Welcome to Scribd, the world's digital library. Read, publish, and share books and documents. See more
Download
Standard view
Full view
of .
Look up keyword
Like this
1Activity
0 of .
Results for:
No results containing your search query
P. 1
Federal Express Case study

Federal Express Case study

Ratings: (0)|Views: 32|Likes:
Published by abhishekjainit
Federal Express Quality Improvement
Federal Express Quality Improvement

More info:

Published by: abhishekjainit on Feb 13, 2012
Copyright:Attribution Non-commercial

Availability:

Read on Scribd mobile: iPhone, iPad and Android.
download as PDF, TXT or read online from Scribd
See more
See less

08/26/2014

pdf

text

original

 
CASESTUDY
FEDERALEXPRESS
Thefirsttimeyoutolerateanythingotherthan
a
movementtoward100percentcustomersatisfaction,you'reontheroadtomediocrity.
FrederickW.Smith,FederalExpresschairmanandchiefexecutiveofficer
FederalExpressCorporation(FedEx)wasfoundedin1973byFrederickW.Smith.Aformermilitarypilotwithavisiontocreatetheair-expressindustry,Smithstartedhiscompanywith14smallplanes.Some17yearslater,FedExhadafleetof419planesdeliveringpackagesallovertheworld.Attheendoffiscal-year
(FY)
1990,thecompanyemployed90,000people,processed1.5millionshipmentsdaily,andtotaled$7billioninrevenues.Since1973,FedExhadreceived195awards,butthemostprestigiouswasreceivedonDecember13,1990,whenSmithacceptedtheMalcolmBaldrigeNationalQualityAward(MBNQA)fromthePresidentoftheUnitedStates,GeorgeBush.FederalExpresswasthefirstcompanytowinintheservicecategorysincetheawardwasestablishedin1988.In1990,theU.S.DepartmentofCommercereceived160,000requestsforMBNOAapplications,butonly97companiescompletedtherigorousapplicationprocess.(SeeExhibit1forMBNQAapplicationheadings.)..AsPresidentBushleftthestagefollowingthepresentationoftheaward,SmithcaughthisattentionandpledgedhissupportforthepotentialPersianGulfconflictwithIraq.(FedExflewpersonnelandsuppliesintotheGulf.)TheIraqsituationposedaparticularchallengeforFedEx,becauseoilpriceshadmorethandoubledbetweenAugustandDecember1990.Unlikethecommercialairlines,FedExdidnotvaryitsshippingratesonaregularbasis.Inaddition,overnight-deliverygrowthrateswereslowing,whichmad~competitiveactivitiesfromEmery,theU.S.PostalService'sexpressdivision,andAirbornemorethreateningthaninthepast.Costwasbecomingabiggerfactorintheovernightpurchasedecisionasqualityeffortsimprovedserviceratesacrosstheindustry.Afterthepresentation,Smithwalkedoffstageandjoinedtheother1990MBNOAawardwin-ners(IBMCorporation,WallaceCompany,andtheCadillacDivisionofGeneralMotors)ataround-tablediscussionaboutthechallengesfacingacompanythatfocusesonquality.ThefirstquestionreferredtothechalJengesfacingFedEx.
USAToday
asked,"Intougheconomictimes,isn'tittoocostlytoimplementquality-improvementprogramsthatrequireretrainingtheworkforce?"AsSmith'squotationatthe.beginningofthiscasesuggests,theroadtotheMBNQAwinner'scirclehasarrowspolntedoneway.CompanyPhilosophy
Customersatisfactionbeginswithemployeesatisfaction.Puttingpeoplefirstineveryaction,everyplanningdecision,everybusinessdecisionrequiresatremendouscommitmentfromeverymanagerandeveryemployeeinthecompany.
James
L.
Barksdale,ChiefOperatingOfficer
OM-110
 
