United Parcel Service (UPS) and FedEx Compare and Contrast - 1375 Words

United Parcel Service (UPS) and FedEx Compare and Contrast (Research Paper Sample) Content: UPS and FedEx Compare and ContrastNameInstitutionInstructorCourseDateIntroductionUnited Parcel Service (UPS) and FedEx Corporation (FEDEX) are the principal delivery services companies in the New York Stock Exchange (NYSE) as well as key competitors to one other. These companies are essentially rather different in their operational strategies and models. This article analyzes the basic social, legal, and economic environment that UPS and FedEx operate, the managerial, operational, and financial issues impacting the organizations, how the management teams perform in terms of the four functions of management, and identify and explain strong points of the managers and areas in which improvement is needed.Legal environmentThe deregulation of airline industry by the Government has permitted landing of bigger freight planes thereby reducing FedEx cost of operation (Johns, 2010). Trucking industry deregulation also greatly made UPS to establish long trucking system. Deregula tion of trade in the Asia Pacific has opened fresh markets for both UPS and FedEx.Social environmentBoth the two companies have expanded beyond their boundaries and have reached their global reach, taking advantage of cheaper resources and the new markets. The movement of their products through quick, and safer delivery of goods created new demands for the logistics industry and transportationEconomic environmentBoth the UPS and FedEx works under economic environment with trends that has brought growth to both the companiesà ¢Ã¢â€š ¬ such as globalization of the businesses, Information Technology (IT) advances, and rapid market demand for the more value-added service.The managerial, operational, and financial issues impacting the organizationsThe UPS does its management of the business like air, domestic, ground, commercial, international, and residential by a single pickup and a delivery network. This single network structure of operation has made UPS to compete favorably with its competitors. On the other hand FedEx operates in different units like express, freight, ground, and services that operates independently. Additionally, UPS has smaller equity base shareholder than FedEx, through the use of hefty debt leverage, it has managed to match FedEx in total assets. UPS has generated more revenues than FedEx by using e-commerce environment in its operations, thereby achieving higher operations efficiency for the shareholders. Therefore, UPS financial stock is much higher than FedEx stock.The UPS revenue by 2013 was approximately 53 billion dollars much higher than FedEx that was approximately 42 billion dollars (Palepu, 2007). The operating income of UPS is about 5.8 billion dollars, which is higher than FedEx that was 3.1 billion dollars. The net income for UPS was about 3.8 billion dollars, higher than FedEx that was 2.03 billion dollars (Hill Jones, 2013).Industry Analysis: SWOT ToolThese are strength, weaknesses, opportunities, and threats of both the c ompanies as discussed.Strength: both UPS and FedEx gets their strength from core packaging competence routing as well as delivery. Their deep experience in bar-code technology, network management, wireless communications, and linear programming gives them strength.Weaknesses: UPS and FedEx must rely on technological development, global economies reliance, costly innovation technologies, late deliveries judgment, and increased debt.Opportunities: with the development of technology, both UPS and FedEx has the opportunity to design and change their business model from inventory management at rest to inventory management in motion.Threats: both the UPS and FedEx face threats from new entrance such as United States Postal Service (USPS), Deutsche Post world Net, and DHL, as well as Specialist competitors, Competition service costs Gain, and economic standing.Management Teams Performance In Terms Of Four Functions of ManagementManagement is the process of organizing, controlling, planning , and leading use of the resources in order to accomplish the performance goals (Tripathi, Tripathi Reddy, 2008).Planning: both the UPS and FedEx uses planning to determine their stand and goals to be achieved in future as well as in analyzing companyà ¢Ã¢â€š ¬s internal and external factors.Organization: UPS has single network structure that must be properly organized to ensure that right amount of goods are shipped on time while FedEx operates different units like express, and freight that must be organized to ensure everyone performs their task.Leading: FedEx has many departments, and therefore managers should direct everyone to work efficiently as planned. Each department must communicate with one another. UPS has also managers that directs and leads employees in their single network structure.Controlling: both UPS and FedEx controls their departments effectively since they have established standards.Strong Points of the Managers and Areas in Which Improvement Is Needed.Both t he ...