Monday, May 14, 2012

Back to the Future

What to do with the U.S. Postal Service?

The USPS just backed away from closing 600 rural post offices. This will probably be the first of many “blinks” over the decision to close 252 mail-processing centers and 3,700 post offices, as part of a plan to save some $6.5 billion a year. Rural interests and Members of Congress are howling about eradicating pieces of Americana. However, deepening deficits are eradicating tax dollars while consumer use patterns spell doom for “snail mail”.

Two solutions are never discussed.

One has existed since the mid-1990s. The USPS actually experimented with 24-7 automated Postal Service. It was so successful that one of these automated kiosks was installed in the Longworth House Office Building when I was Chief Administrative Officer. On October 19, 1995, Postmaster General Marvin Runyon and I cut the ribbon on this facility. Its equipment allowed customers to weigh and mail letters and parcels, as well as process registered & certified mail. This was not your parents’ stamp vending machine. So why not install these automated kiosks in the 600 rural post offices and others as well? I am sure this 18-year-old technology is even more efficient and cost-effective today. Postal employees could “ride circuit” and be available for that “human touch” on designated days and hours. At all other times, rural customers could do everything they need 24-7 in the local post offices they love.

Another solution is one that allowed Western Union to survive and thrive into the 21st Century. No one sends telegrams, but people still need to wire funds outside of the banking system. Western Union quickly realized its market niche while also realizing it did not need its own facilities. Enter the world of strategic partnering. Western Union partners with Walmart, Winn Dixie, Weis, and countless pharmacies and stores to provide their services – eliminating staffing and other fixed costs. Why isn’t the USPS co-locating their 24-7 service kiosks in a similar network of partner locations? Why couldn’t there be mailboxes at Walmart and other large stores? This simple solution would allow the USPS to expand service into new population areas without building new facilities.

The reason these “back to the future” options are not pursued is that few in government are creative and have the desire to fight the Postal Unions and other special interests to change with the times. Until there is a will the way will be ignored.

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