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Is535 Implementation Plan

In: Computers and Technology

Submitted By timfore
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IS 535 - Managerial Applications of Information Technology


Section I: Purpose of Plan
Section II: Strategic Business Plan Rationale
Disruptive Forces in USPS Market:
Opportunity for Future Relevance:
Raison d'être/ Justification for plan:
Porter’s Model and EagleMail
I. Rivalry among Competing Firms
II. Potential Development of Substitutes
III. Buyer Power
IV. Bargaining Power of suppliers
V. Threat Of New Entrants
Rationale Summarized
Section III: Current Systems
Major Systems Supporting Business Functions and Processes
List of Current USPS MIS
Specific Examples of Innovation by Foreign Postal Services
Section IV: New Developments
System Projects
Identity and access management
Account Creation
Figure 1: Overview of Account Creation Process
Email infrastructure
Figure 2: Illustration of Email Process in Company Environment
Web portal
Business Information Systems
Business continuity and disaster recovery
Section V: Management Strategy
Senior Management:
Middle Management:
Security Validation:
Sales and Marketing:
Human Resources:
Operational Management:
Section VI: Budget Requirements
Budgeting the New Implementations
Table 1: Illustration of Costs for Implementation of Proof of Concept EagleMail Plan
Cost benefits and models to evaluate the cost and assets.
Is the project at risk?
What are the benefits?
References 

Section I: Purpose of Plan
How important is the United States Postal Service (USPS) to Americans? Is the idea of a national postal service a concept that has relevance within the competitive market in which it competes? Despite recent efforts to modernize through new technology implementations, it appears that the USPS cannot compete within its current market. The role of USPS in the mail delivering sector is declining, and spending money to try to squeeze profitability out of a declining market may not be productive in helping the USPS or taxpayers avoid being called on to provide funding to continue the service (Carbaugh & Tenerelli, 2011). This plan is focused on the actual technological systems that USPS is currently using to provide services, the disadvantages of the business strategy with respect to competitors and what new systems we can use to boost revenue and regain financial solvency for an American institution. It is the hope of this team that implementing a new IS based service will give USPS a competitive edge by creating a new market that complements the service’s historical mission while allowing operational funding to continue to provide the universal service and value that have been the hallmarks of the USPS. This plan is also provides a deep study into new methods USPS should start using, in order to be updated with new technology and be a step ahead of the competition and other potential market entrants. A decade ago the USPS was the number one choice for most customers’ needs. Today, with new market entrants, mainly services made possible by the internet, the USPS faces competitive forces which do not make it the primary provider of such services. Although the USPS has found it difficult to compete, it is required to do so. Carbaugh and Tenerelli (2011) explain that the USPS is “structured to operate like a business, financing its operations through the sale of postal products and receiving no direct taxpayer subsidies” (129). Considering that fact might make one ponder what would happen if the USPS lost the main source for financing its operations as many previously successful enterprises have experienced in the past 5 years. There’s no need to think for long, because it has already started. When people started using commercial services such as FedEx and UPS, demand for USPS services decreased. When people started using email and online bill paying services, the situation only got worse for the USPS and the obstacles it was facing have only gotten bigger. Technology has substituted some of the main services that USPS provides, that’s why people don’t feel the need to use it anymore, or at least use it as often. From 2004-2005, the USPS lost $0.9 billion, in 2006, $5.3 billion, and in 2010, $10.8 billion (USPS, 2008; USPS, 2010a). These losses are only an indication of the current situation at the USPS (Carbaugh & Tenerelli, 2011). The USPS is an independent agency of the Federal Government. The USPS relies on the sales of its products to finance its operations, and “it is required by law to cover its costs and has not received taxpayer subsidies since the early 1980s” (Carbaugh & Tenerelli, 2011). But the USPS receives an annual appropriation from Congress and it can sometimes borrow from the U.S. Treasury. Even though the USPS has those two sources for funding, it is now in debt and that means that the only way to get out of that debt is to for it operate and finance itself as originally meant to be, and that can only be done if the USPS regains its competitive edge so it can aggressively compete against its current and future competitors. In order to regain a competitive advantage against established competitors and regain profitability in a market that has changed since the USPS was last profitable, it has to offer something that no one else is offering, a product that would make it outstanding in the current market. Advances in information technology have allowed tremendous flexibility in running the world free of physical constraints while managing data from anywhere. Taking this into consideration, delivery of physical mail to a physical address is likely to continue to decline in relevance. Carbaugh (2007) illustrates this issue by explaining that “the current business model of the Postal Service, which relies on increasing mail volumes to mitigate postal rate increases and cover the Postal Service’s rising costs, is at risk in today’s environment of greater competition and communication alternatives” (461). Much of these costs are directly related to the delivery of physical mail to addresses where the USPS loses money in rendering the service. None the less, Carbaugh and Tenerelli (2011) explain that the USPS has an obligation to provide services: “The USPS is obligated to provide a uniform price and quality to all Americans, irrespective of geography” (P 129). The world is changing continuously and new technologies are adopted by organizations in order to offer competitive and attractive products and services to increase revenues while reducing costs. USPS is struggling to remain competitive in the physical mail market and takes pride in offering a highly regarded quality service, but that is a service in a market where competitors are offering similar service for a lower price. Where the USPS does not have to compete, the delivery of letters, the market is in decline. The answer to this problem is not becoming more entrenched in a market where the USPS cannot realize revenue, but to offer a profitable and complementary service that will transition consumers to a system that allows USPS to remain solvent while providing a service that is in demand by consumers. Considering the realities facing the USPS in the road ahead and examining the cause of loss of market share for USPS it becomes apparent that a complementary service that has potential to generate revenue and retain relevance in the digital age is within reach and more importantly, demand for such a service exists, but the market will have to be developed. Consumers as well as public and private organizations all face the danger of having identities and private or proprietary information hacked. Risks are increased due to the transmission of correspondence via non-secure email services that allow anonymous individuals to send messages appearing to originate from legitimate entities when in reality they do not. Compounding the risks is the ability for these anonymous entities to attach malicious attachments that cause damage or allow remote entry to networks where the attachments are accessed. Just as the Second Continental Congress recognized when creating the USPS (USPS, 2006), reliably secure transmission of correspondence is critical to promoting commerce and the functions of government and society as a whole. Yet, in the digital age there exists no such digital service with the universal acceptance of reliability that USPS mail provides. Using information systems, we propose the creation of a service for companies as well as the private citizen, offering low cost and convenient digital communication between institutions and customers, ensuring perfectly secure transactions by using high security email. The end result of this plan is to provide proof of concept that bridging the services of the past with services of the future will allow financial solvency while maintaining services that customers demand. USPS will provide a large scale email portal, accessible only by dedicated users which is safeguarded with state-of –the-art encryption and actively monitored for intrusion, assuring that only authorized customers have access to the data. Offering consumers the ability to send a secure email, will provide a new form of communication, free of worry, as data is safely maintained and secured by the USPS. Development of such a service should not be left up to commercial providers to innovate and provide, nor should it be ignored when considering solutions to the rising costs associated with USPS’ physical mail services obligations.
Following is a detailed breakdown of this plan:
Section II: Strategic Business Plan Rationale
Section III: Current Systems
Section IV: New Developments
Section V: Management Strategy
Section VI: Budget and Cost Benefit Analysis
Section II: Strategic Business Plan Rationale
Two key factors will determine the fate of the United States Postal Service (USPS) as a self funded government entity: market share and non-discretionary spending. In 2006 demand for USPS services peaked with 213.1 billion pieces of mail delivered (USPS, 2008, P 3). Demand has steadily declined since 2007 with best case projections showing at least a 30% decrease from 2006 levels by 2020 (USPS, 2010a, P 3). The USPS is the 2nd largest employer in the United States with 574,000 career employees in 2010; 300,000 of those employees will become eligible for retirement by the year 2020 (USPS, 2011, P 4,; USPS, 2010c,P 4). USPS operates the largest civilian fleet of vehicles in the world providing service to every mailbox in the country regardless of location (USPS, 2011, P 22). The vast scale of operations combined with service commitments (e.g. six-day per week service) subjects the USPS to an impossible situation with regard to maintaining financial solvency if the business model remains unchanged. Somehow the USPS must cover not only operating expenses, but an estimated $75 billion in unfunded obligations (e.g. retirement benefits) as of 2007 (Carbaugh, 2007) that are required to be pre-funded in accordance with the Postal Accountability Act of 2006 (USPS, 2010b). However, even removing these long term obligations from the balance sheet, does not allow USPS to maintain profitability. This dilemma can be attributed to increased operating costs paired with declining revenue due to the drop in demand for its services (USPS, 2010b). The main driver of the decline in demand for USPS services, as a whole, is due to an inability to change the fundamental mission of the post office with regard to universal pricing and service. That inflexibility creates a hindrance for the USPS to adapt in order to compete. Given the requirement to deliver the same level of service, to all addresses, for a low price, the USPS is unable to change prices in areas where costs are extreme and lower prices accordingly in lower cost areas in an effort to compete. The USPS is left with increased market share where they are unprofitable and decreased market share where they can be most competitive. This is due to a need to subsidize the more expensive areas to maintain standardized pricing. While competitors are free to change prices in accordance with cost thereby capturing more of the market and capitalize on any efficiency they may create through innovative means, the USPS is forced to rely on one segment of their market from which to generate the revenue required to cover the rest of their expenses. USPS enjoys a monopoly on the delivery of letters, media and periodicals to mail boxes due to United State Federal Law prohibiting any other entity from delivering to mailboxes (Carbaugh, 2007). That service includes First Class Mail, which accounts for the bulk of USPS revenue (USPS, 2010a). With the advent of the internet however, what was once a cash cow has lost its ability to alone provide the revenue required to sustain the financial solvency also required of the USPS (Montanye, 2007).
USPS has two main rivals for parcel delivery and express mail. FedEx dominates the express letter market and UPS dominates the small parcel and large parcel market (Montanye, 2007). The intent of this plan however, is not to improve USPS competition among these rivals, but to enter a new market which currently, is competing with First Class Mail, the profit center that USPS has relied on since its inception.
Disruptive Forces in USPS Market:

