U.S. Postal Service: Enhancing Procedures Could Improve Product Scanning
Fast Facts
As e-commerce continues to grow, package delivery has become an increasingly important part of the U.S. Postal Service's revenues. USPS competes with private delivery companies for this business.
To stay competitive, USPS tracks packages with barcode scans so it can offer customers accurate delivery estimates, real-time data, and more.
USPS data show that almost all of these packages are scanned accurately, but some scans are missed or inaccurate. Considering the importance of this business to USPS's financial outlook, we recommended adopting standards to improve guidance and procedures related to scanning, and dealing with inaccurate scans.
Photo of a USPS employee scanning a package using a handheld device.
Highlights
What GAO Found
Mail products over which the United States Postal Service (USPS) does not exercise market dominance, such as many of its packages, are called competitive products. These items are scanned throughout the mail delivery system to track their progress (see figure). USPS data show that these products are almost always scanned. For example, USPS data showed that for the first three quarters of fiscal year 2018; all but one of USPS's 67 districts met their scanning goals. Additionally, mailers that account for a high volume of USPS's competitive products told GAO that they believed USPS was generally scanning products correctly. However, a small percentage of missed or inaccurate scans occur. For example, a report from one USPS district showed that for one week, 0.73 percent of the products delivered were missing a scan and that for the fiscal year to date almost 155,000 competitive products were missing a delivery scan.
USPS Employee Scanning a Competitive Product and a USPS Mobile-Scanning Device
USPS has designed and implemented procedures and activities to help ensure accurate scanning, but some limitations could contribute to scanning errors. For example, USPS has not based its operational procedures for scanning on any internal control standards. USPS officials said the procedures were based on USPS's unique responsibilities, management experience, and sound business practices, but the officials could not identify specific standards or a framework that they followed as the basis for the procedures. USPS officials said they did not believe any internal controls standards applied to these procedures. By not basing procedures on standards, USPS may miss opportunities to improve how it achieves its mission to scan and measure the performance of competitive products. Additionally, USPS's scanning procedure documents, such as for outlining specific delivery scanning steps, are not always consistent, and USPS relies on more informal methods, such as meetings with employees to communicate changes. Thus, employees may not have accurate procedures available to them. Finally, USPS lacks procedures to help managers identify and address incorrect scans, address customer complaints or otherwise address scanning irregularities. For example, USPS's guidance for managers is limited to a list of bullet-points that do not detail the steps managers should follow to resolve scanning irregularities. In addition, this list has not been updated since 2005. Without consistent or detailed procedures, USPS's employees and managers may not scan items accurately or find information needed to resolve scanning issues—a situation that could hinder USPS's ability to reduce inaccurate or missing scans for these important mail products.
Why GAO Did This Study
USPS's competitive products have become increasingly important, comprising about 28 percent of USPS's total revenue. USPS scans these packages at various points throughout the postal network. When scans are inaccurate or missing, questions are raised about the veracity of USPS's data on scanning performance and can lead to customer complaints.
GAO was asked to review USPS's scanning policies and procedures. In this report, GAO (1) describes USPS's scanning performance and (2) examines how USPS ensures accurate scanning. GAO reviewed USPS's policies and procedures and assessed them against internal control standards; interviewed officials from USPS and five high-volume mailers; and conducted site visits to six post offices in two USPS districts that represented a range of volume, number of routes, and performance.
Recommendations
GAO recommends that USPS: (1) identify and adopt internal control standards for its operational activities such as for scanning of competitive products; (2) improve the communication of procedures for scanning competitive products; and, (3) create procedures for supervisors on how to address inaccurate scans and resolve scanning issues. USPS agreed to explore addressing the first recommendation and agreed with the other two recommendations.
Recommendations for Executive Action
| Agency Affected Sort descending | Recommendation | Status |
|---|---|---|
| United States Postal Service | The Postmaster General should identify and adopt a set of internal control standards that can be used as the basis for operational internal-control activities, such as those for scanning competitive products. (Recommendation 1) |
Closed – Implemented
With the growth of e-commerce, the delivery of packages has become an increasingly important part of the U.S. Postal Service's (USPS) business. Since consumers generally expect these products to be delivered to a preferred address and within a specific timeframe, tracking these shipments has become an important aspect of USPS's ability to compete in this market. To track these packages, USPS employees and machines scan barcodes on these products at various points throughout the postal network. Most of these packages are known as "competitive products," for which USPS competes with other companies' delivery services on pricing and service. In 2018, we found that USPS has not based its operational policies and procedures, such as those that support the accurate scanning of competitive products, on any standards for internal controls. USPS officials told us that they have not used any specific criteria for designing, implementing, and operating an internal control system for meeting its operational policies and internal controls, such as those that help ensure competitive products are accurately scanned. But without standards for an effective internal-control system for its operational policies and procedures for scanning competitive products, USPS may miss opportunities to improve how it achieves its mission to deliver those important products. Accordingly, we recommended that USPS identify and adopt internal control standards for its operational activities such as for scanning of competitive products. USPS agreed to explore addressing this recommendation and in 2019 completed a cost study to evaluate the benefits and costs of implementing an internal control framework for scanning of competitive products. The cost study resulted in the identification of gaps in USPS's alignment to the COSO Internal Control Framework and recommendations to close those gaps. In 2020, USPS implemented these recommendations to strengthen its risk management process for scanning competitive products. For instance, USPS developed a scanning risk management program that establishes processes for risk response, documents practices to monitor scanning performance, and establishes roles and responsibilities for scanning risk management. In addition, USPS officials told us that they have in place a variety of other standards and polices for other operational activities. For example, USPS has a variety of health and safety policies including policies for managers to promote safety and health, to inspect work areas, and to complete job safety analyses. These policies are designed to prevent personal injuries, as such injuries can jeopardize USPS's mission by costing money, reducing efficiency, and causing human suffering. By having such standards and policies for operational activities, including competitive product scanning, USPS is better positioned to reduce risks to achieving its mission.
