Dive Brief:
- The U.S. Postal Service sees strong upside in using artificial intelligence to boost network efficiency, customer service and workforce productivity amid growing use by other parcel carriers, according to an Aug. 3 report from the agency's Office of Inspector General.
- Potential future applications at the USPS include using AI to better predict shipment arrival time at facilities, transitioning to more dynamic delivery route adjustments, and expanding the features and functionality of its Informed Delivery notification service, per the report.
- However, scaling AI across the organization won't be straightforward, the OIG report said. "Given the size and complexity of Postal Service operations, investments in AI infrastructure need to be balanced against other critical initiatives such as network modernization, workforce management, and long‑term financial stability."
Dive Insight:
While the Postal Service is looking to grow its AI-enabled capabilities, the agency already has familiarity with the technology. There are more than 35 active AI use cases within the USPS and additional applications in testing, per the report.
For example, the Postal Service has used AI-driven detection tools to better identify counterfeit shipping labels and find suspicious accounts and transactions, the OIG said. Since January, AI has helped the agency identify and close 1,250 accounts generating counterfeit labels. Additionally, the USPS uses machine learning to provide estimated delivery dates through its Advanced Expected Delivery program.
However, the Postal Service has the opportunity to implement AI at a wider scale and will need "to evolve from isolated pilots to more integrated, transformational systems" to stay competitive among logistics providers, per the report. FedEx and UPS are already heavy users of AI, using the technology to improve package flows within their networks and enhance shipper visibility. Smaller parcel carriers are also leaning on AI to strengthen their operations and the customer experience.
"For USPS, staying competitive will mean moving beyond isolated use cases and leveraging AI to reimagine and revitalize the interconnected processes that define its operational backbone," the OIG report said.
One potential future AI application for the USPS highlighted by the report is dynamic route optimization. Delivery providers can improve route efficiency by using AI to incorporate real-time data like traffic patterns and volume fluctuations, and adjust routes accordingly to keep deliveries on track while limiting costs, per the OIG. Currently, the USPS is exploring how AI can define the most efficient routes to trim mileage.
But implementing AI-driven route optimization at USPS would need collaboration and agreement with labor unions, the report said. Implementation costs are also a barrier given high subscription fees for commercially available tools, with USPS leadership expressing "a strong preference to delay implementation until they can develop proprietary, in-house technology," per the report.
