Contract Management: Postal Service's National Office Supply Contract Has Not Been Effectively Implemented
GAO-03-230
Published: Jan 17, 2003. Publicly Released: Jan 17, 2003.
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Highlights
Over the past 2 years, the Postal Service has experienced growing financial difficulties. In an effort to transform the organization to reduce costs and increase productivity, the Postal Service awarded a national-level office supply contract to Boise Corporation. In addition, the Postal Service required Boise to submit a subcontracting plan, which outlines how small, minority-, and woman-owned businesses will be reached through the contract. GAO was asked to assess the status of the Postal Service's implementation of the Boise contract and Boise's achievement of its subcontracting plan. GAO also reviewed the extent to which the Postal Service is buying office supplies directly from small, minority-, and woman-owned businesses.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| United States Postal Service | The Postmaster General of the United States should determine why the national contract is not being used as a mandatory source of office supplies. |
Closed – Not Implemented
Postal Service headquarters officials indicated that they have taken action to implement the recommendation. The documentation provided declares that the Postal Service is in compliance with mandatory use of the national office supply contract. GAO and the Postal Service agree to disagree.
|
| United States Postal Service | The Postmaster General of the United States should reassess the cost effectiveness of a national office supply contract and measure actual savings from using the contract rather than applying the outdated estimating formulas initially established. |
Closed – Implemented
The Postal Service indicated it is making progress and provided documentation of its validated savings figures. The Postal Service Office of the Inspector General issued a report (report number CA-MA-05-002) recommending that the Vice President, Supply Management report a revised savings of $3.4 million in FY 2004 supply chain management impact associated with the Boise contract, rather than the estimated annual savings on $28 million.
|
| United States Postal Service | The Postmaster General of the United States should develop mechanisms to track employees' compliance with the mandatory use of the contract, if analysis indicates that the national-level contract is beneficial. |
Closed – Implemented
Postal Service headquarters officials indicated that they have taken action to implement the recommendation. The Postal Service provided a copy of the Boise "MOVE" report that tracks credit card spending compliance with the national office supply contract by area and district spending.
|
| United States Postal Service | The Postmaster General of the United States should direct that the contract be modified to include a revised subcontracting plan that accurately and clearly reflects realistic goals for small, minority, and woman-owned businesses, consistent with the Postal Service's supplier diversity program. |
Closed – Implemented
Boise's subcontracting plan has been renegotiated to reflect realistic goals. GAO received documentation of the revised Boise Office Solutions Small, Minority, and Woman-Owned Business Subcontracting Plan for CY 2003 & CY 2004 for the National Strategic Office Supply Contract. In addition we have the Postal Service office products Subcontracting Plan dated March 29, 2005 for CY 2005.
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Office suppliesSubcontractsContract administrationSmall businessMinority businessesWomen-owned businessesContract termsContract performancePostal service contractsPostal service