Submitted to: MUNNAWER AHMED
Supply Chain of FedEx
RAMEEZ RIAZ SHOAIB MASOOD SIDDIQUI 5/21/2013
Overview: The modern air/ground express industry was pioneered with the founding of Federal Express in 1971; the corporation was created in 1998 as FDX Corporation and became FedEx Corporation in January 2000. FedEx Corporation provides customers and businesses worldwide with a broad portfolio of transportation, e-commerce and business services. With annual revenues of $43 billion, the company offers integrated business applications through operating companies competing collectively and managed collaboratively, under the respected FedEx brand. Consistently ranked among the world's most admired and trusted employers, FedEx inspires its more than 300,000 team members to remain "absolutely, positively" focused on safety, the highest ethical and professional standards and the needs of their customers and communities. The average daily volume is more than 10 million shipments for express, ground, freight and expedited delivery services. Offer Service in more than 220 countries and territories, including every address in the United States. Over 32 million unique visitors monthly; more than 6.5 million package tracking requests daily and more than 20 million labels generated via FedEx Ship Manager monthly Recent Awards: FORTUNE Magazine: No. 10 among ―World’s Most Admired Companies‖ (2013) FORTUNE Magazine: ―100 Best Places to Work For‖ (2013) Bloomberg Businessweek Magazine: No. 12 among ―The Civic 50‖ listing of America’s Most Community-Minded Companies (2012) Black Enterprise Magazine: Top 40 ―Best Companies for Diversity‖ (2012) Wal-Mart: ―Small Parcel Carrier of the Year‖ (2012)
1
Mission: FedEx Corporation will produce superior financial returns for its shareowners by providing high value-added logistics, transportation and related business services through focused operating companies. Customer requirements will be met in the highest quality manner appropriate to each market segment served. FedEx will strive to develop mutually rewarding relationships with its employees, partners and suppliers. Safety will be the first consideration in all operations. Corporate activities will be conducted to the highest ethical and professional standards.
Strategy: The unique FedEx operating strategy works seamlessly - and simultaneously - on three levels. Compete collectively by standing as one brand worldwide and speaking with one voice. Operate independently by focusing on our independent networks to meet distinct customer needs. Manage collaboratively by working together to sustain loyal relationships with our workforce, customers and investors.
Values: People: We value our people and promote diversity in our workplace and in our thinking. Service: Our absolutely, positively spirit puts our customers at the heart of everything we do. Innovation: We invent and inspire the services and technologies that improve the way we work and live. Integrity: We manage our operations, finances and services with honesty, efficiency and reliability. Responsibility: We champion safe and healthy environments for the communities in which we live and work. Loyalty: We earn the respect and confidence of our FedEx people, customers and investors every day, in everything we do.
2
Family of FedEx:
Today's FedEx is led by FedEx Corporation, which provides strategic direction and consolidated financial reporting for the operating companies that compete collectively under the FedEx name worldwide: FedEx Express, FedEx Ground, FedEx Freight, FedEx Office, FedEx Custom Critical, FedEx Trade Networks, FedEx Supply Chain Solutions and FedEx Services. FedEx Corporation provides customers and businesses worldwide with a broad portfolio of transportation, e-commerce and business services. With annual revenues of $43 billion, the company offers integrated business applications through operating companies competing collectively and managed collaboratively, under the respected FedEx brand. Consistently ranked among the world's most admired and trusted employers, FedEx inspires its more than 300,000 team members to remain "absolutely, positively" focused on safety, the highest ethical and professional standards and the needs of their customers and communities FedEx Express invented express distribution and remains the industry’s global leader, providing rapid, reliable, time-definite delivery to more than 220 countries and territories, connecting markets that comprise more than 90 percent of the world’s gross domestic product within one to three business days. Unmatched air route authorities and transportation infrastructure, combined with leading-edge information technologies, make FedEx Express the world’s largest express transportation company, providing fast and reliable services for more than 4 million shipments each business day. 3
FedEx Ground is a leading North American provider of ground small-package delivery services, providing service to the U.S. and Canada. FedEx Home Delivery, the industry’s first ground service dedicated to residential delivery, is available from FedEx Ground and is backed by a money-back guarantee. FedEx Ground segment financial results include FedEx SmartPost, which specializes in the consolidation and delivery of high volumes of low-weight, less timesensitive business-to-consumer packages using the U.S. Postal Service for final delivery to any residential address or P.O. Box in the United States FedEx Freight is the market leader in providing less-than-truckload (LTL) freight services across all lengths of haul. FedEx Freight segment financial results also include FedEx Custom Critical, North America’s largest time-specific, critical shipment carrier. FedEx Services operates combined sales, marketing, administrative and information technology functions in shared services operations that support our transportation businesses and allow us to obtain synergies