Supply Chain Management: Assignment

R.no: 34447

Srinivas. Surapareddi R.no: 34447 Supply Chain Management Assignment

United Parcel Service, Inc. (NYSE: UPS), typically referred to by the acronym UPS, is a package delivery company. Headquartered in United States, UPS delivers more than 15 million packages a day to 6.1 million customers in more than 220 countries and territories around the world. UPS was initiated in 1907 by Jim Casey along with his friend Claude Ryan. They started the company in a small basement office. (Michael Bosl, nd). In start UPS was known as American Messenger Company. Today UPS is the largest company which is using air and ground for delivering packages all around the world. UPS is acting as an active leader of supply chain management and different freight services. Its headquarter is located in Atlanta and operating and providing services in more than 200 countries of the world. Firstly UPS started its services for delivering packages in Seattle, Washington. UPS is using more than 200, 000 drivers for delivery vehicles and package handlers. At the time of company origin there were only two bicycles and a phone which Jim and his friend owned but with the passage of time now company is operating at best with huge infrastructure around the world and doing a successful job to meet its promise of best service and lowest rates. UPS Company is operating with 359,000 employees, 1,748 operating facilities, 152,500 delivery vehicles and 238 aircrafts. With the passage of time UPS has now become expert and leader in transformation, innovation and creativity in its information system for providing package delivery services from a small messenger company to a market leader messenger company. UPS's primary business is the time-definite delivery of packages and documents worldwide. In recent years, UPS has extended their service portfolio to include less than truckload transportation (primarily in the U.S.) and supply chain services. UPS reports their operations in three segments: U.S. Domestic Package operations, International Package operations, and Supply Chain & Freight operations.

Supply chain design

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Supply Chain Management: Assignment

R.no: 34447

Design of logistics: The UPS Parcel Network is based on a hub and spoke model. UPS operates centers that feed parcels to hubs where parcels are sorted and forwarded to their destinations. Centers typically are the point of entry for parcels and send the parcels to one or more hubs. A hub is a location where many centers send packages to be sorted and sent back out to other centers or hubs. The UPS air network runs similarly to the ground network through a hub-and-spoke system, though air hubs are typically located at airports so packages and planes can quickly be unloaded, sorted, and loaded again. Centers feed packages to facilities at airports (called gateways), which in turn send them to an air hub to be sorted and put on another plane to a final destination gateway, and then from there to a center.

Supply Chain Planning:

Mode of transportation are, Flights, Trains, Trucks and Ships. And the moment of assets can be goods, funds or information.

Customers are demanding later pick-ups, earlier deliveries, competition is increasing and the market is expanding rapidly, which increases the effects of poor planning or decision making. Just a single aircraft departing late can result in thousands of dissatisfied customers and a potential loss of millions of dollars. So an analysis and the forecast plan has to be prepared for transport schedules in order to minimize the operational costly without changing the delivery timelines of the consignments. United Parcel Service (UPS) temporarily modified their flight schedule during late December to accommodate the holiday season demand. As a result, one morning arrival was moved up an hour earlier and an additional forth flight was added. The modifications were short-term and have since returned to the previous schedule.

COMPASS Tool:
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Supply Chain Management: Assignment

R.no: 34447

For operations monitoring, planning and scheduling system and information flow at UPS, uses COMPASS which is very helpful for providing information regarding planning flights, scheduling and handling loading functions. It is a unique system from competitors and provides the company with competitive advantage because it can provide flight schedules for next six years and make the company active in its actions not reactive.

Supply Chain Strategy:

A well executed supply chain strategy results in value creation for the organization. It is important to clearly understand how the enterprise chooses to compete. It forces the supply chain operation to see itself as a customer facing entity serving the competitive goals of the enterprise. Supply chain strategy is not simply a linear derivative of the business strategy. If the business strategy is to be the low cost provider, the supply chain strategy should support this. And just like when developing a business strategy, look to your core competencies, focus, and means of differentiation when developing a supply chain strategy. Integrations: In 1929, UPS became the first package delivery company to provide air service via privately operated airlines. UPS started operating its own airlines since 1988. Outsource Where Appropriate: Part of developing a supply chain strategy includes evaluating opportunities to outsource areas that are not your core competency. If someone else can do it cheaper, it may be worth outsourcing not only to drive down costs, but also to focus more resources on the core competencies your organization does well. In the case of UPS, the development of the customized IT application that are supported for tracking of the vehicle and the tracking of the consignment are outsourced to the leaders in the market.

Distribution system at UPS:

Distribution system of UPS consists of three major portions/steps.
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Supply Chain Management: Assignment

R.no: 34447

Consolidation: This is the first step in which parcels are collected and assigned to specific routes of their delivery. Traffic conditions are monitored to shorten the destination path. Drivers use DIAD (Delivery Information Acquisition Device) to collect information about package. This is helpful for tracking packages. Distribution: This operation is functionalized from one hub to another for calculating distances for making decisions about using trucks or air way. Distribution operates between three hubs i.e. 1. The Main Hub is Louisville, Kentucky 2. UPS World port 3. Willow Springs in Chicago Fragmentation: In this process packages are delivered to its destination places. It is actually reverse process of consolidation.

Development of IT:
Information flow:
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Supply Chain Management: Assignment

R.no: 34447

UPS package flow system using labels which UPS called smart labels which bears information for delivery and which is readable by bar code reader. The package carrier's shall have smart labels with data given by customers on UPS website for transfer of consignment. With the help of this data the company makes plans for dispatching for every route of delivery. This system has also the feature of built-in geographic information system software for mapping out routes. Delivery Information Acquisition Device (DIAD) and information at UPS: DIAD is a handheld device. Every UPS delivery driver carried this device for keeping the information for package delivery. Drivers record the information with the help of this device and then they transmit this information to UPS network to keep the information flow about every delivery package smooth, immediate and on time. All the communication and information are shared by this device between company network and drivers. Drivers stay in contact with UPS network due to DIAD and get news about delivery picking schedules and traffic conditions. UPSnet and Information: UPSnet using an electronic data communication network which is operating globally and is useful for streamlining the processing of information to manage the international package delivery. UPSnet is operating to manage the information and communication tasks for about 500,000 mile of communication lines between 1300 distribution sites in 46 countries. Quantum View Manage: Improved Shipping Visibility through Quantum View Manage. Shipment tracking, customs brokerage, and inbound-outbound scheduling can be a full-time job. Step back and get a broader perspective on shipping activity with Quantum View Manage. Eliminate the need to look up shipments individually by tracking number.