The Postal Service’s goal is to deliver at least 95 percent of local First-Class Mail overnight and to achieve 100-percent customer satisfaction. Delivery performance is measured in 96 metropolitan areas across the nation and results are published quarterly. This measurement system, known as the External First-Class Measurement System (EXFC), is based on test mailings done by Price Waterhouse. For the Washington, D.C., metropolitan area, EXFC results are available separately for Washington, D.C.; Northern Virginia; and Southern Maryland. Nationwide averages are also available for comparison purposes. Customer satisfaction is measured in 170 metropolitan areas across the nation, and results are also published quarterly. This measurement system, known as the Customer Satisfaction Index (CSI), is administered by the Opinion Research Corporation. Each quarter it mails a questionnaire to thousands of households asking them how they would rate their overall satisfaction with the Postal Service’s mail service. For the Washington, D.C., metropolitan area, CSI results are available separately for Washington, D.C.; Northern Virginia; Southern Maryland; and Suburban Maryland. The processing and distribution facility for Southern Maryland is located in Prince George’s County. The facility for Suburban Maryland is located in Montgomery County. Nationwide averages are also available for comparison purposes. The Postal Service said that its delivery service and customer satisfaction goals—nationwide and locally—are ambitious, and attaining those goals will require a high level of employee commitment. For example, the quarter 4, 1994, EXFC nationwide average was 12 percentage points below the established goal. To gauge employee attitudes and satisfaction levels, the Service has administered a questionnaire to all employees in each of the last 3 years. This questionnaire is commonly known as the Employee Opinion Survey (EOS), and survey results are available for the nation, broken down by local postal facility. In conducting our review, we (1) obtained and analyzed numerous Postal Service reports containing data on factors affecting mail processing and delivery; (2) obtained and analyzed numerous types of performance data for both the local Washington, D.C., area and the nation, as well as for other selected locations; (3) interviewed various postal and union officials; (4) observed mail processing operations at local processing and distribution centers and local postal stations; and (5) examined recent reports on mail service issued by the Postal Service’s Inspection Service and the Surveys and Investigations Staff of the House Committee on Appropriations. (Additional background information and more details on our objectives, scope, and methodology are presented in appendix I.) Mail service and customer satisfaction in the Washington, D.C., metropolitan area have consistently been below stated goals; generally below the national average; and, in 1994, substantially below the levels attained in 1993. Specifically, service in the Washington metropolitan area, as measured quarterly by EXFC, has been below the national average in 16 of the 17 quarters since EXFC was first established in 1990. The national average ranged between 79 and 84 percent in that time period but has always been below the 95-percent on-time delivery goal. Figure 1 compares mail delivery service in the Washington metropolitan area, over time, with the national average and delivery service goal. Further analysis of EXFC data showed that delivery scores in the Washington, D.C., metropolitan area have been among the worst in the nation. For example, 88 percent of the time, service in Northern Virginia and Southern Maryland was in the bottom 25 percent of all locations where service was measured; 76 percent of the time, service in Washington, D.C., was in the bottom 25 percent. Additionally, delivery service scores in the Washington, D.C., metropolitan area for quarter 4, 1994, were significantly below the scores attained for quarter 4 the previous year. Southern Maryland’s score, for example, dropped 8 percentage points. Residential customer satisfaction in much of the Washington, D.C., metropolitan area, as measured by CSI, has generally been below the national average. (See figure 2.) Since 1991, the Opinion Research Corporation has sent CSI questionnaires to postal customers on a quarterly basis asking them how satisfied they were with mail service. Information collected during these 16 quarters show that in each quarter between 85 and 89 percent of customers nationwide rated their satisfaction with the Service’s overall performance as excellent, very good, or good. In 12 of 16 quarters, Northern Virginia customers reported being as satisfied, or more satisfied, than the nation as a whole. Customer satisfaction in the other locations that make up the metropolitan area—Southern Maryland; Washington, D.C.; and Suburban Maryland—was lower. For example, Washington, D.C., customers rated the Postal Service lower than the national average in all 16 quarters. Further analysis of CSI scores showed that customer satisfaction was lower in all parts of the Washington, D.C., metropolitan area during quarter 4 of fiscal year 1994 than during comparable periods in 1991, 1992, and 1993. (A detailed discussion of mail service conditions in the Washington, D.C., metropolitan area is presented in appendix II.) Mail