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| United States Postal Service | The Postmaster General should improve the communication of standard operating procedures for scanning competitive products by, for example, updating or consolidating USPS documents, job aids, and standard work steps. (Recommendation 2) |
Closed – Implemented
With the growth of e-commerce, the delivery of packages has become an increasingly important part of the U.S. Postal Service's (USPS) business. Most of these packages are known as "competitive products," for which USPS competes with other companies' delivery services on pricing and service. As competitive products become essential to USPS's economic viability, it is increasingly important for USPS to accurately track them to remain competitive in the market. USPS management has designed standard operating procedures to provide assurance that competitive products are scanned accurately. Although USPS officials stated that employees should rely on prompts from their scanning devices to ensure scans are done correctly, USPS communicates these procedures mainly via (1) documents (e.g., handbooks), (2) job aids, and (3) standard work steps or guidance listing procedures steps for scanning. However, GAO found that USPS's scanning procedures may not provide the necessary assurance for accurate scanning because they are located in numerous documents and are not consistent. This inconsistency in USPS's scanning procedures likely occurred because many of the documents have been updated at different times and have not always reflected new operations. In addition, USPS officials told us that management updates its procedures typically though regular meetings and stand-up talks with employees, which are documented in handouts or slides. By not having consistent procedures, USPS risked not clearly communicating to its employees how they should carry out scanning procedures and therefore contributing to scanning errors. Therefore, GAO recommended that USPS should improve its communication of standard operating procedures for scanning competitive products by updating or consolidating documents, including handbooksdocuments, job aids and standard work steps. In 2019, GAO confirmed that USPS has consolidated documents related to scanning procedures on its internal website, "Blue." By placing its scanning procedures in one location on Blue, USPS can update these procedures and provide employees easy access to accurate scanning procedures. As a result, USPS is in a better position to clearly communicate consistent procedures to employees to help ensure that they are making accurate scans.
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| United States Postal Service | The Postmaster General should create standard operating procedures for managers on how to address inaccurate scans and use available reports to investigate and resolve scanning issues. (Recommendation 3) |
Closed – Implemented
With the growth of e-commerce, the delivery of packages has become an increasingly important part of the U.S. Postal Service's (USPS) business. Most of these packages are known as "competitive products," for which USPS competes with other companies' delivery services on pricing and service. Since consumers generally expect these products to be delivered to a preferred address and within a specific timeframe, tracking these shipments has become an important aspect of USPS's ability to compete in this market. In 2018, GAO reported that USPS has a high scanning rate, although some missed and inaccurate scans for competitive products do occur, errors that could potentially affect millions of competitive products. Given that inaccurate scans can and do occur, it is important that postal managers explore and investigate any instances of missed or inaccurate scans. To do so, USPS managers use a variety of reports as tools to ensure that the required scans are made at the appropriate place and time, and take action to monitor the status of competitive products, track lost items, and identify scanning issues. While having these reports are helpful, their full potential to help USPS managers may be limited because USPS lacks detailed and up-to-date standard operating procedures for how managers should use these reports or conduct other activities to efficiently investigate and resolve scanning issues. USPS's Scanning Performance: Delivery Standard Operating Procedures for managers are a list of bullet points outlining managers' responsibilities to meet scanning performance target goals and not a list of detailed procedures for managers to follow. In addition, this list has not been updated since approximately October 2005. Without detailed standard operating procedures means managers may not be aware of all the reports available to them. Additionally, USPS may miss opportunities to prevent scanning issues from happening again by not clearly communicating how managers should use the various reports to address specific scanning issues. Therefore, GAO recommended that USPS create standard operating procedures for managers on how to address inaccurate scans and use available reports to investigate and resolve scanning issues. In 2019, GAO confirmed that USPS had created standard operating procedures for its managers on how to address inaccurate scans and use available reports to investigate and resolve scanning issues. USPS has also consolidated the documents related to these and other standard operating procedures on scanning competitive products for its managers on its internal website, "Blue." By creating these standard operating procedures and them in one location on Blue, USPS is in a better position to clearly communicate consistent procedures to its managers to help resolve scanning issues for these important products.
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