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FedEx-Creating Competitive AdvantageI. Case Study:Federal Express almost single-handed created the express-package delivery industry as we now know it. Founded in 1973, the company got off to a slow start-it took time to educate the American public about the value of overnight delivery. However, building doggedly on the advertising promise, “when it absolutely, positively has to be there on time,” made possible by the companys innovative and now much-copied “hub-and-spoke” distribution system, FedEx went on to become one of the fastest start-ups in American history. After three years of losses, it grew explosively. At a compound growth rate of more than 40% per year, annual sales reached $1 billion by 1983, $5 billion by 1989, and almost $8 billion by 1993. And despite strong challenges from a glut of imitators over the years, Federal Express remains the undisrupted market leader. It now commands a 45% US market share, comfortably ahead of major challengers UPS at 25%, Airborne at 14%, and the US Postal Service at about 8%.Staying atop the overnight package delivery business will require a well-designed and well-executed competitive strategy. Although the market is large and growing, competition is torrid. Federal Express is now streetfighting with competitors on price, looking for ways to boost productivity in order to stay price competitive. But FedEx is not, and may never be, the lowest-priced express-delivery service. Federal Express traditionally has differentiated itself not by luring customers with low prices, but by giving them unbeatable reliability and service. Even in the face of cutthroat pricing by competitors, the company has been careful not let cost-cutting undermine its main source of competitive advantage-superior quality.At Federal Express, quality goes far beyond slogans and idle talk. In 1987, it established a formal Quality Improvement process, which set simple yet lofty quality goals: 100 percent on-time deliveries, 100 percent accurate information on every shipment to every location in the world, and 100 percent customer satisfaction. A few years later, FedEx became the first service organization to receive the Malcom Baldrige National Quality Award for outstanding quality leadership. It developed a Service Quality Index (SQI), made up of twelve things that it knows disappoint customers-how many were damaged, how many billing corrections the company had to make, and other such mistakes. “Quality action teams” study SQI results daily, looking for trouble spots and ways to eliminate them. Even management bonuses are keyed to achieving SQI goals. Each year, the company invests more than $200 on each of its 96,000 employees in 185 countries for quality initiatives.FedEx believes that top-flight quality is well worth the heavy investment, even if it results in higher prices. In an industry where late delivery can spell disaster, most customers will gladly pay a little more for the added peace of mind that comes with unwavering reliability. Although raising service quality can be expensive, losses of customers resulting from poor quality can cost a great deal more. FedExs obsession with quality has paid big dividends. In recent years, despite a sluggish economy and the long-running price war, the company has experienced healthy growth.In the early 1980s, flush with domestic success, FedEx decided that the time had come to go global. It began to buy up foreign competitors, invested heavily to set up European version of its venerable hub-and-spoke system, and prepared to launch a full front assault on Europe. In 1989, it capped its global networking building with the acquisition of the legendary Flying Tigers, the worlds largest carrier of heavyweight cargo. With this acquisition, it could now move freight of any size. By the early 1990s, FedEx had become the worlds largest express transportation company, with 441 aircrafts and 30,000 pickup and delivery vans serving 173 countries. Its new global goal: to be able to deliver freight anywhere in a global network within just two days.Despite its high hopes and heavy investment, however, the global effort turned out to be a disaster. Although international sales doubled in only a year, earnings plummeted. After eight long years and losses of more than $1 billion FedEx finally turned a modest profit on its international operations in 1994. What went wrong? For one thing, FedEx appears to have overestimated the European market for overnight delivery, which stalled out at only 100,000 packages daily. For another, the company may have underestimated the competition: Whereas FedEx is the clear market leader in the US, in Europe it is a challenger. To win in Europe, it had to take on a well-entrenched competitor, DHL, the world leader in international express delivery. FedExs aggressive attack on international markets provoked an equally aggressive defense, not just from DHL, but also from UPS, Australian-based TNT, and other large international rivals. For example, DHL strengthened its international base by forging new relationship with Lufthansa and Japan Airlines. UPS invested heavily to beef up its global delivery network, expanding coverage to 175 countries. The result: too many competitors chasing too little business, driving down prices and profits for all.In May 1992, FedEx began a decisive retreat from its disastrous European campaign. It closed down operations in more than 100 countries, fired 6,600 employees, and contracted with other companies to handle its deliveries to all but 16 major European cities-such as London, Pairs, and Milan-that it still serves directly. FedEx executives insist that the retreat doesnt mean surrender. The company still leads in the US market, and it had retained a strong base for building more solid international expansion. The European retrenchment simply signals a new, more cautious approach to international expansion. Despite its losses, FedEx has learned the most important lessons: A blockbuster competitive strategy that makes a company “lord of the skies” at home wont necessarily fly abroad.Today, understanding customers is not enough. Under the marketing concept, companies gain competitive advantage by designing offers that satisfy target consumer needs better than competitors offers. They might deliver more customer value by offering consumers lower prices for similar products and services, or by providing more benefits that justify higher prices. Thus, marketing strategies must consider not only the needs of the target consumers, but also the strategies of the competitors. The first step is competitor analysis, the process of identifying and assessing key competitors. The second step is developing competitive marketing strategies that strongly position the company against competitors and give it the greatest possible competitive advantage. Notes:1. UPS(United Parcel Service.)联合包裹服务公司UPS于1907年作为一家信使公司成立于美国,目标是致力于支持全球商业,如今已发展成拥有360亿美元资产的大公司。如今的UPS是一家全球性的企业,其商标是世界上最知名、最值得景仰的商标之一。作为世界上最大的快递承运商与包裹递送公司,他们同时也是专业的运输、物流、资本与电子商务服务的领军者,在世界上200多个国家和地域管理着物流、资金流与信息流,通过结合货物流、信息流和资金流,不断开发物流、供应链管理和电子商务的新领域。2. TNT TNT集团TNT集团是全球领先的快递邮政服务供应商。凭借其在欧洲和亚洲的高效网络设施和不断扩展的全球业务网络, TNT为企业和个人客户提供全方位的快递和邮政服务。总部位于荷兰的TNT集团拥有15.9万名员工,分布于200多个国家和地区。2006年,集团销售收入为101亿欧元,运营收入为12.76亿欧元。TNT集团分别在阿姆斯特丹和纽约证券交易所上市。3. hub-and-spoke system 集线器与车轮状结构的企业级数据库这种结构也成为“Hub and Spoke”,这是为中央数据库汇集了来自各业务处理系统的数据,同时也负责向各从属数据集市提供信息,看上去像一个Hub(集线器);而业务人员在进行数据分析与信息访问时将根据需要连接到不同的数据集市,这种交叉复杂的连接看上去就像Spoke(车轮辐条)一样。“Hub and Spoke”结构解决了企业内部统一数据存储模型的问题,但从实际使用的角度来看仍有比较严重的结构缺陷:一是业务人员对信息的访问非常不方便,很难进行跨数据集市或跨部门的信息分析;另一个问题是每个数据集市都需要相应的软硬件投入,当数据集市增加时,系统整体投资迅速增加,同时管理的复杂性也随之增加。这些都意味着巨大的整体拥有成本TCO(Total Cost of Ownership)的增加。为什么不直接访问中央数据仓库而非要设计一个数据集市呢?主要原因在于当中央数据库保存越来越多的数据、并开发用户越来越多时,一般的数据库引擎无法承担这样的负载,只好把它们分解到不同的数据集市中去。. Analyzing the Case:1. What did FedEx set as its quality goal?2. What is Service Quality Index and what role does it play in FedEx?3. After FedEx became the worlds largest express transportation company, what is its new goal?4. What are proper market strategies?5. What could FedEx learn from its failure in the European market?. Translation of the Case:创造竞争优势联邦快递联邦快递几乎是单枪匹马地创立了快递产业。它成立于1973年,开始时起步缓慢,它要花费时日让美国公众认识到速递的价值。尽管如此,联邦快递仍然恪守它在广告中的承诺“WHEN IT ABSOLUTELY, POSITIVELY HAS TO BE THERE ON TIME”。在联邦快递的创新精神和几经人们效仿的集线器和车轮数据系统的辅助下,这一承诺得以兑现。联邦快递逐渐成为美国历史上迅速崛起的公司之一。经历三年的亏损后,联邦快递迅速壮大。每年的综合增长率超过40%,1983年度销售额达到1亿美元,1989年达到5亿美元,而1993年则达到了8亿美元。尽管联邦快递面临众多的效仿者,它在速递行业中的主导地位仍不可撼动。如今联邦快递已占有美国市场45%的份额,轻而易举地超过了主要竞争对手UPS和US Postal Service,这三家公司市场占有率分别为25%,14%和8%。在次晨达快递服务中,只有借助精细的策划和高效的管理竞争机制才能占据霸主地位。虽然市场很大,且不断壮大,但竞争激烈。现在联邦快递正在同对手展开价格大战,并寻找提高生产力的方法以保证价格竞争的优势。但联邦快递现在和将来都不可能以最低的价格来提供快递服务。早期联邦快递的定位就是凭借无可比拟的可靠优质服务而不是以低价来赢得客户的。即使面临对手的赔血本的低价,联邦快递也能尽力不让成本降低的局面破坏其主要的竞争优势优质服务。在联邦快递,质量远比口号和闲谈重要。1987年联邦快递建立了正规的质量提高程序,确定了简单却至高无上的质量目标:100%的准时,100%的准确,100%的满意。几年后,联邦快递因其卓越的服务质量而成为第一家获得Malcom Baldrige全国质量奖的服务机构。联邦快递创立了服务质量指标多少次邮包迟送、多少次送错了日子、多少次邮件受损、多少次发票需要改正等十二项指标。每天质量行动小组都会研究服务质量指标,寻找问题并设法解决。甚至于将近都和服务质量挂钩,每年公司为分布在185个国家的9.6万名员工每人支付200多美元的质量创新奖。联邦快递认为以大量的资金投入来换取优质的服务是物有所值的,即使这会使价格上涨。在一个延误会导致灾难的产业中,顾客很愿意多掏钱买个心安。提高服务质量必须投入大量资金,但因服务质量下降导致客户流失所带来的损失会更大。优质服务给联邦快递带来丰厚的收益。近年来虽然经济低迷,价格拉锯战持续上演,但联邦快递仍运转良好。20世纪80年代早期,联邦快递在美国的业务发展顺利,它决定要走向世界
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