership candidates in 

positions not served by the CSP program.8 During the FY 2012 cycle, management

expanded the program to include top performers who are early in their career 

progression in the leadership pipeline. The expanded program also includes 

 1 GAO-04-127T, Succession Planning and Management Is Critical Driver of Organizational Transformation,

October 1, 2003. 2 A Postal Career Executive Service manager who identifies and assesses eligible employees during the talent

review process and recommends employees for successor pools within his or her function.

3 A group composed of the postmaster general, the deputy postmaster general, and several senior officers who assist 

in setting management policy and objectives and approving major plans, programs, and budgets. 

4 A tool that guides employees as they acquire new knowledge or skills, gain critical experience, and develop the 

necessary leadership competencies.

5 The Postal Service implemented DRIVE as a management process in FY 2010 to improve business strategy 

development and execution through 24 active key initiatives. These initiatives focus on cutting costs, generating 

revenue, improving customer experience, and engaging employees and other key stakeholders in organizational 

change.

6 This team supports the organization's strategic plan by identifying and developing the next generation of 

high-potential leaders, ensuring a diverse and rich talent pipeline. 7 These programs include the Executive and Administrative Schedule (EAS) Leadership Development program, the 

Managerial Leadership program, and the Advanced Leadership program. 8 The CSP considers employees in EAS positions 22 and above and Postal Career Executive Series I and II.
Corporate Succession Planning Program HR-MA-14-006

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coaching and mentoring and more cross-functional developmental opportunities. 

Finally, in FY 2012, executives identified several talent pools to fill difficult positions

and address specialized knowledge and critical skills needs.

 Addressing specific human capital challenges like diversity, leadership, and 

retention – In its FY 2013 annual report,

9 the Postal Service stated that it is 

committed to a diverse workforce, which means building an inclusive environment 

that respects the uniqueness of every individual and encourages the contributions of 

people from different backgrounds, experiences, and perspectives. According to a

2013 diversity report,

10 potential successors in the CSP program are more diverse in 

race or national origin, age, and gender than current Postal Career Executive 

Service (PCES)11 employees. Also, the LDTM stated the program is viewed as a 

retention tool. Talented people are more likely to stay when they are identified as 

potential leaders. According to a 2012 study,

12 developing leaders takes time and 

effort. Internal candidates are more likely to be successful than external candidates. 

External candidates are more likely to leave a job, are paid more, and have lower 

performance ratings within the first 2 years of hiring. Postal officials measure the 

success of the CSP program by the availability of potential qualified successors 

when vacancies rise. For FY 2013, the Postal Service implemented a goal of 95 

percent talent availability in the corporate pipeline. Management filled 94 percent13

of vacant executive positions with candidates from the CSP program during that 

period.

Individual Development Plan Approval

Managers did not always approve IDP activities in a timely manner. We determined that

17 percent of IDP activities were pending management approval even after the deadline 

for approval was extended.14 As shown in Table 1, of the 3,624 IDP activities we 

reviewed, management had not approved 621 of them as of December 4, 2013, 289 

days after the extended approval deadline. This occurred because the Postal Service 

did not have adequate controls to ensure managers approved IDP activities on time.

 9 2013 Annual Report to Congress, dated January 28, 2013. Annual Report to Congress, January 28, 2013. 10 Corporate Succession Planning Diversity Council Update to Postal Officials, February 2013. 11 The PCES was established in 1979 to develop and maintain a highly motivated, competent group of individuals to 

fill key executive-level positions and provide the leadership needed for the continued success of the Postal Service. 12 Study conducted by Matthew Bidwell, assistant professor at the University of Pennsylvania’s Wharton School. 13 215 of 229. 14 The deadline for managers to approve IDP activities for the current 2-year cycle was January 31, 2013. It was 

subsequently extended to February 15, 2013.
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The IDP is a crucial component of the CSP process. The potential successor and their 

manager identify developmental activities and assignments to build the IDP. Managers 

receive system-generated email reminders advising them that they have IDP activities 

pending their review and approval. Potential successors cannot begin activities until 

they are approved. Upon receiving approval for the IDP activities, potential successors

can record progress made on developmental activities and revise the IDP with their

manager’s consent.

