Report about UPS operation system Essay

Executive Summary

UPS, one of the leaders in bundles bringing industry, has 1000000s of concern minutess every twenty-four hours, across more than 200 states and districts in the universe. Therefore, it ‘s no uncertainty to state that UPS manages their company to work swimmingly, comprehensively particularly in term of operations, is such a large issues for all operation directions.

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Furthermore, UPS ‘s successful determiner is that UPS, itself adapts with the extremely rate changing of operations environment, particularly engineering development, is another issue that needs to be considered.

From these above thoughts, I would wish to analysis the operation procedure of UPS, which is a good illustration of operation direction, in the undermentioned descriptions.

From the above information, we can recognize that UPS has a strong and complicated supply concatenation system. So, UPS a extremely recommended illustration of Operations Management Skills in the logistics concern industry.

This is NOT an debut. It needs to sum up all the cardinal thoughts from your analysis. Always does the Exec Summary last?





Sandy Springs, Georgia, U.S


Courier Express Services

Freight Forwarding Services

Logisticss Servicess


408,000 ( 2009 ) [ 1


UPS Business Unit of measurements

US Domestic bundle,

UPS Airline,

UPS bundle,

Supply Chain & A ; Freight, International Packages United Parcel Service, Inc.A ( NYSE: A UPS ) , normally referred to asA UPS, is considered as one of the largest bundle bringing companies and besides a planetary leader in supply concatenation direction operations.

The company manages supply ironss for big and little companies in over 175 states and districts and has a great figure of concern units and bureaus in different states which targets different types of clients and supply diverse solutions ( including both goods and services ) for conveyance and logistics industry.

In add-on, in footings of grosss, UPS was ranked 43 among the Fortune 500 list of America ‘s largest corporations in 2010.

Furthermore, the company is included in the Dow Jones Sustainability Index for the 7th back-to-back twelvemonth and the FTSE4Good Index for the fifth back-to-back twelvemonth in 2009. Index Top 50 Global Companies in 2009. UPS was among the 40 Best Companies for Diversity by Black Enterprise Magazine in 2009. It was besides among the Top 50 Companies for Diversity by Hispanic Business Magazine and was among the 100 Best Global Brands by Interbrand ( ranked No. 31 ) published in 2009. It was besides included in the America ‘s Top Corporations for Women ‘s Business Enterprises every twelvemonth since 1999.

UPS is known as one of the largest bundle bringing companies in the universe, in footings of gross and volume of minutess:

In the fiscal twelvemonth ended on December 2009, the company recorded grosss of $ 45,297 million, runing net income of the company was $ 3,801million and the net net income estimated $ 2,152 million.

The company delivers bundles for around 1.8 million clients to 6.1 million consignees in over 200 states and districts each concern twenty-four hours. The company is one of the largest air lading bearer and logistics supplier in Latin America and in the Caribbean.

The Procedure

Supply Chains Procedure:

UPS processes extremely comprehensive, consistent operation system holding the ability to pull off each company individual factors ( or known as a concatenation in value concatenation of operations ) in the procedure and guarantee all factors in the procedure working under best public presentation and continuously heightening the concern public presentation.

In add-on, UPS has been tried to better all of its factors by using the latest engineerings & A ; invention in the logistics industry. As respect to human resources, they besides provide farther preparation for their employees, directors in such a manner that their employees are equipped with necessary accomplishments in footings of occupation enrichment and occupation expansion.

By making that, concern has a great chance to work at its best productiveness, high quality services and prolong the competitory advantage towards its rivals.

Basically, UPS ‘s production procedure has three chief constituents with a high rate of mechanization. These constituents are Value creative activity procedure, Support procedure and General Management procedure.

Value Creation Process: is the chief procedure in which the company moves and delivers from transmitter to receiver right and precisely.

Support Procedure: is the procedure of research and use the new engineering in to value creative activity procedure that enables value creative activity procedure work more efficient and effectual.

General Management procedure: is the critical constituent of UPS ‘s operation procedure, which keeps all the others constituents such as value creative activity and support procedure work good. With a good direction manner, all their concern units can work under a good, effectual and efficient mode.