While the USPS began experiencing pressure from costs of operating, demand for its flag ship product, First Class Mail, began to wane (USPS, 2010a). This decline in volume was driven in part by businesses seeking reductions in cost through automated, web-based billing and payment systems as well as an overall move toward digital means of communication over physical mail based communication (Montanye, 2007). The internet had reduced the number of paper bills being sent by billers and payments sent by payees. Email had taken over as the primary means of conducting all manner of correspondence, and media previously mailed in hard copy form was made available on websites.
Although in declining amounts, large volumes of physical mail continue to be sent, but a system which has relied on growth to remain profitable has reached its breaking point. Few answers appear to exist for the question of how to maintain the current levels of service without dramatically increasing the costs for the service. One potential solution is to simply raise prices; however, dramatic price increases are likely to drive remaining business towards digital means of delivery where possible.
Opportunity for Future Relevance:

Given the move to digital means of sending and receiving information, it would appear that USPS is left with a rather bleak future and without drastic changes. The USPS is likely to require large amounts of subsidization from tax payers in order to continue operating. Under such a scenario, tax payers would be asked to pay for a service that they more and more demonstrate that they require less and less. The Ponemon Institute (2010) ranked the USPS as “the sixth Most Trusted Business in the nation”. Given the positive consumer perception of reliability for USPS First Class Mail delivery and the importance of correspondence reaching recipients in a timely and secure manner, it would seem that any disruptive technology replacing demand for mail would be highly reliable. However, nearly fifteen years into widespread use of email there exists no commercial email service that can replace the security afforded by USPS First Class Mail. A simple typographical error in an email address renders email undeliverable, or worse, delivered to an unintended recipient with nothing to alert the sender of the error unless the recipient replies to inform the sender of the error. A typographical error in a name on a piece of First Class Mail, still tends to reach the address intended and if completely incorrect, gets returned to the sender with a notification of why the letter was unable to be delivered. Although a possible concern, most users reliably send and receive email messages with ease to the intended recipient. The truly worrisome issue is who has access to email accounts besides the registered user, the true identity of a user, and the proliferation of techniques to spoof identities and steal data.
Raison d'être/ Justification for plan:

Security of commercially provided email services such as Yahoo and Google have been shown to be inadequate (Anderson, 2011) and even businesses have struggled with providing security for their own internal email systems (Anderson, 2010). In order to provide a digital means for the correspondence upon which commerce depends and provide USPS with a relevant replacement for revenue lost due to the emergence of email and other digital means of sending and receiving correspondence, our plan provides a means to solve both of these dilemmas. Only the U.S. Government has the means, authority, and responsibility to provide secure email that verifies identity of both sender and receiver. The agency within the U.S. Government that is best positioned to provide services within the realm of a digital service for correspondence is the USPS. The desire to streamline the USPS operations, particularly regarding the number of facilities that the USPS maintains has become a highly charged subject. The jobs that these facilities provide are aggressively protected by the unions that represent the USPS’ 574,000 workers (Montanye, 2007; Carbaugh, 2007). For a fee considerably cheaper than the price of a First Class Postage Stamp, an email could be sent via a secure service backed by the reputation of the USPS and implemented and serviced by human beings at a physical location that provides traditional physical mail concurrently. By pairing these proposed future services with legacy USPS services, it will allow for cross selling of appropriate services as well as the maintenance of the status quo with regard to current service obligations of the USPS. As the labor force is reduced due to retirement, it is likely that further IT improvements could lower the demand for manpower in stride with the decreased numbers without a need to drastically raise postage rates to cover operating costs and alleviate the potential for layoffs or furloughs. Providing a high security email system that relies on a small fee will also generate a significant revenue stream which will grow to replace physical mail while cost for operating the service gets cheaper each year to provide due to IT innovations and increases in volume. Using Porter’s Model, the USPS will differentiate its services from those of potential rivals in order to gain a competitive advantage.
Porter’s Model and EagleMail

Applying Porter’s Model to analyzing the market that USPS would be part of in offering a secure email service would differ from analysis of the market in which USPS currently competes. The introduction of a secure email service that every resident of the U.S. and every corporation or registered organization can use to conduct reliably secure communication would be a disruptive technology that would be difficult if not impossible for commercial email providers to compete with due to tactics described below. The following breakdown of Porter’s Five Forces Model details the IT advantages that USPS can leverage to reduce the effectiveness of competition from rivals.
I. Rivalry among Competing Firms

USPS currently feels competition from competitors in the delivery of physical mail and is subject to forces exerted on it by factors such as high exit barriers, low switching costs, slow market growth, and high fixed costs (QuickMBA, 2010). UPS and FedEx enjoy efficiencies that USPS cannot overcome due to the commitments to physically deliver mail to every mailbox six days per week (Carbaugh, 2007). This high exit barrier forces USPS to compete in a market in decline. While UPS and FedEx can use IS solutions to determine more efficient routes for delivery on a per unit basis, the USPS is required to visit each mailbox six days per week regardless of whether the service is utilized. Where appropriate, the USPS is committing resources to develop IT improvements aimed at streamlining the sorting of physical mail and selling of services to compete with these competitors in the physical mail market, however, out of small parcel, large parcel, and letter mail, the only segment of the market that USPS can currently compete is letter mail due to the monopoly granted to the USPS by Federal Law. If that monopoly were taken away, there would be no USPS; the USPS would be unable to compete with commercial service providers (Carbaugh, 2007; Carbaugh & Tenerelli, 2011). Removal of the monopoly, however, is unlikely due to the commitment to physical delivery and pickup that the USPS is charged with- also the cause of high exit barriers. USPS competition in the new EagleMail digital market will come from companies such as Google, Yahoo, Microsoft, and AOL. The main advantage that these services have over the proposed EagleMail is that they have market momentum and they offer the user an experience through linked services. The USPS will find it difficult to take over the email market en masse, but that is not the intent of EagleMail. Users would be encouraged to use their established commercial accounts for social interaction, but when it comes to digital correspondence that requires any degree of security (e.g. financial statements, password resets, or business dealings) users would be encouraged to use EagleMail. Users would tend to continue to use the already established free email services provided by commercial companies. To counteract this tendency, USPS will improve product differentiation by relying on its reputation for trustworthiness and other advantages that their rivals will not be able to provide. The persistence of malware, phishing, hacking and other digital threats have the ability to allow commercial Email accounts to be hijacked and used to send the ubiquitous spam email that have become so common place that commercial email providers gain market advantage against rivals by offering better spam filtering than rivals (Ghosh, Dhumal, & Chawla, 2011). The ability of consumers to differentiate legitimate email correspondence from phishing attempts is left to the user to determine on a case by case basis. Part of what will differentiate USPS EagleMail from rivals is that USPS EagleMail messages will only originate from other EagleMail accounts, thereby eliminating the need for Spam filtering or the reliance on the users’ savvy with current email based threats. USPS, with the backing of the Federal Government, will develop, provide, and aggressively secure the most advanced email service available in the world. Using the same standards used for identifying customers for the purposes of applying for passports (a service provided by the USPS), the USPS will enroll customers in their new EagleMail accounts. In a move to further differentiate EagleMail and ensure adoption of the service as the gold standard in digital correspondence, USPS will seek to promote itself as the most trustworthy channel of distribution for financial firms and government entities for communication with their customers. By doing so, USPS will use vertical integration to cement EagleMail as THE way for commerce and customer to communicate in a secure manner. To facilitate ease of use, EagleMail will offer to send an alert to a non-EagleMail account (e.g. commercial Email account or social media account) notifying a customer that they have an EagleMail message waiting to be opened on the secure portal. Research shows that consumers place the aspect of cost as their number one decision factor when considering the use of a secure email service. Persistence of risks associated with commercial email accounts will, alone, fail to drive customers to EagleMail (Ghosh et al., 2011). EagleMail will mitigate the risks associated with commercial email and the benefits are anticipated to produce a value to business users of EagleMail when used as a means to communicate with customers. By leveraging the adoption of EagleMail by corporations and government entities as the only means through which they will send external correspondence, USPS will bring consumers to the market. Given that research has shown that the likelihood of consumers adopting a fee-based service hinges on pricing being free of cost (Ghosh et al., 2011), IT systems related to billing for the service should take into account this factor and encourage public and private sector entities to cover the cost for transmitting messages to them, along the lines of a collect call or toll free telephone number. Covering the small cost of sending a secure EagleMail message to these organizations will prove to be a cost effective means of eliminating a major source of criminal activities (scams perpetrated via unsecured email) that results in loss to consumers, businesses, and governments as well requiring major investments in anti fraud efforts at each separate entity. As the system matures, later developments will offer biometric controls that can be added to offer the ultimate express mail service- digitally delivered correspondence with biometrically verified sender and recipient. This could be accomplished through EagleMail sent from the same Post Offices where mail services have been provided for decades. Additional opportunities could be made available to use these services in the form of advanced digital kiosks developed to occupy the same footprint as the iconic blue mailboxes that are currently spread throughout our neighborhoods across the country. However, biometric security is beyond the scope of the current plan, but will provide increased opportunity for successive development of EagleMail and increased integrity and value of the system.
II. Potential Development of Substitutes

