Parrick R, DoNAHOE Poctwasten Gener ‘UNITED STATES POSTAL SERVICE December 6, 2010 Dear Postal Colleagues, Today is my first official day in the office as Postmaster General, and | am incredibly honored and humbled to have been asked by the Governors to serve this organization at such an important time in our history. | started my career with the Postal Service in Pittsburgh, Pennsylvania, 35 years ago and | can stil recall my orientation as a new employee that first day. While itis striking how much has changed in the world since then, the story of the Postal Service has been one of considerable progress, and of a culture of service and commitment to customers that has endured and strengthened We remain the finest Postal Service in the world, despite the headlines about our financial situation, delivering nearly 40 percent of the world’s mail, and providing greater value for the dollar of any comparable post. Looking ahead, our continued success as an organization depends on our ability to adapt to a changing marketplace and mailing habits, and our ability to leverage our core strengths: our people, our network, and our core offerings. My personal vision is of a profitable, nimble Postal Service that competes for customers and has ‘a well-defined and valued role in an increasingly digital world. Part of that vision is to ensure the Postal Service will always be a resource to every American business, and be valued and trusted at every American residence Itis no secret that digital means of communicating are eroding use of First-Class Mail, and that the growth we have recently experienced in Standard Mail cannot fully offset this erosion. While we wish these trends to be otherwise, we can nevertheless be very successful as an organization by adapting to the reality of a smaller marketplace. We are not going to stray from our core business function-mail and package delivery-but we are going to revitalize the way we approach the marketplace. We have to be more than an available, low-cost delivery resource; we have to win customers and find ways of complementing and adding value to the evolving nature of the way people communicate and conduct business. In the coming days, weeks, and months, I will be communicating about business strategies and initiatives that will drive some significant changes throughout the organization. The core of these strategies includes: 1. Strengthening the business to consumer channel: We will need to build our business around this concept and continue investments in tracking technologies and create compelling offerings for small businesses, 2. Improving the customer experience: Every interaction with us—with a carrier, a clerk, at a kiosk, at a contracted desk or online—must be a great one. Our ability to win customers and grow revenue depends on making significant progress in creating better ‘customer experiences.3. Competing for package business: Packages represent a major growth area which nicely ‘complements the rise in e-commerce. We intend to build on our successful Flat-Rate Shipping campaign. 4, Becoming a leaner, faster and smarter organization: We need to continue to optimize our network, realign our workforce, reduce energy use and our physical footprint, and drive costs out of every aspect of the Postal Service. We have done a tremendous job in this arena over the past several years, while maintaining record service levels. In the past nine years I have served as Chief Operating Officer, and also as Deputy Postmaster General/COO for the past five years. As many of you know from my video programs, webinars, and from my travels throughout the organization, | believe strongly in frequent, open ‘communications. | plan to work closely with a strong leadership team to improve our competitive posture, and to provide regular updates to you as we move forward. ‘As | begin my new role, | am ever mindful that our greatest strength is our people. Its to your credit that the Postal Service has been able to respond so successfully to the recent economic downturn and that the Postal Service remains among America’s most trusted, ubiquitous, and indispensable organizations, My view is that we are at the beginning of a new chapter in the history of our organization, and we will all help write it. Your good ideas, your engagement, and relentless dedication ensure we will make great strides as we create tomorrow's Postal Service together. As always, thanks to every one of you for the great job you do every day. I look forward to ‘working with all of you