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Preface
Significant Dates in Postal History
United States Postal Systems
The Postal Role in U.S. Development (Part 1)
The Postal Role in U.S. Development (Part 2)
The Postal Role in U.S. Development (Part 3)
Postal Reform (Part 1)
Postal Reform (Part 2)
Rates (Part 1)
Rates (Part 2)
Stamps (Part 1)
Stamps (Part 2)
Postmasters General
Governors of the United States Postal Service
Postal Insignia (Part 1)
Postal Insignia (Part 2)
Research Resources
Bibliography and Credits
USPS History
Postal Reform (Part 2)

History of the United States Postal Service 1775-1993

*Postal Mechanization/Early Automation
*ZIP+4
*The Age of Automation
*Competition and Change

Postal Mechanization/Early Automation

At the turn of the 20th century, in spite of a burgeoning mail volume and limited work space, the Post Office Department relied entirely on antiquated mailhandling operations, such as the "pigeonhole" method of letter sorting, a holdover from colonial times. Although crude sorting machines were proposed by inventors of canceling machines in the early 1900s and tested in the 1920s, the Great Depression and World War II postponed widespread development of mechanization until the mid-1950s. The Post Office Department then took major steps toward mechanization by initiating projects and awarding contracts for the development of a number of machines and technologies, including letter sorters, facer-cancelers, automatic address readers, parcel sorters, advanced tray conveyors, flat sorters, and letter mail coding and stamp-tagging techniques.
As a result of this research, the first semi-automatic parcel sorting machine was introduced in Baltimore in 1956. A year later, a foreign-built multiposition letter sorting machine (MPLSM), the Transorma, was installed and tested for the first time in an American post office. The first American-built letter sorter, based on a 1,000-pocket machine originally adapted from a foreign design, was developed during the late 1950s. The first production contract was awarded to the Burroughs Corporation for 10 of these machines. The machine was successfully tested in Detroit in 1959 and eventually became the backbone of letter-sorting operations during the 1960s and 70s.
In 1959, the Post Office Department also awarded its first volume order for mechanization to Pitney-Bowes, Inc., for the production of 75 Mark II facer-cancelers. In 1984, more than 1,000 Mark II and M-36 facer-cancelers were in operation. By 1992, these machines were outdated and began to be replaced by advanced facer-canceler systems (AFCS) purchased from ElectroCom L.P. The AFCSs process more than 30,000 pieces of mail per hour, twice as fast as the M-36 facer-cancelers. AFCSs are more sophisticated too: they electronically identify and separate prebarcoded mail, handwritten letters, and machine-imprinted pieces for faster processing through automation.
The Department's accelerated mechanization program began in the late 1960s and consisted of semi-automatic equipment such as the MPLSM, the single position letter sorting machine (SPLSM), and the facer-canceler. In November 1965, the Department put a high-speed optical character reader (OCR) into service in the Detroit Post Office. This first-generation machine was connected to an MPLSM frame and read the city/state/ZIP Code line of typed addresses to sort letters to one of the 277 pockets. Each subsequent handling of the letter required that the address be read again.
Mechanization increased productivity. By the mid-1970s, however, it was clear that cheaper, more efficient methods and equipment were needed if the Postal Service was to offset rising costs associated with growing mail volume. To reduce the number of mail piece handlings, the Postal Service began to develop an expanded ZIP Code in 1978.
The new code required new equipment. The Postal Service entered the age of automation in September 1982 when the first computer-driven single-line optical character reader was installed in Los Angeles. The equipment required a letter to be read only once at the originating office by an OCR, which printed a barcode on the envelope. At the destinating office, a less expensive barcode sorter (BCS) sorted the mail by reading its barcode.
Following the introduction of the ZIP+4 code in 1983, the first delivery phase of the new OCR channel sorters and BCSs was completed by mid-1984.

ZIP+4

Introduced in 1983, the ZIP+4 code added a hyphen and four digits to the existing five-digit ZIP Code. The first five numbers continued to identify an area of the country and delivery office to which mail is directed. The sixth and seventh numbers denote a delivery sector, which may be several blocks, a group of streets, a group of post office boxes, several office buildings, a single high-rise office building, a large apartment building, or a small geographic area. The last two numbers denote a delivery segment, which might be one floor of an office building, one side of a street between intersecting streets, specific departments in a firm, or a group of post office boxes.
On October 1, 1983, the Governors of the Postal Service approved price incentives for First-Class Mail bearing the ZIP+4 code.
By the end of 1984, 252 OCRs were installed in 118 major mail processing centers across the country and were processing 24,000 pieces of mail per hour (an average productivity rate of 6,200 pieces per work hour) -- a substantial increase compared to the 1,750 pieces per work hour processed by MPLSMs.

