UPS’s alternative-fuels fleet as a response to trends taking place in the company’s general environment
Every country exists in a constantly changing environment that can be subdivided into the internal and external layers. The general environment is a part of the external environment and consists of international, technological, natural, sociocultural, economic, and legal/political dimensions. Even though the general environment does not immediately affect a company’s every-day operations, its influence requires effective measures as responses to shifts in its trends. Today’s society, technology, and the international situation dictate a shift towards alternative types of fuel to reduce the emission of greenhouse gases and UPS acknowledges the tendency.
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All the dimensions dictate the company’s decisions in one way or another. The discovery of massive shale gas fields can be attributed to both the international and economic aspects of the general environment, as there is no need to import the fuel and it becomes a lot cheaper to use LNG. Moreover, the US has a reliable network of fueling stations, which serves as an additional argument towards replacing diesel vehicles.
The U.S. Environmental Protection Agency (EPA) offering subsidies to companies that turn to more environment-friendly business models can be treated as a legal/political dimension supporting UPS in its effort. Technology also helps, as new engines running on LGD with full horsepower were created. In short, all the aspects of the general environment govern the company towards adopting a trucking fleet running on alternative fuels.
The central driving force for UPS to turn to liquidized natural gas (LNG) is the influence of the international, socio-cultural, and natural dimensions of the general environment. People all over the world are beginning to realize the impact of business on global warming. The international society and citizens of the US call for big companies taking responsibility for emitting too many greenhouse gases into the atmosphere, contributing to climate change. The company states that its top priority is doing what is right to the society and environment while staying economically prosperous. Such statements support the overall approval of the company and attract new customers.
UPS using boundary-spanning roles to adapt to energy-related uncertainty in its environment
Boundary-spanning roles are vital for companies to address the issues of the constantly changing external situation. Boundary spanners are useful, as they collect and process information about the trends of the environment and represent the company’s interests to the public. UPS is profound in using boundary-spanning roles to deal with energy-related uncertainty.
First, assigned employees constantly search for innovations in the sphere and evaluate the economic impact of utilizing new types of fuel. Due to the findings in the Marcellus Shale region of the United States, the transportation managers faced the situation, where the natural gas supplies had grown considerably, and its price had gone down. In this situation, the negative impact of the barriers between the company and the outside environment was successfully mitigated by boundary-spanning roles. As a result, the affordable supply of domestic clean energy made the designated employees suggest turning to LNG.
Second, the fact that UPS was not alone in its effort to start using natural gas is an illustration of how boundary-spanning roles in the form of business intelligence influence a company’s decision-making process. It may be the sign that these companies collaborated to obtain information about the possibility to adopt a new fuel policy. Even though it is not directly mentioned, this is an example of blurring the lines between companies to unite their efforts in a mutual goal.
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Third, UPS employees in research scanned for technological innovations and introduced the newly developed LNG engine that could perform in full horsepower emitting 25% fewer greenhouse gases. This boundary spanning resulted in the company buying 48 LNG trailers that could result in spending less money on fuel. Even though the company spent considerable resources on buying tractors, other research showed that UPS could offset that expense through government subsidies.
Lastly, UPS assigned designated employees to communicate with society to share corporate values with the public and get their opinion about the matter. Scott Wicker Kurt Kuehn played boundary-spanning roles while stating the company’s priorities to the community. In summary, all the examples described above prove the fact that UPS used the management tool appropriately to achieve their goals.
UPS’s clean fleets initiative illustrating the concepts of sustainability and corporate social responsibility
The clean fleets initiative is an excellent illustration of sustainability and corporate social responsibility. Corporate social responsibility is defined as an obligation of organization management to make decisions and take actions that will enhance the welfare and interests of society as well as the organization. While this definition may seem ambiguous, as there are no criteria set to distinguish between what is beneficial for society, it can be used regarding UPS’s project.
The central issue with social responsibility is that it includes many stakeholders. While decisions may serve the interests of one group of people, they may be disruptive or unacceptable for another. However, the innovation introduced by UPS does not seem to interfere with the interests of any part of the US or international society. Turning to environment-friendly undoubtedly contributes to the social concerns and well-being, as it preserves the Earth for future generations and lets the US citizens breathe with cleaner air.
Corporate social responsibility, however, does not end at reducing global warming. All companies must account for their duties on four levels: economic, legal, ethical, and discretionary. Therefore, UPS made sure that its new initiative would be lawful and would not prevent the company from contributing to the global economy and be able to pay the employees.
Saving the planet for the needs of descendants also adheres to the concept of sustainability. Sustainable development is described as economic advancement based on generating wealth minding the demands of the external and internal environment. In other words, it is making a profit and securing the future possibility to stay financially prosperous. This concept acknowledges that damaging the environment and acting against the interest of the community may disrupt the company’s ability to remain profitable in the long perspective. Therefore, UPS adopted the initiative to control the emission of greenhouse gases to preserve nature and follow the current trends to serve the interests of the public.
Even though sustainability aims at serving the society, the primary goal remains to stay economically prosperous. Minding the bottom line is crucial, as it makes the company stay on the market. Therefore, UPS created a position of chief sustainability officer (CSO) that was in charge of finding the balance between the two priorities. The CSO evaluated the initiative and examined if it was viable and should be implemented. Even though it was evident that preserving the Earth contributed to the well-being of the society, the economic feasibility of the project was doubtful. As a result of a thorough analysis, Scott Wicker stated that UPS could compensate for the considerable expenses on new vehicles with government subsidies and natural-gas-related fuel savings.