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Improving Customer Service

Recommendations and Actions

ICS04: Customer Service Performance Standards--Postal Service

BACKGROUND

The U.S. Postal Service delivered 166 billion pieces of mail in 1992 and generated revenues of $46 billion. By volume and revenue, business mail accounts for the bulk of its business. However, residential mail delivery and window service in nearly 40,000 offices are the postal services most visible to the public.

The Postal Service has adopted three goals to put itself on an increasingly businesslike basis.

--Improve service and customer satisfaction.

--Strengthen commitment to employees.

--Generate revenues above costs.

The Postal Service's commitment to customer service is being driven by the competitive business environment in document delivery and electronic information services. There is direct accountability because business consumers have a choice of service providers, and postal revenues depend upon customer satisfaction. The Postal Service has instituted a Total Quality Management program, a central feature of which is the goal to achieve 100 percent customer satisfaction over the next several years. Marvin Runyon, the Postmaster General, is committed to improving the accountability, credibility, and competitiveness of the Postal Service. In restructuring the Postal Service in 1992, he created a new emphasis on customer service throughout the organization.

The Postal Service has developed a Customer Satisfaction Index (CSI) to track satisfaction of residential customers in 170 metropolitan areas. The CSI measures overall satisfaction levels and more than 35 individual indicators such as courtesy, waiting time, prompt delivery, and complaint response. A contractor, Opinion Research Corporation, administers the CSI quarterly, with responses from an average of approximately 183,000 customers each quarter.[Endnote 1] The CSI has been reviewed by the General Accounting Office (GAO) and is considered to be a statistically valid survey, conducted in a sound and independent manner.[Endnote 2] The External First Class Measurement System conducted by Price-Waterhouse measures, in 95 metropolitan areas, the elapsed time from when a letter is mailed to when it is delivered.[Endnote 3]

The Postal Service recently incorporated the CSI into its employee bonus system. Absolute ranking in CSI, improvement in CSI, and financial success are each counted as one third in determining performance bonuses. Employees represented by two of the Postal Service's major unions and management are participating in this new bonus system. In 1994, the Postal Service plans to replace its system of individual objectives and incentives with one in which performance-based rewards for executives and managers will be linked to organizational and team success in three areas--financial performance, commitment to employees, and customer satisfaction (as measured by CSI).

Between August and November 1992, the Postal Service carried out a large-scale restructuring that eliminated nearly 30,000 positions, focusing on people who didn't touch the mail. According to GAO, the restructuring was carried out "without adversely affecting customer service in the short term. For example, nationally, overnight First-Class mail delivery performance remained stable during the restructuring period.''4 Performance and CSI have remained stable or have improved even after the restructuring.[Endnote 5]

The Postal Service is developing ways to strengthen employee commitment and productivity. It recently initiated focus groups with employees and is taking a number of internal steps to improve employee morale. The Postal Service is also monitoring employee attitudes toward customer service, among other topics, through an annual opinion survey. In the most recent survey, 85 percent of employees indicated that they understood the impact of their work on customer satisfaction.

NEED FOR CHANGE

The Postal Service first set service standards for First-Class mail in 1971. The standards include local delivery overnight, delivery within two days to contiguous states, and delivery anywhere in the United States within three days. Today, 84 percent of First-Class mail is meeting the overnight target for local delivery, 78 percent for two-day delivery, and 82 percent meets the target for third day long- distance delivery according to Price-Waterhouse, which conducts evaluations of the Postal Service's performance.[Endnote 6] However, the delivery standards are not generally known. For example, until recently First-Class mail standards were buried in the back pages of the ZIP Code Directory.

Using focus groups and other means of getting customer input, the Postal Service has identified several additional areas for improving customer service: shortening waiting times at Post Office counters, increasing easy access to postal information, improving complaint handling, and becoming more responsive to the needs of business customers.

Customers in focus groups across the country identified waiting time in retail lobbies as an issue they care about. In response, the Postal Service has developed, and is beginning to introduce nationwide a "service in five minutes'' program. It began in August 1993 with those offices that can demonstrate that they can provide this level of service on a consistent basis. Other offices will need to make operational changes before they are able to participate in the program.