Procedure Image:

Obviously, UPS has a great incorporate system between value creative activity, support procedure and general direction procedure. These accompany aid full production processes to work and better their public presentation. At all the points of production procedure, we can see that there is a mix of human resources, engineering and high degree direction.

Measure 1: Roll uping the bundles from the clients:
This is the first measure in the long term travel of bundles across the state or even the universe.

By utilizing several different roll uping methods ( straight collect, indirectly collect, postaˆ¦ ) the bundles are gathered at the local agent hub.

In order to do the conveyance easier, more right, the bundles will be classified, separated as 3 sorts of bundles such as little, parcel and irregular.

Small: Minute 6:41



Measure 2: Input signal the information of the bundles and burden it ‘s to Airplane
6:00 Autopsies: All bundles begin to be arranged and sorted based on the services, type and urgency degree.

After screening and set uping, UPS stick a barcode on every individual point and this information besides is stored, saved in the UPS webs. With this right information provided by the sorting and stamping, UPS can easy track their bundles and minimise the doomed, and optimise the planning of bringing in the real-time.

For illustration:

Information helps the finish local hub has a clear understanding about their plants tomorrow and has a good program such as new wave agreement, deliver clip and agenda aˆ¦to present the bundles.

Information allows the universe port track the bundles lost in their procedure, and set up the burden and unloading clip of aeroplane.

[ Support Process ] To do certain saloon codification spine provides to the full information about itself. UPS ‘s utilizing SMART LABEL taging system, which one have three different type of barcode includes in one spine. Smart Label provides critical information about the bundles such as finish, services, nothing codification aˆ¦

8:00 Autopsy: Loading all the bundles to the monolithic transportation container Begin and aeroplane get ready to go forth off the local hub to its finish, World Port.

[ Support Process ] A particular type of container is used with the ability right fit with Airplane shop. Efficaciously, minimise the spread between two container, and increase the loading infinite for bundles.

Measure 3: Airplanes set downing and droping the bundles:
10:15PM: Airplane is about to set down on the World Port Airport with careful and accurate control direction.

[ Support Process ] Thanks to the new engineering named ADIB ( Automatic Dependent Surveillance – Broadcast ) , UPS can follow the flighting control and developing plan to maintain better bid and better control for the aeroplane. It helps their aeroplanes safety landing and right fit with the clip agenda.

11:15PM: All the aircraft landed and parked in their appropriate place for lading and droping to the container. In this measure, we can see that they use non merely engineering installations but besides a careful and experienced skilled people.

[ Support ] Traveling a dozenss container is a tough work and takes a long clip. However, this work becomes easier with assisting of K-loader and Ball Floor. A individual individual can travel dozenss container easy or even faster.

K-Loader: A particular type of truck which is designed to precisely fit with aeroplane lading country and equipped with a strong Crane to travel a figure of containers at the same clip.

Ball Floor: is a new innovation of warehouse building. There are a figure of drifting balls in the floor in which people can travel a container leaden dozenss, easy and right.

Chain 4: Sort and Loading
This measure is regarded as one of the most of import parts of UPS presenting procedure and has a highest degree of engineering & A ; information direction.

Entire procedure holds in a mill which called Worldport, worldwide air hub of UPS, located at theA Louisville International AirportA inA Louisville, A Kentucky US. World port is the consequence of $ 1 billion, five-year enlargement from in 2002 from its mill before. The undertaking is presently the size of 80 football Fieldss and capable of managing 84 bundles a 2nd, or 416,000 per hr, with over 20,000 employees.

After all bundles unloaded from the container ( Can ) , it so begins its travel inside 100s ‘ kilometer of convoyed in World Port. Every type of bundles ( Small, Parcel, Irregular ) has its different procedure.




By and large, after cameras reads the codification, the bundles are sorted, putted on their right topographic point in the immense web of conveyer belts, began its journey right through, ne’er one time hit when traveling with another bundle during the manner until it eventually drops into its designed finish.

[ Support Process ] With all advantage of engineering application, UPS brought to their mill a good automated screening system. All bundles are continuously sorted by their provided codification when it travels along the conveyers.