The threat of substitutes has contributed to the dislodging of the USPS from a competitive position in the mail delivery market, potentially relegating the USPS to the ash heap of history. A failure to adequately identify the force that the substitutes of the digital age provide for business and consumers is partially to blame for the USPS’ current financial troubles. Using Porter’s methodology, identifying substitutes for an industry is a concern that must be addressed in order to remain competitive (QuickMBA, 2010). Two substitutes for the main source of revenue for the USPS include internet portals for financial services billing and payments (reducing bills and payments travelling via First Class Mail) and the advent of Email as the main means of individual correspondence (reducing the volume of First Class Letters being sent) (Montanye, 2007). Forecasting the effects of the force these two substitutes exert on the USPS are proving to have been crucial to the success of USPS in meeting its mandate of being self funded (Carbaugh, 2007). However, just as it is difficult to judge the mass or speed of an oncoming train, it was difficult for the USPS to anticipate how drastic these forces would be in reducing the need for USPS services in the mail delivery market. As discussed previously, the rise of unsecure email based threats results in costs to the economy as a whole. Although the USPS is a latecomer to the Email services provider market, the need for a universal, secure Email service for every person was not evident to the degree that it is today, until recently. In order to reduce the force of rivals in the future, USPS could choose to seek out the same Government regulation based monopoly protection it enjoys for its First Class Mail service (Carbaugh & Tenerelli, 2011). Such protection will not however protect the USPS from substitutes, but rather increase the likelihood that they are developed by competitors as they seek to find substitutes to once again dislodge the USPS from a competitive position in the lucrative market of providing services for communication. In order to reduce the force of substitutes on EagleMail, USPS will establish an office which maintains expertise in the integration of EagleMail services with developing services in the digital and traditional realms. By keeping one foot anchored in traditional services, but constantly focusing on emerging services and maintaining constant focus on finding ways to keep EagleMail compatible with developing technologies and services, USPS will ensure that the speed of technological advances does not outpace USPS ability to adapt. A development team organic to the USPS should specialize in adapting all traditional services to interface with EagleMail and likewise to interface with any evolving platform or application as new technology enters the marketplace. By aggressively developing and staying in synch with the market the USPS will be proactive in reducing the force of substitutes as opposed to being reactive as has been the case for the last decade. Development of substitutes is likely a given in the digital economy, however, by placing themselves within the digital market in a meaningful and profitable way, the USPS will be in a position to develop innovations to reduce the force of substitutes for digital communication we have not yet imagined.
III. Buyer Power

The force of customer buying power on a supplier can become a force that a supplier has little flexibility in responding to if buyers have credible alternatives (QuickMBA, 2010). Such is the case for traditional mail services that the USPS offers. Where alternatives exist and customers are driven by price, USPS will lose market share if it is unable to differentiate its services from competitors. In the case of EagleMail, USPS will seek to create and exploit an advantage that will likely be mimicked by competitors initially. Customers currently have credible alternatives to EagleMail if they forgo the security that a USPS email service would provide. Differentiation of USPS backing the security makes alternatives unlikely lowering customer bargaining power. However, offering a secure email service would not be altogether difficult for a commercial company and may well be likely in the wake of EagleMail’s launch, but the level of trust placed in a commercial company for the safeguarding of the data stored on a commercial company’s servers may well be the deciding factor for consumers. A differentiation that USPS will highlight is that it is a not for profit entity backed by the full resources of the United States Government. No other secure email provider will be able to make this claim. The USPS will be able to make use of government IT resources, specifically with regard to intrusion monitoring and network traffic monitoring that competitors are not able to use. Another key differentiation that USPS will make clear is that it lacks the tendency that plagues large, for profit firms from hiding details of any intrusions out of a desire to protect the company stock valuation from negative press. The USPS in contrast will have a page that describes what it is doing to secure user’ data, what users can do to keep access secure, and what to do if users think their credentials have been compromised. By maintaining a website reporting to the public the status of the network and valuable information about the risks of unsecure email (e.g. phishing, malware attachments, links to sites containing malware, hacking), EagleMail will also differentiate itself as an easy source of this information to make the decision to use EagleMail easier as well as to convey the message that EagleMail values security above profits at all times. The more aware consumers become, the more likely they are to insist on EagleMail as their preferred method for any correspondence that involves personal information or financial or business transactions of any type. Educating consumers of the risks associated with unsecured data and the ways that their unsecured data can be accessed and used by criminal elements to cause serious damage to an individual or organization will decrease customer buying power and increase EagleMail market share while promoting good security practices amongst consumers. The more customers know, the more difficult it will be for rivals to claim that a competing product is comparable in security or transparency, resulting in a de facto monopoly by USPS in this market.
IV. Bargaining Power of suppliers

In the not so recent past, bargaining power of suppliers was increased for large IT installations due to the proprietary nature of equipment and the software designed specifically to operate those information systems. Bargaining power of suppliers is strong when the cost of switching to substitute products would prove to be cost prohibitive for a customer (QuickMBA, 2010). Thankfully, due to the advent of cloud based technology and virtualization, it is easier than ever to operate more systems on less hardware and use more varied hardware in building of a system. Virtualization and utilization of a cloud based system will assist with security by allowing patches to be rolled out en masse and allow rapid replacement of any affected hardware during reconstitution of the system if affected by a large scale corruption of critical systems. Decreasing reliance on single provider sources of technology will increase the bargaining power of USPS in implementing EagleMail. Given the ambitious nature of the plan to provide the ultimate in secure email service, EagleMail will become a target for a variety of criminal entities. The potential for companies to benefit from teaming up with USPS in building this system creates a potentially lucrative marketing message for a company that can claim that EagleMail runs on their product. Furthermore, approaching the security of EagleMail as an “Apollo Program” of security projects could generate excitement in security that will have benefits in the way of attracting top talent to both the USPS and any vendors with whom the USPS partners with. Services developed for USPS would be valuable for deployment in the commercial sector for business to business (B2B) use (along the lines of spin off technology from the space program). The opportunities that such a synergistic partnership could provide would decrease supplier power and help to decrease costs while strengthening the EagleMail system.
V. Threat Of New Entrants

The threat of new entrants and entry barriers is something that will likely pose the least problem for USPS in implementing EagleMail and enjoying a near monopoly in providing the service. The threat of new entrants is high when technology is widely available and brand is unrecognizable (QuickMBA, 2010). While few consumers scrutinize the manufacturer of components soldered to the motherboard of their computer or MP3 player, consumers are likely to scrutinize who is guaranteeing the security of a so called secure system. Similarly, the USPS does not restrict corporations’ email systems within their organizations, but only the USPS can offer identity guaranteed email accounts registered to individuals or organizations across the country with the identity backed by the U.S. Government- no commercial provider can make this claim. The USPS’ reputation for being trustworthy and ability to tap cutting edge methods for protection of data will make entry more difficult for new entrants. Exit costs are another key factor in limiting new entrants to the secure email market and are a factor that the USPS will be able to benefit from. Once such a service is in place, the exit cost of leaving the market would be high and therefore also reduce threat of entrants (QuickMBA, 2010). Should a commercial company choose to enter the market and make the choice to leave, they will take with them the ability for their company to use their name again in the tech industry. What established company would risk their brand to compete with the USPS in an environment where market exit would be difficult to claim was due to anything but an inability to protect the data to which it was entrusted. The secure email market will be high profile for any failures and low profile for success. The USPS’ problems with downsizing of post office locations has been an issue that stands in the way of profitability (Carbaugh & Tenerelli, 2011), but when considering the advantage this restricted distribution channel provides, the physical locations provide an advantage against potential market entrants (QuickMBA, 2010). The reason the extensive system of post offices is an advantage is realized when confirming identity for the purposes of enrolling customers in their EagleMail account. An EagleMail kiosk within the facility would increase visibility of the new service and offer a convenient location for identity to be confirmed and account initiation to take place. Few potential competitors could boast such a convenient and nationally available network of locations to roll out a service that would require physical presence for initial account setup. If no other factor reduces threat of new entrants, this liability turned asset for the USPS creates that competitive advantage against new entrants.
Rationale Summarized

