Bay-Valley Kim R. Fernandez District Manager Customer Service & Sales

Bay-ValleyKim R. Fernandez

District Manager Customer Service & Sales

Bay-ValleyBay-Valley

VisionMissionValue

BAY-VALLEY DISTRICT BAY-VALLEY DISTRICT VISIONVISION

Be the premier provider of service and value as

defined by our customers.

“A great place to work, and the right place to do

business”

BAY-VALLEY DISTRICTBAY-VALLEY DISTRICTMISSIONMISSION

• Providing affordable quality services and products for our

customers.

• Inspire employees through clear communication to achieve breakthrough performance and

profitability.

BAY-VALLEY DISTRICTBAY-VALLEY DISTRICTVALUEVALUE

• Excellence • Courtesy• Integrity

• Trustworthiness• Efficiency

Bay-Valley Circle of SuccessBay-Valley Circle of Success

DLT

Expectations

ToolsTrainingResources

Performance & Compliance

SuccessOpportunities

Bay-Valley Circle of Success

Strategic/Tactic/Process/Compliance Flow

District Leadership Team (DLT)

Strategies

Local Leadership Team (LLT)

Tactics

SOM, KOM SUPERVISORS

IMPLEMENTATION

Results

DLT Strategies Kim R. Fernandez

District Manager Customer Service & Sales

Rick J. BlancasSenior Plant Manager

Bay-Valley District

Service Strategies

Bay-Valley District

TOP 5 NATIONAL

RANKING

ACHIEVE

FY 09 SERVICE STRATEGIES

SERVICE STRATEGIES

SERVICE UP

ServiceFY 09 Target

FY 09YTD Gap

NationalRanking

EXFC 1-day 98.0 96.47 1.53 17

EXFC 2-day 96.5 95.75 .75 3

EXFC 3-day 95.0 93.04 1.96 27

DCPM-R Surface 98.0 96.30 1.70 16

DCPM-R Air 95.0 91.96 3.04 32

Express 98.0 96.94 1.06 9

SERVICE STRATEGIES

SERVICE UP

ServiceFY 09 Target

FY 09YTD Gap

NationalRanking

CSM 740.0 544.4 195.6 69

WTIL 95 84 11 45

SERVICE STRATEGIES – Market Dominant Products

SERVICE UP

Service FY 09 TargetFY 09YTD Gap

Presort 1-Day 98.0 80.14 17.86

Presort 2-day 96.5 89.28 7.22

Presort 3-day 95.0 84.23 10.77

Presort 4-day 95.0 77.10 17.90

FCM Parcels 1-day 98.0 80.68 17.32

FCM Parcels 2-day 96.5 89.57 6.93

FCM Parcels 3 to 5-day 95.0 81.43 13.57

SERVICE STRATEGIES – Market Dominant Products

SERVICE UP

Service FY 09 TargetFY 09YTD Gap

Standard 3-day 95.0 90.50 4.50

Standard 4-day 95.0 58.82 36.18

Standard 5-day 95.0 77.78 17.22

Periodicals 95.0 68.06 26.94

SERVICE STRATEGIES – Market Dominant Products

SERVICE UP

Service FY 09 Target

Package Svcs – Del Con – All Stds 97.0

End to End 97.0

Intra BMC 97.0

1st Enroute 97.0

Cost Strategies

Bay-Valley District

STRATEGY

ACHIEVE

%

Plan

YTD

%

SPLY

Target

Current

%

SPLY

Current

GAP

TOE 2.4% -7% -3.7% $9,853,680

Non-Personnel Plan

-2.9% -4.8% -9.6% 0

FY 09 COST STRATEGIES

COST DOWN

$ Achieve Non personnel plan

$ Travel Reduction (Line 3D, 3E, 3K)

$ Reducing POV$ Only Necessary Travel – Utilizing Meeting Place$ Limit/Eliminate Off-Site Meetings

$ -0.6% to Plan YTD $ -10.2% to SPLY YTD

$ Supplies & Service ( Lines 31-39)$ Monitoring by finance number – managing the sites that are overrunning$ Only necessary expenditures

$ -2.7 % to Plan YTD$ -21.6% to SPLY YTD

COST DOWN

FY 09 DISTRICT COST TACTICS

FY 09 District COST TACTICS

Miscellaneous Expenses (Line 44) $ Monitoring financial counts – manage the sites

that are not in compliance

$ Monitoring Excess Stock Inventory – manage the sites that are not in compliance

$ Monitoring financial overages and shortage (AIC 247 & 647) – manage the sites that are not in compliance