service in the Washington, D.C., metropolitan area is poor for a number of reasons, including (1) the Postal Service’s inability to effectively deal with the unexpected growth in mail volume, (2) mail handling process problems, and (3) labor-management problems. Over the past few months, the Postal Service has initiated additional actions in each of these areas in an effort to improve mail service. In 1994, the percentage increase in the amount of mail delivered in the Washington, D.C., metropolitan area was twice the national average. According to Postal Service officials, the Postal Service had not anticipated this growth and was unprepared to process and deliver the increased volume of mail. Complicating the situation were several factors that worked against the Postal Service. First, according to Postal officials, local processing and delivery units experienced staffing problems because more craft people than expected accepted a retirement incentive (buyout) of up to 6 months’ salary and left the Service during the 1992 restructuring. Also, staffing ceilings were put into place in anticipation of more automation equipment. These events, according to Postal officials, left the delivery units with too few people to handle the increased volume of mail. Additionally, the processing units were operating with too many unskilled, temporary employees who had been hired to replace more costly career employees who retired in 1992. Training also became an issue when some new supervisors were placed in jobs where they were not familiar with the work of the employees they were supervising. After considerable attention was focused on these problems in the spring of 1994, the Postal Service took steps to hire new, permanent employees and strengthen training for supervisors and craft personnel. Second, to focus additional attention on customer service, separate lines of reporting authority were established for mail processing and mail delivery functions under the Executive Vice President/Chief Operating Officer during the 1992 restructuring. This realignment of responsibilities was done as part of the Postmaster General’s broad strategy to make the Postal Service more competitive, accountable, and credible. This action left no single individual with the responsibility and authority to coordinate and integrate the mail processing and delivery functions at the operating levels of the organization. The primary focus of each of the function managers was to fulfill the responsibilities of his or her function. Working with the other function managers became a secondary concern. Consequently, because critical decisions affecting both mail processing and customer services could not be made by one individual at the operating level of the organization, coordination problems developed. In June 1994, the Postmaster General moved responsibility for processing and delivery down to the Area Vice President level, and on January 10, 1995, postal officials announced plans for establishing a position under the Mid-Atlantic Area Vice President that would be responsible for overseeing all processing and delivery functions in the Washington, D.C., metropolitan area and Baltimore area. Time slippages in the automation program was another factor that affected the Postal Service’s ability to handle the increased volume of mail. More mail than planned had to be processed manually or on mechanical letter-sorting machines. The Postal Service had expected that by 1995 almost all letter mail would be barcoded by either the Postal Service or mailers and be processed on automated equipment. However, automation fell behind schedule in 1993-1994. The new projected date for barcoding all letter mail has slipped to the end of 1997. (A detailed discussion of the Postal Service’s inability to respond effectively to the unexpected mail volume growth in the Washington, D.C., metropolitan area is presented in appendix III.) Delivery service in the Washington metropolitan area was also adversely influenced by various mail handling process problems, including (1) the unnecessary duplicative handling of much mail addressed to Northern Virginia, (2) overnight service areas that managers believed were geographically too large, (3) mail arriving too late for normal processing, (4) the absence of a control system for routinely pinpointing the specific causes of delays in specific pieces or batches of mail, and (5) failure of employees to follow prescribed processing procedures. The Postal Service has taken action to address, at least in part, each of these problems. Some of the more significant actions taken include (1) reducing the amount of mail handled by more than one processing facility in Northern Virginia, (2) processing more mail at local facilities rather than transporting it to distant processing and distribution centers, (3) working with the large mailers to get them to mail earlier in the day and give advance notice when mailing unusually large volumes, (4) taking the first steps to develop a system that can pinpoint causes of delayed mail, and (5) requiring greater adherence to established operating procedures. Additionally, a number of service improvement teams are continuing to examine mail handling processes in an effort to identify other areas needing improvement. Examples provided by local postal officials that most clearly illustrate problems affecting the local area are discussed below.