EXHIBIT1MalcolmBaldrigeNationalQualityAwardApplicationHeadings
1990ExaminationCategories/ItemsMaximumPoints
1.0
Leadership
1001.1
Seniorexecutiveleadership
30
1.2
Qualityvalues
20
1.3
Managementforquality
30
1.4
Publicresponsibility
20
2.0
InformationandAnalysis
60
2.1
Scopeandmanagementofqualitydataandinformation
35
2.2
Analysisofqualitydataandinformation
25
3.0
Strategicqualityplanning
90
3.1
Strategicqualityplanningprocess
40
3.2
Qualityleadershipindicatorsinplanning
253.3
Qualitypriorities
254.0
Humanresourceutilization
1504.1
Humanresourcemanagement
304.2
Employeeinvolvement
40
4.3
Qualityeducationandtraining
40
4.4
Employeerecognitionandperformancemeasurement
20
4.5
Employeewell-beingandmorale
205.0
Qualityassuranceofproductsandservices
150
5.1
Designandintroductionofqualityproductsandservices
30
5.2
Processandqualitycontrol
25
5.3
Continuousimprovementofprocesses,products
25
andservices.5.4Qualityassessment
15
5.5
Documentation
10
5.6
Qualityassurance,qualityassessment,and
25
qualityimprovement
of
supportservicesandandbusinessprocesses.
5.7
Qualityassurance,qualityassessment,and
20
qualityimprovementofsupplier.
6.0
Qualityresults
150
6.1
Quality
of
productsandservices.
50
6.2
Comparisonofqualityresults
35
6.3
Businessprocess,operational,andsupportservice
35
qualityimprovement.
6.4
Supplierqualityimprovement.
307.0
Customersatisfaction
300
7.1
Knowledgeofcustomerrequirementsandexpectations
50
7.2
Customerrelationshipmanagement
30
7.3
Customerservlcestandards
20
7.4
Commitmenttocustomers
20
7.5
Complaintresolutionforqualityimprovement
30
-.:c.
7.6
Customersatisfactiondetenninalion
50
7.7
Customersatisfactionresults
50
7.8
Customersatisfactioncomparison50
Total
1000
OM-111
 
FedExvieweditsjobassellingservice;itsoldthepromisethatapackageorletterwouldarrive"absolutely,positivelyovernight."Sometimesfulfillingthispromiserequiredemployeestoworkharder.FedExCOOBarksdalelikedtousethisletterfromacustomertostresstheidea:
TheSaturdaybeforeLaborDay,IwasanxiouslyawaitingapackagebeingdeliveredtomeviaFed-eralExpress.Itcontainedmaterialswhichhadtobeconsolidatedwithanotherpackage,thensentontoEuropethatnight.Itwas4:00
P.M.
whenthepackagefinallyarrived;soIrushedtoyourlocalstation.Unfortunately,Ididn'tarriveuntilafteryourclosingtime.Iwasfurious.Afterlisteningtomystory,IngridJames...theoperationsmanageratEmeryville...promisedshewoulddowhatevershecouldtogetthepackageoutthatnight.Shewaited45minuteswhileIcompiledthematerialsandmadesurethepackagemade
it
outthatnight.WhenIarrivedin
my
officethefollowingTuesdaymorning,IhadfaxesadVisingmethatthepackageswerereceived.Having
an
employeelikeMs.Jamestellsmethatyouandyouremployeescareaboutthecustomer'sbusiness.Tomeshe"notjustIngridJames,she
is
FederalExpress.
Barksdaleagreed:"SheisFederalExpress.Thatsaysit
all.
Ourpeopleholdintheirhandsour..customer'sperceptionofquality.Clearly,thedegreetowhichpeople
choose
toexerttheirbesteffortdeterminesoursuccessinacompetitiveglobaleconomy.Thequestionis:howdoweorganizeourcompaniesandpreparealJpeopletolead?"Theanswer,accordingtothePeople-Service-Profit(P-S-P)philosophy,reliedheavilyonmanagement'sabilitytocreateanenvironmentthatencouragedandallowedpeopletochoosetodeliversuperiorservice.Inshort,Barksdalesaid,Customersatisfactionbeginswithemployeesatisfaction.Ouremployeeshavebeenactingontheirowntokeepcustomerssatisfiedevenbefore
empowerment
becameabuzzword."Consequently,theP-S-PphilosophyguidedFedExinallitspoliciesandactions.AttentiontoqualityserviceemergedearlyinFedEx'shistory.Forinstance,FedExadvertisedthecompany'shighservicelevelsvis-a-visEmeryin1975withtheslogan,"FederalExpress.TwiceasGoodastheBestintheBusiness."Inthe1970s,servicewasmeasuredbythepercentageofovernightdeliveriesthatweremadeontime.Inthe19aOs,however,FedExmanagersconcludedthathighservicepercentageswouldnotbesufficientinthefuture.Forexample,a99-percentsuccessrate,atFedEx's1990volume,translatedinto2.5millionactualfailuresperyear.
EXHIBIT
2
FederalExpressquality
Tobolsterqualityefforts,FedExadoptedtheQualityImprovementProcess(QIP).ThisprocesshelpedestablishtwoimportantideastosupporttheP-S-Pphilosophy.First,QIPrecognizedthe
correlation
betweendoingthingsrightthefirsttimeandproductivity:the
Q::
Pparadigm(quality::::productivity).Second,QIPdefinedqualityservicenotinstatisticalterms,butasperformancetothestandardsofthecustomer:"100%"satisfactionbecametheuncompromisinggoal.Exhibit2,whichappearsintheFedExemployeehandbook,isagraphicrepresentationofthesephilosophies.
OM-112

You're Reading a Free Preview

Download
scribd
/*********** DO NOT ALTER ANYTHING BELOW THIS LINE ! ************/ var s_code=s.t();if(s_code)document.write(s_code)//-->