USPS watchdog says agency didn't consider operational impact of changes as it cut costs

Dive Brief:

Postmaster General Louis DeJoy's operational changes to the post office beginning soon after he took the helm in May caused confusion within the service, and led to "slower and less reliable mail delivery," according to a report released Monday from United States Postal Service Assistant Inspector General Mark Duda.
DeJoy's operational changes, according to the IG report, included the elimination of late and extra trips to transport mail, organizational restructuring, expedited street afternoon sortation, and roughly 57 other initiatives to cut costs and reduce work hours. DeJoy accelerated, but did not begin, the removal of mail processing equipment, according to the IG.
USPS had estimates of the cost savings these efforts would bring (64 million work hours), but not their impact on performance, according to the report. USPS performance figures bottomed out in late-June and early July, according to USPS and third-party data. DeJoy pledged to release performance data weekly for the rest of the year in August.

Dive Insight:

The IG confirmed what postal workers told Supply Chain Dive in July and August. Several major operational changes were verbally presented at an in-person meeting in early July. It was then that USPS leadership enacted restrictions on extra trips from the sort centers to the delivery stations and overtime — especially affecting urban deliveries. Leadership also eliminated certain mail processing operations on Saturdays, according to the report.

DeJoy has testified that his changes were intended to bring the service in line with its existing operational strategy.

"The only change that I made, ma'am, was that the trucks leave on time. Theoretically, everyone should have got their mail faster," DeJoy said to Sen. Jacky Rosen at an August hearing before the Senate Homeland Security and Governmental Affairs Committee.

The IG report responds to an August congressional request surrounding concerns of operational changes at USPS. It contradicts DeJoy's statement to Rosen and further confirms what postal carriers and union leaders suspected — that leadership did not fully understand the impact of operational changes.

First Class and Pre-sort mail lost roughly 10 percentage points from on-time service levels each. Parcel service data was redacted from the IG report because this information is considered commercially sensitive, according to an IG spokesperson.

"No analysis of the service impacts of these various changes was conducted and documentation and guidance to the field for these strategies was very limited and almost exclusively oral. The resulting confusion and inconsistency in operations at postal facilities compounded the significant negative service impacts across the country," reads the report.

The USPS Board of Governors objected to several conclusions in the IG report, stating in a response included by the IG that DeJoy's changes were "not strategic or transformational in nature," and the board did not agree with the IG's characterization of the cause of postal service delays.

The IG plans to issue a separate report to the Postmaster General "with recommendations for corrective action."

Editor’s note: This story has been updated to include comment from the USPS Inspector General.