The U.S. Postal Service has begun talks with software developers on a modeling program that the agency would use to redesign its operations and transportation networks.
The goal of the Network Integration and Alignment program is to create a logistics network that “reduces the combined costs for us and for mailers as well as eliminate service failures and inefficiencies,” said John Rapp, senior vice president, operations, USPS. “This is a major initiative, the most complex modeling effort that has ever been done in the field, and we are expecting to produce major results from it.”
Rapp said the postal service has approved a budget for the project but he would not provide details.
The USPS will ask mailers for input to ensure that “we have everybody's thoughts in the process before we begin to do simulation runs,” Rapp said. He will present a session on the initiative at the National Postal Forum April 21-24 in San Diego.
“This is one postal service program that has buy-in and support both from inside and outside the organization,” said John C. Campanelli, president of R.R. Donnelley Logistics. “I think it will move forward.”
Data on operations, such as the volume that each plant does, will be plugged into the model along with information such as the equipment in each plant and what should be in the facilities.
“We will be able to create scenarios to be analyzed,” Rapp said. “For example, we could present a scenario where we differentiate facilities by shape [of mail], for example, or by flats. When we finish the modeling program, we will have good, solid data to help us make these decisions. Rather than just deciding we are going to close this facility or that facility or consolidate operations because it is easy to do, we want to run this model to determine the optimum place for us to put our facilities, what those facilities should be doing.”
The USPS expects to complete the modeling effort this summer, then work on realigning its networks.
Rapp also said the effort might bring additional opportunities for the USPS to partner with customers and consolidators as modeling shows more drop shipping is optimal.