The Postal Service is planning to train front-line employees in the new "service in five minutes'' program. It has developed "service in five minutes or less'' door decals and retail counter display cards to be used in those offices that can satisfy the unit manager and the district team that they can consistently meet the standard.

Easy access to postal information is a second area of service improvement. Basic information, such as the price of a stamp, used to require a trip to the post office or a wait for a telephone representative. In 1988, the Postal Service introduced an interactive Postal Answer Line so consumers can get routine information by using a touch-tone keypad. Although this service is now available to more than 112 million customers in 80 metropolitan areas, it is not well known. The Postal Service is looking at a number of ways to extend this service: for rotary-dial customers using voice recognition technology, for hearing impaired customers who have access to TDD (Telecommunications Device for Deaf and Hearing Handicapped) equipment, and for automated ZIP Code information.

ACTION

As part of its participation in the National Performance Review, the U.S. Postal Service should expand its plans to display the following standards in Post Office lobbies. (1)

--You can expect First-Class mail delivered anywhere in the U.S. in three days, your local mail overnight.

--You will receive counter service within five minutes.

--You can get postal information 24 hours a day by calling the following local number: (appropriate local numbers will be used).

The standards above are ones that the Postal Service itself has developed and that are included in the Postal Service's plans. The National Performance Review believes that publishing and posting these standards even more broadly will highlight and reinforce the Postal Service's growing program of customer service.

The First-Class mail standard was revised in 1989; it is not well known. Posting it in at least all post offices in the largest 95 metropolitan areas, beginning in the spring of 1994, will enhance the public's awareness of this commitment.

The commitment to service within five minutes is a new standard; the Postal Service began a comprehensive program to introduce it this past summer. It will be posted in retail lobbies nationwide as staff are trained and demonstrate that they can meet this performance standard consistently.

Information on the 24-hour postal information line is currently posted in some post offices. NPR's recommendation will mean that this sign will be placed in all other retail lobbies in the 80 metropolitan areas where this service is offered.

These standards and their public display are part of the Postal Service's plans to reach 100 percent customer satisfaction. As its service levels improve and as it gets additional customer feedback, the Postal Service plans to set additional customer service standards. Currently it is working on two additional areas, complaint handling and improved service to business customers.

The Postal Service is seeking ways to improve its complaint handling processes. It now handles consumer complaints via telephone and written complaint forms that are available in retail lobbies. It is completing what appears to be a highly successful test of a 1-800 number for complaints in two metropolitan areas and has expanded the test to three more cities. The Postal Service hopes to begin nationwide expansion during the latter part of 1994.

Increasing its responsiveness to business customers is also a priority for the Postal Service. Although this program is earlier in its development than the residential program, efforts are under way to develop an index and a survey instrument to measure the satisfaction of business customers. Within the past year, the Postal Service has opened 95 Business Centers nationwide to assist small and mid-size business customers.

The National Performance Review supports the efforts of the Postal Service in making customer service a core part of its strategic planning; using focus groups and customer surveys to assess customer issues and concerns; developing innovative customer service programs; and commissioning and publishing external assessments of customer satisfaction.

ENDNOTES

1. See U.S. Postal Service, U.S. Postal Service Customer Survey (Washington, D.C., 1993).

2. See U.S. General Accounting Office, U.S. Postal Service: Tracking Customer Satisfaction in a Competitive Environment, GAO-GGD-93-4 (Washington, D.C.: U.S. General Accounting Office [GAO], November 1992).

3. Interview with Ann McK. Robinson, U.S. Postal Service, Vice President and Consumer Advocate.

4. U.S. General Accounting Office, Postal Service: Restructuring, Automation, and Ratemaking, GAO/T-GGD- 93-15 (Washington, D.C.: GAO, March 1993).

5. U.S. Postal Service, "Comprehensive Statement on Postal Operations, 1992,'' Washington, D.C., undated, p. 3.

6. In 1990, the Postal Service revised the localities to which the standards apply in an effort to set standards that could be met with greater consistency. GAO criticized this move saying it actually slowed delivery of some mail. See U.S. General Accounting Office, Revised Delivery Standards: Postal Delivery Scores Improved but Service is Slower, GAO-GGD-93-12 (Washington, D.C.: GAO, November 1992).

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