Here is the installation Process Design, which one describes the manner all the bundles move through World Port and are sorted:

Facility Image

Chain 5: Loading Back to Airplane & A ; Managing to the Local Agent Hub:
After the sorting finished, the bundles are fundamentally ready to be delivered to receiver. The full bundles one time once more are loaded back to airdrome and take a travel to their finish at the local hub.

[ Support Process ] As reference above, Flighting control system, Container burden is assisting people lading, taking off easier.

Chain 6: Delivery to Receivers:
After the bundles arrived at local hub, it begins to present to receiver by smaller finish country and with little new waves or others transit.

[ Support Process ] UPS implement the handled equipment ( Personal Digital Assistant – Personal digital assistant ) that provide the new wave driver have the most optimized deliver program to present bundles such as ever turn right, avoiding traffic ropeway points and some others maps for case digital note, receiving system information aˆ¦

Overall, we can see that UPS procedure have really high degree of high engineering execution and high degree of direction every bit good.

Value Chain
From above procedure we can clearly acknowledge that motion of the goods and stuffs such as bundles, truck, container, aeroplane and back uping from direction and information engineering, through the whole procedure. However, it will in sufficient if we do n’t advert the others portion of UPS operation which is besides of import to UPS operation system. It ‘s non merely physical motions of good, but it ‘s besides in footings of service every bit good, which is named UPS Value Chain.

Like all others value concatenation procedure, UPS value concatenation procedure includes supplier, inputs, procedures, end products and post-sale services.

Image of Value Chain Page 23

In the value concatenation procedure, when we can better one constituent value to go superior value, we can hold more chance to increase client perceived benefits in the following measure of procedure and the extraordinary at the consequence.

The patterns of analyzing the UPS ‘s value concatenation procedure can let us wholly place critical factors that aid UPS increase its competitory border. Because in recent old ages, Customer needs nonstop for good merchandise or good services merely, their demands increase dramatically_ they besides desire to hold a great value services which is worthy to their payments. Therefore, pull offing the whole value concatenation procedure is the alone manner that UPS guarantee their operation fruitfully provide to clients quality Products & A ; services, increase the client satisfaction and bit by bit accomplish Value Proposition.

In extra, Value concatenation is the consecutive line procedure and screen full concern operation. Any jobs happen at any points will take the procedure to be jammed or bottleneck. So, pull offing good every individual point of value concatenation procedure is the most unafraid manner to avoid defects in the procedure.

Potential Improvement:

From the visual perception of videos instance, in my personal apprehension and researching in bundles bringing industry, I would wish to give some sentiments that might assist to better the UPS productiveness.

UPS should utilize more engineering in order to take more advantages.

“ Apply Technology is one of the most indispensable key that concern, particularly logistics company have to carry through in order to forestall and prolong the competitory ability from others ”

Mike Terzich, senior frailty president of gross revenues and selling for Zebra Technologies, the Chicago-based maker of thermic transportation saloon codification pressmans and related label design package.

At Step 1 & A ; 2 ( Roll uping the bundles & A ; input bundles information )

We can lodge the bundle barcode spine instantly when we receiver the merchandise at local hub.

The first advantage, we can hold an optimized program for set uping and screening the merchandise in World Port

At Steps 2 & A ; 4 ( Input informations about bundles & A ; Screening at World Port )

UPS could utilize the RFID ( Radio Frequency Identification ) for their marker alternatively of saloon codification. Because RFID uses the wireless frequence, the information can be read easier than reading the codification by cameras even it is hidden.

Further, World Port Operation could minimise the figure of employee for turning the face of the bundles up to the right face for which let camera read barcode, and likely assist the procedure work faster.

However, this action has to be considered at fiscal benefit. Cause the different between RFID ( Radio Frequency Identification ) Chips and barcode spine will be excessed the operation benefits.

From the value concatenation procedure position point

UPS besides need to see about another constituents ( except production procedure ) such as provider, input, end product and post-sale, because these constituents are besides indispensable if concern want to accomplish long-run value delivering.

To be more precise, from the procedure, UPS should non entirely concentrate on the advantage of engineering, they besides need to carry through more advantage from provider, general direction in order to better its operation public presentation and besides have more concatenation to better the current procedure.