from the combination of these functions. The FedEx Services segment includes: FedEx Services, which provides sales, marketing, information technology, communications and back-office support to our other companies; FedEx TechConnect, which is responsible for customer service, technical support, billings and collections for U.S. customers of our major business units; and FedEx Office, which provides an array of document and business services and retail access to our customers for our package transportation businesses. FedEx Custom Critical launched Temp-Assure Validated in 2004. This temperature-control service provides thermal-mapped cargo boxes and hard-copy temperature documentation for customers. This was the first service of its kind in the industry for customers regulated by agencies such as the Food and Drug Administration. The company added FedEx Truckload Brokerage to its portfolio of services in 2008. This provides customers with a truckload brokerage option, while also providing them with the reliability and service they expect when using FedEx. FedEx Custom Critical continues to be a leader in the expedited industry, providing a full portfolio of ground, air, temperature-control and truckload brokerage shipping options. FedEx Trade Networks is the global freight forwarding arm of FedEx and is the largest-volume customs entry filer in North America. FedEx Corp. acquired TowerGroup and World Tariff Ltd. to create FedEx Trade Networks in 2000. In 2002, TowerGroup was rebranded as FedEx Trade Networks Transport & Brokerage, Inc. In 2008, the company began an aggressive global expansion opening offices around the globe. The expanded market reach gives FedEx Trade Networks access to 91% of the world’s GDP by providing international air and ocean freight forwarding, customs brokerage, distribution and warehousing, and other value-added services to assist customers with international shipping.
4
A second subsidiary, called FedEx Trade Networks Trade Services, Inc., was also formed in 2002. This division incorporates the duty and tax data services of WorldTariff® with Trade & Customs Advisory Services (TCAS), which is designed to streamline, automate, and simplify the international shipping process for customers, as well as provide comprehensive trade information. FedEx Trade Networks was the first company to provide a duty and tax application on its website. WorldTariff® provides customers the ability to estimate duties and taxes online by accessing real-time customs duty, tariff and tax information for over 175 countries. Today, FedEx Trade Networks provides FedEx customers international freight forwarding services with seamless, end-to-end solutions, and is leveraged to access the wide array of services offered by the other members of the FedEx family of companies and their subsidiaries.
Asia pacific: FedEx Express President, Asia Pacific Region (APAC): David L. Cunningham Headquarters: Hong Kong Employees and Contractors: More than 17,000 Stations: Located in all major cities in Asia Main Hubs: Guangzhou, China Countries and Territories Served: More than 30 Airports Served Directly: More than 20 Asia is an important part of FedEx global strategy. We have been focused on this region since we began operations in Asia in 1984. We have more than 17,000 employees in the region, serving more than 30 countries and territories in Asia China plays a significant role in FedEx business in Asia. FedEx entered mainland China in 1984 and has been committed to growing points of access to and within China. Currently, FedEx operates as a wholly foreign-owned enterprise and has direct custodial control of operations, which allows for enhanced business flexibility and improved speed-to-market. FedEx China has more than 9,000 employees dedicated to providing international and domestic services in the country. We currently have 252 weekly flights to and from five cities in China – Beijing, Shanghai, Guangzhou, Shenzhen and Chengdu.
Transportation Management Services: FedEx Transportation Management is an outsourced solution that offers you end-to-end transportation management: optimized, multi-modal, and door-to-door. It leverages the FedEx
5
family of companies (along with a select group of core carriers) to help you improve operational efficiencies and customer service. Features: Review and analysis of your supply chain Order administration Shipment planning and management Freight bill audit and payment Invoice and report generation
How You Benefit: Enhance customer service - shipments managed to meet individual distribution requirements Improve inventory management - gain consistent on-time delivery reducing need for safety stock Increase asset and labor efficiency, eliminating need for internal transportation management applications or IT support and reduces transportation administration Optimize transportation costs - choose optimal overall transportation solution from FedEx companies and core carrier networks to reduce costs Reallocate resources - refocus your time and money on core competencies
FedEx Supply Chain Services: FedEx Supply Chain offers a portfolio of services to help turn supply chain management into a competitive strategy. By outsourcing these modular and scalable solutions to a trusted provider, you can focus on your core competencies, reduce costs, and improve overall customer service. Each program is carefully matched to the requirements of your business to gain improved supply chain performance. From services designed to optimize availability and delivery of critical inventory and components through our network of forward stocking locations, central warehouses and fulfillment services, to transportation management, dock services, and a ―coldchain‖ transportation network – the Healthcare Shared Network – FedEx Supply Chain provides your link to strengthen custodial control and optimize use of available transportation alternatives.