The Age of Automation

Today, a new generation of equipment is changing the way mail flows and improving productivity. Multiline optical character readers (MLOCRs) read the entire address on an envelope, spray a barcode on the envelope, then sort it at the rate of more than nine per second. Wide area barcode readers can read a barcode virtually anywhere on a letter. Advanced facer-canceler systems face, cancel, and sort mail. The remote barcoding system (RBCS) provides barcoding for handwritten script mail or mail that cannot be read by OCRs.
The ZIP+4 code reduced the number of times that a piece of mail had to be handled. It also shortened the time carriers spent casing their mail (placing it in order of delivery). First tested in 1991, the delivery point barcode, which represents an 11-digit ZIP Code, will virtually eliminate the need for carriers to case mail because mail will arrive in trays at the delivery post office sorted in "walk sequence." The MLOCR reads the barcode and address, then constructs a unique 11-digit delivery point barcode using the Postal Service's National Directory and the last two digits of the street address. Then barcode sorters put the mail in sequence for delivery.
Until now, most of the emphasis in automation has been processing machine-imprinted mail. Still, letter mail with addresses that were handwritten or not machine-readable had to be processed manually or by a letter sorting machine. The RBCS now allows most of this mail to receive delivery point barcodes without being removed from the automated mailstream. When MLOCRs cannot read an address, they spray an identifying code on the back of the envelope. Operators at a data entry site, which may be far from the mail processing facility, read the address on a video screen and key a code that allows a computer to determine the ZIP Code information. The results are transmitted back to a modified barcode sorter, which pulls the 11-digit ZIP Code information for that item, and sprays the correct barcode on the front of the envelope. The mail then can be sorted within the automated mailstream.
Letter mail represents approximately 70 percent of the Postal Service's total mail volume, so development of letter mail equipment has received the most attention. In addition to letter-mail processing, the Postal Service is taking steps to automate mail-forwarding systems and the processing of flats and parcels. The Postal Service also has accelerated installation of automated equipment in lobbies to serve customers better. The backbone of this effort is the integrated retail terminal (IRT), a computer that incorporates an electronic scale. It provides information to customers during a transaction and simplifies postal accounting by consolidating data. Postage validation imprinters have been attached to the IRTs to produce a self-sticking postage label that has a barcode for automated processing.

Competition and Change

Despite improved technology, the Postal Service faced mounting financial and competitive pressures. Following a decade of prosperity in the 1980s that saw a dramatic increase in mail volume, the nation entered a period of slower economic growth in the 1990s. Bankruptcies, consolidations, and a general restructuring of the marketplace reduced the flow of business mail. In 1991, overall mail volume dropped for the first time in 15 years. The following year, volume rose only slightly, and the Postal Service narrowly avoided the first back-to-back declines in mail volume since the Great Depression.
Competition grew for every postal product. The rise of fax machines, electronic communications, and other technologies offered alternatives for conveying bills, statements, and personal messages. Entrepreneurs and publishing companies set up alternate delivery networks in an attempt to hold down the costs of delivering magazines and newspapers. Many third-class mailers, finding their mailing budgets reduced and their postage rates increased higher than expected, began shifting some of their expenditures to other forms of advertising, including cable television and telemarketing. Private companies continued to dominate the market for the urgent delivery of mail and packages.
To become more competitive, the Postal Service began to change and restructure. In 1990, the Postal Service awarded two contracts to private firms that now independently measure First-Class Mail service and customer satisfaction. The Postal Service also began working more closely with customers to identify ways to better meet their needs and expanded customer conveniences such as stamps on consignment. With the help of business mailers, the Postal Service continued support for rates reflecting customer work-sharing features, many tied to automation, to give customers more flexibility. At the same time, the Postal Service began implementing Customer Advisory Councils, groups of citizens who volunteered to work with local postal management on postal issues of interest to the community. By the summer of 1993, 500 Advisory Councils were in place.
In the summer of 1992, under the leadership of newly appointed Postmaster General Marvin Runyon, the Postal Service intensified its drive for competitiveness. After consulting with mailers, the Governors of the Postal Service, postal employees and their representatives, and Congress, Runyon set a 120-day agenda to reduce bureaucracy and overhead, to improve service and customer satisfaction, and to stabilize postage rates.
To help accomplish these goals, the Postal Service created a new organizational structure, starting at the top. The Postal Service reduced the officer corps by nearly one-half, eliminated layers of management to speed decision-making, and trimmed overhead positions by nearly one quarter, or 30,000 positions. By offering early-out retirements and other incentives, the Postal Service reduced overhead without layoffs or furloughs.
Throughout the country, the five regions and 73 field divisions were replaced by 10 areas, each with a manager for Customer Services and a manager for Processing and Distribution. At the local level, 85 Customer Services districts and 350 processing and distribution plants were established, and a marketing and sales office was set up in each area. The new structure allowed postal managers to focus their expertise, improved communications up and down the line, and empowered employees to meet the needs of their customers.
The Postal Service also took steps to improve service in 1993. It invested in service improvements in the processing and delivery of mail at every major postal facility, expanded retail hours, and developed a more user-friendly Domestic Mail Manual. In cooperation with business customers, the Postal Service began to develop new services to meet specific mailer needs and to overhaul and simplify its complex rate structure. In 1993, it awarded contracts for two additional external measurement systems, one to survey the satisfaction levels of business mailers, the other to track service performance of third-class mail.
Postal finances also improved. The restructuring eliminated some programs, cut costs, brought in new business, and reduced the Postal Service's projected deficit of more than $2 billion. This put the organization in a better position to try to hold rates steady, which means that rates will have remained stable for four years for the first time since the Postal Service began operations in July 1971. Furthermore, the independent measurement surveys already in place indicated that service was as good or better than ever since the restructuring.
Despite many challenges, the Postal Service plans to draw on its diverse strengths to become a model for government, a force to help American businesses be more competitive, and a more effective communications system that binds the nation together.