The act  charges the Postal Service with binding the nation together through the  personal, educational, literary, and business correspondence of the people  and providing reliable and efficient mail services to all areas of the country. The Postal Service is now facing a financial crisis brought about by  declining revenues and growing operating expenses and capital needs,  including the cost of existing and new investments in information  technology (IT). This approach  enables the organization to consider the relative cost, benefit, and risk of  newly proposed investments along with those previously funded and to  identify the optimal mix of IT investments to meet its mission, strategies,  and goals. However, many key practices still need to be executed  before the Postal Service can effectively manage its IT investments from a  portfolio perspective. However, it does not regularly capture  lessons learned from post-implementation reviews, the performance of its  portfolio, or benchmarking in order to improve its investment processes. Until it implements stage four and five critical processes, the  Postal Service will not be positioned to effectively improve its IT  investment management processes and successfully leverage IT to improve  business outcomes. While there have been some  efforts to identify best practices from best-in-class organizations and  incorporate these practices into the Postal Service’s IT investment  management processes (such as the CTO organization’s use of lessons  learned in benchmarking to develop the BCS), the Postal Service has  not defined policies and procedures for improving the IT investment  management process using benchmarking. The Postal Service has in place most of the foundational practices required  to ensure that IT investments are being selected and monitored to support  its overall objectives. The Postal Service shows mixed progress in managing its IT investments as  a portfolio. At a minimum, the plan should specify an approach to  develop comprehensive guidance that defines and describes the  complete investment management process, unifies existing processes  enterprisewide, and reflects changes in processes as they occur;  develop additional process guidance, as needed, to completely define  the operations and decision-making processes of investment boards and  other management entities involved in managing IT investments;  ensure that cost, benefit, schedule, and risk expectations are set and  approved in the original business case for each investment; that  accurate and complete actual cost, benefit, schedule, and risk data are  tracked against these expectations; and that status information on these  four criteria is periodically reported to executive-level investment  boards; and  establish a structured, transparent, and documented portfolio selection  process that assesses, prioritizes, selects, and funds investments  according to established portfolio selection criteria, including explicit  cost, benefit, schedule, and risk criteria.
Why GAO Did This Study

The U.S. Postal Service invests hundreds of millions of dollars in information technology (IT) each year to support its mission of providing prompt, reliable, and efficient mail service to all areas of the country. It must support these operations through the revenues it earns for its services. Growing operating expenses and capital needs in the face of reduced revenues highlight the need for the Postal Service to invest its IT dollars wisely. Accordingly, the Senate Committee on Governmental Affairs and its Subcommittee on International Security, Proliferation, and Federal Services asked GAO to evaluate how well the Postal Service manages its IT investments.

What GAO Found

The Postal Service has in place many of the foundational capabilities required for managing IT investments described in GAO's IT Investment Management framework, illustrated below. Proposed major projects go through established review processes and must be approved at a high level before being implemented. Control processes also are in place. Although the Postal Service evaluates proposed IT projects before investing in them, it does not fully manage these investments from a portfolio perspective by assessing projects on the basis of indicators that clearly link performance to initial selection criteria. Such a portfolio approach would enable the Postal Service to consider proposed projects along with those that have already been funded and to select the mix of investments that best meets its mission needs. The Postal Service has not yet attained the key attributes associated with most capable organizations, such as evaluating the performance of investments as a whole, capturing "lessons learned," and institutionalizing these lessons to benefit the organization. Until it addresses areas such as these, the Postal Service will not be in a position to continually improve its investment process and leverage its IT capabilities for strategic outcomes.