Federal Express- FedEx

Service operation Management

Submitted toH.C.Jain
Professor
New Delhi Institute
of Management

Submitted bySougata Mukherjee-48

Ashish Kr Verma-212
Sagar Khurana-26
Kaushik Panigrahi-162

Introduction to Industry
Estimated at a value of $14
billion US dollars
9% to 10% growth in the years
to come
Leading players:
Concor
TNT express
UPS
TCI
Agarwal Packers and Movers

Contd
Global Players:
DHL Logistics
Kuehne Nagel
DB Schenker Logistics
Nippon Express
C.H. Robinson

7% growth in each year since

2011

Service Characteristics
Government rules and
regulations
Distinctive Competencies
FedEx's Business Level Strategy
Targeting Customer Needs
Market Segmentation
Product Technology
Response to Differences among
Nations

FedEx Global Supply Chain Services

Transportation Management
Services Process

Verify/validate order data

Select appropriate routing for order
Communicate transport order to FedEx Express
or designated service provider
Shipment tracking
Process invoices from other carriers
Prepare billing for customers

FedEx Global Supply Chain Services

Cold Chain Services Process

Collection at customer facility after receiving
a minimum of five day advance notice
Service provider delivers a fully operational
and preconditioned container on the
collection day
Customer check the container and
temperature setting and loads the container
and provides appropriate paper work
Container is shipped to the pre agreed
airport for loading on the next outbound
FedEx flight
FedEx Custom Critical will collect the
shipment and perform the end customer
delivery

Critical Business success

factor

Low cost
Ease of use
Free setup
Service and trouble-free ordering
Payments and delivery
Technology to shorten the order to delivery
cycle with service including transportation,
order processing, distribution centre
operations, fulfilment, inventory control,
purchasing, production, and customer and
sales services.

Service quality and

imperatives
Tangibles 1240 stations
10 air express hubs
33 ground hubs
more than 500 pick up/ delivery stations
approximately 370 centres

Reliability
positively spirit puts customers at the
heart of everything they do

Contd
Responsiveness
Try to solve customers problem within 24
hours of time

Assurance
Service gurantee is provided by the fedex,
if they are not able to deliver as per
promise they are ready to return money

Empathy
Always treat customers in a professional,
competent, polite and caring manner.

Service facility
More than 325,000 team members worldwide
Connecting more than 99% of global GDP
with transportation solutions, e commerce
solutions and business services
Processing 50 million unique fedex.com
visitors monthly
More than 50 million requests daily
More than 9 million packages shipped daily
Moving more than 11 million shipments each
business day (average volume) to 220
countries & territories

Contd
FedEx express 1240 stations
10 air express hubs
165000 team members
More than 4 million packages daily
647 aircraft
More than 47500 vehicles
Operates in more than 220 countries

Contd
FedEx freight
More than 39000 team members
Moving 95000 shipments avg daily
volume
More than 20000 motorized vehicles
Nearly 370 service centre
US Canada Mexico Puerto Rico, Virgin
Islands

FedEx Techconnect
More than 3000 team members

Contd
FedEx ground
More than 70000 team member
More than 4.5 million daily avg shipments
More than 45000 motorized vehicle
33 hubs
27 distribution centre
More than 500 pick up delivery centre
1750 FedEx office locations
6100 FASC

 FedEx Smart Post

More than 8500 Team members
More than 2 million packages daily
27 distribution centre

FedEx Supply Chain

More than 800 team members
More than 250 warehouse
North America plus 21 additional
countries

 Fedex office
More than 1800 office
Team Members- 14000
Warehouses-1800
FedEx Custom Critical
Team Members- more than 1500
Motorized Vehicle- more than1250
More than 800 shipments daily (avg)
By ground US, Canada and Mexico
By air charter around the world

Successes for FedEx

In July 2010 it has won the
Institute of Transport
Managements Best Global
Cargo Hub
Cubbyhole
Insight partners

Failures for Fedex

Zip-Mail venture
Expansion to Europe.

Principal Weakness of the FedEx

Dont maintain up to date tracking information.
Dont document calls
Dont honour commitments made by telephone
representatives.
Dont issue cell phones to their drivers
Dont hire drivers who know addresses at major
businesses
Do hire drivers who lie about whether a delivery
has been attempted.
Provide inferior service to residential customers
at the same price for which business customers
receive better service.

Recommendation
Can generate more business and even further
cement its reputation for accurate, on time
delivery by offering real-time tracking of
packages for an extra fee
Switching to RFID tagging for packages will
save costs in the long run and improve
accuracy because these can hold much more
information and only require that the package
be within a given range.
This can be further supplemented with the
installation of GPS tracking on all delivery
modes

Contd
Company should continue
investing capital in planes,
vehicles and infrastructure,
especially in Asia (China
specifically), but also focus on
penetrating into foreign markets
by partnering with local carriers
Continue spending heavily on
advertising.