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\pard\sb0\sl-240{\bkmkstart Pg2}{\bkmkend Pg2}\par\pard\ql \li3750\sb0\sl-253\sl
mult0 \par\pard\ql\li3750\sb177\sl-253\slmult0 \up0 \expndtw-4\charscalex100 \ul
0\nosupersub\cf1\f2\fs22 About the Center for Information Systems Research \par\
pard\ql \li1080\sb0\sl-287\slmult0 \par\pard\ql\li1080\sb0\sl-287\slmult0 \par\p
ard\ql\li1080\sb5\sl-287\slmult0 \up0 \expndtw-2\charscalex100 \ul0\nosupersub\c
f5\f6\fs28 CISR M\ul0\nosupersub\cf15\f16\fs22 ISSION\par\pard\sect\sectd\sbknon
e\cols2\colno1\colw6320\colsr160\colno2\colw5620\colsr160\ql \li1080\ri499\sb23\
sl-275\slmult0 \up0 \expndtw-3\charscalex100 \ul0\nosupersub\cf8\f9\fs24 CISR wa
s founded 25 years ago and has a strong track \line \up0 \expndtw-3\charscalex10
0 record of practice based research on the management \line \up0 \expndtw-3\char
scalex100 of information technology. As we enter the twenty-\line \up0 \expndtw3\charscalex100 first century, CISR\u8217?s mission is to perform practical \lin
e \up0 \expndtw-3\charscalex100 empirical research on how firms generate busines
s \line \up0 \expndtw-3\charscalex100 value from IT. CISR disseminates this rese
arch via \line \up0 \expndtw-3\charscalex100 electronic research briefings, work
ing papers,\par\pard\qj \li1080\ri566\sb0\sl-278\slmult0 \up0 \expndtw-3\charsca
lex100 research workshops and executive education. Recent \up0 \expndtw-2\charsc
alex100 and current research topics include:\par\pard\ql \li1080\sb0\sl-276\slmu
lt0 \par\pard\ql \li1440\sb77\sl-276\slmult0 \up0 \expndtw-7\charscalex100 \ul0\
nosupersub\cf16\f17\fs24 \ul0\nosupersub\cf8\f9\fs24 Assessing IT Governance\p
ar\pard\ql \li1440\sb100\sl-276\slmult0 \up0 \expndtw-7\charscalex100 \ul0\nosup
ersub\cf16\f17\fs24 \ul0\nosupersub\cf8\f9\fs24 IT Architecture as Strategy\pa
r\pard\ql \li1440\sb99\sl-276\slmult0 \up0 \expndtw-6\charscalex100 \ul0\nosuper
sub\cf16\f17\fs24 \ul0\nosupersub\cf8\f9\fs24 IT Infrastructure for Strategic
Agility\par\pard\ql \li1440\sb99\sl-276\slmult0 \up0 \expndtw-6\charscalex100 \u
l0\nosupersub\cf16\f17\fs24 \ul0\nosupersub\cf8\f9\fs24 NSF Project on IT Impa
cts\par\pard\ql \li1440\sb99\sl-276\slmult0 \up0 \expndtw-6\charscalex100 \ul0\n
osupersub\cf16\f17\fs24 \ul0\nosupersub\cf8\f9\fs24 Steering the Information A
valanche\par\pard\ql \li1440\sb99\sl-276\slmult0 \up0 \expndtw-6\charscalex100 \
ul0\nosupersub\cf16\f17\fs24 \ul0\nosupersub\cf8\f9\fs24 Time in Organizations
Migrating to the\par\pard\ql \li1800\sb9\sl-276\slmult0 \up0 \expndtw0\charscal
ex100 Internet\par\pard\ql \li1440\sb99\sl-276\slmult0\tx1795 \up0 \expndtw-3\ch
arscalex100 \ul0\nosupersub\cf16\f17\fs24 \tab \up0 \expndtw-3\charscalex100 \ul
0\nosupersub\cf8\f9\fs24 21st Century IT Management\par\pard\ql \li1080\ri582\sb
129\sl-277\slmult0 \up0 \expndtw-3\charscalex100 CISR has recently embarked upon
a new phase of \line \up0 \expndtw-3\charscalex100 industry-sponsored research,
under the leadership of \line \up0 \expndtw-3\charscalex100 Peter Weill. Peter
comes to CISR from Melbourne\par\pard\qj \li1080\ri529\sb0\sl-270\slmult0 \up0 \
expndtw-3\charscalex100 Business School and brings a strong practical research \
up0 \expndtw-3\charscalex100 background in IT portfolio and IT infrastructure\pa
r\pard\ql \li1080\sb10\sl-276\slmult0 \up0 \expndtw-3\charscalex100 management.\
par\pard\ql \li1080\ri995\sb264\sl-277\slmult0 \up0 \expndtw-3\charscalex100 CIS
R is co-located with MIT Sloan\u8217?s e-\line \up0 \expndtw-3\charscalex100 Bus
iness@MIT initiative and the Center for \line \up0 \expndtw-3\charscalex100 Coor
dination Science to facilitate collaboration.\par\pard\qj \li1080\sb0\sl-270\slm
ult0 \par\pard\qj \li1080\ri1081\sb14\sl-270\slmult0 \up0 \expndtw-3\charscalex1
00 CISR is funded in part by Research Patrons and \up0 \expndtw-3\charscalex100
Sponsors.\par\pard\column \qj \li20\ri1288\sb22\sl-277\slmult0 \up0 \expndtw-3\c
harscalex100 CISR gratefully acknowledges the support and \up0 \expndtw-3\charsc
alex100 contributions of its current Research Patrons and \up0 \expndtw-4\charsc
alex100 Sponsors\u8230?\par\pard\qj \li20\ri2730\sb228\sl-300\slmult0 \up0 \expn
dtw-2\charscalex100 \ul0\nosupersub\cf5\f6\fs28 CISR R\ul0\nosupersub\cf15\f16\f
s22 ESEARCH \ul0\nosupersub\cf5\f6\fs28 P\ul0\nosupersub\cf15\f16\fs22 ATRONS \u

p0 \expndtw-1\charscalex100 \ul0\nosupersub\cf8\f9\fs24 Accenture\par\pard\qj \l


i20\ri2700\sb17\sl-389\slmult0 \up0 \expndtw-3\charscalex100 Compaq Computer Cor
poration \up0 \expndtw-1\charscalex100 Gartner\par\pard\ql \li20\ri3541\sb16\sl390\slmult0 \up0 \expndtw-3\charscalex100 IBM Corporation \line \up0 \expndtw-3\
charscalex100 Microsoft Corporation\par\pard\ql \li20\sb198\sl-333\slmult0 \up0
\expndtw-2\charscalex100 \ul0\nosupersub\cf5\f6\fs28 CISR S\ul0\nosupersub\cf15\
f16\fs22 PONSORS\par\pard\qj \li20\ri2655\sb0\sl-343\slmult0 \up0 \expndtw-3\cha
rscalex100 \ul0\nosupersub\cf8\f9\fs24 Dresdner Kleinwort Wasserstein \up0 \expn
dtw-3\charscalex100 Dow Corning Corporation\par\pard\qj \li20\ri3570\sb15\sl-390
\slmult0 \up0 \expndtw-3\charscalex100 The Gillette Company \up0 \expndtw-3\char
scalex100 Intel Corporation\par\pard\ql \li20\sb110\sl-276\slmult0 \up0 \expndtw
-2\charscalex100 Marsh, Inc.\par\pard\qj \li20\ri2220\sb20\sl-390\slmult0 \up0 \
expndtw-3\charscalex100 Metropolitan Life Insurance Company \up0 \expndtw-3\char
scalex100 State Street Corporation\par\pard\ql \li20\sb110\sl-276\slmult0 \up0 \
expndtw-3\charscalex100 TRW, Inc.\par\pard\ql \li20\sb114\sl-276\slmult0 \up0 \e
xpndtw-3\charscalex100 The Vanguard Group\par\pard\ql \li20\sb262\sl-333\slmult0
\up0 \expndtw-2\charscalex100 \ul0\nosupersub\cf5\f6\fs28 C\ul0\nosupersub\cf15
\f16\fs22 ONTACT \ul0\nosupersub\cf5\f6\fs28 I\ul0\nosupersub\cf15\f16\fs22 NFOR
MATION\par\pard\qj \li20\ri1921\sb5\sl-270\slmult0 \up0 \expndtw-2\charscalex100
\ul0\nosupersub\cf8\f9\fs24 Center for Information Systems Research \up0 \expnd
tw-3\charscalex100 MIT Sloan School of Management\par\pard\qj \li20\ri2715\sb15\
sl-270\slmult0 \up0 \expndtw-3\charscalex100 3 Cambridge Center, NE20-336 \up0 \
expndtw-3\charscalex100 Cambridge, MA 02142\par\pard\qj \li20\ri3195\sb0\sl-279\
slmult0 \up0 \expndtw-4\charscalex100 Telephone: 617/253-2348 \line \up0 \expndt
w-4\charscalex100 Facsimile: 617/253-4424\par\pard\ql \li20\sb1\sl-266\slmult0 \
up0 \expndtw-3\charscalex100 {\field{\*\fldinst {HYPERLINK "http://web.mit.edu/c
isr/www/" }}{\fldrslt {\ul0\nosupersub\cf46\f47\fs24\ul http://web.mit.edu/cisr/
www}}}\par\pard\ql \li6480\sb0\sl-276\slmult0 \par\pard\ql \li20\sb5\sl-276\slmu
lt0\tx3250 \up0 \expndtw-3\charscalex100 \ul0\nosupersub\cf8\f9\fs24 Peter Weill
, Director\tab \up0 \expndtw-2\charscalex100 pweill@mit.edu\par\pard\qj \li20\ri
840\sb0\sl-360\slmult0\tx3415 \up0 \expndtw-3\charscalex100 David Fitzgerald, As
s\u8217?t. to the Dir.\tab \up0 \expndtw-3\charscalex100 dfitz@mit.edu \line \up
0 \expndtw-2\charscalex100 Jeanne Ross, Principal Res. Scientist jross@mit.edu
\par\pard\ql \li20\sb70\sl-276\slmult0\tx3115 \up0 \expndtw-3\charscalex100 Jack
Rockart, Sr. Lecturer\tab \up0 \expndtw-3\charscalex100 jrockart@mit.edu\par\pa
rd\ql \li20\sb69\sl-276\slmult0\tx3145 \up0 \expndtw-3\charscalex100 Chuck Gibso
n, Sr. Lecturer\tab \up0 \expndtw-3\charscalex100 cgibson@mit.edu\par\pard\qj \l
i20\ri840\sb15\sl-360\slmult0\tx3235\tx3303 \up0 \expndtw-3\charscalex100 Chris
Foglia, Admin. Officer\tab \up0 \expndtw-3\charscalex100 cfoglia@mit.edu \line \
up0 \expndtw-3\charscalex100 Julie Coiro, Admin. Assistant \tab \up0 \expndtw-2\
charscalex100 julieh@mit.edu \par\pard\sect\sectd\fs24\paperw12240\paperh15840\p
ard\sb0\sl-240{\bkmkstart Pg3}{\bkmkend Pg3}\par\pard\li1440\sb0\sl-276\slmult0\
par\pard\li1440\sb0\sl-276\slmult0\par\pard\li1440\sb0\sl-276\slmult0\par\pard\l
i1440\sb0\sl-276\slmult0\par\pard\li1440\sb0\sl-276\slmult0\par\pard\li1440\sb10
1\sl-276\slmult0\fi0\tx5580 \up0 \expndtw-3\charscalex100 \ul0\nosupersub\cf24\f
25\fs24 CISR Working Paper No. 318\tab \up0 \expndtw-3\charscalex100 MIT Sloan S
chool of Management WP No. 4356-01\par\pard\li1440\sb0\sl-276\slmult0\par\pard\l
i1440\sb107\sl-276\slmult0\fi0\tx2880 \up0 \expndtw-3\charscalex100 Title:\tab \
up0 \expndtw-3\charscalex100 United Parcel Service: Delivering Packages and E-Co
mmerce Solutions\par\pard\li1440\sb0\sl-276\slmult0\par\pard\li1440\sb64\sl-276\
slmult0\fi0\tx2880 \up0 \expndtw-3\charscalex100 Author:\tab \up0 \expndtw-3\cha
rscalex100 Jeanne Ross\par\pard\li1440\sb234\sl-276\slmult0\fi0\tx2880 \up0 \exp
ndtw-3\charscalex100 Date:\tab \up0 \expndtw-3\charscalex100 August 2001\par\par
d\li1440\sb249\sl-276\slmult0\fi0\tx2880 \up0 \expndtw-3\charscalex100 Abstract:
\tab \up0 \expndtw-2\charscalex100 \ul0\nosupersub\cf26\f27\fs24 This case study
describes how UPS has successfully migrated from a bricks-and-\par\pard\ql \li1
440\ri1264\sb0\sl-276\slmult0 \up0 \expndtw-2\charscalex100 mortar environment t
o a clicks-and-mortar environment. It focuses on the development of an IT \line
\up0 \expndtw-2\charscalex100 capability that positioned UPS to aggressively pur
sue e-business opportunities. It then describes \line \up0 \expndtw-2\charscalex