The USPS is in dire need of a drastic change in service offerings that will allow the simultaneous delivery of legacy services combined with and a new source of revenue that will stand the test of time with regard to relevancy in the market. Delivery of physical mail served as a profitable enterprise for a considerable period of time, but was quickly replaced by the rise of digital technologies. Increasing risks of transmitting sensitive information digitally has given rise to a demand for a secure digital means for transmitting this data. The USPS is uniquely suited to provide this service and the proceeds from providing such a service will provide the revenue needed to deliver the USPS’ legacy obligations while keeping the service relevant and able to adapt to the future changes in the market.
Section III: Current Systems
Major Systems Supporting Business Functions and Processes

The U.S. Postal Service currently has listed on its corporate portal ( the Major Information Systems (MIS) that are in place to support the business functions. The list encloses 114 different systems, for a wide variety of purposes. These systems range from PIN databases where the employees authenticate their identity in order to have access to USPS systems, to financial systems like the National Accounting Oracle Financials Application, which handles all the financial system and reporting requirements of the business (USPS, 2012). List of Current USPS MIS

Following is a brief description of the systems that have the most relation to this IS plan. In some instances added to the description will be an example of how the current IS infrastructures can be utilized or adapted to support the new product.
Accounts Receivable Oracle:

The Accounts Receivable-Oracle System is in charge of one aspect of the accounting process; it communicates with several other systems as payroll, accounts payable etc, where it acquires information or feeds information. The system is able to balance the account receivable ledger to the general ledger, issue 1099’s, and update IRS information (USPS, 2012).

Is one of the systems that Human Resources utilized as a portal to provide and process information to the employees. Forms like W2’s, bank allotments, and LES’s can be reviewed and printed. Another characteristic of Postalease is that the employees can interact with the system using a webpage, or if not possible, users can call and talk to an IVR (Interactive Voice Technology) (U.S. Office Of Personnel Management, 2012). Retail Data Mart (RDM):

RDM is a system that acquires essential information from retail transactions, and works as a tool that helps operational planning, customer service, and helps to understand the customer’s needs (Laich & Breed, 2005).
WWW.USPS.COM: is the face of the U.S. Postal Service on the Internet. The site makes available information, provides some services like tracking packages, and offers a USPS office locations directory. This portal has the brand recognition, and the trust of its customers (USPS, 2012). The USPS webpage could be used to advertise the new EagleMail service and provide a link for remote log in to the secure EagleMail portal.
Transportation Optimization Plan and Schedule (TOPS):

TOPS provides logistics planning tools and optimization. The system’s purpose is to plan and optimize transportation in all its forms (ground, air). The system has applications which help to plan routes, and includes such levels of detail as the most optimal parking spaces in the warehouse to optimize loading and unloading of the trailers (USPS, 2012).
Automated Postal Service (APC):

APC is the new automated approach of the USPS to decongest the Post Offices. The system is able to carry out 80% of the normal processes required to send a package or letter. The entire transaction can be generated without the assistance of a USPS representative (USPS, 2007). Two limitations of the system are that the customer, in order to validate the identity of the sender, needs to pay with a credit card or debit card as well as have a digital picture taken by the system at point of sale for security purposes (USPS, 2012). An added value to the proposed system, could be to add to the APC a module where the customer, after verifying their identity (fingerprint, ID, picture, Iris reader), could type and attach documents to an EagleMail message that guarantees security and identity verification in a retail type form.
National Accounting Oracle Financials Application:

Oracle provides USPS with Financial solutions that use Commercial Off the Shelf (COTS) products adapted to the requirements of business and provides flexibility of work between other applications (Mall & Akhavan, 2005).
Mail Transport Equipment Labeler:

The Mail Transport Equipment Labeler is a system that provides organization to the warehouses, and cargo in general. Through a systematic labeling system, cargo containers can be easily identified and tracked during every step of the transportation phase (USPS, 2012). Address Information System Product Fulfillment:

The Address Information System Product Fulfillment system is a database with the information about addresses, and zip codes. This information is a raw form, and it needs an interface application to be manipulated (USPS, 2012).
Information Based Indicia (IBI) Revenue Protection:

IBI Revenue Protection system is an automated platform that is able to identify counterfeit postage by decoding the IBI information from the stamp when it is being scanned by a wide field of view camera in the system (USPS, 2012).
Enterprise Content Management:

The purpose of this system is to add automation to certain processes that are normally applied by hand and with a big use of paper. Areas such as supply management, Labor relations, publishing, equal opportunity, etc. (USPS, 2012).
Biohazard Detection System National Controller (BDS):

BDS is a new system that is being implemented in USPS Mail Processing Facilities to monitor the mail system for presence of biohazardous substances. It works as a central repository for data collected by the system which analyzes air samples from the different centers. It is also responsible for communications of a positive detection of a Biohazard agent in the mail (USPS, 2012).
Human Resource Business Intelligence:

This system compiles information in a datamart solution, the HR information provided by three other systems in order to provide organized and intelligent HR info results through another software application named Microstrategy (USPS, 2012).
Unique Customer Identification:

This system will provide the USPS with a way to identify in a unique way their customers and provide specific services tailored to that specific customer. Having a unique identification per customer will ease the integration between systems and avoid information redundancy. A personal unique form of ID customers could be a very good ground for the secure email platform. One of the challenges for the secure email solution is to be able to authenticate the sender of the information, and that challenge is one step closer to being overcome if USPS can individually identify their customers (USPS, 2012).
Marketing Operational Data Store (ODS):

ODS is the result of the compilation of information from other systems such as: Unique Customer Identification Program, Customer data quality initiative, and Customer Insight Reporting for the purpose of improving service and promoting new marketing strategies (USPS, 2012).
Foreign Posts Offices Actual Technology:

It is a fact that all around the world Posts offices are being affected by the new ways of communication, like email, Text message, cellular phones, social networks etc. These advances have a big influence in the new and creative ways that have been designed to keep post offices open worldwide. With a diversity of new services and products around the world, post offices are competing by adopting the new technologies. Two common tools that are being used are Hybrid Mail and Costumer Verified Identification. Hybrid mail service is a general term that is being use in the post offices around the world. This expression is use when the post office combines their regular capabilities of delivering mail, with the new technologies such as email, cloud computing, and mobile communication. The most standard version of hybrid mail is when the costumer logs in to the post office secure website through a username and password, in some other instances with the help of a USB device such as a webcam, fingerprint reader, or a postal specific ID card with an encryption key encoded within a chip embedded in the card. After account login, the costumer will type or attach information that is desired to be transmitted and then send it. The message or document is transmitted through a secure network to the recipient electronic inbox; the receiver will get the notification on their mobile device or regular email to check their secure inbox in the postal office portal. The sender will get a message of delivery confirmation. The recipient will decide if he/she wants the email officially print, and physically deliver; if they do, it will be printed at the Postal office, and it will have the same authenticity as the original document (GAO, 2011). Another version of this service model occurs when the sender has a physical letter, which is mailed in the traditional manner, until the letter gets to a secure postal scanning facility, where it gets digitalized and sent through a secure network to the electronic postal inbox of the recipient. The customer then decides if they want it officially printed and sent to the house. As is expected the initial cost of this infrastructure is big, but after is implemented it has the capacity of reducing cost of transportation dramatically (GAO, 2011). Customer Verified Identification is one the tools that provide the ground base for many of the actual and future advancements in customer services and many other fields of the business world; Costumer verified identification could guarantee mail delivery, since if the customer has a change of address or phone number it will be updated or added every time the individual access the system. The customer will have the capability of a digital signature, which allows official business requiring the signing of documents possible remotely (GAO, 2011). Specific Examples of Innovation by Foreign Postal Services

Australia, (Australia Post)

The Australian Post have diversify their services, customers now can get their bills, and mail in an electronic way, through the Hybrid mail solution, also are able to pay bills, store receipts, tax information and important documents in the cloud service provide it by the postal office (Auspost, 2012).
Canada (Canada Post)

