U.S. Postal Service:

Postal Activities and Laws Related to Electronic Commerce

GGD-00-188: Published: Sep 7, 2000. Publicly Released: Sep 7, 2000.

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Pursuant to a congressional request, GAO reviewed the U.S. Postal Service's (USPS) electronic commerce (e-commerce) initiatives, focusing on USPS': (1) e-commerce initiatives that have been implemented or are being developed; (2) goals and strategies for the e-commerce area; (3) processes for approving these initiatives; and (4) expected performance and results to date related to e-commerce.

GAO noted that: (1) since the beginning of 2000, USPS has taken a number of steps to develop and implement its e-commerce activities; (2) some key actions included developing a definition of its e-commerce initiatives, identifying its e-commerce and related initiatives, outlining its overall goals and strategies, establishing expected performance, and providing some information on results to date; (3) how USPS defines its e-commerce activities is fundamental when determining what USPS is doing in the e-commerce area; (4) USPS defined its e-commerce initiatives to include products and services that: (a) require the use of the Internet; and (b) generate revenues for USPS from user charges of license fees; (5) USPS defines its e-commerce initiatives as a subset of its broader eBusiness activities that involve the use of new technology; (6) USPS identified seven e-commerce initiatives that were either planned or implemented as of September 2000; (7) these seven initiatives are generally intended to facilitate the movement of messages, merchandise, and money; (8) USPS outlined the purpose and direction for its eBusiness and e-commerce areas and stated that its overall goal is to use the best technology, including the Internet, to provide customers with expanded universal access and choices on how they do business with USPS; (9) USPS also explained that the criteria for these initiatives are that they be universally available, designed to fulfill customer and marketplace needs, offer customers voluntary choices, be secure and private, provide financial benefits to customers and USPS, and be consistent with the USPS' mission; (10) USPS identified eight strategies for accomplishing its eBusiness goal and its related e-commerce goal; (11) examples of these strategies were using the Internet as a cost-effective channel, providing security and privacy for customers, minimizing USPS investments and risks, and pursuing partnerships and alliances with industry; (12) in May 2000, USPS established a management process for reviewing and approving e-commerce initiatives that is different from the review and approval process for other new products; (13) the e-commerce review process was designed to result in quicker approval of initiatives than USPS' review and approval process for new products; (14) the new process requires a business proposal and plan, a public affairs/communication plan, periodic monitoring, and approval by top management or USPS' Board of Governors; and (15) some e-commerce initiatives were launched before the new process was introduced.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: Since GAO issued a report in December 2001 (GAO-02-79), the Postmaster General has taken actions to address this recommendation. As USPS reported in its May 2004 report on its eCommerce activities, it has reviewed the product performance of each of its e-commerce and related initiatives, and has decided to discontinue or reconfigure all of its remaining e-commerce initiatives. USPS reported that the net effect of these changes will result in the elimination of losses associated with the remaining eCommerce services.

    Recommendation: To help ensure more effective management and oversight of USPS' e-commerce activities, the Postmaster General should take appropriate actions to help ensure that e-commerce and related initiatives are appropriately identified and maintain accurate and complete information related to the status of these initiatives.

    Agency Affected: United States Postal Service

  2. Status: Closed - Not Implemented

    Comments: GAO issued a report in December 2001 (GAO-02-79), that updated the status of these recommendations. GAO reported that USPS had taken some action to respond to GAO's recommendations, but inconsistency remained in the implementation of its processes and controls for developing its e-commerce initiatives. GAO made additional recommendations to address this issue in its December 2001 report.

    Recommendation: To help ensure more effective management and oversight of USPS' e-commerce activities, the Postmaster General should follow processes and controls that have been established for developing and approving e-commerce initiatives.

    Agency Affected: United States Postal Service

  3. Status: Closed - Not Implemented

    Comments: GAO issued a report in December 2001 (GAO-02-79), that updated the status of these recommendations. GAO reported that USPS had taken some steps to collect and report additional information on the costs and revenues associated with its e-commerce initiatives. However, GAO reported that the information provided was not complete because it did not include sufficient information on the direct and indirect costs associated with e-commerce initiatives. Also, some discrepancies in the information provided raised questions about data accuracy that need to be resolved. GAO made additional recommendations to address these issues in its December 2001 report.

    Recommendation: To help ensure more effective management and oversight of USPS' e-commerce activities, the Postmaster General should provide complete and accurate information on costs and revenues for the financial data on e-commerce initiatives.

    Agency Affected: United States Postal Service

 

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