100 the firm\u8217?s wide ranging e-business initiatives, which include providin
g UPS functionality in \line \up0 \expndtw-2\charscalex100 vendor software packa
ges, providing downloadable functionality on its website, and creating and \line
\up0 \expndtw-2\charscalex100 e-Ventures group to seek out new business opportu
nities. The case addresses the challenge of \line \up0 \expndtw-2\charscalex100
moving quickly to provide e-business solutions while leveraging UPS\u8217? robus
t infrastructure. \par\pard\qj \li1440\ri3389\sb34\sl-560\slmult0 \up0 \expndtw2\charscalex100 Key words: IT infrastructure, e-business strategy, IT-business r
elationships \up0 \expndtw-5\charscalex100 Pages 14
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husetts Institute of Technology \line\tab \up0 \expndtw-4\charscalex100 Sloan Sc
hool of Management \par\pard\ql \li4020\sb319\sl-322\slmult0 \up0 \expndtw0\char
scalex113 \ul0\nosupersub\cf29\f30\fs28 Center for Information Systems Research

\par\pard\ql \li4410\sb0\sl-460\slmult0 \par\pard\ql\li4410\sb0\sl-460\slmult0 \


par\pard\ql\li4410\sb0\sl-460\slmult0 \par\pard\ql\li4410\sb364\sl-460\slmult0 \
up0 \expndtw0\charscalex86 \ul0\nosupersub\cf30\f31\fs40 UNITED PARCEL SERVICE:
\par\pard\ql \li3180\sb14\sl-322\slmult0 \up0 \expndtw-7\charscalex100 \ul0\nosu
persub\cf2\f3\fs28 Delivering Packages and E-Commerce Solutions\par\pard\sect\se
ctd\sbknone\cols2\colno1\colw6320\colsr160\colno2\colw5620\colsr160\ql \li1080\s
b0\sl-255\slmult0 \par\pard\ql \li1440\ri1189\sb39\sl-255\slmult0 \up0 \expndtw2\charscalex100 \ul0\nosupersub\cf32\f33\fs22 The business model is changing, an
d our \up0 \expndtw-4\charscalex100 focus is changin g. Our customers are \up0 \
expndtw-2\charscalex100 demanding broader, deeper services,\par\pard\qj \li1440\
ri860\sb0\sl-250\slmult0 \up0 \expndtw-2\charscalex100 whether that\u8217?s runn
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ing their\par\pard\ql \li1440\ri907\sb1\sl-255\slmult0 \up0 \expndtw-3\charscale
x100 computer parts for them. We\u8217?re doing all \up0 \expndtw-2\charscalex10
0 kinds of things we didn\u8217?t dream of doing ten \up0 \expndtw-1\charscalex1
00 years ago.\par\pard\qj \li2895\ri775\sb0\sl-255\slmult0\fi600 \up0 \expndtw-2
\charscalex100 \u8212?Jim Kelly, CEO and \line \up0 \expndtw-2\charscalex100 Cha
irman of the Board, UPS\par\pard\qj \li1080\ri656\sb240\sl-255\slmult0 \up0 \exp
ndtw-2\charscalex100 \ul0\nosupersub\cf17\f18\fs22 Jim Kelly, CEO of United Parc
el Service (UPS), a \up0 \expndtw-3\charscalex100 company best known for reliabl
e, efficient package \up0 \expndtw-3\charscalex100 delivery, was commenting in l
ate 2000 on how his \up0 \expndtw-3\charscalex100 company had become far more th
an a package\par\pard\ql \li1080\ri533\sb2\sl-253\slmult0 \up0 \expndtw-3\charsc
alex100 delivery company. For a decade, UPS had been \line \up0 \expndtw-3\chars
calex100 capitalizing on opportunities created by information \line \up0 \expndt
w-3\charscalex100 technology to increase the efficiency and flexibility \line \u
p0 \expndtw-3\charscalex100 of its core business. More recently, the Internet ha
d \line \up0 \expndtw-3\charscalex100 presented a rapidly expanding set of busin
ess \line \up0 \expndtw-2\charscalex100 opportunities. Kelly observed that his c
hallenge was \line \up0 \expndtw-3\charscalex100 to \u8220?walk the fine line\u8
221? between a focus on enhancing \line \up0 \expndtw-3\charscalex100 UPS\u8217?
core business and a focus on developing new \line \up0 \expndtw-2\charscalex100
business opportunities.\par\pard\column \ql \li6480\sb0\sl-264\slmult0 \par\par
d\ql \li20\sb37\sl-264\slmult0 \up0 \expndtw-2\charscalex100 \ul0\nosupersub\cf3
3\f34\fs22 Background\par\pard\qj \li20\ri1382\sb0\sl-249\slmult0 \up0 \expndtw3\charscalex100 \ul0\nosupersub\cf17\f18\fs22 American Messenger Company (later
renamed \line \up0 \expndtw-3\charscalex100 United Parcel Service) was founded i
n 1907 by \line \up0 \expndtw-3\charscalex100 James E. Casey to provide local me
ssenger and \line \up0 \expndtw-3\charscalex100 delivery services in Seattle. By
2000, UPS had \line \up0 \expndtw-3\charscalex100 grown to become the world\u82
17?s largest integrated\par\pard\ql \li20\sb1\sl-252\slmult0 \up0 \expndtw-3\cha
rscalex100 package delivery company, delivering an average of\par\pard\qj \li20\
ri1293\sb1\sl-255\slmult0 \up0 \expndtw-3\charscalex100 13.6 million packages a
day sent by 1.8 million \line \up0 \expndtw-3\charscalex100 shippers to 7 millio
n consignees. UPS employed \line \up0 \expndtw-3\charscalex100 approximately 359
,000 people in 200 countries\par\pard\ql \li20\ri903\sb5\sl-250\slmult0 \up0 \ex
pndtw-3\charscalex100 around the world. International revenues represented \up0
\expndtw-3\charscalex100 only about 15% of UPS\u8217? $27 billion in revenues in
\up0 \expndtw-2\charscalex100 1999, but international business was growing at a
\up0 \expndtw-4\charscalex100 double -digit rate. (See Exhibit 1 for the firm\u
8217?s\par\pard\qj \li20\ri904\sb1\sl-255\slmult0 \up0 \expndtw-3\charscalex100
financial summary.) Despite its size UPS was mostly \up0 \expndtw-3\charscalex10
0 a centralized business. Core functional units\par\pard\qj \li20\ri1068\sb5\sl250\slmult0 \up0 \expndtw-3\charscalex100 included U.S. operations, Internationa
l Operations \up0 \expndtw-3\charscalex100 (both of which had regional offices a
s well), Sales \up0 \expndtw-3\charscalex100 and Marketing, Finance, Legal, Huma
n Resources, \up0 \expndtw-3\charscalex100 and UPS Airlines. UPS started to intr
oduce\par\pard\qj \li20\ri1506\sb1\sl-255\slmult0 \up0 \expndtw-3\charscalex100
subsidiaries in the 1980s. (Exhibit 2 lists UPS \up0 \expndtw-2\charscalex100 su

