Since the establishment of the company, FedEx has been focusing on building superior, virtual and people networks by focusing on building change at the global perspective. The company has been investing heavily on creating flexible network computing architecture as well as pulling in and experiencing many chances of locking in many customers thus increasing the competitiveness of the company as a result of investing heavily in technological integration. Over the years, the company has experienced changes from express delivery company to operating like a global logistics as well as supply chain management over the last years. Before the implementation and application of the company’s first internet in 1996, FedEx has applied IT technology to thrive in the competitive market (Farhoomand & Ng, 2002). As a result, FedEx has been investing heavily in innovation thus adopting technological changes that increase the company to thrive in the architecture industry. This paper shows that FedEx Transportation Company has been focusing on technological improvements to succeed in the competitive market.
FedEx was established in the year 1973 when the transportation industry was highly competitive. During this period, people developed an interest in developing transportation mechanisms that would minimize the costs associated with physical transportation. Whenever there existed a need for connecting customers to the business, there had to be a physical movement of goods and people. However, FedEx had a successful technical breakthrough that increased the ability of the company to thrive in the competitive market. For example, FedEx became the first company to introduce software that was designed to link log customers with the FedEx companies thus reducing the distance between the company and its clients (Farhoomand & Ng, 2002). The business had more than 100,000 PCS fixed with software that increased the ability of the company to communicate with its customers in the year 1980. The services were designed to ensure that people were capable of improving FedEx’s ordering and tracking systems. The automated call center played an essential role in providing real-time tracking for all packaging as well as managing people. Since this became the interest of many people, FedEx won the loyalty for the majority of workers by improving services and reducing the physical movement of goods and people.
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As early as 1979, FedEx Corporation had implemented a centralized computer system that increased the ability of the company to link to its customers. This service was made possible by placing a code in every parcel and creating an opportunity for employees to scan the circulation of the service at every stage (Van Mieghem, 2018). This innovation was designed to ease the connection between customers and the company by scanning and monitoring and easing the movement of goods from the ordering, delivery, and picking of the parcels. The process created an opportunity for signifying the central store Memphis store that served the interest of different customers to monitor orders and deliveries. FedEx was also the first company in logistics architecture to adopt the electronic data interchange that allowed companies to link directly to their customers. FedEx applied this technology to monitor back its supply chain from the supply of raw materials with an objective of ensuring that supply matched demand. This technology increased the ability of the company to increase its sales volume before other players in the industry could adopt the technology.
Since the year 1996, FedEx has taken advantage of the emergence of internet exchange technology to use logistics as its source of differentiating its products from those of its competitors. The company’s integration of the company and its customers was fueled by the increased ability of the clients to adopt online services. For instance, Cisco developed a website that made it possible for FedEx Customers to make orders from the company without necessarily leaving the website. The components of the strategy included the desire for FedEx to improve its transportation, enhance related distribution center operations, inventory control, purchasing products and improving customer service experience. Application of technology in this sector would play an essential role in integrating all the key players in the economy as a way for increasing the ability to thrive in the market by offering efficient services to customers at a reduced cost. Application of logistics created a room for business to reduce the costs of operations as well as increasing sales volume by offering product and services that serve the interest of customers. This approach was effective because it became possible for FedEx to receive access order by customers as they were directly updated on the COSMO system. Additionally, the courier route also increased the ability of both customers and employees in a central warehouse to monitor the movement of goods due to increased tracking. The effectiveness of the changes is revealed through the increased level of integration among its partners which helps customers to connect with their customers. By the year 1999, FedEx served more than 60 million customers through the implementation of its differentiation approach by using logistics to create improvement in its supply chain.
Based on the changes of the services offered by FedEx to its customers, it is evident that logistics can be viewed as a detailed organization for a company to implement complexity in its operation services (Bukova et al., 2018). From this view, complexity originates from the fact that there is an integration of all services that the company offers to its partners in the supply chain. Logistics would mean the integration of services offered in different departments of the organization as well as businesses operating in different countries especially with the increased level of globalization (White et al., 2018). The benefits of the reorganized system should not be limited to the organization by they should extend to the customers of their clients. For example, FedEx offers an example of a complex operation system by integrating all its partners. For instance, the FedEx has incorporated its systems by increasing its ability to integrate its services ranging from the manufacturing to customer service and invoicing thus avoiding calls from clients inquiring about their order.
A virtual supply chain is considered as an increased electric interconnection in an organizational structure that facilitates the efficient flow of goods and services among the partners. Virtual supply chain calls for the need of using internet links that increase the ability of businesses to increasingly increase the movement of both physical commodities and services from one department or partner to the other (Langley, 2018). The essential factors of characteristics of a virtual supply chain are its ability to operate temporally and the level of flexibility that makes it possible adapts changes in the organizational structure or add new members in the system. Flexibility becomes an underlying factor in the achievement of a virtual chain because it creates a chance for businesses to operate at both local and international markets. The analysis of FedEx Express provides an opportunity for a retail clothing company that seeks outsourcing internationally by offering services related to the transportation of materials (Van Mieghem, 2018). The clothing company will be able to monitor the needs of customers as well as maintaining the connection between all partners in the supply chain. The company will be in a position to place an order to monitor the processing the order as well as invoicing without the need for making calls to know the progress. Similarly, the organization will also remain connected to its customers.
Despite the increased success associated with increased adoption of technology in the operation of FedEx Company, it is evident that the company had to change its operations in January 2000. Several factors such as increased rice for fuel compelled the company to change its operations with an objective of increasing its level of income. In the first of the year 1999, FedEx missed its target income growth making it difficult for FedEx to thrive in the market (Van Mieghem, 2018). Internet marketing and e-tailing changed the level of competition from one that made it difficult for a company to take advantage of its size. These changes significantly affected FedEx negatively making it difficult for the company to succeed. As a result, FedEx had to re-engineer its supply chain making it more effective. Many players were offering transport delivery services increasing the level of competition. Though the company created advancements on its website, the changes became a norm rather than a competitive advantage. The internal factors originated from the low technology discoveries associated with the changes in technology. As a result, the company changed to branding strategy as an alternative approach for improving its performance in the transportation industry. Branding strategy will be successful because it becomes a fundamental source technology for differentiating the company’s services from those of its competitors.
FedEx has been successful in the transportation sector because of its increased investment in technology. Based on the success of the company, it is evident that FedEx provides basics that company that a company that should focus on remaining ahead of the competition. For example, the company should invest heavily on innovation to identify new changes in technology from both supply and demand side (White et al., 2018). A company that remains the first player in the industry to implement technological changes becomes a fundamental approach for remaining ahead of competitors. Organizations also need to have a flexible operating structure that is capable of adopting and fitting changes in the business. FedEx operating has been temporary and flexible for adding players and integrating changes in their operations thus making it possible to thrive in the market.
References
Bukova, B., Brumercikova, E., Cerna, L., & Drozdziel, P. (2018). The Position of Industry 4.0 in the Worldwide Logistics Chains. LOGI-Scientific Journal on Transport and Logistics , 9 (1), 18-23.
Farhoomand, A. F., & Ng, P. S. P. (2002). FedEx Corp: Structural Transformation through e-Business'. Strategic Management: Concepts and Cases .
Langley, C. J. (2018). Logistics Service Providers. In Trucking in the Age of Information (pp. 101-125). Routledge.
Van Mieghem, J. A. (2018). FedEx: aligning operations strategy to the company’s mission. The Business & Management Collection .
White, C. C., Mitchell, W., Nowak, M., Canessa, E., & Nagarajan, A. (2018). Technology in Trucking. In Trucking in the Age of Information (pp. 147-181). Routledge.