The Canadian Postal office has implemented a few new innovations in their services, products and locations. Right now they have partnership with local business and banks in which if you have email account with e-post (Canadian Post office) you can get all of those companies mail through your e-post email. Also all of this electronic documents and other important documents that you upload to your virtual storage unit, can be save for 7 years with no cost to you (GAO, 2011).
In their near future they have planned to implement a form of Customer Verified Identification, which is going to provide them the capacity of developing secure online services which could interact with the Government, and other agencies. Canada Postal office has a partnership with a retail pharmacy chain that is allover Canada, and this provides flexibility to the service, and reduces the fix cost of owned buildings (GAO, 2011).
Also if the customer is traveling could have the ability to redirect his mail to the nearest e-post partner location (e.g. pharmacy) with any type of hassle, as long as he verifies his identity and the period of time that is going to spend there (Epost, 2012).
Finland (Itella, Netposti)

Finland has begun testing a new mail delivery system named Itella. One of the characteristics of this system is that is designed to reduced the cost of what is call the last mile delivery. Here the customer is notified via email that he has mail waiting for him in post office processing facility closest to him, at the same time the second class mail is being scan and sent to the customer via email. Also there are several companies that have a subscription with the postal office, and all their mail is digitalized and sent to the appropriate person (GAO, 2011).
Germany Deutsche Post DHL (E-Postbrief)

DHL has two strong advancements in technology, which are key to keeping them on the Postal business. The first one is their version of the Customer Verified Identification, in conjunction with hybrid mail. Customers need to affiliate DHL, and physically verified their ID’s which could be a passport, a driver license etc. Then they get access to E-Postbrief portal. All their messages from the portal are authenticated, and sent through a secure network. If the customer decides that he wants to send a document to an individual that is not part of E-Postbrief, DHL will print the document in their nearest recipient DHL location, and this document is legally binding and confidential (Deutsche Post, 2012).
The second advancement is their Pack stations, these are machines / lockers which are located in bus terminals, train stations, and populated areas. Customers can choose to get their mail directed to one of these pack stations; they will be notified via email, or text message and also can send packages from here. The pack stations are very practical because these are open 24/7 (Deutsche Post, 2012).
Sweden (E-letter)

Two of the advancements use by Sweden are hybrid mail, which basically works as the standard, where you have the best of the two types (regular mail, electronic mail); and they reduce fix cost by using partnerships with local stores to locate their offices. They also train the store employees to manage the post office. When customers get a letter o package, automatically they get a text message or email notification (GAO, 2011).
Switzerland (Swisspost)

Switzerland has taken two strong steps towards the future: The Digital identification, which provides the customer with the benefit of the digital signature. In the process of identification of the individual at the post office, the customer gets an USB device for the digital identification in to the network; this guarantees that the account is not being use by someone different than the person initially identified (GAO, 2011). The second system used is the hybrid mail, with one variance, that the customer is the one that authorized the postal office to open the mail and scanned. The customer receives the normal email letting him know that he has mail, and the post office sends a scanned picture of the front and the back of the letter and the customer chooses if he wants that letter scanned or physically delivered (GAO, 2011).
Section IV: New Developments
System Projects

The information system for the new secure email service offered by USPS will include the 1) identity and access management system, 2) account creation, 3) email infrastructure, 4) web portal, 5) business information systems, and 6) business continuity. The following is a description of the project, its importance to the overall system, and a recommendation of equipment functionality.
Identity and access management

The identity and access management system will manage how accounts are created and accessed. A key value offered by this new secure email service is identity verification. This part of the system occurs when an account is created and accessed. Identity management must provide a way of verifying a customer’s identity documents, handle the documentation in a way that protects users from identity theft, and connect that identity to the access management system. The access management system will manage employee access vs. customer access to user information and accounts.
Identity Verification

Each customer’s identity has to be verified before an account will be issued. In order to do this, it is recommended that USPS piggy backs on a system that is already in place. Currently, many Post Offices are capable of accepting U.S. Passport applications (Apply for a Passport, 2012). USPS has to train employees on how to accept identity verification documentation, to offer this service. Further, USPS can require the same points of identification necessary to apply for a passport to apply for the email account.
Access Architecture

Employee access control vs. Customer Access Control

The access management system will have separate access controls for employees and customers. While some employees may have access to the user database for customer relationship issues, it will be more common for various applications within the information system to access user account information. These applications need access control mechanisms to ensure that customers’ email accounts and identity are protected (Harnik et al., 2011). Further, to prevent attacks each application should be given “the least amount of access necessary to perform its request (Harnik et al., 2011).” Provisions should also be made to sync employee access controls with the employee database, so that recently departed employees will not continue to have access previously granted to them. Customer access will be controlled with an alphanumeric password chosen by the customer and a device given to customers that provides an algorithm based key that is regenerated on a schedule. This algorithm will match one stored on our database or that of a third-party provider. Customers will have to have the device on them at the time they log-in to their email account. This two-tiered system will prevent common email hacks like fake duplicate websites and key logging software. This system must also require users to change their passwords at timed intervals (i.e. 60 or 90 days). Commercial products like RSA Access Manager provide features such as “Policy-based access controls - protect online assets and mitigate risk by ensuring only authorized users can access sensitive data; Centralized policy management – manage authentication and authorization policies separately across multiple applications; and Fine-grained access controls – access privileges can be provided by select attributes like job function and responsibilities” (EMC, 2012). We recommend similar features be provided in our access management system.
Account Creation

Figure 1 provides an illustration of the account creation process. Customers can create an account by visiting a local Post Office that also processes U.S. Passport applications. This is important for identity verification. The account creation system must integrate with the identity and access management system as well as the email infrastructure. This will require an application allowing Post Office employees to enter the customer’s information. This information will be stored in a data warehouse. The application will use the information entered to create a user account, create an email address on the email server, link the account to an algorithm based device, and assign access privileges. The customer will then receive the email address, login instructions, and an algorithm-based key device that matches the algorithm stored on the server for their account. The use of applications stored on various servers working together can automate much of this process. In keeping with the access management system, these applications will be provided with the minimum access necessary to complete their requests.

Figure 1

Figure 1: Overview of Account Creation Process

The employee application should be accessible through the current intranet and enterprise application that Post Office employees use when interfacing with clients. The application should be easy to use and walk employees through the process step-by-step.
Email infrastructure

Before explaining the email infrastructure required for this plan, a brief explanation of how email communication works will be provided (see Figure 2). First Sender writes and sends an email to Receiver using a mail user agent (MUA); that MUA communicates with a mail submission agent (MSA) to send that email from Sender’s computer to Sender’s email server; Sender’s email server makes a copy of the email on the hard drive and sends the email to the internet via a mail transfer agent (MTA); the email is filtered through a spam & virus blocker; from there Receiver’s email server receives the email via a MTA; and Receiver’s email server sends mail to Receiver’s computer where it is retrieved via a MUA (How email works, 2012).
Figure 2

Figure 2: Illustration of Email Process in Company Environment

To create a secure email for users, USPS will have to make significant changes to their current IT infrastructure. The types of changes will depend on whether USPS chooses to build a physical or cloud-based solution. Either way, USPS will have to create the following 3 layers: 1) Email Gateway, 2) Email Backbone, and 3) Groupware and applications.
Email gateway security


An email gateway is the first layer of email infrastructure. One component of an email gateway security is a firewall. For enterprises, a firewall is just the first step. Additionally, enterprises need a filter for email containing spam/viruses, as these can be crippling to both users and the enterprise.
Data DMZ

Another component of the gateway security is a data demilitarized zone (DMZ). The concept comes from the military and refers to an area between nations where military action is not allowed. In IT applications, it refers to a barrier between the local area network and the outside world. The DMZ prevents an attacker from gaining access to the local area network by only allowing access to equipment on the DMZ. Information can be sent out to the appropriate destination but will not be allowed in without the proper security certificate.
Email backbone

Email Server

The second layer of the solution will be the email backbone. This layer stores email messages including backups for disaster recovery and records. The layer also transports email to the router so that it goes to the intended receiver. Email can be retrieved from the email server by users in 3 ways:

The earlier explanation of email transportation included the use of MUA, MSA, and MTA. Each of these is software. The email backbone will require the selection of MSA and MTA software to communicate between the various severs.
Backup email server

Backup servers are necessary in case a primary email server malfunctions. It is necessary to have at least one backup, but more are recommended.
Storage Array

The storage maintains complete backups of the data stored on the email servers. These backups are programmed to automatically happen on a set interval of time (ex. hourly). This device also communicates with the backup email server, backup redundant storage array, and remote redundant storage array.
Remote email server and storage

The remote email server and redundant storage array are needed for disaster recovery purposes. If the location of the main and backup email servers were to be shut down or compromised, the remote server and storage array will ensure continuity of data service.
Email Monitoring Application

This application is for compliance purposes. It allows an email administrator to access email stored on a server for compliance purposes.
Groupware & Applications

