This kind of behavior is exactly why those of us at FedEx Express don't have a sunshine and rainbows opinion of our compatriots at Ground.
We take pride in our handling, tracking and movement. Ground doesn't really seem to care. They do make money, but it's based on volume, not a reflection of their service metrics.
I should note that the Smartpost program supposedly ended and that volume was simply absorbed into the FX network. Probably a good thing, since it seemed to have pretty poor results in terms of on-time delivery.
One is a premium service with a long culture of excellence; one is a commodity, a ground operation that was built onto what was RPS (Roadway Package System, itself an addition to an LTL trucking carrier, Roadway). (Not to besmirch RPS, which was trying to do an innovative ground-up competitor to UPS Ground; for example, it invented the bar-code-sorting of ground packages.) RPS/FedEx Ground started out as a business-to-business-only service (Ground), then set up a whole additional last-mile delivery network to do homes (Home Delivery). FedEx has done a lot to improve Ground's reliability, and it has a number of lanes in which it is faster than UPS; I use it all the time during the year and am amazed that I can ship a package from NY to, say, New Hampshire, and it gets there the next day at a Ground price. And with my discounts, it's a lot cheaper than UPS. But it apparently doesn't have the redundancy or culture -- both of which cost money -- to handle a surge as well as Express does. I think most people think Tom Hanks in the opening of Castaway when they think of the culture at FedEx Express; probably not so much at Ground.
SmartPost was actually previously a division of Quad Graphics. Workshare with the USPS was actually a great idea, but executed in a mediocre way by SmartPost. They had the worst label of the Workshare partners; they didn't place it in a consistent way on the package; they were constantly over-labeling, etc., etc., and in a big operation, these little details affect reliability. There are published stories of automated USPS equipment sorting the Smartpost-label packages onto routes back to the sender because of the label design, thinking that the return address was the addressee, only to be pulled by a human and sent back in the right direction, only to be sent back again because the equipment was reading the return address as the addressee. Oy. So not to cannibalize their own services, and to keep costs low, many Workshare folks didn't/don't go out of their way to eliminate the extra day that transferring to the USPS takes. (Amazon, OTOH, cuts that day and gets the parcels to the local DDU by the morning cutoff time (usually 7am), so there's no extra-day delay, and thus uses an inexpensive last-mile in a premium way.) SmartPost had its own ground line-haul network until a couple of years ago, when someone finally realized that it would go faster and much-more-reliably on the Ground line-haul network. But that was a problem, too, because the stuff would come to say, Keasby, NJ (a big Ground node), then have to be hauled over to the Smartpost sort center, which would add a day despite them being less than an hour apart. Finally, the operations were better-integrated, and, like at UPS, a parcel can be pulled from Smartpost and delivered by Home Delivery if cost-effective, making the Home Delivery providers happier. If SmartPost goes away entirely, that would probably help FedEx reputationally, but open a little bit of an opportunity for folks like DHL E-commerce, which continues what was once Airborne At Home, and Newgistics. The latter was bought by Pitney-Bowes, the postage meter people, and has been emphasizing, of late, easy e-commerce returns over original delivery, but apparently still does both. I always thought that Workshare was a great idea if executed correctly, and Amazon is really the only company (after Netflix in the old DVD days) to use it super-effectively. (Netflix was once USPS's largest customer, and they hired a retired Postmaster General to optimize their outbound and return USPS interactions, and the dang thing worked pretty-amazingly and lightning-fast.)