bsidiaries as of late 2000.)\par\pard\qj \li6480\sb0\sl-250\slmult0 \par\pard\qj


\li20\ri982\sb10\sl-250\slmult0 \up0 \expndtw-2\charscalex100 UPS emphasized ef
ficiency in its delivery services. \line \up0 \expndtw-3\charscalex100 The firm
employed a large industrial engineering \line \up0 \expndtw-3\charscalex100 staf
f, which studied ways to increase the efficiency \line \up0 \expndtw-3\charscale
x100 of its operations. For example, included in its driver \par\pard\sect\sectd
\sbknone \ql \li1155\sb0\sl-210\slmult0 \par\pard\ql\li1155\ri992\sb24\sl-210\sl
mult0 \up0 \expndtw-1\charscalex100 \ul0\nosupersub\cf27\f28\fs18 This case was
prepared by Dr. Jeanne W. Ross of the Center for Information Systems Research at
the MIT Sloan School of Management. \up0 \expndtw-1\charscalex100 This case is
for the purpose of management education, rather than illustrating or endorsing a
ny particular management practice. The case \up0 \expndtw-3\charscalex100 is par
t of a research project on e-business migration conducted jointly by Melbourne B
usiness School and the MIT Sloan School. Support \up0 \expndtw-1\charscalex100 f
or the project from PricewaterhouseCoopers LLP is gratefully acknowledged. This
case may be reproduced free of charge for \line \up0 \expndtw-1\charscalex100 ed
ucational purposes provided the copyright statement appears on the copy. \par\pa
rd\ql \li1155\sb0\sl-207\slmult0 \par\pard\ql\li1155\sb6\sl-207\slmult0 \up0 \ex
pndtw-1\charscalex100 \ul0\nosupersub\cf28\f29\fs18 \u8221?\ul0\nosupersub\cf27\
f28\fs18 MIT and Melbourne Business School. All rights reserved to the author
(March 2001).
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{\sp{\sn shapeType}{\sv 0}}{\sp{\sn fFlipH}{\sv 0}}{\sp{\sn fFlipV}{\sv 0}}{\sp{
\sn geoRight}{\sv 1425}}{\sp{\sn geoBottom}{\sv 1425}}{\sp{\sn shapePath}{\sv 4}
}
{\sp{\sn pVerticies}{\sv 8;5;(0,1425);(1425,1425);(1425,0);(0,0);(0,1425)}}
{\sp{\sn pSegmentInfo}{\sv 2;11;16384;45824;1;45824;1;45824;1;45824;1;45824;3276
8}}
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}}\par\pard\sect\sectd\fs24\paperw12240\paperh15840\pard\sb0\sl-240{\bkmkstart P
g5}{\bkmkend Pg5}\par\pard\sect\sectd\sbknone\cols2\colno1\colw6370\colsr110\col
no2\colw5620\colsr160\qj \li1080\sb0\sl-251\slmult0 \par\pard\qj \li1080\sb0\sl251\slmult0 \par\pard\qj \li1080\sb0\sl-251\slmult0 \par\pard\qj \li1080\ri530\s
b133\sl-251\slmult0 \up0 \expndtw-3\charscalex100 \ul0\nosupersub\cf17\f18\fs22
training programs are instructions on which foot a \up0 \expndtw-3\charscalex100
driver should first put into the truck to minimize the \up0 \expndtw-3\charscal
ex100 time between boarding and driving. While efficiency \up0 \expndtw-3\charsc
alex100 was important to the firm\u8217?s profitability and pricing \up0 \expndt
w-3\charscalex100 structure, UPS management attributed the\par\pard\qj \li1080\r
i938\sb2\sl-255\slmult0 \up0 \expndtw-2\charscalex100 company\u8217?s long-term
success to the efforts of \up0 \expndtw-3\charscalex100 individual drivers who p
rovided reliable, trusted \up0 \expndtw-2\charscalex100 service to their regular
customers.\par\pard\qj \li1080\sb0\sl-240\slmult0 \par\pard\qj \li1080\ri760\sb
27\sl-240\slmult0 \up0 \expndtw-3\charscalex100 In 2000, UPS was named by \ul0\n
osupersub\cf32\f33\fs22 Fortune\ul0\nosupersub\cf17\f18\fs22 magazine as \up0 \
expndtw-3\charscalex100 both America\u8217?s and the World\u8217?s Most Admired\
par\pard\ql \li1080\ri573\sb4\sl-253\slmult0 \up0 \expndtw-3\charscalex100 mail,
package and freight delivery company\ul0\super\cf35\f36\fs21\ul0\super\cf35\f36
\fs20 1\ul0\nosupersub\cf17\f18\fs22 and by \line \up0 \expndtw-2\charscalex100
\ul0\nosupersub\cf32\f33\fs22 Forbes\ul0\nosupersub\cf17\f18\fs22 magazine as
Company of the Year.\ul0\super\cf35\f36\fs21\ul0\super\cf35\f36\fs20 2\ul0\nosup
ersub\cf17\f18\fs22 UPS\u8217? \line \up0 \expndtw-3\charscalex100 information
technology unit, which had been the \line \up0 \expndtw-3\charscalex100 recipien
t of the Computerworld Smithsonian award \line \up0 \expndtw-3\charscalex100 in
1991 and 1997, earned the firm a place among \line \up0 \expndtw-3\charscalex100
\ul0\nosupersub\cf32\f33\fs22 Red Herring\u8217?s\ul0\nosupersub\cf17\f18\fs22

100 Most Important Companies in \line \up0 \expndtw-3\charscalex100 2000 and \u


l0\nosupersub\cf32\f33\fs22 PCWeek\u8217?s\ul0\nosupersub\cf17\f18\fs22 Fast-Tr
ack 100. MIT\u8217?s Sloan \line \up0 \expndtw-3\charscalex100 School gave UPS a
\u8220?Clicks-and-Mortar\u8221? award in \line \up0 \expndtw-3\charscalex100 Ap
ril 2000, calling it the most advanced company in \line \up0 \expndtw-2\charscal
ex100 integrating physical and online business practices.\par\pard\qj \li1080\ri
505\sb1\sl-255\slmult0 \up0 \expndtw-5\charscalex100 These citations recognized
that UPS was transforming \up0 \expndtw-5\charscalex100 itself from a package de
livery firm to one that would, \up0 \expndtw-5\charscalex100 as senior managers
described it, \u8220?offer total solutions \up0 \expndtw-4\charscalex100 to cust
omers\u8217? global commerce needs.\u8221?\par\pard\ql \li1080\sb248\sl-264\slmu
lt0 \up0 \expndtw-3\charscalex100 \ul0\nosupersub\cf33\f34\fs22 Becoming a Techn
ology-Driven Firm\par\pard\ql \li1080\ri592\sb0\sl-251\slmult0 \up0 \expndtw-2\c
harscalex100 \ul0\nosupersub\cf17\f18\fs22 Many of the awards UPS received in 19
99-2000 \line \up0 \expndtw-3\charscalex100 recognized UPS\u8217? information te
chnology capability, \line \up0 \expndtw-3\charscalex100 but UPS had not always
emphasized information \line \up0 \expndtw-3\charscalex100 technology in the del
ivery of its services. In 1985,\par\pard\qj \li1080\ri581\sb13\sl-240\slmult0 \u
p0 \expndtw-3\charscalex100 when UPS offered a single package delivery service \
up0 \expndtw-2\charscalex100 at a single price and was generating revenues of\pa
r\pard\qj \li1080\ri939\sb3\sl-255\slmult0 \up0 \expndtw-3\charscalex100 about $
8 billion, the corporate IT unit numbered \line \up0 \expndtw-3\charscalex100 ap
proximately 100 people and had a budget of \line \up0 \expndtw-3\charscalex100 a
pproximately $50 million. Some of the firm\u8217?s\par\pard\qj \li1080\ri551\sb0
\sl-255\slmult0 \up0 \expndtw-2\charscalex100 regional operating units relied on
their own IT staffs \up0 \expndtw-3\charscalex100 to support local needs, so th
at total IT spending was \up0 \expndtw-4\charscalex100 about $75 million.\par\pa
rd\qj \li1080\ri506\sb240\sl-255\slmult0 \up0 \expndtw-3\charscalex100 Around th
is time, the competition was introducing \up0 \expndtw-3\charscalex100 services\
u8212?most notably package tracking\u8212?that were \up0 \expndtw-3\charscalex10
0 heavily dependent upon information processing.\par\pard\qj \li1080\ri550\sb0\s
l-255\slmult0 \up0 \expndtw-2\charscalex100 UPS management was not convinced tha
t customers \up0 \expndtw-3\charscalex100 really cared about tracking so they we
re initially\par\pard\ql \li1080\sb0\sl-255\slmult0 \up0 \expndtw-3\charscalex10
0 reluctant to invest in a tracking capability:\par\pard\qj \li1080\sb0\sl-225\s
lmult0 \par\pard\qj \li1080\sb0\sl-225\slmult0 \par\pard\qj \li1080\ri847\sb160\
sl-225\slmult0 \up0 \expndtw0\charscalex103 \ul0\super\cf35\f36\fs21\ul0\super\c
f35\f36\fs20 1\ul0\nosupersub\cf3\f4\fs19 \ul0\nosupersub\cf34\f35\fs19 Fortune
\ul0\nosupersub\cf3\f4\fs19 , \u8220?The world's most admired companies,\u8221?
01 \up0 \expndtw0\charscalex100 October 2000.\par\pard\ql \li1080\ri519\sb15\sl225\slmult0 \up0 \expndtw0\charscalex102 \ul0\super\cf35\f36\fs20 2\ul0\nosupers
ub\cf3\f4\fs19 Barron, Kelly, \u8220?Logistics in Brown,\u8221? \ul0\nosupersub
\cf34\f35\fs19 Forbes\ul0\nosupersub\cf3\f4\fs19 , 10 January \up0 \expndtw0\cha
rscalex102 2000. According to Barron, \u8220?UPS used to be a trucking \up0 \exp
ndtw0\charscalex103 company with technology. Now it\u8217?s a technology\par\par
d\ql \li1080\sb11\sl-230\slmult0 \up0 \expndtw0\charscalex102 company with truck
s.\u8221?\par\pard\ql \li1080\sb130\sl-230\slmult0\tx5755 \up0 \expndtw0\charsca
lex102 \ul0\nosupersub\cf34\f35\fs19 Jeanne Ross\tab \up0 \expndtw0\charscalex10
1 Page\ul0\nosupersub\cf3\f4\fs19 \ul0\nosupersub\cf34\f35\fs19 2\par\pard\colu
mn \ql \li6480\sb0\sl-252\slmult0 \par\pard\ql \li6480\sb0\sl-252\slmult0 \par\p
ard\ql \li6480\sb0\sl-252\slmult0 \par\pard\ql \li380\ri1206\sb129\sl-252\slmult
0 \up0 \expndtw-2\charscalex100 \ul0\nosupersub\cf32\f33\fs22 We thought, \u8220
?Why do they care about \line \up0 \expndtw-2\charscalex100 tracking? We know we
deliver them all. It\u8217?s \line \up0 \expndtw-3\charscalex100 really only a
creature comfort, because we \line \up0 \expndtw-2\charscalex100 deliver every p
ackage every day. We\u8217?re so \line \up0 \expndtw-2\charscalex100 effective t
hat there\u8217?s no reason to track these \line \up0 \expndtw-2\charscalex100 p
ackages.\u8221?\par\pard\qj \li1700\ri1142\sb1\sl-255\slmult0\tx1830 \up0 \expnd
tw-2\charscalex100 \u8212?Mike Eskew, Vice Chairman \line\tab \up0 \expndtw-2\ch
arscalex100 and Executive Vice President\par\pard\qj \li6480\sb0\sl-240\slmult0