For illustration:

Pull offing the provider relationship by and large can better the concern cost and flexibleness.

Pre and Post sale services will convey more value to client who use this services while UPS repute and client relationship stronger.

The Competitive Advantage:

Achieved Competitive Edge:

From the picture instance, I found these competitory advantages that UPS have achieved from its procedure scheme:

First of all, Time, the factor that more indispensable in the high rate of competitory environments, in peculiar US market ( Fed ex, US station… ) . Technology seem to be the best solution for clip decrease, cause machines is working more right and faster than people so UPS can cut down the clip that people can short and travel the bundles such as screening with the conveyer.

In term of quality, UPS with the latest engineering such as Airplane bringing, saloon codification reading and information system, give their client an extraordinary service with 12 hours. All the bundles separate and present to client faster and more right than traditional by utilizing saloon codification, aeroplane and ache planning system.

Automated automatons, smart label, information database system, aeroplane bringing… have overall improve quality of UPS services. Innovation is one of of import portion of UPS procedure. These above inventions have covered all the production procedure as a whole and assist the procedure better it possible every bit much as possible.

Using engineering is such a manner that the concern procedure could salvage cost in term of employee wage, faulty repair and guarantee disbursal aˆ¦ However, a high degree of engineering besides addition of the operation cost which one make the services lesser competitory.

Completive Sustainability scheme:
Beside competitory advantages and disadvantages that UPS had in recent instance, UPS besides be able to prolong and keep its competitory advantages, minimize and avoid it disadvantages overtime.

With a great portfolio and

Economicss of graduated table: The Company ‘s strong market place and big graduated table of operations enable it to function a wide scope of clients across major international markets and provides it the benefit of economic systems of graduated table.

Proprietary larning curve: With a big portfolio of investing and a immense scope of employees. They are good learning organisation. Employees will be master their experience by work easier than other organisation. The procedure will be faster and more efficiency if they leverage and encourage their on the job experience.

What do you believe is the competitory advantage to the organisation of utilizing this procedure? Can that be sustained over clip?


After delving into the organisation and its operations, what did Y From the picture we can non see the flexible of UPS services. All bundles ship in the same they even it ‘s non

Harmonizing to Michael Porter, The male parent of competitory advantages and “ Five forces of completive advantages and three generic three schemes ”

Supplier Power: is one of UPS ‘s value concatenation constituents. It can assist the concern have a good chance in cost and invention, Flexibility ( distinction ) with their rivals, when UPS can pull off a good relationship between it and their provider such as Airplane fabrication.

For illustration: good relationship with provider such as Airplane fabrication, new wave fabrication or even new waves tired distributers will allow them hold more chance to better its cost of operation and supply cheaper services while keep invariable services quality.

Barrier Entry: In the recent old ages, we can see that UPS has a great sum of rival that they have to against such as DHL, aˆ¦ However, UPS besides have ability to prolong its competitory advantage by forestalling new entrants to the market by some operation scheme such as:

Branding Identity:

Capital demands:

Buyer Power:

Menace of Substitutes:

The UPS services can be substituted by the other deliver company services, so that in other to forestall that go on. UPS should to maintain their monetary value as a degree that its services have a safety zone with others services monetary value.

In add-on, a new engineering or a new invention besides another ways that damage UPS services.

For illustration: with the revolution online purchasing ( or online market ) , the markets seems to be changed, all the dealing does n’t merely transporting from one topographic point to another topographic point. They have to include the unafraid dealing, on-line payments. So that if UPS can non rapidly accommodate with this market altering by operation method such as warrant cargos, recognition transportation merchandises. Gradually or even shortly other company services will take over their market.

Degree of Rivalry

These figure is a strong grounds to demo that UPS has a successfully settled up effectual operation system in such a manner that

The company is good clarified and offer the best solution for all type of terminal clients that it serves. It provides big set of offerings through its concern units. It means UPS can offer all the solution related to transit for its client depend on the type, size and forte of its client.

. further the bundles are traceable so that the doomed will be minimize every bit less as possible.

Furthermore, UPS ever seek for new invention which can use to their services with purpose to better it quality every bit good.