An incentive/penalty scheme has been agreed for INTERCONNECT Premium and Standard parcels heavy and light services for 2018 – the first ever end-to-end pay for performance scheme. The financial elements of the standard letter packets incentive/penalty scheme are currently up for decision.
IPC payment reports for INTERCONNECT Premium and Standard services are now in the testing phase and should be operational by end of year. These reports are needed to provide the KPI scores that will be used by postal operators participating in INTERCONNECT for calculating penalties and preparing their invoices for remuneration. Reports for parcels for 2017 are being developed and tested in parallel and will be released soon.
Posts can test the reports using INTERCONNECT items as well as with legacy volumes. The inclusion of legacy volumes in the testing also enables posts to do a simulation of the effect of transferring volumes from legacy links to the INTERCONNECT network. This simulation will give the participating posts a better idea of what the transfer will entail.
IPC payment reports will cover Premium and Standard items separately, looking at the volumes and penalty KPIs by service level, the type of item – parcel or letter packet, the tracking method, and the weight category.
Penalties and incentives concern both the delivery service performance (timeliness of delivery) and the provision of data (tracking events). The reports per country will include the number of items with an outbound/inbound duration greater than the agreed standard for that item and the percentage of those items compared to the total report volume. Reports will also look at the number of missing and late transmitted mandatory tracking events and the percentage of total tracked events.
Undeliverable returns to sender, mis-sent, misrouted, return service items as well as invalid items will be identified and excluded from the main report and part of separate reports.
Participating posts will be able to access the reports online through the INTERCONNECT Business Intelligence reporting system, IPC Insights.