\par\pard\qj \li20\ri1009\sb27\sl-240\slmult0 \up0 \expndtw-5\charscalex100 \ul0


\nosupersub\cf17\f18\fs22 Nonetheless, when Oz Nelson became CEO in 1986, \line
\up0 \expndtw-5\charscalex100 he pushed the firm to invest heavily in informatio
n\par\pard\qj \li20\ri874\sb2\sl-255\slmult0 \up0 \expndtw-5\charscalex100 techn
ology and develop the capability not just to track \up0 \expndtw-5\charscalex100
packages but to offer a wider range of services. Frank \up0 \expndtw-5\charscal
ex100 Erbrick, who was CIO at the time, commented on the \up0 \expndtw-5\charsca
lex100 motivation to change UPS\u8217? technology strategy:\par\pard\qj \li6480\
sb0\sl-251\slmult0 \par\pard\qj \li380\ri1230\sb9\sl-251\slmult0 \up0 \expndtw-6
\charscalex100 \ul0\nosupersub\cf32\f33\fs22 Federal Express\u8217? strength wit
h regard to the \line \up0 \expndtw-5\charscalex100 power of their tracking syst
em and the things \line \up0 \expndtw-6\charscalex100 they were doing with techn
ology was really \line \up0 \expndtw-5\charscalex100 eroding what little share o
f the market we had \line \up0 \expndtw-5\charscalex100 in air services. The boa
rd was immensely\par\pard\qj \li380\ri1452\sb1\sl-255\slmult0 \up0 \expndtw-6\ch
arscalex100 concerned that Federal would not only take \line \up0 \expndtw-5\cha
rscalex100 the air business away, but also start doing \line \up0 \expndtw-6\cha
rscalex100 daily ground business. They also saw the\par\pard\qj \li380\ri1225\sb
7\sl-247\slmult0 \up0 \expndtw-6\charscalex100 profitability of the air business
and said, \u8220?We \up0 \expndtw-6\charscalex100 just can't continue as we are
. We have to put a \up0 \expndtw-5\charscalex100 lot of money into technology.\u
8221?\par\pard\ql \li6480\sb0\sl-251\slmult0 \par\pard\ql \li20\ri979\sb9\sl-251
\slmult0 \up0 \expndtw-3\charscalex100 \ul0\nosupersub\cf17\f18\fs22 Between 198
6 and 1996 UPS invested more than \line \up0 \expndtw-3\charscalex100 $11 billio
n in information technology, growing the \line \up0 \expndtw-3\charscalex100 IT
unit to more than 4,000 people by 1997. Con-\line \up0 \expndtw-3\charscalex100
vinced of the importance of moving aggressively on \line \up0 \expndtw-3\charsca
lex100 IT, senior management did not require traditional\par\pard\qj \li20\ri864
\sb1\sl-255\slmult0 \up0 \expndtw-3\charscalex100 financial justifications for i
nfrastructure investments. \up0 \expndtw-3\charscalex100 This gave Frank Erbrick
the freedom to build\par\pard\qj \li20\ri1416\sb0\sl-255\slmult0 \up0 \expndtw2\charscalex100 infrastructure with a long-term view. He broke \up0 \expndtw-3\c
harscalex100 ground for a large data processing facility in\par\pard\qj \li20\ri
1068\sb3\sl-252\slmult0 \up0 \expndtw-3\charscalex100 Mahwah, New Jersey, hired
technical experts from \up0 \expndtw-2\charscalex100 outside the company to addr
ess the firm\u8217?s need for \up0 \expndtw-3\charscalex100 network and database
capabilities, and started to \up0 \expndtw-3\charscalex100 develop a centralize
d customer database. Erbrick \up0 \expndtw-3\charscalex100 noted that package tr
acking provided the rallying \up0 \expndtw-3\charscalex100 point for IT infrastr
ucture:\par\pard\ql \li6480\sb0\sl-250\slmult0 \par\pard\ql \li20\ri1529\sb10\sl
-250\slmult0 \up0 \expndtw-5\charscalex100 \ul0\nosupersub\cf32\f33\fs22 There w
ere some applications that were really \up0 \expndtw-6\charscalex100 critical to
us, but tracking was always the Holy \up0 \expndtw-6\charscalex100 Grail. Peopl
e were talking tracking this and \up0 \expndtw-6\charscalex100 tracking that. I
said, \u8220?Look, we don't have\par\pard\ql \li20\ri1525\sb1\sl-255\slmult0 \up
0 \expndtw-6\charscalex100 anything in place to do tracking. We have no \line \u
p0 \expndtw-6\charscalex100 network. We have no databases. We have no \line \up0
\expndtw-6\charscalex100 repository for packaging. We are several years \line \
up0 \expndtw-6\charscalex100 away from a sophisticated tracking system.\u8221?\p
ar\pard\ql \li9195\sb0\sl-230\slmult0 \par\pard\ql \li9195\sb0\sl-230\slmult0 \p
ar\pard\ql \li2735\sb146\sl-230\slmult0 \up0 \expndtw0\charscalex101 \ul0\nosupe
rsub\cf3\f4\fs19 CISR Working Paper
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{\sp{\sn shapeType}{\sv 0}}{\sp{\sn fFlipH}{\sv 0}}{\sp{\sn fFlipV}{\sv 0}}{\sp{
\sn geoRight}{\sv 2880}}{\sp{\sn geoBottom}{\sv 20}}
{\sp{\sn pVerticies}{\sv 8;5;(0,20);(2880,20);(2880,0);(0,0);(0,20)}}
{\sp{\sn pSegmentInfo}{\sv 2;11;16384;45824;1;45824;1;45824;1;45824;1;45824;3276
8}}

