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This essay investigates the success of United Parcel Service (UPS) in providing excellent delivery and consulting services through highly efficient logistics system. In 2011 UPS took 52th place in Fortune 500 (2012), an annual rating of the most valuable and successful corporations. According to the UPS Annual Report (2011) its revenue accounted for $53,105 million, free cash flow amounted to $5,022. UPS employs more than 398, 000 employees, has 101,121 delivery fleet, 2,879 operating facilities situated all over the world, 4 billion delivery volume and 8,8 million customers. Moreover, the Company owns 61,700 retail access points, 1,827 daily flight segments and 2,593 alternative fuel vehicles. These figures are examples for other company’s operating in the industry to follow.
The Company does not limit its operations with package delivery services in more than 220 countries, it provides logistics, supply chain and forwarding services in 195 countries, rail, ground, air and ocean freight services, management of the transportation network and less-than-truckload and long-haul freight services. In 2011, with the aim to facilitate the progress in the business-to-consumer (B2C) operations UPS introduced and implemented logistics business solution UPS My Choice. It supports the needs of UPS shipments’ receivers with control over the delivery status. Moreover, reverse logistics aspect of UPS operations was realized in UPS Returns Pack and Collect and UPS Returns Exchange products. These logistics solutions allow retailers as the clients of UPS to deal with the return processes in the most effective cost reducing way. Moreover, UPS implemented UPS Quantum View which reduced delays in the confirmation of order and accelerated the revenue cycle, Flex Global View that assisted in inventory monitoring, UPS Import Control and UPS Paperless Invoice (UPS Annual Report, 2011).
To be on the wave of the technological and information progress for UPS means to implement the most efficient and productive initiatives in logistics. The Company put into practice keyless entry as the system that allowed the processes of “ignition, unlocking the doors, and opening the bulkhead door” being automatic (UPS Annual Report, 2011, p.4). Sensor technology called Telematics assists the company to control on time and safe delivering by gathering data from its vehicles, processing this information efficiently. There it improves reliability of customer service and increases service efficiency. Moreover, issue of sustainability arises whereas the Company reduce emissions and save fuel using Telematics. Next Generation Small Sort (NGSS) simplifies workload in the area of small sorting operations while eliminating the necessity of ZIP codes usage. The advanced technology enhancing analytics procedures includes the On Road Integrated Optimization and Navigation (ORION) and Network Planning Tool (NPT).
Euchner (2011) put an emphasis on that fact the United Parcel Service is the most innovative company among its competitors. The author gave an example of how UPS integrates its logistics experience and its clients’ operations. UPS makes a proposal to take over operational functions of client’s shipping department and optimize its logistics schemes. This “opening up” process is essential because the client gives an outsider UPS access to its internal logistics processes and supply chain and UPS delivers better services while applying its advanced information technology.
It should be emphasized that the main goal of UPS’s logistics services is to make static situation with trillions of dollars located in numerous warehouses of suppliers into highly dynamic operations where the client is the beginner and end receiver of UPS services. The client is the central figure in all activities provided by UPS. The company makes every effort to satisfy his requirements concerning right time of delivery, appropriate condition, place and affordable price.
Value-based logistics of UPS include three crucial parameters connectivity, globalism and high service standards. “By leveraging our international infrastructure, UPS enables our customers to bridge time zones, cultures, distances and languages to keep the entire supply chain moving smoothly” (UPS Annual report, 2011, p. 2). The Company involves more than 800 logistics facilities in 120 countries which territory equals to 35 million square feet of warehouse space. The Company provides its logistics service at the domestic market and internationally. The main directions are distribution, transportation, brokerage, forwarding, and different kinds of freight activities. The main operational segments include U.S. Domestic Package, International Package and Supply Chain & Freight. Logistics in UPS operations is not only casual services for ordinary companies such as warehouses, forklifts, racks, inventory control and allocation but also facility design and planning, brokerage and customs services, intermodal delivery, orders processing, quality testing and assurance, private fleet managing, after-sale services. Integration of cutting edge technologies and a wide range of services mentioned above ensure numerous competitive advantages for UPS comparing to its main competitors Fedex and United States Postal Service.
United Parcel Service is a leader in logistics that succeeds in implementing such business solutions that lower costs for the customers, develop control over the supply chain and improve service. The figures describing Company’s operational achievements prove the fact that United Parcel Service is a leading company in implementing innovative approaches to business conduct. Up-to-date solutions in logistics area leverage the broad scope of UPS’s network, which includes 5,000 locations of The UPS Store. The main strengths of United Parcel Service that assure the highest standards of logistics services include integrated global network with sophisticated engineering systems, global presence and leading edge technologies, variety of services. It gives an opportunity to control all stages in product life cycle, establish long-term relationships with the customers, strong brand image, distinctive culture of promotion within the company and financial stability.