Business Strategy and Technology Comparison: FedEx vs. UPS Analysis

This assignment analyzes the business strategies and technology employed by FedEx and UPS, two leading delivery service companies. It begins by introducing FedEx and its overnight shipping service, highlighting its pioneering package tracking system. The assignment then compares the business models and strategies of FedEx and UPS, focusing on their use of technology. UPS utilizes technologies like DIAD, barcode scanners, and GPS tracking to improve efficiency and reduce costs, enhancing its services for both individual customers and business clients. FedEx, on the other hand, emphasizes cost leadership through efficient value chain management, wireless solutions, and strategic alliances to gain a competitive advantage. The analysis includes a discussion of their respective technologies, strategic alliances, and competitive advantages, supported by references to industry sources and company websites. The assignment highlights how both companies leverage technology and strategic planning to maintain their market positions and cater to diverse customer needs.

WEEK 1 ASSIGNMENT
The business I posted in the discussion board was Fedex.
Fedex is a delivery services company headquartered in Memphis, Tennessee. The company is
known for its overnight shipping service and pioneering a system that could track packages and
provide real-time updates on package location, a feature that has now been implemented by most
other carrier services. FedEx Corp. provides customers and businesses worldwide with a broad
portfolio of transportation, e-commerce, and business services.
United Parcel Service, Inc. (UPS) and FedEx Corp. (FDX) are two leading delivery services
companies and main competitors to each other, at least in the public eye. However, to those
following them closely, the two companies are quite different in their business models and
strategies.
The technologies used by UPS are:
DIAD, Barcode Scanner, Wireless Communication, ERP, Web service and GPS tracking device.
These technologies are related to UPS’s business strategy because they improve efficiency and
make parcel service’s cheaper. UPS uses Delivery Information Acquisition Device (DIAD)
which can be accessed by wireless network. Drivers can know more detailed information (for
example, geographic location of entire fleet) from handheld PCs that captures customer
signatures automatically.
These technologies also help the strategy to increase flexibility in business. These technologies

help the business to integrate tracking, rating, address validation and other stuffs to be done
easily in a real time.
UPS information system, website, use of internet and mobile app provide solution for different
categories of customers.
For individual Customers:
- Easy Access to Shipping and Tracking
- Everything You Need to Ship and Track, Online
- Receive Packages Your Way
- Access UPS When and Where You Need To
- Get Your UPS Bill Faster
- Returns Made Simple
For business Clients
- Save Time and Money
- Manage Shipping Online
- Receive Packages at Your Convenience
- Access UPS Where and When You Need To
- Get Paid Faster
- View and Pay Your Invoice
- Excess resources like call center and others.
For shipping and receiving Managers:
- Leverage UPS Technology to Manage Shipping and Returns

- Take Control of Your Receiving Process
- Access UPS When and Where You Need To
- Receive Your Invoice Electronically From UPS
DIAD (Delivery Information Acquisition Device) is the latest technology UPS is using in the
U.S. (Bortholomew, 2004) This device allows connections with multiple wireless connectivity
points and combines GPS, Bluetooth, Wi-Fi, and GSM networks. Delivery information is sent to
UPS via the DIAD as soon as it is entered into the device. On-Demand Services enable real time
communication with the driver. Text messages may be sent and received by dispatchers and
management. This service also allows UPS to take advantage of the most ideal geographic
locations for pickups.
On the other hand, FedEx offers an abundance of technology solutions. Getting rate quotes and
finding drop-off locations is easy from your web-enabled mobile device. FedEx is continually
enhancing their wireless solutions to improve efficiency and productivity. Their strategic alliance
with w-Technologies Inc which is a global provider of wireless software products, has improved
their wireless solutions. They know that an expanding mobile work force will require leading-
edge technology for those hand-held devices. FedEx continues to be the leader in wireless
solutions.
They have a strong competitive advantage because of their ability to deploy information
technology.
Cost leadership is the main generic strategy that FedEx uses in various consumer markets. The
primary objective of using this strategy is to preserve the market leadership position through
efficient value chain management. (Vrontis & Sharp, 2003)

Cost leadership strategy allows FedEx to expand the market share by targeting the middle class,
which makes the largest proportion of overall consumer market mix in most of the countries.
Middle class consumers generally place high importance to the pricing factor. So, cost leadership
is the best strategy to cater the needs of this consumer segment.
FedEx focuses on affordability and easy accessibility of its produce across the globe. This leads
towards high brand awareness and high sales growth. It also provides a strong competitive
advantage basis.
Other than charging low prices by lowering production cost and maximizing supply chain
efficiency, FedEx frequently offers discounts and coupons to achieve sales targets and handle the
competitive pressure by its closest rival. The intended outcome of these discount and
promotional campaigns is to increase brand popularity and encourage consumption.

SOURCES:
Bortholomew, D., (2004, December 21) It Delivers for UPS. Industry Week.
https://www.industryweek.com/leadership/companies-executives/article/21952416/it-delivers-
for-ups
Bernard, M., (2018, June 15) The Brilliant Ways UPS uses Artificial Intelligence, Machine
Learning and Big Data. https://www.forbes.com/sites/bernardmarr/2018/06/15/the-brilliant-
ways-ups-uses-artificial-intelligence-machine-learning-and-big-data/?sh=1394c415e6da
Vrontis, D., & Sharp, I. (2003). The strategic positioning of FedEx in their global marketing
operation. The Marketing Review, 3(3), 289-309.
UPS Website:
https://www.ups.com/us/en/services/tracking/mobile/android.page
Fedex Website:
https://www.fedex.com/en-us/home.html