Postal Service sets a new systems course with first CIO at the helm

With its first chief information officer at the helm, the Postal Service is embarking
on a program to blend the systems and automated equipment it uses to process mail.

“We have applications; what we need is overarching information,” said Norman
E. Lorentz, the service’s vice president for quality, who last week became the CIO
and head of the modernization effort. “An integration capability will have to be

The project is the biggest systems initiative the service has ever undertaken, Lorentz
said. “But it is our lifeblood; we must do it or face extinction,” he said.

The project will focus on four of the service’s five core processes: the
collection, transport, processing and delivery of mail. USPS wants to streamline those
processes, Lorentz said.

Ultimately, USPS wants to put in place a system that will let mail customers track the
progress of a piece of mail via the Web. But the Postal Service first must integrate
several disparate systems into an organized whole, the new CIO said.

The automated mail sorters already gather a lot of tracking data, Lorentz said. The
service will create an overarching database to integrate that information.

“Essentially, we are talking about a data warehouse,” he said.

Creating the system will take about five years, Lorentz said. The service has not set a
cost estimate for the project and has no schedule for releasing a request for proposals,
he said.

The first step is to find out what kinds of systems the service will need to integrate
its existing systems and mail-processing machinery.

“We don’t know where the specific gaps are,” Lorentz said. “In some
cases, it will just be a matter of fitting pieces together. In others, we will need to
develop something.”

Postmaster General William J. Henderson characterized the project as the creation of an
information platform when he spoke at the National Postal Forum in Washington last week.

“It will create an information technology base where [the mailing staff] can talk
to management and the customer,” Henderson said. “We will know, for example,
what class of mail it is, which machine handled it, the date and time it was processed and
virtually any other piece of information that we or our customers require.”

Much of the tracking system is already in place. The service is now testing forms of
electronic postage under its Information-Based Indicia Program. Through IBIP, the service
will let customers buy postage online and print out postage on local printers. But for
stamped letters, the service will rely on the information stored in the bar code strips it
now ink-jet sprays on all mail, Lorentz said.

Better service is needed, Lorentz said, because USPS competes with e-mail, electronic
funds transfer and other mailing companies such as United Parcel Service and Federal
Express Corp.

Specific data about what and where mail is during processing will help the service
develop an activity-based accounting system and better market and price its products,
Lorentz said.

“We will be able to measure specifically how much it costs for each function to
handle all of our various products and services,” Henderson said.

“In a changing world, where one day we could see our monopoly erode, an
activity-based accounting system will be a vital tool to help us determine what our true
costs are and price accordingly,” he said.    

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