This final layer controls the routing of email to users. Just like MTA are necessary to route email from one server to another, they are also necessary to route that email to the correct receiver. There are two major MTA’s for routing email messages to the right receiver they are Microsoft’s MS Exchange and IBM’s Domino 8. Each is capable of routing email messages to a given address from a server.
Web portal

Email messages can be retrieved from an email server based with either an email client or a webmail client. Due to our two tiered authentication procedure, users will be limited to accessing their email strictly through a webmail client initially. It is recommended that this webmail client is only available via a Secure Hypertext Transfer Protocol (S-HTTP). S-HTTP is a protocol for encrypting data transferred over the internet (Laudon & Laudon, 2012). Additionally, the webmail application must connect to the user database and the access control system. Connecting to the user database verifies that the user is valid. Similarly connecting to the access control system users to login securely and access their email. Users must have the authority to delete files from their account. The webmail client will be accessible through a website. A website is a collection of web pages hosted on a server (World Wide Web, 2003). Websites have their own unique Internet Protocol (IP) address, which is access with a domain name. Domain names use English characters to correspond to the IP address (Laudon & Laudon, 2012). Providing a website requires a Domain Name Server (DNS) to point the domain name to the IP address (Laudon & Laudon, 2012). Building out the website and webmail client will require a webserver, application server, database server, DNS server, and database. This infrastructure must connect with the email infrastructure previously recommended.
Business Information Systems

Laudon & Laudon (2012) state that new information technology (IT) often changes how a business works and supports entirely new business models. The exact thing will be happening at USPS. The new IT will create a new business model for USPS. It will also change the way USPS works. This new way will need the support of business information systems. We will focus on management information systems (MIS), executive support systems, (ESS) and knowledge management systems (KMS).

A MIS reports on the organization’s current performance, allowing middle managers to use information systems to “monitor and control the business and predict future performance (Laudon & Laudon, 2012).” Digital dashboards are an option for displaying a graphical overview of key performance indicators (Laudon & Laudon, 2012). We recommend tools be used to display information regarding accounts created vs. lost, email messages sent, IT usage, troubleshooting issues and customer relations initially. This information will allow a manager to monitor key indicators for this service.

An ESS provides information used to make decisions for non-routine forward-looking situations faced by executives (Laudon & Laudon, 2012). This sort of system may help executives determine long term decision necessary to support this program. It is also recommended that this system uses digital dashboards. Considering the cost of creating the new email service, we recommend that these digital dashboards focus on the finances and overall profitability of the project.

Better knowledge about how to create, produce, and deliver products and services helps some firms perform better (Laudon & Laudon, 2012). To be effective, an organization’s KMS must “create, locate, capture, and share” the organization’s knowledge (Gopal-C.S. & P.A., 2011). Further, an effective KMS should help a company foster innovation, streamline customer service response time, eliminate redundant or unnecessary processes (Levinson, 2012). According to Levinson, (2012) not all information is valuable and therefore companies have to determine what information will be an “intellectual and knowledge-based” asset. USPS is no different. The new email service will require that changes be made to any current knowledge management system. At a minimum, employees will need to know how to use the employee application for creating accounts, troubleshooting problems on the various servers and the applications that run on them, and identity protection protocols. The infrastructure necessary to complete these business information systems include telecommunication networks to link non-collocated resources, databases to collect interrelated data, data warehouses to collect information over time that can be mined for later uses, applications to manipulate the data as necessary, and servers to store data and applications.
Business continuity and disaster recovery

The current disaster recovery and business continuity plan (DRBCP) will have to be updated to include protocols and procedures for this new system. Strategic and continuity management must be integrated in terms of: “planning processes, capability development and socio technical approaches, speed, configuration, resilience, and obligation (Karim, 2011).” The DRBCP should also prevent security policy violations. Typically disaster recovery procedures call for multiple copies of data to be created. Daily and weekly backups of data are taken to an off-site facility. Additionally, the nature of email creates multiple copies of data through the various servers and computers (Balaouras, 2008). USPS should adopt a DRBCP that ensures data is not and could not be transmitted in insecure ways.
It is recommended that the DRBCP for IT systems created cover the following areas:

Backup locations and procedures

Where are backup locations? What are the procedures for backing up data?

How much of the DRBCP will call for virtual backups of data? What procedures will be followed to switch virtual servers on if main servers fail? How is the data on virtual servers secured?
Event logs

How are event logs maintained? What information is captured in an event log? It is further recommended that the DRBCP include “Security incident handling steps, including escalation points of contact and procedures for preserving the forensic qualities of logical evidence (Camara, Crossler, Midha, & Wallace, 2011)”. This will put in place procedures to handle system hacks and vulnerability exploitations.
Section V: Management Strategy Each level of the Management team is responsible for a specific aspect of the product development and implementation of a new product or service, which in this case, is the development of an Information Technology (IT) to implement Internet based, Secure Email. The purpose of the plan, as stated, is to modernize the USPS operations through enhancements for an alternative for the delivery of mail and postage related products and services. Senior management’s agenda is to spearhead this pilot project in the Washington D.C. area within 18 months with a long-range goal of a total national forecast within the next five years. “The Standish Group consultancy, which monitors IT project success rates, found that only 29 percent of all technology investments were completed on time, on budget, and with all features and functions originally specified“(Laudon & Laudon, 2012). This initiative, from a management prospective will be approached pragmatically by not losing sight of our purpose, strategy and budgetary requirements.
In this plan, we will describe managerial functions within each of the divisions and break down the responsibilities as they relate to a scheduled timeline with specific attention given to three milestones; the rollout of the technology software, the marketing/advertising plan, and the training initiative of team leaders and data workers. “Almost every industry needs radical reinventing. The increasing complexity and globalism will require increasing teamwork to integrate the requisite forms of professionalism” (Dearlove, 2004). Investing in information technology requires management to consider the entire organization and the implications this will have at every level within the organization requiring teamwork and broad initiatives within the departments to attain our goals.
Our focus will be a business model utilizing the following timeline: the development of the new information technology (IT), its production and implementation, the marketing /advertising of the email system to over 600,000 customers within the Washington D.C. pilot market, the training of USPS employees and the delivery of the finalized product to the test market.
Senior Management:

The challenge senior management is faced with is how to modernize the failing Postal Service. It is currently faced with massive financial losses due in part to a decrease in revenue as a result of information technology initiatives by its competitors. The public has lost confidence in the mail system ‘as is’ because of its inefficiency and non-effective business practices. They instead turn to competitors who offer a reliable tracking system whereby you can follow a package from point of purchase to delivery over the internet at any time. The use of mail service has been diminished as consumers become more reliant on internet services such as e-commerce for electronic billing, online banking, online purchasing and a multitude of other facades of internet use. The decrease in revenue coupled with an increased overhead because of rising fuel costs, labor packages; and deterioration of facilities has led to financial hardships.
In responding to this challenge, we have gone before Congress and the Postal Regulatory Commission with creative ideas to develop alternative solutions for increased sustainable profitable growth for the USPS. “USPS issued an action plan and developed legislative proposals for changes needed to implement this plan” (GAO, 2011, P 29) “ The Postal Reorganization Act of 1970 placed requirements on delivery and retail access standards by mandating that the USPS provide “prompt, reliable, and efficient services to patrons in all areas and shall render postal services to all communities.” (GAO, 2011, P 32) USPS has received approval to move forward with initiatives that will modernize and improve the postal system and has made a commitment to achieve these goals through the development of information systems.
Middle Management:

Middle management’s responsibility is to ensure the implementation of the strategic plan as set forth by senior management. The first step toward this goal is a newly designed infrastructure developed by our IT department. This infrastructure needs to consist of a database providing all the information necessary for the successful implementation and operation of the business model. Additionally, IT should be capable of supplying data and tools to analyze the data supporting the new IT system and analyzing its reliability and success. The initial timeline will propose the email servers up and operational within 90 days for testing within a controlled secure test center. MIS will start-up this dummy test center utilizing this new software package for a 30-day period testing its reliability and troubleshooting any program glitches.
Security Validation:

The 30-day goal for troubleshooting at the dummy test center is an “ideal” timeframe with all tests performing as planned. In reality, Management will allow an unpublished window of 60 days for testing realizing testing is time consuming and there are many variables that need to be taken into consideration. Meeting timelines is a challenge because if a test fails, that is a setback that requires evaluation, correction and a new plan for implementation. Each setback is detrimental to the development as a whole and may require a new design plan. This can have a snowball effect in time management. Therefore, a successful management approach will incorporate flexibility in the timeline to compensate for unforeseen issues that arise in testing, such as, problems with hardware, software, compatibility, production or a variable of other maintenance and operational issues. There are many layers of gateway security that must be tested to ensure the site is ironclad and cannot be compromised. Once the USPS is confident that the systems firewalls and data DMZ are secure, the technology for the implementation of the secure login system will be tested. Data needs to be analyzed to ensure operational security as planned. After all glitches are resolved, the product will then be presented to upper management for final approval before a production run is set. Milestone #1 the design and development of the newly designed email program, has been achieved. The production and delivery of the email initiative can now be prepared for deployment into the pilot program.
Sales and Marketing:

