FedEx strategic analysis

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FedEx strategic analysis

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Abstract

FedEx is the IT-focused market leader of the international express courier business and further offers supply-chain-management solutions. Indeed, this company was founded as Federal Express in 1971 by the U.S. Marine and Frederick W. Smith in Little Rock (Arkansas). FedEx has been chosen in order to symbolize a national marketplace. FedEx is the first cargo airline that used jet aircraft for its services.

Concerning the industry, the company takes part in the Air courier industry, indeed i it is a company that delivers packages and mail, often between offices and generally in a shorter timescale than surface mail. Nowadays, bicycle couriers, motorcycle couriers, cars, trucks and aircrafts are used to deliver the packages. Concerning the economy, we can state that the number of jobs for this industry is projected to drop over the next 5 to 10 years; this is due because technology creates efficiencies during the delivery process and therefore reduces the number of employees required to deliver each package. However, the number of packages delivered throughout the world is increasing. It is important to precise as well that the industry is managed by many courier enterprises. Indeed, the world's largest courier companies are "the big four": UPS, FedEx, USPS and DHL.

External environment
1. The industry
2. PEST ? Analysis
3. Porter's Five Forces
4. Industry segmentation
Internal environment
1. Internal Audit
2. Value Chain
3. Core Competences
4. Analyse balances ScoreCard
5. Organisation of the company
6. SWOT

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[...] Unfortunately FedEx has very little alternatives Strategic Recommendations for FedEx FedEx is a well established company and has to act in different aspects in order to consolidate its position of market leader in a market in continuous development. These aspects are: 12.1 What? Improve B2C: The Company has to develop the relation and sales with the private customer Innovate and come up with new services and solutions Achieve a hybrid strategy: low cost / high quality position 12.2 How? To achieve the aims revealed previously, Fed-ex must use different strategies: Invest in innovation and developing new product development. [...]

[...] Industry segmentation: 4.1 Strategic groups In spite of the previous Porter‘s five forces analysis, which was looking at the global express courier industry, the industry for the strategic group analysis is defined as the transportation industry. Thus, the criteria that define the strategic group analysis of this industry are the two major requirements that enable a company to evolve in this industry. These prerequisites are the following: - Ability to operate on a wide geographic scope - Aptitude to integrate IT actively into operations. [...]

[...] Shippers will now have access to the world's most extensive express transportation network via the FedEx global system connected to 212 countries. "This is an exceptionally good match, since FedEx offers the most comprehensive range of international express services into and out of New Zealand and First Express has extensive domestic experience," said Meyers. "We are very pleased to align our services with such a strong partner in a country where our business is growing so fast." Customers of both partners will have the convenience of "one-stop" express transport services. [...]

[...] IT knowledge combined with market knowledge allows efficiency and cost savings which give major benefits to customers and are not easily copied by competitors, especially as FedEx was an innovator in IT (now some customers jump ahead of them as well as competitors, but they have the resources and competences to improve their position in this field again) often first to market Core Competences After this Value Chain analysis of FedEx structure, it is possible to bring to light the company's two major core competences: Firstly, the comprehensive use of IT technology in operations (Just In Time / Total Quality Management etc.). [...]

[...] FedEx uses a fleet of over 670 aircrafts and 40,000 local delivery trucks to transport packages. The logo is orange for this part of the company. FedEx Ground: It delivers primarily to businesses. This part uses a large fleet of trucks which are owned by the independent operators and drivers. Concerning the logo, it is green. - FedEx Home Delivery: It is a division of FedEx Ground. It delivers to residences, offering service to virtually every address in the US. [...]

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