{\sp{\sn fFillOK}{\sv 1}}{\sp{\sn fFilled}{\sv 1}}{\sp{\sn fillColor}{\sv 0}}{\s


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}}
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{\sp{\sn shapeType}{\sv 0}}{\sp{\sn fFlipH}{\sv 0}}{\sp{\sn fFlipV}{\sv 0}}{\sp{
\sn geoRight}{\sv 20}}{\sp{\sn geoBottom}{\sv 13606}}
{\sp{\sn pVerticies}{\sv 8;5;(0,13606);(20,13606);(20,0);(0,0);(0,13606)}}
{\sp{\sn pSegmentInfo}{\sv 2;11;16384;45824;1;45824;1;45824;1;45824;1;45824;3276
8}}
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}}\par\pard\sect\sectd\fs24\paperw12240\paperh15840\pard\sb0\sl-240{\bkmkstart P
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no2\colw5620\colsr160\ql \li1080\sb0\sl-252\slmult0 \par\pard\ql \li1080\sb0\sl252\slmult0 \par\pard\ql \li1080\sb0\sl-252\slmult0 \par\pard\ql \li1080\ri548\s
b129\sl-252\slmult0 \up0 \expndtw-3\charscalex100 \ul0\nosupersub\cf17\f18\fs22
While the IT unit focused on developing a \line \up0 \expndtw-3\charscalex100 ce
ntralized infrastructure, a senior management \line \up0 \expndtw-3\charscalex10
0 committee\ul0\super\cf35\f36\fs21\ul0\super\cf35\f36\fs20 3\ul0\nosupersub\cf1
7\f18\fs22 established the direction for IT and \line \up0 \expndtw-3\charscale
x100 ensured that UPS\u8217? expanding products and services \line \up0 \expndtw
-3\charscalex100 both leveraged and directed IT investments. By \line \up0 \expn
dtw-3\charscalex100 1990, UPS had a global network called UPS Net, \line \up0 \e
xpndtw-3\charscalex100 three centralized databases (people, customers, \line \up
0 \expndtw-3\charscalex100 packages), and a centralized data processing facility
. \line \up0 \expndtw-3\charscalex100 UPS began to build applications around thi
s \line \up0 \expndtw-3\charscalex100 infrastructure, starting with package trac
king and \line \up0 \expndtw-5\charscalex100 billing.\par\pard\ql \li1080\sb0\sl
-252\slmult0 \par\pard\ql \li1080\ri537\sb6\sl-252\slmult0 \up0 \expndtw-3\chars
calex100 The centralized IT infrastructure supported \line \up0 \expndtw-3\chars
calex100 deployment of enterprise-wide applications. For \line \up0 \expndtw-3\c
harscalex100 example, in 1993 UPS introduced the DIAD\ul0\super\cf35\f36\fs21\ul
0\super\cf35\f36\fs20 4 \line \up0 \expndtw-3\charscalex100 \ul0\nosupersub\cf17
\f18\fs22 (Delivery Information Acquisition Device). This \line \up0 \expndtw-3\
charscalex100 device captured a customer signature with every \line \up0 \expndt
w-3\charscalex100 delivery and uploaded data in real time to the \line \up0 \exp
ndtw-3\charscalex100 package information database. The device was \line \up0 \ex
pndtw-3\charscalex100 estimated to save each driver thirty minutes per day \line
\up0 \expndtw-3\charscalex100 by automatically summarizing the day\u8217?s resu
lts. \line \up0 \expndtw-3\charscalex100 With 60,000 drivers, the cost savings r
epresented by \line \up0 \expndtw-3\charscalex100 one-half hour per person were
significant, but the \line \up0 \expndtw-3\charscalex100 real value of the DIAD
was in the additional \line \up0 \expndtw-3\charscalex100 information it collect
ed about each package and \line \up0 \expndtw-3\charscalex100 customer. By captu
ring delivery data on every \line \up0 \expndtw-3\charscalex100 package, UPS enh
anced its package database with \line \up0 \expndtw-2\charscalex100 information
that it could use to better understand the \line \up0 \expndtw-2\charscalex100 p
rofitability of individual customers and packages. \line \up0 \expndtw-3\charsca
lex100 The company used this information to make routing \line \up0 \expndtw-3\c
harscalex100 and pricing decisions, and, ultimately, to provide its \line \up0 \
expndtw-3\charscalex100 customers with information on their individual \line \up
0 \expndtw-3\charscalex100 shipping habits.\par\pard\qj \li1080\sb0\sl-255\slmul
t0 \par\pard\qj \li1080\ri716\sb1\sl-255\slmult0 \up0 \expndtw-3\charscalex100 I
n the mid-1990s Frank Erbrick assigned a small \line \up0 \expndtw-2\charscalex1
00 team to study Web technologies, and UPS became \line \up0 \expndtw-3\charscal
ex100 one of the first companies to create its own web\par\pard\qj \li1080\ri577

\sb0\sl-255\slmult0 \up0 \expndtw-3\charscalex100 page. Although the initial web


page was static, early \up0 \expndtw-3\charscalex100 experiments indicated that
the Internet could\par\pard\ql \li1080\ri669\sb5\sl-250\slmult0 \up0 \expndtw-3
\charscalex100 facilitate linkages among UPS and its existing and \line \up0 \ex
pndtw-3\charscalex100 potential customers. Accordingly, Joe Pyne, then \line \up
0 \expndtw-3\charscalex100 Vice President of Marketing, assigned a team to \line
\up0 \expndtw-3\charscalex100 study the impact of Internet technology on a supp
ly\par\pard\qj \li1080\ri639\sb1\sl-255\slmult0 \up0 \expndtw-3\charscalex100 ch
ain. UPS management had not yet heard the term \up0 \expndtw-3\charscalex100 \u8
216?e-commerce,\u8217? but they believed that Internet\par\pard\qj \li1080\ri578
\sb0\sl-255\slmult0 \up0 \expndtw-3\charscalex100 technologies could tighten the
supply chain and lead \up0 \expndtw-3\charscalex100 to fewer intermediaries. Ei
ghty percent of UPS\u8217?\par\pard\qj \li1080\sb0\sl-232\slmult0 \par\pard\qj \
li1080\ri681\sb117\sl-232\slmult0 \up0 \expndtw0\charscalex103 \ul0\super\cf35\f
36\fs21\ul0\super\cf35\f36\fs20 3\ul0\nosupersub\cf3\f4\fs19 This seven-member
team, consisting of functional unit \up0 \expndtw0\charscalex102 heads, was late
r replaced by a four-person IT Steering \up0 \expndtw0\charscalex101 Committee.\
par\pard\qj \li1080\ri501\sb0\sl-225\slmult0 \up0 \expndtw0\charscalex103 \ul0\s
uper\cf35\f36\fs20 4\ul0\nosupersub\cf3\f4\fs19 An early version of the DIAD wa
s introduced as early as \up0 \expndtw0\charscalex102 1991 but it had minimal ca
pabilities and was not fully\par\pard\ql \li1080\sb10\sl-230\slmult0 \up0 \expnd
tw0\charscalex103 rolled out.\par\pard\ql \li1080\sb130\sl-230\slmult0\tx5755 \u
p0 \expndtw0\charscalex102 \ul0\nosupersub\cf34\f35\fs19 Jeanne Ross\tab \up0 \e
xpndtw0\charscalex101 Page\ul0\nosupersub\cf3\f4\fs19 \ul0\nosupersub\cf34\f35\
fs19 3\par\pard\column \ql \li6480\sb0\sl-252\slmult0 \par\pard\ql \li6480\sb0\s
l-252\slmult0 \par\pard\ql \li6480\sb0\sl-252\slmult0 \par\pard\ql \li20\ri965\s
b129\sl-252\slmult0 \up0 \expndtw-3\charscalex100 \ul0\nosupersub\cf17\f18\fs22
revenues were generated by businesses shipping \line \up0 \expndtw-2\charscalex1
00 goods to other businesses and individual customers. \up0 \expndtw-3\charscale
x100 If businesses increasingly used the Internet to sell \up0 \expndtw-3\charsc
alex100 directly to end customers rather than to wholesalers \up0 \expndtw-2\cha
rscalex100 and distributors, the Internet would prove to be a \up0 \expndtw-4\ch
arscalex100 boon to UPS\u8217? business:\par\pard\qj \li6480\sb0\sl-254\slmult0
\par\pard\qj \li380\ri1203\sb3\sl-254\slmult0 \up0 \expndtw-2\charscalex100 \ul0
\nosupersub\cf32\f33\fs22 Fewer intermediaries result in smaller, more \up0 \exp
ndtw-3\charscalex100 frequent shipments and that plays right into \up0 \expndtw2\charscalex100 UPS\u8217? hands. That\u8217?s what we do well.\par\pard\qj \li1
130\ri1150\sb0\sl-248\slmult0\tx3030 \up0 \expndtw-2\charscalex100 \u8212?Ross M
cCullough, Senior Director \line\tab \up0 \expndtw-3\charscalex100 of E-Commerce
\par\pard\ql \li20\sb263\sl-264\slmult0 \up0 \expndtw-3\charscalex100 \ul0\nosup
ersub\cf33\f34\fs22 Extending the Core through E-Commerce\par\pard\qj \li20\ri91
9\sb0\sl-250\slmult0 \up0 \expndtw-3\charscalex100 \ul0\nosupersub\cf17\f18\fs22
UPS\u8217? goals in electronic commerce were to enable \up0 \expndtw-3\charscal
ex100 more business and to establish a branded presence in \up0 \expndtw-3\chars
calex100 global commerce solutions. From the beginning,\par\pard\qj \li20\ri981\
sb5\sl-247\slmult0 \up0 \expndtw-3\charscalex100 management believed that electr
onic linkages with \up0 \expndtw-3\charscalex100 customers would allow UPS to ge
t more deeply into \up0 \expndtw-2\charscalex100 their customers\u8217? business
es.\par\pard\qj \li6480\sb0\sl-255\slmult0 \par\pard\qj \li20\ri1143\sb2\sl-255\
slmult0 \up0 \expndtw-3\charscalex100 To establish tighter linkages with custome
rs, UPS \up0 \expndtw-4\charscalex100 developed tools that could be embedded int
o\par\pard\ql \li20\ri1108\sb0\sl-255\slmult0 \up0 \expndtw-3\charscalex100 cust
omers\u8217? applications. Tracking was the first \line \up0 \expndtw-3\charscal
ex100 application. The IT unit built a web front-end onto\par\pard\ql \li20\ri92
0\sb0\sl-252\slmult0 \up0 \expndtw-2\charscalex100 the existing tracking system
as well as an API\ul0\super\cf35\f36\fs21\ul0\super\cf35\f36\fs20 5\ul0\nosupers
ub\cf17\f18\fs22 that \up0 \expndtw-3\charscalex100 individual companies or ven
dors could integrate into \up0 \expndtw-3\charscalex100 their applications. Putt
ing the tracking tool on the \up0 \expndtw-3\charscalex100 UPS web site generate
d immediate benefits by\par\pard\qj \li20\ri1220\sb0\sl-254\slmult0 \up0 \expndt

