USPS to simplify intranet, save millions

The U.S. Postal Service says it will save $200 million during the next five years by substantially simplifying its internal computer network.

With 130,000 users in 28,000 locations, the USPS network is the third largest in the world, surpassed in size only by retailer Wal-Mart Stores Inc. and the Defense Department, postal officials say.

USPS' plans call for extensive centralization and simplification.

The network has 13,000 servers in 11,000 locations, but when the overhaul is complete, there will be 1,500 servers in about 500 locations, according to USPS officials.

Of today's 85 help desks, 84 will be shut down, said Robert Otto, the Postal Service's vice president for information technology. Besides saving money, the cut will eliminate the dilemma of getting 85 different opinions on how to fix a problem, he said.

And in place of 270 software packages now in use throughout the Postal Service, there will be just 60.

"We're migrating away from client/ server architecture to Web-based," said Larry Wills, who is overseeing the network overhaul. The Postal Service can achieve substantial savings by reducing the number of network components that reside "out in the field" and moving functions to a few central locations, he said.

The new infrastructure has been named the Advanced Computing Environment, or ACE.

Savings are also anticipated from replacing current, outdated workstations with much simpler ones, Otto said.

Today's desktop computers loaded with programs will be replaced with simpler terminals using programs that reside in a central server and are accessed via the Postal Service network, Otto said.

These new terminals will be essentially "self-installing," he said. Postal employees will plug them in and access the network, and software will automatically complete the installation, a development designed to dramatically cut support costs.

Similar savings are anticipated when computers break. "We're moving to almost disposable workstations," Otto said.

Because computer costs have declined significantly in recent years, it can cost more to send a repairman to a remote Postal Service location to fix a malfunctioning computer than it costs to replace a terminal.

And with plans for fewer servers at fewer sites, the Postal Service has been able to renegotiate maintenance and service contracts, in some cases by more than 30 percent, Otto and Wills said.

The ACE program goal of replacing the infrastructure while saving $200 million is remarkable for a government agency and unusual even for a business, the two officials added. The program requires no new funding and instead uses annual operating funds, according to a spokesman.

But even $200 million in savings during five years will do little to help the Postal Service, which is expected to lose $1.5 billion this year.

"It's pocket change," said Charles Guy, former director of the Postal Service economics and strategic planning office. But the computer system upgrades "could be very valuable" if they improve the Postal Service's ability to use data to make better management decisions.