Part 2 of 3
I visited FedEx for a client once and got a thorough tour of their operations. Several observations have stuck with me since.
I was struck by how everyone came to work. They arrived en masse at the facility at 3am, walking down a very long, 12 to 15-person-wide hallway. Hanging from the ceiling were TV monitors. I asked what they were for, and was told that the CEO, Fred Smith, greeted the workers and talked about items of importance for the day . . . every single working day.
The left side of the hallway was all windows; you could see the very large sorting area below. It looked like a massive version of a baggage carousel, with packages sliding down toward the sorters.
After seeing pure efficiency in action at the sorting station and elsewhere, I asked my host why FedEx was so efficient. “Because it absolutely, positively has to be there overnight,” he said, smiling.
This was their campaign slogan for years. That tagline was in operation from 1978 to 1983, but remained a corporate promise for many years after.
This is a prime example of a marketing promise embraced by the company’s workers and supported by its managers.
But FedEx did more than just deliver packages overnight. I was told they assembled computers for computer manufacturers, and then shipped them, and they rented out their de-icing machines to the local airport when they weren’t using them themselves.
They were among the first companies to scan packages as they were picked up, and rolled out handheld scanning via “SuperTracker” in 1986.
As with Amazon, Fred focused on logistics. On the first night, they began operations in April of 1973, they moved 186 packages across 25 U.S. cities using a fleet of 14 aircraft. It was a fully integrated air-ground network from the start. Presently, the company carries out 17 million shipments per day.
In 1979, FedEx introduced a computer system called COSMOS (Customers, Operations, and Services Master Online System), which managed people, packages, vehicles, and weather in real time.
Their infrastructure strength enabled them to evolve into a global logistics supply chain company, offering freight, ground transport, logistics services, supply-chain management, global shipping, and more.
What also struck me was the workers’ intensity. You could feel it in the air. No one was sitting around. Everyone seemed determined to do their best and was glad to be working there.
One worker review says that Fred “based FedEx on the People-Service-Profit premise—if you take care of your people, they will provide the service needed and the profit will come.”
Some employers and rank-and-file workers describe the period under Smith as one marked by greater purpose, pride in the mission, and a sense of “ownership”—a reflection of his management philosophy (long-term thinking, quality culture, and “freedom with accountability”).
All of these facts and observations confirm what I have come to believe and put into action as a revenue system architect. If you take good care of your workers, customers, and partners, and support them with solid infrastructure, yours will be a standout company that leads your industry.