Fedex and Its Strategic Choices

Executive summery

Introduction

The aim of this report is to firstly identify the sectors CSF, secondly to identify the rage of strategic choice made by FedEx, thirdly to look at FedEx resources and capabilities, and finally look at FedEx strategies using “suitability, feasibility and acceptability” against future competition.

Findings

The findings suggest the sectors Critical Success factors are:-

Acquisitions

Technology

Reputation

Price

They show FedEx has 5.5% low margins than industry leader UPS, and that there revenue is falling at one of the slowest rates due to a small number of acquisitions taking place when the recession hit. Also that FedEx are trying to go green with the “20 by 20” scheme.

FedEx uses route 4(b) on Bowman’s strategic clock. This is a differentiation strategy, and they try to do this by quality and CSR. However the oligopoly has the same standardised product as the industry is very mature. FedEx main strategic choices are to split the business into SBU at a corporate level. To choices differentiation at a SBU level; also to acquire firms to increase market share. To make sure these firms cover as much of the globe as possible and are in the vastly growing BRIC’s countries. FedEx’s main resources that support their strategic choices are their employees, the service department, and expenditure on assets. FedEx capabilities tend to be intangible such as their experience and knowledge of entering new markets. These all add value to the brand name, and intangible assets are hard to imitate. Synergy is created in the supply chain in the operations section.

The B2C segment is showing the highest growth currently, and the internal capabilities of a standardised product make it easier to manage globally and create economies of scale, also making it easier for shareholder so see what they are investing in. The different segments spread the risk for investors. UPS are almost 60% more effective than FedEx at utilising their assets....