w-2\charscalex100 reducing call center traffic. Telephone calls were \up0 \expnd
tw-3\charscalex100 costing UPS more than $2.00 each, while web\par\pard\qj \li20
\ri1068\sb13\sl-240\slmult0 \up0 \expndtw-3\charscalex100 inquiries cost only te
n cents. Marketing considered \up0 \expndtw-3\charscalex100 the internal cost sa
vings to be just the tip of the\par\pard\ql \li20\ri1100\sb3\sl-255\slmult0 \up0
\expndtw-3\charscalex100 iceberg. The real benefit would come when \line \up0 \
expndtw-3\charscalex100 customers integrated UPS into their own customer \up0 \e
xpndtw-2\charscalex100 service systems:\par\pard\ql \li6480\sb0\sl-252\slmult0 \
par\pard\ql \li380\ri1155\sb6\sl-252\slmult0 \up0 \expndtw-3\charscalex100 \ul0\
nosupersub\cf32\f33\fs22 We\u8217?ve gotten into customers\u8217? systems and \l
ine \up0 \expndtw-2\charscalex100 shown that we can save them money, because \li
ne \up0 \expndtw-3\charscalex100 if your customer calls and asks a question \lin
e \up0 \expndtw-2\charscalex100 about your order, nine times out of ten, \line \
up0 \expndtw-2\charscalex100 customer service can\u8217?t answer it. They have \
line \up0 \expndtw-3\charscalex100 to call shipping and shipping often calls \li
ne \up0 \expndtw-3\charscalex100 somebody else. So now that one call is\par\pard
\qj \li6480\sb0\sl-225\slmult0 \par\pard\qj \li20\ri961\sb206\sl-225\slmult0 \up
0 \expndtw0\charscalex102 \ul0\super\cf35\f36\fs21\ul0\super\cf35\f36\fs20 5\ul0
\nosupersub\cf3\f4\fs19 API stands for application program interface. An API is
\up0 \expndtw0\charscalex103 a program that allows two different applications t
o\par\pard\qj \li20\ri1381\sb15\sl-225\slmult0 \up0 \expndtw0\charscalex103 comm
unicate and exchange data. In this case UPS \line \up0 \expndtw0\charscalex103 p
rovided an API that allowed a different company\u8217?s\par\pard\qj \li20\ri928\
sb0\sl-234\slmult0 \up0 \expndtw0\charscalex102 application to retrieve data fro
m the UPS tracking system. \up0 \expndtw0\charscalex102 The external system init
iated a request for tracking\par\pard\qj \li20\ri1082\sb0\sl-224\slmult0 \up0 \e
xpndtw0\charscalex103 information in a format understood by the API and then \up
0 \expndtw0\charscalex102 the API selected the appropriate data from the UPS\par
\pard\ql \li20\sb12\sl-230\slmult0 \up0 \expndtw0\charscalex102 tracking system
and returned it to the external system.\par\pard\ql \li2735\sb130\sl-230\slmult0
\up0 \expndtw0\charscalex101 CISR Working Paper
{\shp {\*\shpinst\shpleft1080\shptop13290\shpright3960\shpbottom13310\shpfhdr0\s
hpbxpage\shpbypage\shpwr3\shpwrk0\shpfblwtxt1\shpz334\shplid0
{\sp{\sn shapeType}{\sv 0}}{\sp{\sn fFlipH}{\sv 0}}{\sp{\sn fFlipV}{\sv 0}}{\sp{
\sn geoRight}{\sv 2880}}{\sp{\sn geoBottom}{\sv 20}}
{\sp{\sn pVerticies}{\sv 8;5;(0,20);(2880,20);(2880,0);(0,0);(0,20)}}
{\sp{\sn pSegmentInfo}{\sv 2;11;16384;45824;1;45824;1;45824;1;45824;1;45824;3276
8}}
{\sp{\sn fFillOK}{\sv 1}}{\sp{\sn fFilled}{\sv 1}}{\sp{\sn fillColor}{\sv 0}}{\s
p{\sn fLine}{\sv 0}}{\sp{\sn lineType}{\sv 0}}{\sp{\sn fArrowheadsOK}{\sv 1}}{\s
p{\sn fBehindDocument}{\sv 1}}{\sp{\sn lineColor}{\sv 0}}
}}
{\shp {\*\shpinst\shpleft6480\shptop12600\shpright9360\shpbottom12620\shpfhdr0\s
hpbxpage\shpbypage\shpwr3\shpwrk0\shpfblwtxt1\shpz675\shplid1
{\sp{\sn shapeType}{\sv 0}}{\sp{\sn fFlipH}{\sv 0}}{\sp{\sn fFlipV}{\sv 0}}{\sp{
\sn geoRight}{\sv 2880}}{\sp{\sn geoBottom}{\sv 20}}
{\sp{\sn pVerticies}{\sv 8;5;(0,20);(2880,20);(2880,0);(0,0);(0,20)}}
{\sp{\sn pSegmentInfo}{\sv 2;11;16384;45824;1;45824;1;45824;1;45824;1;45824;3276
8}}
{\sp{\sn fFillOK}{\sv 1}}{\sp{\sn fFilled}{\sv 1}}{\sp{\sn fillColor}{\sv 0}}{\s
p{\sn fLine}{\sv 0}}{\sp{\sn lineType}{\sv 0}}{\sp{\sn fArrowheadsOK}{\sv 1}}{\s
p{\sn fBehindDocument}{\sv 1}}{\sp{\sn lineColor}{\sv 0}}
}}
{\shp {\*\shpinst\shpleft6120\shptop1154\shpright6140\shpbottom14760\shpfhdr0\sh
pbxpage\shpbypage\shpwr3\shpwrk0\shpfblwtxt1\shpz735\shplid2
{\sp{\sn shapeType}{\sv 0}}{\sp{\sn fFlipH}{\sv 0}}{\sp{\sn fFlipV}{\sv 0}}{\sp{
\sn geoRight}{\sv 20}}{\sp{\sn geoBottom}{\sv 13606}}

{\sp{\sn pVerticies}{\sv 8;5;(0,13606);(20,13606);(20,0);(0,0);(0,13606)}}


{\sp{\sn pSegmentInfo}{\sv 2;11;16384;45824;1;45824;1;45824;1;45824;1;45824;3276
8}}
{\sp{\sn fFillOK}{\sv 1}}{\sp{\sn fFilled}{\sv 1}}{\sp{\sn fillColor}{\sv 0}}{\s
p{\sn fLine}{\sv 0}}{\sp{\sn lineType}{\sv 0}}{\sp{\sn fArrowheadsOK}{\sv 1}}{\s
p{\sn fBehindDocument}{\sv 1}}{\sp{\sn lineColor}{\sv 0}}
}}\par\pard\sect\sectd\fs24\paperw12240\paperh15840\pard\sb0\sl-240{\bkmkstart P
g7}{\bkmkend Pg7}\par\pard\sect\sectd\sbknone\cols2\colno1\colw6370\colsr110\col
no2\colw5620\colsr160\qj \li1080\sb0\sl-255\slmult0 \par\pard\qj \li1080\sb0\sl255\slmult0 \par\pard\qj \li1080\sb0\sl-255\slmult0 \par\pard\qj \li1440\ri957\s
b118\sl-255\slmult0 \up0 \expndtw-2\charscalex100 \ul0\nosupersub\cf32\f33\fs22
generating a minimum of two other calls. If \up0 \expndtw-3\charscalex100 we ass
ume the $2.00 rule, now you\u8217?ve got \up0 \expndtw-3\charscalex100 $6.00 in
cost, where if I can give you a\par\pard\qj \li1440\ri880\sb0\sl-252\slmult0 \up
0 \expndtw-2\charscalex100 tracking number when you order\u8212?which we \up0 \e
xpndtw-2\charscalex100 can do in our system\u8212?and send you to our \up0 \expn
dtw-4\charscalex100 page, you can self -service. So the customer \up0 \expndtw-2
\charscalex100 gets better service. You take away the\par\pard\qj \li1440\ri768\
sb0\sl-255\slmult0 \up0 \expndtw-2\charscalex100 attitude of poor service provid
ers and you get \up0 \expndtw-2\charscalex100 the right information when you wan
t it.\par\pard\qj \li2055\ri775\sb11\sl-240\slmult0\tx3330 \up0 \expndtw-3\chars
calex100 \u8212?Joe Pyne, Senior VP, Marketing and \line\tab \up0 \expndtw-2\cha
rscalex100 Corporate Development\par\pard\qj \li1080\sb0\sl-255\slmult0 \par\par
d\qj \li1080\ri548\sb3\sl-255\slmult0 \up0 \expndtw-3\charscalex100 \ul0\nosuper
sub\cf17\f18\fs22 Although many customers were able and willing to \up0 \expndtw
-3\charscalex100 integrate UPS\u8217? tracking API into their home-grown \up0 \e
xpndtw-3\charscalex100 software, many others purchased software, including \up0
\expndtw-3\charscalex100 ERP systems. To meet the needs of these customers, \up0
\expndtw-3\charscalex100 UPS established alliances with key vendors.\par\pard\q
j \li1080\ri561\sb7\sl-247\slmult0 \up0 \expndtw-3\charscalex100 Companies like
Oracle, Peoplesoft, Harbinger, IBM, \up0 \expndtw-3\charscalex100 and eventually
SAP built the UPS tracking API into \up0 \expndtw-3\charscalex100 their softwar
e. UPS followed three principles in\par\pard\ql \li1080\ri685\sb2\sl-255\slmult0
\up0 \expndtw-3\charscalex100 developing alliances with software vendors: the \
line \up0 \expndtw-3\charscalex100 APIs would be developed by UPS; they would be
\line \up0 \expndtw-3\charscalex100 embedded into the software of the alliance
partner;\par\pard\qj \li1080\ri603\sb0\sl-255\slmult0 \up0 \expndtw-3\charscalex
100 and the service would be branded\u8212?when individual \up0 \expndtw-3\chars
calex100 customers accessed UPS systems, the UPS logo\par\pard\ql \li1080\sb1\sl
-236\slmult0 \up0 \expndtw-2\charscalex100 would be on their screens.\par\pard\q
l \li1080\sb0\sl-255\slmult0 \par\pard\ql \li1080\ri550\sb4\sl-255\slmult0 \up0
\expndtw-3\charscalex100 To enable this strategy, UPS followed a policy of \up0
\expndtw-3\charscalex100 open standards. Management noted that having open \up0
\expndtw-3\charscalex100 standards distinguished its approach to e-commerce \up0
\expndtw-3\charscalex100 from that of competitors like Federal Express, which \
up0 \expndtw-3\charscalex100 used proprietary systems:\par\pard\qj \li1440\ri135
7\sb240\sl-255\slmult0 \up0 \expndtw-2\charscalex100 \ul0\nosupersub\cf32\f33\fs
22 We realized that we could get to larger \line \up0 \expndtw-3\charscalex100 g
roups of people quicker if we would\par\pard\qj \li1440\ri903\sb0\sl-255\slmult0
\up0 \expndtw-3\charscalex100 embrace open standards. There were people \up0 \e
xpndtw-2\charscalex100 out there, like IBM and Andersen and\par\pard\qj \li1440\
ri802\sb3\sl-252\slmult0 \up0 \expndtw-2\charscalex100 Harbinger, and hundreds o
f other folks that \line \up0 \expndtw-2\charscalex100 we\u8217?ve done alliance
s with, that did an awful \line \up0 \expndtw-2\charscalex100 lot of things bett
er than we did. That really \line \up0 \expndtw-2\charscalex100 put us in the le
ad. Our competition wanted to \line \up0 \expndtw-3\charscalex100 do it all them
selves, and that really gave us a \line \up0 \expndtw-3\charscalex100 leg up as
we built these things. It was a good \line \up0 \expndtw-1\charscalex100 move fo
r us.\par\pard\qj \li2385\ri775\sb1\sl-255\slmult0\tx3255 \up0 \expndtw-3\charsc
alex100 \u8212?Mike Eskew, Vice Chairman and \line\tab \up0 \expndtw-2\charscale