During the last six months, the Sales and marketing departments were each developing plans for introducing the new improved USPS. These plans demonstrate the benefits, convenience, security and efficiency of the secure email enhancement. They detail the attributes of using this secured system compared to traditional non-secure mail. The direct approach of implementing this improved USPS to the public will be utilized capitalizing on the public’s pride in the ‘United States’ thus their U.S. postal system. By personalizing the new pilot program, the intent is that the public will feel ownership thus empowering them to support the USPS. The timeline for initial presentation of the marketing plan to Senior Management will be 180 days prior to release of the new USPS enhancements into the Washington D.C. pilot test market. Review, fine-tuning, redesign and resubmission, if necessary, should be completed within 45 days. Production schedules require a 60 -day window for production and delivery of the marketing media. Pragmatically, this timeline will allow ample time to accomplish all tasks within planned timetables even allowing for unexpected delays or glitches.
The target group for the marketing plan is the 600,000 customers in the pilot test market. Through the utilization of various media such as television ads, radio advertising, billboards, mail flyers placed in post office boxes and individual mailboxes, mass internet email advertising and various social networks the market will be flooded with knowledge concerning the new USPS. The team in determining their advertising strategy developed a budget for the purchase of advertising slots. With this budget set, they proceed to purchase advertising on television and radio media optimizing public support and awareness. Milestone #2, the advertising campaign, will be scheduled for release 60 days prior to the implementation of Secure Email to the Pilot Test Market in Washington D.C.
The sales team will develop a product line of services and products that are available as a result of this technology. Internet access of postal services will bring about a new way of conducting business and offer services that were physically impossible in the old system. Real time delivery of email will offer immediate solutions to problems. Efficiency and reliability were key elements that had deteriorated in the USPS and have now once again been achieved.
Human Resources:

Human Resources, utilizing an indirect approach to management, will develop a global announcement introducing the new information system to employees. The timeline for this announcement will be within 30-60 days. The announcement will deliver a positive message presenting a management determined to developing and implementing a plan that will promote the growth of the USPS. It will briefly summarize the positive attributes of internet technology and how it will improve customer service and enhance job performance. We will encourage employees to become part of the solution and join our team in creating a new improved USPS. While acknowledging change will be a necessary component of the proposal, we will assure employees that management is determined to provide support and guidance through all phases of this new and merging USPS. Our goal in the training process is to provide employees with the knowledge and understanding of the data systems so they can provide excellent customer service. Human Resources in collaboration with the IT Department will develop and implement a training program through the use of ‘knowledge wires’. Knowledge wires are training tools developed to teach product knowledge to the employee through the use of the internet and simultaneously test employee understanding of those applications. This plan will include segments for troubleshooting and utilizing technical support.
Meetings will be conducted in small groups by Human Resources. They will address employee concerns involving the modernization of the USPS and how it relates to their employment. We will establish an organizational chart demonstrating employment opportunities and the knowledge and training opportunities that will be available for individual growth within the organization. We will encourage employees to embrace change and grow with us as an organization. Milestone #3, the training program, will commence 12 months prior to the implementation of the new enhanced USPS’s introduction into the Washington D.C. Pilot Test Market.
In addition to the training program, Human Resources we will develop a support group for employees who leave the organization. This plan will offer training in resume writing, assistance in finding employment opportunities, relocation assistance, retirement planning, exploration of educational opportunities and any other areas of support that are relative to employment.
Human Resources will also develop a plan to attract new employees. Attracting experienced knowledge workers within specialized fields will enhance IT development and implementation of the various components involved in training employees. Employees that are knowledgeable in computer sciences would be a valuable asset. By offering incentives, employment benefits and advancement opportunities in a new area, the USPS may attract valued employees away from competitors.
Operational Management:

Operational Management is responsible for monitoring the implementation and breakout of the email system on a daily basis. These employees will be interacting with customers, answering questions and addressing concerns in person, via phone and via internet based help screens and tutorials. Improved customer service will directly affect revenue since consumers who are treated professionally by knowledgeable staff will be return customers. Team leaders will monitor and work closely with the customer service department to ensure compliance with all federal regulations. This department will be manned 24/7, which will allow customers access to USPS services globally at any hour of the day regardless of their physical location or time zone.
This 18-month pilot program in Washington D.C. is an invaluable asset to the USPS if managed and implemented successfully. The 5-year plan to expand the IT design nationally will move forward at an unbelievably fast pace with the goal being 10 states a year until full national implementation is achieved in 2017. Global implementation will be the next phase of development and will incorporate additional security requirements to meet global standards.
Section VI: Budget Requirements
Budgeting the New Implementations

The largest public enterprise in the USA is the United States Postal Service (USPS), which handles up to 40 percent of the world's mail (Boronico, 1997). USPS is anticipating implementing new changes and creating a service that will offer higher security. The USPS, from an accounting viewpoint has stability and “The USPS is obligated to provide a uniform price and quality to all Americans, irrespective of geography” (Carbaugh & Tenerelli, 2011). For the following reason, when considering price increases, USPS has to fully consider the effect the changes will have on its customers. USPS is considered to be a strong company financially, and is ranked near Wal-Mart for the number of employees. Budgeting seems to be a complex and not so easy process, when speaking about such a large and wide company, having offices in all United States, beside, they represent the value too. Competition is increasing with giant steps. FedEx and UPS are offering a better service, in a shorter period of time. The most common issue with USPS is the fact that the prices don’t justify the service. Even thought they offer a reasonable price for mails, the service that the competitors do, is better and definitely is trying to flank the USPS market. Issues with the cost and prices have started to appear and the need for change is always more and more. Change to a better service; offer the “thing” that will bit the competition. “Not only has the revenue of the USPS been declining, but the trend of its operating costs is upward. A key driver of the cost of delivering mail is the obligation to deliver to virtually every mailing address, regardless of volume, six days a week” (Carbaugh & Tenerelli, 2011). The business is slowing down, the costs are going up, and the only solution is INOVATION. “Wages and benefits account for 80 percent of USPS costs, a percentage that has remained steady over the years despite major advances in technology and automatic postal operations” (Carbaugh & Tenerelli, 2011). Employees are not getting more for the work and based on the inflation rate, their wages should be up. These concerns are the main points for this project, dealing with the prices of new implementations; new equipments they need to achieve the final goal; present the secure email and increase the revenues. After a study of the market and a deep research regarding the main equipment that will be needed, the company is anticipating to journalize as equipment expense $ 13,378,426, a considerable amount that will act as an asset and create revenues (see Table 1). Table 1

Product Term Cost Quantity Total cost
Barracuda Networks 1050 Message Archiver One Time 1 time 227996.99 34 7751897.66
Barracuda Spam and Virus Firewall 1000 with 3 Year Updates 1 time 225134.99 1 225134.99
Barracuda Spam and Virus Firewall 1000 with 3 Year Energize Updates 1 time 86546.99 60 5192819.4
The WatchGuard™ XCS Brightmail 2 years 58574.42 1 58574.42
Secure Remote Access VPN Gateway 10000 15 15000
Total cost 13378426.47

Table 1: Illustration of Costs for Implementation of Proof of Concept EagleMail Plan

EagleMail will be free to read/receive and USPS will charge senders 4 cents per email message. This price is subject to change in the future with changes in cost, but for the first year, the service will maintain a fixed price. This will attract customers, will create more sources of income and definitely will affect the USPS balance sheet. According to Boronico (1997) “The determination of optimal prices together with cost-efficient operating policies and high levels of reliability are clearly of immense importance for postal services throughout the world. “Although its growth has slowed recently, and even reversed in some service categories, the USPS remains a very large organization” (Grifell-Tatje & Lovell, 2008) and also is considered as monopoly, which helps it create and “play” with new innovations. Grifell-Tatje and Lovell (2008) describe some of the challenges contributing to the challenges faced in the USPS balance sheet that should improve with the adoption of EagleMail:
“The inability to compensate for the cost of input price increases with revenue-enhancing postal rate increases has reduced operating profit by nearly $100 million annually since reorganization, and by $365 million annually since 1992. This poor price recovery may reflect an inability of the USPS to contain costs by bargaining effectively with its input suppliers, particularly labor, whose price effect has dominated the input price effect throughout the period. This may also reflect an inability of the USPS to enhance revenue by persuading its regulator to grant postal rate increases adequate to cover increases in its inflated operating cost in a timely manner” (2008). The main reasons we believe that the low price of EagleMail will generate profits is that in examining the USPS balance sheets and the income statements, we observe that the profitability is not too low, and take in consideration the fact that it will be the first company to present this new service, there is demand and likely a desire by businesses to adopt the service, as well as the attraction of the USPS brand which is a very powerful intangible asset. Capital budgeting is a big help when planning the budgets. By evaluating the costs and the benefits, USPS will achieve to generate a considerable net income. Cash flow is the statement that will reflect all the income and expenses, grouped in, based on where they are spent. This will offer valuable information about internal and external users. Internal control is anticipated to become more reinforced and organize the jobs, according to the law. After implementing the changes and evaluating the costs, the ratios will define if the profitability is good enough, and the standards are arrived. ROI (Return on Investments) is expected to be more than last year value. Evaluating the risk will be another challenge. Supposing that USPS is acting in a competing environment, the risk of low returns is high. Based on the high risk, finance and management should pay attention to the prices of competition, the time the product should be in the market, the technology issues that could have and be prepared for additional costs.
Cost benefits and models to evaluate the cost and assets.

