FedEx Case Study
Was Written on June 20 2020 for MBA 512 Strategic Management Class at Stony Brook University
Discussion Question #1
Do FedEx and UPS offer the same delivery services, or has each chosen to focus on different forms of delivery and/or customer needs? Explain.
When Fred Smith founded the company in 1971, he was the first person to establish the overnight delivery concept and contributed to the consumer-relationship advancement. The company has been doing exceptionally well going internationally and redefining the supply chain phenomenon in the world. (Parnell, 2017)
The differences between UPS and FedEx lays on three dimensions, according to Simmons (2017), FedEx uses multiple networks (express, Ground, international), while UPS only utilizes one. Also, the employees for FedEx are all union, but at UPS they are independent. Lastly, FedEx is using independent contractors while UPS uses employees for all services.
From the differences above, one can infer that FedEx is used for different functions such as international shipping, or express. Also, businesses are more likely to use FedEx because of the option of branding their company with FedEx.
I believe the target market remains the same, and the locations of the companies are also similar with not one dominancy over another.
Discussion Question #2
The Internet has alleviated the need for overnight delivery of many documents. How has FedEx survived and even prospered amid this key technological change?
According to Fedex.com, the company is sacred in providing the time-definite service. The website also claimed that FedEx continually developing innovative technologies. For example, the company invented the system - COSMOS (Customer Operations Service Master On-line System). “Is a computerized package tracking system that monitors every phase of the delivery cycle at Federal Express. FedEx employees constantly input information into COSMOS by several means,”.
It seems like FedEx has been doing a good job of staying relevant and maintaining a good reputation among the older and younger generations. The company is present on all social media platforms as well as old fashioned ways such as in-store services, and call centers. The tracking code is systematic and up to date and the service tends to be positive.
Discussion Question #3
Should FedEx be partnering with the U.S. Postal Service, a key competitor, and a protected government entity? Why or why not?
Yes. I think that FedEx should learn from past mistakes and find partnerships that can help the company move forward all while maintaining a plan B in case USPS returns to be competition rather than a partner/customer.
For example, in October 2019, Amazon became a FedEx competitor rather than a customer. Amazon used to be FedEx number one customer, but then the company decided not to renew its collaboration contract and founded its own shipping business taking over the consumer shopping habits worldwide.
In my opinion, Amazon’s growth has been witnessed and expected - FedEx should have seen it coming! Amazon has grown to become the primary shopping source of most people for everything, FedEx should have prepared for this crisis and come up with a game plan - something to keep its head above water.
However, to FedEx defense - the CEO seems to handle the crisis optimistically -expressing humor in his media comments. For example, he tweeted, "Ho!Ho!Ho! Have a Fantastical Holiday everyone!!!” with a photo of an Amazon Prime branded jet model.
Ziobro, P., 2020. Fred Smith Created FedEx. Now He Has To Reinvent It.. [online] WSJ. Available at: <https://www.wsj.com/articles/fred-smith-created-fedex-now-he-has-to-reinvent-it-11571324050> [Accessed 18 June 2020].
Parnell, J., 2017. Strategic Management: Theory And Practice. 5th ed. The University of North Carolina at Pembroke: Academic Media Solutions.
Simmons, M. (2017). The Differences Between FedEx and UPS: Comparison | iDrive Logistics. Retrieved 18 June 2020, from https://www.idrivelogistics.com/differences-fedex-ups-comparison/
FedEx Global Home - Select Your Location. (2020). Retrieved 20 June 2020, from http://www.fedex.com/