x100 Executive Vice President\par\pard\ql \li1080\ri518\sb240\sl-255\slmult0 \up


0 \expndtw-3\charscalex100 \ul0\nosupersub\cf17\f18\fs22 UPS\u8217? concern with
its software distribution \line \up0 \expndtw-2\charscalex100 approach was that
someone might sell UPS software \up0 \expndtw-3\charscalex100 externally. The f
irm was developing IT and legal \up0 \expndtw-3\charscalex100 mechanisms that wo
uld register users and establish a \up0 \expndtw-3\charscalex100 contractual agr
eement that limited how the software \up0 \expndtw-3\charscalex100 could be used
. An alliance group was actively\par\pard\ql \li1080\sb0\sl-230\slmult0 \par\par
d\ql \li1080\sb121\sl-230\slmult0\tx5755 \up0 \expndtw0\charscalex102 \ul0\nosup
ersub\cf34\f35\fs19 Jeanne Ross\tab \up0 \expndtw0\charscalex101 Page\ul0\nosupe
rsub\cf3\f4\fs19 \ul0\nosupersub\cf34\f35\fs19 4\par\pard\column \qj \li6480\sb
0\sl-250\slmult0 \par\pard\qj \li6480\sb0\sl-250\slmult0 \par\pard\qj \li6480\sb
0\sl-250\slmult0 \par\pard\qj \li20\ri873\sb137\sl-250\slmult0 \up0 \expndtw-3\c
harscalex100 \ul0\nosupersub\cf17\f18\fs22 \u8220?scouring the environment\u8221
? looking for the vendor \line \up0 \expndtw-2\charscalex100 solutions that were
prevalent among UPS customers. \line \up0 \expndtw-3\charscalex100 A UPS market
ing team would sell those vendors on \line \up0 \expndtw-3\charscalex100 the val
ue of embedding UPS tools in their software:\par\pard\qj \li6480\sb0\sl-255\slmu
lt0 \par\pard\qj \li380\ri1184\sb1\sl-255\slmult0 \up0 \expndtw-2\charscalex100
\ul0\nosupersub\cf32\f33\fs22 A lot of vendors wanted us to pay them to get \up0
\expndtw-3\charscalex100 the tools into their software, and we said no, \up0 \e
xpndtw-2\charscalex100 we\u8217?re giving you the value of our brand.\par\pard\q
j \li380\ri1608\sb7\sl-247\slmult0 \up0 \expndtw-3\charscalex100 We\u8217?re inc
reasing the functionality. Your \up0 \expndtw-2\charscalex100 customers will see
greater value in what \up0 \expndtw-2\charscalex100 you\u8217?re offering.\par\
pard\ql \li3410\sb2\sl-254\slmult0 \up0 \expndtw-3\charscalex100 \u8212?Joe Pyne
\par\pard\qj \li6480\sb0\sl-255\slmult0 \par\pard\qj \li20\ri1217\sb2\sl-255\slm
ult0 \up0 \expndtw-3\charscalex100 \ul0\nosupersub\cf17\f18\fs22 Following the l
aunch of the Tracking API, UPS \line \up0 \expndtw-3\charscalex100 introduced a
Rates and Services tool that allowed \line \up0 \expndtw-2\charscalex100 UPS cus
tomers to link their own customers to a \line \up0 \expndtw-2\charscalex100 menu
of UPS shipping options and costs. By late \line \up0 \expndtw-3\charscalex100
2000, UPS had six OnLine Tools available to\par\pard\qj \li20\ri996\sb0\sl-248\s
lmult0 \up0 \expndtw-3\charscalex100 customers for downloading, and had compiled
a list \up0 \expndtw-3\charscalex100 of 30 services, some functional, others\pa
r\pard\qj \li20\ri994\sb0\sl-255\slmult0 \up0 \expndtw-3\charscalex100 informati
onal, that the company intended to make \up0 \expndtw-3\charscalex100 available
through UPS Online Tools. (See Exhibit 3 \up0 \expndtw-3\charscalex100 and the U
PS website at {\field{\*\fldinst {HYPERLINK "http://www.ups.com/" }}{\fldrslt {\
ul0\nosupersub\cf17\f18\fs22 www.ups.com}}}\ul0\nosupersub\cf17\f18\fs22 for a\
par\pard\ql \li20\sb0\sl-255\slmult0 \up0 \expndtw-3\charscalex100 description o
f tools available at the end of 2000.)\par\pard\ql \li20\ri1096\sb240\sl-255\slm
ult0 \up0 \expndtw-3\charscalex100 These tools leveraged the UPS infrastructure
by \line \up0 \expndtw-3\charscalex100 accessing data from the centralized packa
ge and \line \up0 \expndtw-3\charscalex100 customer databases. For example, the
tracking tool \line \up0 \expndtw-3\charscalex100 used data on package delivery
transmitted by the \line \up0 \expndtw-3\charscalex100 DIAD. Because the DIAD co
nfirmed receipt, UPS\par\pard\qj \li20\ri877\sb0\sl-255\slmult0 \up0 \expndtw-3\
charscalex100 customers could immediately bill for goods that their \up0 \expndt
w-2\charscalex100 customers had received. One UPS customer\par\pard\qj \li20\ri1
031\sb0\sl-250\slmult0 \up0 \expndtw-3\charscalex100 documented a reduction in d
ays\u8217? sales outstanding \up0 \expndtw-3\charscalex100 from 48 to 34 days af
ter tying UPS tracking into its \up0 \expndtw-3\charscalex100 accounts receivabl
e system.\par\pard\qj \li6480\sb0\sl-255\slmult0 \par\pard\qj \li20\ri950\sb1\sl
-255\slmult0 \up0 \expndtw-3\charscalex100 In addition to its OnLine Tools, UPS
developed a \up0 \expndtw-2\charscalex100 wide range of web-supported products a
nd services. \up0 \expndtw-2\charscalex100 UPS Document Exchange allowed firms t
o transfer \up0 \expndtw-3\charscalex100 large electronic files in a secure, enc
rypted\par\pard\qj \li20\ri1037\sb0\sl-250\slmult0 \up0 \expndtw-5\charscalex100
environment, with full visibility real-time tracking \up0 \expndtw-4\charscalex

