S.W.O.T. Analysis
Company Strengths and Resource Capabilities:
Globalism: Federal Express operates on a global scale. They operate in 211 countries.
They provide services that appeal to most of the world. They have such a large market in
which to operate, and thus realize tremendous revenues. They can also achieve global
economies of scale.
Innovation: Federal Express took airplanes and trucks and used them differently than any
other company before them. This is innovation. They have first-mover advantage in name
recognition because of this innovation. This has helped them to remain the industry leader
since 1973.
Technology and Communication: Federal Express uses and continues to search for new
technology. They allow spending of $1billion a year, 10% of total revenues, for
information technology. That commitment keeps customers from switching to other
providers. Federal Express also has excellent communication with their customers. They
use tracking devices on all shipments, and customers can find out where their shipment is
through many different avenues including a user-friendly Web site. Federal Express
customers are assured that FedEx will always be on top of technology.
Strategic Vision: Federal Express will always have competent top managers in charge of
strategic direction. Frederick Smith built an industry leader, and kept it in that position
since 1973.
First-Mover Advantage: Federal Express has had first-mover advantage in several areas.
(1) Being a global express transportation company. (2) Advanced technology and
communication throughout the companys operations. (3) Incorporating smaller companies
with similar operations under its belt to synergize and control more of the market.
Industry Leader: Federal Express has been the industry leader since 1973.
Strong Brand Image: In 1990, Federal Express became the first company awarded the
Malcolm Baldrige National Quality Award in the service category. In 1994, Federal
Express became the first global express transportation company to obtain simultaneous
system-wide ISO 9001 certification in international quality standards. Federal Express has
also developed their own quality system that matches their customers standards.
Company Weaknesses and Resource Deficiencies:
Rising Prices: Federal Express prices are above their competitors. This can be a weakness
if their customers do not perceive a difference between Federal Express and its competitors
services.
Labor Disputes with Pilots: Federal Express pilots have formed the Fedex Pilots
Association. This organization demanded changes in the pilots salaries, retirement
benefits, and the fact that Federal Express outsources some foreign flights instead of
giving their own pilots the job. The pilots have a Web site where news is posted and
feelings are discussed. During the busy Christmas season in 1998, the pilots threatened to
