I agree with this writer, in principle, that the United States Postal Service should look to cut costs before increasing postal rates (it’s up from 37 cents to 39 cents today).
The writer lists a number of ways to cut costs, but they pretty much ignore lean princples and basic process improvement methods (as the Canadian postal service has used with great success).
The Toyota Production System mindset says that prices are set by the market. It’s hard to tell what the true “market price” for standard postal service is, given the monopoly that the USPS has. Overnight mail, where there are obvious competitors like FedEx, UPS, and DHL, truly has market-set prices.
In the TPS model, Profit = Price – Costs, where you reduce costs (not just by laying people off) to reach your profit target. Under the old mindset, which I assume the USPS uses, you set Price = Cost + Profit, where you feel you are entitled to a particular profit and you set the price accordingly.
This article does reference one of my favorite W. Edwards Deming quotes:
“It is not necessary to change. Survival is not mandatory.”
I doubt, given their semi-private monopoly, though, that the USPS survival is anything but guaranteed. It will probably take a really special leader to get the USPS to really change.
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