The difference in Investment strategy between FedEx and UPS
FedEx in comparison to UPS focuses more on operating independently. The management in all its companies is given the freedom to make independent decisions to deliver the best kind of service to its customers in their consequent markets. They, therefore, end up serving more people using a wider area of service. FedEx has got two main focuses in terms of how they have brought about change; these are operations and strategies. In looking at operational changes, we realize that the company has implemented newer systems, structures and has adapted more recent advanced technologies to improve its business strategies. Strategic changes that they use include a recent vision statement that is more focused.
On the other hand, the strategy adopted by UPS involves great investment in partner businesses of distribution and logistics, creative use of technology, the attraction of talent, and encouraging innovation. In addition, UPS has a business strategy that focuses on the customer (Levy, 2001, para.2). It aims at studying the demand and behaviors of the customer so that to improve its services to its customers.
In my view, FedEx is more structured and more advantaged compared to its competitor. This is because; as much as one would want to make the customer more comfortable, FedEx’s structure enables them to reach out to more, thus increasing its customers. The fact that the companies run independently gives them more freedom to analyze their customers’ tastes and needs. This makes it easy to enable them to supply their customers with what they require. In addition, their products are designed according to their customers’ preferences; thus enhancing their satisfaction.
FedEx’s “move communicate and shoot” strategy
Considering that the company is the top amongst its competitors, the company has decided to take up this challenge as a means to keep it ahead of its competitors. This strategy is simply a move that will see to it that the company does not stall on its investment in technology. The reason why this is a good strategy for FedEx is that it is the only available way to keep on top. Its focus on innovation rather than copying what others do to hang on top makes it the only way to survive. The CIO explains that they spend more than $1 billion just on technology (Colvin, 2006, p.2).
Sincerely speaking, it is a rather ambiguous plan for other up and coming companies and the reason is that these companies may not have enough resources in terms of information, humans, and finance to purely invest in such a way to make them a top brand. It is more sensible for such companies to take time and reach a competitive place at which such ambiguous strategies as these would become of effect.
By saying that his company is “in the business of engineering time” the CIO of FedEx tries to imply that his company is trying to create products or services that will assist its customers to get their different work done within the timeline they were supposed to (Colvin, 2006, p.4). I would want to believe that this is a good strategy seeing as time seems to be of the essence for virtually everyone in this shrinking and changing world. People would love to have jobs done faster and in a more efficient way. Anything that would make this happen would be highly welcomed. IT assists the group work more effectively. Its main task is to offer communication solutions to other businesses. In an example, FedEx can be able to provide tracking systems for a company’s cargo in three different fields: The internet, the website for the company, and finally, shipping software created by FedEx.
Analysis between FedEx, UPS, and DHL
For FedEx, services provided range from transportation of parcels, various business services, and also e-commerce services. It also provides shipping services, air cargo distribution, and also custom clearance services. It has revenues worth $33.16 billion as of 2009. In addition, it extends a service that offers 10-20% discount using certain American delivery services. Stock prices are high for the company at 107. An increase of $500000 since 1999 reveals the extent to which it’s doing well. It has a P/E ratio of 27implying that the company is getting more and more internet affiliated.
As for DHL, revenues stand at a high of $33.1million. This has been a drop from $44 billion with other numbers reading as follows: Operational expenses are at $54.2million and gross profit is at $9.8million per year on average. UPS concentrates its delivery overseas as it does more mail delivery, feeding over 70million people per week. In addition, it also provided outsourcing for mail.
Finally, we have UPS. The revenues thereof are at a high of $78 altogether. Nevertheless, it has been making losses of$2billion as of 2009. Other figures include annual expenses of 64million per year and shares of the company going at $2.31 per share. Just like FedEx UPS concentrates its delivery on overseas shipping, with an expanded luggage shipping structure. Custom clearance services and air transport of cargo are also common features of UPS.
FedEx War on terrorism
It is quite attractive for any terrorist organization to transport its devices (for example bombs) through some of these services provided by the company. Nevertheless, the CIO makes it clear that the chains of services that are owned by FedEx are a bad place to have vices like that going on. The company keeps a record of its usual customers; therefore anyone coming in as a new subscriber to this service must pass through a series of checks to ensure safety and top-ranking security. The CIO also explains that the company works closely with the DEA, FBI CIA, and other anti-terrorism organizations to curb the vice (Colvin, 2006, p.4).
Reference List
Colvin, Geoffrey. (2006). The Colvin Interview: The CIO. C-Suit Strategies.
Levy, Mitchell. (2001). Case Study: United Parcel Service, Inc. (UPS). PeachPit.