Postal Service policy15 requires that executive managers review and approve, approve 

with changes, or decline the developmental activities identified in each potential 

successor’s IDP. Managers have the authority to remove those potential successors

who are not committed to their development from the CSP program. However, there are 

no consequences for managers who do not approve IDP activities on time.

According to postal officials, managers could delay IDP activity approvals for many 

reasons. The main reason, however, is that managers do not make approving IDPs a 

priority. These delays hinder potential successors’ ability to develop the skills and 

experience they need for leadership positions.

Other Matters

A significant number of possible successors are eligible to retire in the next few years, 

which might make it challenging to fill key positions. Specifically, we found that 30 

percent of potential successors are eligible to retire now and 73 percent will be eligible 

over the next 7 years. Further, nearly half of Postal Service executives will be eligible to 

retire over the next 3 years and developing leaders at the executive level requires time. 

Retirement eligibility is not part of the criteria management consider when identifying

potential successors for the CSP program. Postal Service officials said they do not 

preclude potential successors from the CSP program because they are eligible to retire.

Further, successors' retirement eligibility dates may differ from actual retirement dates.

Management redesigned the CSP program for the 2012 open season with a focus on 

expanding the leadership pipeline to include top performers who are early in their career 

progression. Management added the “Ready in 5 Years” category and single position

talent pools so they could more easily assess the retirement risk of potential successors

 15 Management Instruction EL 384, Corporate Succession Planning, January 15, 2013.

Table 1: IDP Activities’ Approval Status as of December 4, 2013

IDP Activities 

Reviewed

IDP Activities 

Approved

IDP 

Activities 

Pending 

Approval

Days 

Late

3,624 3,003 (83%) 621 (17%) 289

Source: U.S. Postal Service Office of Inspector General (OIG) analysis.
Corporate Succession Planning Program HR-MA-14-006

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for key jobs. Additionally, management created new CSP reports to provide leaders with 

better visibility into the leadership pipeline. In January 2014, postal officials initiated an

interim talent review to assess their talent pools midway through the 2-year cycle and 

make appropriate adjustments.

We acknowledge the Postal Service’s efforts to mitigate the impact of retirement on the 

availability of talent for future leadership roles. Management must ensure they use the 

expanded resources to ensure the leadership pipeline remains viable.

Recommendation

We recommend the chief of Human Resources and executive vice president:

1. Enhance controls to ensure managers approve potential successors' individual 

development plans in a timely manner.

Management’s Comments

Management agreed with the recommendation and findings and stated it is a top priority 

they have incorporated into DRIVE meetings. They have begun implementing 

enhancements to the IDP system that will raise the awareness and tracking compliance 

of timely approval of IDP activities. They plan to implement these enhancements by 

June 30, 2014. See Appendix B for management’s comments, in their entirety.

Evaluation of Management’s Comments

The OIG considers management’s comments responsive to the recommendation in the 

report and corrective actions should resolve the issue identified in the report. 
Corporate Succession Planning Program HR-MA-14-006

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Appendix A: Additional Information

Background 

Retirement eligibility for executive management positions continues to be a significant 

risk in the Postal Service. Because the Postal Service's workforce demographics are 

rapidly changing, the Postal Service must identify and develop top talent for future

executive positions. According to postal officials, in FY 2012, 35 percent of Postal 

Service executives were eligible to retire. They estimate that number will increase to 49 

percent within 3 years. To fill the expected vacancies, the agency must make the most 

of its human capital. The Postal Service uses the CSP program to identify, develop, and 

prepare top performing employees for new or expanded executive roles in response to 

this challenge. With many impending executive retirements and considering the 

numerous years required to develop effective leaders at the executive level, the Postal 

Service finds itself at a critical juncture in its history. Unless the agency invests in 

identifying and developing potential successors to build a stronger leadership pipeline, it 

risks significant operational disruptions.