$ -64.2% to Plan YTD$ -79% to SPLY YTD

COST DOWN

Higher Level

$ Manage Vacancies

$ Manage Unauthorized Details

$ Current PerformanceCurrent Performance$ Baseline PP 24$ Reduction to Baseline - 4.2%

COST DOWN

FY 09 District COST TACTICS

FACILITY OPTIMIZATION

# SitesAnnual Cost Avoidance

Sale Price

FY 09 Sites ClosedMare Island Sta., Vallejo NPU, Concord NPU 3 $214,776 *

FY 09 Site SoldSaratoga Village Sta. 1 $85,000 2M

Current Savings 4 $299,776 2M

Pending Site ClosuresMartinez Pacheco Branch

Oakland ISF (release building) 2 $1,860,080 *

Under Consideration for ClosureParkmoor Sta., Berkeley NPU 2 $801,367 *

Under Consideration for SaleDanville Lot, Hayward Bradford Lot, Berkeley DDU Lot 3 $75,000 N/A

Grand Total 12 $3,036,223 2M

$ Right Sizing Facilities for Operational Needs

STRATEGY

ACHIEVE

%Plan

YTD

% SPLYTarget

% SPLY

YTD

WKHR

GAP

Work Hour Plan

FN 1 2.8% -18.3% -17% 66,087

FN 2B 3.8% -10.0% -7.8% 175,685

FN 3A 3.3% -9.9% -7.7% 10,515

FN 3B -0.2% -7.5% -9.2% 0

FN 4 1.8% -14.9% -12% 21,745

Support Functions -0.1% -2.8% -4.7% 0

FY 09 COST STRATEGIESCOST DOWN

FY 09 COST STRATEGIES

STRATEGYActual YTD

Last 4 Weeks

% SPLY YTD

MINIMIZE OT

FN 1 OT 6.29% 1.61% -37.6%

FN 2B OT 6.77% 4.56% -32.6%

FN 3A OT 6.28% 2.25% -45.2%

FN 3B OT 1.83% .24% -72.9%

FN 4 OT 5.25% 2.74% -42.8%

COST DOWN

Operational Strategies

Bay-Valley District

Bay-Valley Operational Strategies

Scheduling and Staffing (All Operations)

Tour Realignment• Plants Completed

– 528 People Migrated– OT Reduction

PIV Reduction• Reduce Higher Level• Bid Realignment

PVS Trip Reduction • 27 Trips South

• 27 Trips North

Bay-Valley Operational Strategies

Scheduling and Staffing (All Operations)

Route Reduction• 157 Routes Eliminated• F2C Work hour reduction to SPLY

― WK 25 -7.6% MTD -12.3% YTD -7.9 %

» - 381,832 work hours to SPLY

— Performance to Plan— WK 25 7.2% MTD 5.7% YTD 4.7%

Hours Per Route• WK 25 7.92 MTD 7.99 YTD 8.24

Bay-Valley Operational Strategies

Manual Volume Reduction

• FY 08 Flats 33.03% Letters 7.72%• YTD Flats 28.19 Letters 6.83%• MTD Flats 26.32% Letters 6.59% • WK 25 Flats 26.54% Letters 6.15%

• Reduction of Collection Boxes• 173 Removed• LDC 27 -3.4% SPLY YTD

– Performance To Plan -2.6% YTD

• DPS Improvement•FY 08 YTD 89.53%•FY 09 YTD 92.76%

• Rural Route Counts» In Progress

Bay-Valley Operational Strategies

People Strategies

Bay-Valley District

FY 09 PEOPLE STRATEGIES

STRATEGY

ACHIEVE

FY 09 March

YTD

%

SPLYNational Ranking

VOE 70% 64.2 1.3 34

MVA Target 8 10.23 -14.2 47

OII Target 4 5.06 -9.5 39

FY 09 PEOPLE STRATEGIES

Right People In The Right Place At The Right Time

o Manage ORNAo Effective Management of Productive Hours

o Align Resources to Earned Workloado Use of Complement Tools – CSV, CCM, MPSOM, MPES, CSAW

Growth Strategies

Bay-Valley District

Strategy

February YTD

% Plan

February

YTD

%SPLY

Plan

GAP

Achieve Revenue Plan -7% -7.4% -25,601,234

FY09 GROWTH STRATEGIES

FY09 GROWTH STRATEGIES

StrategyYTD

Participation

Total Leads YTD

Total Revenue

YTD

Revenue % to

Target

Maximize Business Connect to drive leads for BDT sales

91.43% 2,475 $1,859,470 30.83

Maximize Customer Connect to drive leads for BDT sales

46.25% (Carriers)