6
Hub and Spoke: Federal Express successfully implemented hub and spoke distribution to achieve a competitive logistics advantage. They have found that this method of distribution reduces transportation costs, improves cycle times, and reduces inventory. Many other companies are now realizing that significant cost savings can result from improving their distribution processes. A hub and spoke network is a centralized, integrated logistics system designed to keep costs down. Hub and spoke distribution centers receive products from many different origins, consolidate the products, and send them directly to destinations.
COSMAT II: (Computerized On-line System for Management, Accounting and Tracking) is a complete Enterprise Resource Planning system indigenously developed by FedEx. It interfaces with the Human Resources Management, Financial Management, Purchase, Sales Monitoring Executive Information and Customer Relationship Management systems. It was constructed in 4 major modules to cover all the complex processes of the entire organization. COSMAT II enables easy access to the database over a wide area network, and ensures reliable information and feedback even in areas that are afflicted by poor telecom services. It is an evolving system, upgraded continuously, to deliver value to the customer and make operations easier, more secure and manageable.
7
SMART: (Space Management Allocation Reservation and Tracking), is an in-house developed state-ofthe-art technology system, which allows real-time space and revenue management on the Aviation network. It ensures that the aircraft is filled profitably, and that all customers with space confirmed on the aircraft have the assurance that their packages would travel. SMART dovetails into COSMAT II leveraging on the infrastructural strength of the system. SMART is built on Oracle technologies, with the database housed on Oracle 8i (Release 2).
Shop Track: Shop Track is an API (Applications Program Interface) designed specifically to support and enhance the services provided by a portal or any e-business. Shop Track provides an effortless, customized solution. Customers no longer have to leave the Portal site to track their purchases. The Portal can decide how to display the data elements and may even store them in their database.
Pack Track: Pack Track is an API (Applications Program Interface) designed for any client involved in logistics, distribution and inventory control. It has been designed to streamline and integrate shipping processes. Pack Track can be integrated into the client's systems and enables him to keep track of the entire distribution status of all his customers. Cold Chain Services: FedEx Cold Chain Services arranges for a temperature-controlled air-cargo container and exclusive-use vehicles for pickup and delivery. It has Ability to regulate container placement within the aircraft, along with the cargo-hold temperature, for optimal performance of the cargo container.
A specially trained Temperature-Control Services Team to handle your temperaturesensitive airfreight shipments. Shipment tracking from pickup to delivery, with unmatched command and control of the freight within the FedEx network.
Critical inventory: 8
FedEx Critical Inventory Logistics has been developed to support customers' time-sensitive, high-value inventory. Healthcare and high-tech finished goods and spare parts logistics operations are two great examples of market segments that require critical logistics for urgent shipments. With FedEx Critical Inventory Logistics you get the ideal supply-chain combination including
Technology: Skip the investment and the ongoing expense associated with building your own supply chain technology when you can rely on ours. Our Global Supply Chain Manager technology was custom created to support the global movement of your most critical service parts and finished goods. View inventory around the corner or around the world. See an order — from order inception through proof of delivery — so that your field reps can rest at ease and carry less trunk stock and your warehouses can also carry less safety stock. Reduce the number of tracking and order placement calls to your customer service center by accessing the global FedEx Critical Inventory Logistics order placement, inventory management and visibility tools. Through EDI or an application on fedex.com, you can 'watch' over your supply chain Location: Bring products to market faster with the globally integrated network of FedEx stocking locations that provide faster access to the new markets and new places where your products are needed most. Service your customers more efficiently. Move inventory to locations that best match the local, central or global needs of your business and your customers. Reinvest in other areas of your business that can drive revenue by utilizing our global stocking network rather than building your own. Services: Choose from a range of robust transportation service options to match your unique needs — from 1-hour courier and next-flight-out to next-day and second-day delivery and returns. Take advantage of operational excellence on every level, including ISO 9001 and ISO 13485 certifications and dedicated customer support teams. 9
Access our dedicated FedEx Command and Control customer support teams who will keep watch over your orders until they make it safely to their destinations, 24 hours a day, 7 days a week
Online tool: FedEx Supply Chain has harnessed a powerful combination of supply chain management tools which allows you to navigate today’s complex supply chain reliably, efficiently, and with peace of mind. Our technology platform offers features such as: Order administration – efficiently manage the processes associated with order fulfillment and transportation Real time visibility – provides a view into inventory at rest and in motion throughout the supply chain Connectivity – provides multiple access points to key members of your supply chain
Conclusion: FedEx Supply Chain Systems executes solutions that leverage the FedEx transportation and information networks in commercial markets around the world. The company provides integrated FedEx services for customers with high-value products or complex supply chain requirements. FedEx Supply Chain Systems offers specialty logistics services that include critical inventory logistics, transportation management and temperature-controlled transportation through a network of owned and managed resources – all tightly integrated via advanced IT systems.
References: http://www.fedex.com
10