When a new system is implemented, many changes should be expected that will affect the company and its financial statements. Evaluating costs of any new system is one of the major problems faced, particularly when dealing with technology and innovations not yet used by a company. USPS is anticipating creating a secure email service that will offer higher security and that will require radical changes in the IT department. These changes require costs but also have benefits that will be translated into revenue if the service is adopted and utilized. The final goal is to measure these costs and evaluate all the opportunities USPS has to grow financially and maintain a stable position in the market. Considering the competition that exists, even if based on best case scenario estimates, this will be a cost-benefit war and the methods should be well defined in order for the company to have a clear focused effort and success in the endeavor. The model we are evaluating is the capital budgeting and will help us determine the cost and benefits for these new implementations. These models use, as an input, the cash flow information (a very important financial statement). According to Kimmel 2012, the cash flow statement gives the internal and external user valuable information about the cash in and cash out, used by the company during a certain period of time, usually a quarter, half a year or a fiscal year, and presents all transactions that use cash. Inflows and outflows are the information used in the capital budgeting evaluation, even though the estimations are based also on credit sales. What USPS will try to achieve, is a calculation of all additional costs related to the new service to include: new software and equipment purchased, staff needed to implement the new technology, and all the face to face and webinar training. After taking into account these adjustments to the cost, the benefits from the new IS system can be fully evaluated for use in making that decisions relate to a full implementation of EagleMail. Of course, whenever changes exist, and in technology field even more, it is difficult to forecast exact numbers of costs for a future system. This difficulty in estimation is the purpose for the confidence factor in expressing the risk and the possibility the pilot plan could succeed. All the benefits in revenue are shown to increase in following years, and while at startup the implementation cost will result in losses due to the high operational cost and the high equipment cost, these will be depreciated, according to the GAAP standards and will be used as long term assets, generating revenue for several years. We anticipate receiving a reasonable ROI for the first year, and even more in upcoming years (Laudon & Laudon, 2012).
Is the project at risk?

Evaluating the risk is crucial for any project. The more the company invests in unpredictable fields, the more risky the investment is considered. USPS is anticipating a moderate risk evaluation, for this new implementation. The plan requires purchase of costly new equipment, the need to attract increasing numbers of clients to succeed in the secure email market, and expects to realize high levels of revenue in the upcoming years. Beating competition is never easy, even when considering that USPS has an established operation, many years operating in the market and a stable financial situation until recently. The risk of any activity depends on many internal and external factors. Although the benefits of this new service will bring more security and convenience for consumers, USPS has to assume a fair amount of risk in an effort to offer a better product, and in so doing result in a positive change in market position for the USPS. Costs include all the new purchases that are expected to happen for the pilot program including: servers, routers, virus firewalls, message archives and security monitoring equipment. This equipment will make it possible for the company to launch EagleMail, and charge customers 4 (four) cents per email sent (similar to a stamp, but far less expensive). In doing so, EagleMail will generate income that will justify the costs of implementing the system in future financial reporting periods. These revenues will allow the operation of the secure EagleMail system and make possible reliable and secure communication able to be sent/ received in real time by the masses staying in line with the mandate that USPS service be universally offered. After measuring the number of people this system will include and after determining the cities it will be implemented at first, we came up with the following risk dimensions:
Project structure will be very high tech, servers and equipment used will the most cutting edge technology, using wide DBMS and cloud services, and the new structure will definitely offer more security and quality. The service will be better in every direction and will generate more income and will cover the costs of operations. Using remote email servers and storage will make the system flexible and adjustable to the customer needs. The staff will be trained to use the software and register the customers quickly and efficiently as well as provide a quick tutorial on its use. This will create a simple program to run and to manage, so the risk will be lower than using a new service where users lack clear ideas of what they can expect from the service. The new IS system will have clear procedures, will be well-defined and will be introduced by trained personnel, so is calculated that the risk will be moderate.
Project size will be small at the beginning, involving 600,000 users during the pilot period and growing in number of customers, with a 25% increase in number of users and more than 45% increase in volume of messages within the first two years. The size of the IS plan will begin quiet and slow, so the employees can have the opportunity to absorb the changes, adopt to the new management technology systems and train each other in effectively. This will give USPS the opportunity to create a stable and solid system to work with, where employees will be able to implement the changes and gain for them, making their job easier while offering better service. This is considered as a moderate risk also, because of the size and the gradual growth of the project. This implementation can help USPS assimilate the changes gradually and assume less risk.
The experience with technology is vital. USPS is currently using Oracle account receivables, for their employees Postalease, RDM as a customer service tool, DBS national controller and all the necessary IS to operate the mail service. The organization is familiar with the use of IS, being that the Postal Service is a service that is based on technology. Given these factors, the risk of the project will be low or moderate, taking in consideration the prior systems used and the fact that the trainings will be offered continuously.
Using the risk dimensions and the area the company will be affected, helps us determine better the possibilities USPS has to make this pilot plan a success and be accepted by the majority of employees and customers. The goal is to reduce the risk and put as much financial capital as is possible in secure investments.
What are the benefits?

Defining benefits, means to have calculated the tangible and intangible assets the company will spend on a project, those assets that generate or are expected to generate profit in a certain period (Kimmel, 2012). USPS, being in the market since 1775 (USPS, 2006), has become a real necessity for Americans. For a long time physical mail was used as the only way to keep correspondence with each other. The good name and the service quality associated with the USPS for those many years are providing revenue now and will continue to do so. Based on the effect the new system will have, we categorize the benefits as followed:
Tangible benefits
Intangible benefits There will be product utilization in levels higher than before if the customers start using EagleMail and see the benefits of the service. A good marketing strategy will help the company spread publicity and use of the web page to increase market penetration will both increase revenue. There will be a reduction in work force, after the training period, the IT department will be left with specialists and people who can handle a lot of duties and because a lot of services will go to the cloud, the service provider will have to fix and also pay for the costs. It is anticipated to have fewer defects and the new equipment will last more and won’t require updating very often. Benefits will be seen also by the decrease in operating costs, considering that fuel, power, rented facilities, wages and other expenses will be lessened. This will lead to a better income statement and an improved cash flow. According to Mukhopadhyay & Srinivasan (1997), IT improves quality which in turn enhances output, and therefore increases revenue. Intangible assets create revenues and make their own contribution to the company; we will define them as composed by the positive brand recognition of USPS, higher satisfaction in services provided, and better work processes and motivation of employees. Clients will be better served and will reflect satisfaction, related with the better image of the company. Keeping the name and being a representative of a service is not easy, USPS has tried hard to keep its position in the market, so more changes will be made and the more nimble the USPS will become through better organizational planning, improved payroll services and digitalized CRM and creation of databases allowing every user to find the information they need. All of these assets are considered part of the company; they will create and generate benefits for USPS, making it possible to lead the market, in offering a secure email system while maintaining the traditional services that have defined the USPS for over 200 years. References
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...Migrating to a Standardized ERP System in a Cloud Computing Environment at ABC Corporation Barbara Ferneyhough Managerial Applications of Information Technology – IS535 (ON) Section B DeVry University, Keller Graduate School of Management December 11, 2011 Course Project Example used with permission from student Migrating to a Standardized ERP System in a Cloud Computing Environment at ABC Corporation Proposal Topic This proposal discusses the use of multiple financial systems throughout ABC Corporation (ABC), the impact that this has upon effective corporate operations and proposes a solution. ABC maintains four different ERP systems (BaaN, PeopleSoft, SAP and Deltek) and a financial consolidation system (Hyperion) across all of its divisions leading to increased IT costs as individual systems must be procured, maintained, and manipulated to provide financial data in a format that is meaningful to the home office for reporting and strategic management purposes. Not only is this a potentially inefficient use of technology, the use of a non-standardized system impacts the ability of management to obtain, manipulate and interpret critical data elements for strategic planning purposes and regular performance monitoring. Problem The business problem to be solved is how to improve operational efficiencies, reduce IT costs, and improve insight into the financial management aspects of the company for improved strategic planning and performance monitoring. ......

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