Running head: UNITED PARCEL SERVICE 1

Analysis of United Parcel Service

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Abstract

United Parcel Service (UPS) is a large logistics company in the United States with its
headquarters in Sandy Springs, Georgia, in the United States. The United Parcel Service operates
on a global scale and has acquired over than 7.9 million customers globally. UPS has been
operational for decades and has gained a tremendous reputation through its unique organizational
culture and business framework. A company like UPS mainly uses the SWOT analysis approach
to determine the strengths and weaknesses of the company.
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United Parcel Service

UPS is an American based courier and transportation provider which provides the domestic and
international delivery of letter and package.It’s also committed with the provision of specialized
transportation service, financial and logistic services to the clients.

Internal Environment Analysis of UPS.

UPS has the following internal environment factors to consider in its analysis;

a) Corporate Culture.

The corporate culture of UPS revolves around its rich history. This is because the company had
spent decades trying to test their methods to perfect their system on which their built to provide
their customers with quality and satisfaction.

b) Operational Structure.

Sales and marketing functional structure strategy are one of the most commonly used systems in
many companies. One of the main reasons behind the selection of this structure is that it enables
UPS to have high specialization and control to achieve maximum efficiency.

c) Business Model.

The current business strategy being employed by UPS is the Total Quality approach. They apply
this strategy to all parts of their business. The reason behind the selection of this approach was
because they wanted to make the quality of UPS the best in the world. The application of this
form of business strategy was made to improve their productivity, efficiency, and quality which
emphasizes on continuous improvement (Ziegler, 2014).

d) Strength and Weaknesses.

UPS is one of the major companies in the courier industry due to three key strengths. These
strengths are:

1) Strong market position.

UPS conducts a very intensive and extensive integrated global ground and air network which
consists of more than 140,000 international and domestic access points.

2) Broad Portfolio of Services.

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UPS enjoys many benefits due to the very diverse end markets that it serves. It offers some
services across its three different business spectrums. UPS national contingent consists of both
air and ground delivery of small packages and letters to and from all the states in the US (Ross,
2002).

3) Robust Infrastructure.

Unlike other companies in the industry, UPS has a very strong transportation infrastructure. It
operates a ground fleet of approximately 101,900vehicles, which reaches all business and
residential zip codes in the contiguous US and air fleet of 510 aircraft which is one of the largest
airlines in the world.

Although UPS has ups and downs, it emphasizes more on internal concerns, skills, financial
performance, and marketing capabilities in which the firm operates under the following
guidelines:

A) Issues about the internal organizational environment.

The following are elements of the internal organizational environment;

a) Owners-These are the people who have claims and rights over the company. They can be
individuals or group of persons who bought the company over the market share and have a right
to change any policy at any given time.

b) Board of Directors-This is the governing body of the organization and mostly is elected by
stakeholders.

c) Employees-This is the primary workforce and the most crucial element of organization’s
internal environment. Proper management of the employees is essential in realizing the
company’s objectives and organizational efficiency.

d) Culture-This is the most critical element in the internal organization environment which
usually defines the behavior of the employees and the organization’s values, visions, beliefs,
habits that they attach to their actions.

B) Internal marketing needs.

The following are the elements that the organization needs to focus on when undertaking internal
marketing;

a) Collection of critical operational metrics-This means that data must be collected before any
optimization can begin. UPS is an excellent example of a company using internal data to make
continuous improvements.
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b) Analyzing of the organizational data- By placing sensors in their delivery trucks, UPS can
track drivers' movements, which the drivers approve of because the sensors also inform them
when maintenance is required.

c) Using the findings from your data analysis to make internal improvements- Experts mine the
information gathered by the sensors in the trucks and contrast them with information from
similar sensors in different vehicles which permits UPS information investigators to distinguish
information designs that demonstrate a truck is going to have a mechanical breakdown
(Lekoudis, Richardson & Roark, 2005).

C) Sources of Revenue related to Financial Performance.

The following are the sources of revenue related to financial performance in UPS;

i. U.S. Domestic and International Package Operations-This revenue are released upon
delivering a letter or package.
ii. Forwarding and Logistics-These are the main services offered at UPS. Truckload freight
brokerage revenue and related transportation costs are recognized upon delivery of the
shipment.
iii. Material management and distribution revenue-This is recognized upon performance of
the service provided.
iv. Customs brokerage revenue-This is recognized upon completing documents necessary
for customs entry purposes.
v. Financial Services-These is finances and revenue collected on loans and direct finance
leases on the effective interest methods.

D) Analysis and evaluation of the internal environmental issues.

A company like UPS mainly uses the SWOT analysis approach to determine the strengths and
weaknesses of the company. Moreover, UPS SWOT analysis is essential given that it faces
competition from other companies that offer the same services. Therefore, to understand its
environment better it is critical to use SWOT analysis which is a highly interactive process and
requires effective coordination among various departments within the organization such as
marketing department, the finance and strategic planning departments.
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References

Lekoudis, G., Richardson, D., & Roark, C. (2005). United Parcel Service optimization of vehicle

balance. 2005 IEEE Design Symposium, Systems, and Information Engineering.

doi:10.1109/sieds.2005.193272

Ross, J. W. (2002). United Parcel Services: Delivering Packages and E-Commerce Solutions.

SSRN Electronic Journal. doi:10.2139/ssrn.305714

Ziegler, M. (2014). Choice at Work: Young v. United States Parcel Service, Pregnancy

Discrimination, and Reproductive Liberty. SSRN Electronic Journal.

doi:10.2139/ssrn.2524142