Case Study: UPS vs. Federal Express
Uploaded by tamii on Oct 26, 2011
Abstract: This paper is a case study of the two giant delivery companies. It follows the format of a standard written case analysis, beginning with an Executive Summary and following that with a Situation Analysis, Financial Analysis, SWOT Analysis, Strategic Alternatives and Recommendations. (16 pages; 5 sources; MLA citation style.
Case Study: UPS vs. Federal Express
I Introduction
Both United Parcel Service (UPS) and Federal Express (FedEx) are successful package delivery companies. Over the years, they have “see-sawed” back and forth, with first UPS and then FedEx holding the top spot. This paper examines the rivalry between the two, their strategies and policies, and other aspects of their operations. It follows the format of a case study.
II Executive Summary
This report analyzes the on-going competition between UPS and FedEx. The situation analysis explains the “see saw” battle going on between the two, with first one, then the other, more profitable and popular.
The financial analysis reveals that both companies are stable and profitable, though at the present time, surprisingly enough, UPS is out-earning its rival.
The SWOT shows that both companies have strong corporate cultures, which have proven to be both strengths and weaknesses. UPS’s rigid structure kept if from developing its IT capabilities until recently, yet allowed it to survive the challenge mounted by FedEx. FedEx, on the other hand, charged ahead with a “can do” entrepreneurial spirit, but entered into several business ventures that ultimately failed. They might have done better to be as cautious as their rival.
Both companies are threatened not only by one another but by the possibility of new competitors entering the package delivery arena, which is extremely competitive. They also face threats from such widely divergent factors as the uncertainty of fuel prices caused by the American invasion of Iraq, and their enormous fixed costs. But opportunity certainly exists, particularly in new markets, and in that situation, specifically in China.
The strategic alternatives section touches on the problems that FedEx has created for itself by scheduling its flights to the second, literally. A one-minute delay at an airport will throw the entire schedule haywire, which is unacceptable.
UPS is also “clock watching” but in a different way: it focuses on telling its employees such things as which foot to use to get into the truck, and how to fill out forms while walking back to the vehicle. ...