420 $1,396,927 53.62

Maximize Rural Outreach to drive leads for BDT sales

15 Rural Carriers

21 $280,268 No target

Bay-Valley District

Service

People

Growth

Cost

LLT TACTICSLLT TACTICS

Bay-Valley District

Bay-Valley TacticsBalwant Grewal, Sam Vasquez

Toya Jackson, Ed KimbleLLT Co-Chair

Service Tactics

Bay-Valley

SERVICE TACTICS

Eliminate Last Mile Failures

Improve Flat Performance

Improve Quality

Improve Scanning Performance

Improve WTIL

Achieve Operating Plan (24-hour clock)

SERVICE UP

SERVICE TACTICS

3M Process

Reduce Missent Volume to Delivery Offices

Perform PM Audits

Monitor Pivoting

Monitor OOS rate

ELIMINATE LAST MILE FAILURES

SERVICE TACTICS

2M Process

Reduce Missent Volume to Delivery Offices

Address AFSM At-Risk Volumes

Establish Flats Improvement Team

IMPROVE FLAT PERFORMANCE

SERVICE TACTICS

PAARC

Daily QC checks – Auto, AFSM, APPS, Manual, Containerization, Dispatch

Address – DSMART, eMIRS

IMPROVE QUALITY

SERVICE TACTICS

Preventable Failures

Proper Scanning

IMPROVE SCANNING PERFORMANCE

SERVICE TACTICS

Staffing and Scheduling

Alert System

Alternate Access

Wait Time In Line (WTIL)

Commercial First-Class Mail

Periodicals

Standard Mail

Package Services– Includes Single Piece Parcel Post,

Media Mail, Bound Printed Matter, Library Mail

NEW SERVICE MEASUREMENT

Market Dominant Products

SERVICE TACTICS

COMMERCIAL FCMTreat as Collection MailIOP Agreement with BMEUSecure BMEU hand-off procedure

STANDARD MAILMail Flow Color Code Adherence

PERIODICALS Operating plan compliance

Dispatch & logistics compliance

Cost Tactics

Bay-Valley

FN 1 (less than 1%)

F3A (less than 1%)

F3B (less than 1%)

FN 2B (3%)

FN 4 (2%)

COST DOWN

FY 09 COST TACTICS

ACHIEVE OT TARGETS

OT Tactics

Minimize NSD OT

Minimize Pre-Tour & Post Tour OT

Realign Bids to have right people in the right place at the right time

– Earned Workload– Bid Management

COST DOWN

FY 09 COST TACTICS

Manual Volume Reduction

$ TARGETS$ 20% Flats$ 5% Letters

Last 4 Wks Performance 26.43% Flats

6.49% Letters

COST DOWN

FY 09 COST TACTICS

Manual Volume Reduction Tactics

$ Proper Volume Recording

$ Back flowing

$ Gatekeeper for Manual Operations

COST DOWN

FY 09 COST TACTICS

COMPLEMENT MANAGEMENT

Migrate Complement to Meet Financial ChallengesCOST DOWN

F1 Excessing 120 clerks

Migrate LDC 10 Employees to meet 22:1 ratio

F3A Projected Excessing 6 clerks, 6 drivers

F3B Projected Excessing 60 LDC 37, 38 & 39 Employees

Route Reduction & Carrier Migration to Reduce Complement

Re-position F4 through CSV Earned Validated Through 1994

Process

People Tactics

COMPLEMENT MANAGEMENT TACTICS

Manage current complement

Utilize CCM, MPSOM & MPES Tools

Manage PTF’s to prevent maximization

Manage Efficiencies and Productivities

Bid Management

Realign Bids and complement to the workload

Current 1994

Pivoting

Ensure the correct skills are on the bids

COMPLEMENT MANAGEMENT TACTICS

ORNA

Manage Medicals

Utilize Push Reports

Ensure medicals are timely

Ensure Job Offers match medicals

Manage Non-Productive

Manage DRAC process

Utilize DAT Coordinator

Growth Tactics

• Business Connecto TARGETSLevel 24’s - 3 activities per monthLevel 22 and below – 2 activities per month

– Community• Chamber of Commerce• Lyons, Rotary• Emerging Markets• Community Networking Presentations• Customer Appreciation• PCC

Growth Tactics

• Customer Connect

o TARGETOne lead per zip code per month

– Roll outs – 96 Offices YTD – 100% as of Jan FY 09– Qrtly Meetings– SBS Office visits and Stand Ups

Growth Tactics

• Rural Reach

– Roll outs – 39 Offices YTD – 100% as of Jan FY 09

– SBS Office visits and Stand Ups

Growth Tactics

TOP 5 NATIONAL

RANKING

ACHIEVE

FY 09 PEOPLE STRATEGIES