The Postal Service uses the CSP program to address this challenge. The program's 

main purpose is to develop and prepare candidates to fill vacant positions. The LDTM

team administers and oversees the program.

In FY 2012, the Postal Service streamlined the CSP program by moving from a 

self-nominated program to an executive-nominated program, which no longer requires 

employees to complete an extensive CSP application. Other program changes include:

 Implementing a continuous business process instead of a one-time event.

 Integrating talent management processes instead of stand-alone talent management 

tools.

 Requiring ownership and accountability by each executive instead of ownership by 

the Executive Review Board.16

 Requiring identification of critical positions.

 Implementing structured career discussions instead of ad-hoc career discussions.

 Implementing annual leadership reports to the program management group.

About every 2 years, postal officials hold a CSP program open season during which all 

EAS-2217 and above employees are considered for nomination into the CSP program. 

Using validated managerial competencies and a structured multi-step process to ensure 

the fairness and objectivity of the nomination process, executive managers propose 

employees who first are reviewed and then selected and placed by the ELT and Human 

Resources department into executive positions.

 16 A group of PCES managers who review nominees during the CSP application process and recommend potential 

successors within the officer’s function.

17 Employees, such as postmasters and various managers, who manage postal operations.
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To manage the program, Postal Service officials use the CSP System to monitor and 

track the progress of potential successors, monitor executive managers' participation, 

maintain talent reviews, and track the overall status of the succession pools. Currently, 

executives have defined 240 successor pools18 for leadership placement. Postal 

officials measure the success of the CSP program by the availability of qualified 

successors when vacancies arise. In FY 2013, with a goal of 95 percent, the Postal 

Service filled 94 percent of vacant executive positions with candidates from the CSP 

program. Of the remaining 6 percent, 4 percent were postal employees not in the 

program and 2 percent were external hires.

Objective, Scope, and Methodology

Our objective was to assess the CSP program and determine whether Postal Service 

officials are effectively managing it to identify and develop potential leaders to assume 

executive management positions. Our scope included assessing how the Postal Service 

administered the CSP program during FY 201219 through FY 2013.

To accomplish our objective, we:

 Interviewed Postal Service officials to gain an understanding of the CSP program.

 Reviewed applicable succession planning policies, procedures, and guidance.

 Reviewed prior audits related to our objective.

 Researched industry benchmark studies related to succession planning and 

compared them to the Postal Service's CSP program processes.

 Obtained and reviewed available statistics related to CSP program activities.

 Assessed internal controls related to the Postal Service’s succession planning 

activities to determine the program's effectiveness.

 Tracked two candidates through the CSP System to determine the data's validity 

and whether the required CSP steps had been completed.

 Interviewed four potential successors to determine their understanding of the 

program and whether it met their expectations. 

We assessed the reliability of computer-generated data by interviewing agency officials 

knowledgeable about the data, reviewing existing information, comparing the data to 

manual documentation, and tracking two candidates through the CSP System. We 

determined that the data were sufficiently reliable for the purposes of this review.

We conducted this review from July 2013 through April 2014 in accordance with the 

Council of the Inspectors General on Integrity and Efficiency, Quality Standards for 

Inspection and Evaluation. We discussed our observations and conclusions with 

management on March 24, 2014, and included their comments where appropriate.

 18 Successor pools include talent and critical position pools. A talent pool is a group of positions with similar functions, 

roles, scope, and functional/technical requirements. Critical position pools are specific positions isolated from those 

groups and deemed particularly crucial based on their impact on the business. 19 The Postal Service revised the CSP program in FY 2012.
Corporate Succession Planning Program HR-MA-14-006

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Prior Audit Coverage

The OIG did not identify any prior audits or reviews related to the objective of this 

review.
Corporate Succession Planning Program HR-MA-14-006

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Appendix B: Management’s Comments
Corporate Succession Planning Program HR-MA-14-006

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