100 and confirmation of delivery. UPS Returns Services \up0 \expndtw-3\charscale


x100 supported the return process for shippers who\par\pard\qj \li20\ri1355\sb1\
sl-255\slmult0 \up0 \expndtw-2\charscalex100 wanted to make their customers\u821
7? return process \line \up0 \expndtw-4\charscalex100 hassle -free. Finally, UPS
shippers could enter\par\pard\qj \li20\ri1144\sb7\sl-247\slmult0 \up0 \expndtw3\charscalex100 package information on-line and receive the same \up0 \expndtw-3
\charscalex100 services as firms that had downloaded the OnLine \up0 \expndtw-2\
charscalex100 Tools (See Exhibit 4 and the UPS website at\par\pard\ql \li20\ri11
90\sb2\sl-255\slmult0 \up0 \expndtw-2\charscalex100 {\field{\*\fldinst {HYPERLIN
K "http://www.ups.com/" }}{\fldrslt {\ul0\nosupersub\cf17\f18\fs22 www.ups.com}}
}\ul0\nosupersub\cf17\f18\fs22 for a description of UPS\u8217? web-\line \up0 \
expndtw-2\charscalex100 supported products and services.) These products\par\par
d\qj \li20\ri947\sb0\sl-255\slmult0 \up0 \expndtw-3\charscalex100 and services w
ere intended to bring UPS deeper into \up0 \expndtw-3\charscalex100 its customer
s\u8217? businesses and increasingly provide \up0 \expndtw-3\charscalex100 globa
l commerce solutions:\par\pard\ql \li9195\sb0\sl-230\slmult0 \par\pard\ql \li273
5\sb121\sl-230\slmult0 \up0 \expndtw0\charscalex101 \ul0\nosupersub\cf3\f4\fs19
CISR Working Paper
{\shp {\*\shpinst\shpleft6120\shptop1154\shpright6140\shpbottom14565\shpfhdr0\sh
pbxpage\shpbypage\shpwr3\shpwrk0\shpfblwtxt1\shpz680\shplid0
{\sp{\sn shapeType}{\sv 0}}{\sp{\sn fFlipH}{\sv 0}}{\sp{\sn fFlipV}{\sv 0}}{\sp{
\sn geoRight}{\sv 20}}{\sp{\sn geoBottom}{\sv 13411}}
{\sp{\sn pVerticies}{\sv 8;5;(0,13411);(20,13411);(20,0);(0,0);(0,13411)}}
{\sp{\sn pSegmentInfo}{\sv 2;11;16384;45824;1;45824;1;45824;1;45824;1;45824;3276
8}}
{\sp{\sn fFillOK}{\sv 1}}{\sp{\sn fFilled}{\sv 1}}{\sp{\sn fillColor}{\sv 0}}{\s
p{\sn fLine}{\sv 0}}{\sp{\sn lineType}{\sv 0}}{\sp{\sn fArrowheadsOK}{\sv 1}}{\s
p{\sn fBehindDocument}{\sv 1}}{\sp{\sn lineColor}{\sv 0}}
}}\par\pard\sect\sectd\fs24\paperw12240\paperh15840\pard\sb0\sl-240{\bkmkstart P
g8}{\bkmkend Pg8}\par\pard\ql \li6840\sb0\sl-253\slmult0 \par\pard\ql\li6840\sb0
\sl-253\slmult0 \par\pard\ql\li6840\sb0\sl-253\slmult0 \par\pard\ql\li6840\sb111
\sl-253\slmult0 \up0 \expndtw-2\charscalex100 \ul0\nosupersub\cf32\f33\fs22 can
walk in and give depth to the power of\par\pard\sect\sectd\sbknone\cols2\colno1\
colw6370\colsr110\colno2\colw5620\colsr160\qj \li1440\ri810\sb19\sl-251\slmult0
\up0 \expndtw-2\charscalex100 We are driving deeper into our customers\u8217? \l
ine \up0 \expndtw-3\charscalex100 systems so that they get a benefit. Then when
\line \up0 \expndtw-2\charscalex100 we\u8217?re in there, it\u8217?s harder for
them to get us \line \up0 \expndtw-3\charscalex100 out. If we are just talking t
o them at the dock, \line \up0 \expndtw-2\charscalex100 we can be replaced in a
day. If we are in\par\pard\ql \li1440\ri815\sb4\sl-251\slmult0 \up0 \expndtw-3\c
harscalex100 their order entry system, if we\u8217?re adding \line \up0 \expndtw
-2\charscalex100 value in their picking system, if we\u8217?re adding \line \up0
\expndtw-2\charscalex100 value in their customer service system, in \line \up0
\expndtw-2\charscalex100 their warehousing system, it\u8217?s harder to be \line
\up0 \expndtw-1\charscalex100 replaced.\par\pard\qj \li1965\ri775\sb0\sl-255\sl
mult0\fi420 \up0 \expndtw-3\charscalex100 \u8212?Joe Pyne, Senior Vice President
, \line \up0 \expndtw-2\charscalex100 Marketing and Corporate Development\par\pa
rd\ql \li1080\sb0\sl-253\slmult0 \par\pard\ql \li1080\ri595\sb3\sl-253\slmult0 \
up0 \expndtw-3\charscalex100 \ul0\nosupersub\cf17\f18\fs22 By mid-2000 more than
50,000 firms had \line \up0 \expndtw-3\charscalex100 downloaded UPS\u8217? OnLi
ne Tools and integrated \line \up0 \expndtw-3\charscalex100 them into their ship
ping or accounting applications. \line \up0 \expndtw-3\charscalex100 On December
19, 2000, UPS received 6.5 million \line \up0 \expndtw-3\charscalex100 tracking
requests, approximately double the number \line \up0 \expndtw-3\charscalex100 o
f tracking requests on the busiest day in 1999. In \line \up0 \expndtw-3\charsca
lex100 1995, UPS had received only 100,000 tracking \line \up0 \expndtw-3\charsc
alex100 requests during the entire month of December. A \line \up0 \expndtw-3\ch
arscalex100 UPS press release stated:\par\pard\ql \li1080\sb0\sl-252\slmult0 \pa
r\pard\ql \li1440\ri771\sb6\sl-252\slmult0 \up0 \expndtw-2\charscalex100 \ul0\no

supersub\cf32\f33\fs22 The surge in online tracking requests is a \line \up0 \ex


pndtw-2\charscalex100 clear indication of the rapidly growing use of \up0 \expnd
tw-2\charscalex100 Internet technology, by UPS and its \line \up0 \expndtw-2\cha
rscalex100 customers, to manage the \u8220?supply chains\u8221? of \up0 \expndtw
-2\charscalex100 everyone from Fortune 500 companies to \line \up0 \expndtw-3\ch
arscalex100 individual consumers.\par\pard\ql \li1080\sb0\sl-264\slmult0 \par\pa
rd\ql \li1080\sb240\sl-264\slmult0 \up0 \expndtw-5\charscalex100 \ul0\nosupersub
\cf33\f34\fs22 Managing e -Commerce\par\pard\qj \li1080\ri685\sb0\sl-250\slmult0
\up0 \expndtw-3\charscalex100 \ul0\nosupersub\cf17\f18\fs22 UPS located respons
ibility for e-commerce in an \up0 \expndtw-2\charscalex100 electronic commerce t
eam with two branches. One \up0 \expndtw-3\charscalex100 branch focused on allia
nce building and\par\pard\ql \li1080\ri1193\sb0\sl-255\slmult0 \up0 \expndtw-3\c
harscalex100 communication, strategy development, and \line \up0 \expndtw-3\char
scalex100 technology. A group within this team defined\par\pard\ql \li1080\ri699
\sb3\sl-251\slmult0 \up0 \expndtw-3\charscalex100 technology requirements for On
Line Tools and \up0 \expndtw-3\charscalex100 handed them off to IT for developme
nt. This group \up0 \expndtw-3\charscalex100 then created marketing plans for ea
ch tool that \up0 \expndtw-3\charscalex100 clarified target customers and the sp
ecific, \line \up0 \expndtw-3\charscalex100 quantifiable value proposition for t
he tool.\par\pard\qj \li1080\sb0\sl-255\slmult0 \par\pard\qj \li1080\ri757\sb1\s
l-255\slmult0 \up0 \expndtw-2\charscalex100 The second branch of the e-commerce
team was a \up0 \expndtw-3\charscalex100 group of over one hundred ECAMs (electr
onic\par\pard\qj \li1080\ri599\sb13\sl-240\slmult0 \up0 \expndtw-3\charscalex100
commerce account managers). The ECAMs worked \up0 \expndtw-3\charscalex100 clos
ely with traditional UPS account managers,\par\pard\qj \li1080\ri984\sb3\sl-255\
slmult0 \up0 \expndtw-3\charscalex100 accompanying them on their visits to large
UPS \up0 \expndtw-3\charscalex100 customers:\par\pard\qj \li1440\ri971\sb255\sl
-255\slmult0 \up0 \expndtw-2\charscalex100 \ul0\nosupersub\cf32\f33\fs22 So wher
e the account manager has breadth \line \up0 \expndtw-2\charscalex100 about the
entire UPS portfolio, the ECAM\par\pard\ql \li1080\sb0\sl-230\slmult0 \par\pard\
ql \li1080\sb121\sl-230\slmult0\tx5755 \up0 \expndtw0\charscalex102 \ul0\nosuper
sub\cf34\f35\fs19 Jeanne Ross\tab \up0 \expndtw0\charscalex101 Page\ul0\nosupers
ub\cf3\f4\fs19 \ul0\nosupersub\cf34\f35\fs19 5\par\pard\column \qj \li380\ri122
1\sb22\sl-247\slmult0 \up0 \expndtw-2\charscalex100 \ul0\nosupersub\cf32\f33\fs2
2 process and transportation technology. They \up0 \expndtw-3\charscalex100 can
go in and talk about how we save them \up0 \expndtw-2\charscalex100 $4.77 per re
turned package because we\par\pard\qj \li380\ri1753\sb1\sl-255\slmult0 \up0 \exp
ndtw-2\charscalex100 provide visibility, or $2.40 because we \up0 \expndtw-2\cha
rscalex100 provide tracking.\par\pard\ql \li2630\sb0\sl-255\slmult0 \up0 \expndt
w-2\charscalex100 \u8212?Ross McCullough\par\pard\ql \li1580\sb0\sl-255\slmult0
\up0 \expndtw-3\charscalex100 Senior Director of E-Commerce\par\pard\ql \li6480\
sb0\sl-247\slmult0 \par\pard\ql \li20\ri1325\sb14\sl-247\slmult0 \up0 \expndtw-2
\charscalex100 \ul0\nosupersub\cf17\f18\fs22 Both branches of the e-commerce tea
m were \line \up0 \expndtw-3\charscalex100 committed to integrating e-commerce i
nto all of \line \up0 \expndtw-3\charscalex100 UPS:\par\pard\qj \li6480\sb0\sl-2
54\slmult0 \par\pard\qj \li380\ri1259\sb5\sl-254\slmult0 \up0 \expndtw-2\charsca
lex100 \ul0\nosupersub\cf32\f33\fs22 The one key thing is that we did not create
a \up0 \expndtw-3\charscalex100 separate organization in and of itself. In\par\
pard\ql \li380\ri1216\sb4\sl-252\slmult0 \up0 \expndtw-2\charscalex100 other wor
ds, my team is the core\u8212?the \line \up0 \expndtw-2\charscalex100 driving co
mponent of e-commerce, but it is \line \up0 \expndtw-3\charscalex100 not like we
went off in a new building and \line \up0 \expndtw-3\charscalex100 closed the d
oor and said \u8220?Don\u8217?t come in, \line \up0 \expndtw-2\charscalex100 UPS
ers.\u8221? We knew that we had to raise \line \up0 \expndtw-2\charscalex100 eve
ryone up to know and understand 21\ul0\super\cf36\f37\fs21\ul0\super\cf36\f37\fs
20 st \line \up0 \expndtw-2\charscalex100 \ul0\nosupersub\cf32\f33\fs22 Century
commerce. We are making sure that \line \up0 \expndtw-2\charscalex100 the entire
IT organization knows and \line \up0 \expndtw-2\charscalex100 understands the i
mplications of integration \line \up0 \expndtw-3\charscalex100 and how important
it is to our future \line \up0 \expndtw-3\charscalex100 platform.\par\pard\ql \

li2630\sb1\sl-255\slmult0 \up0 \expndtw-2\charscalex100 \u8212?Ross McCullough\p


ar\pard\ql \li20\sb263\sl-264\slmult0 \up0 \expndtw-3\charscalex100 \ul0\nosuper
sub\cf33\f34\fs22 Identifying New Business Opportunities\par\pard\ql \li20\ri895
\sb0\sl-251\slmult0 \up0 \expndtw-3\charscalex100 \ul0\nosupersub\cf17\f18\fs22
In addition to enhancing its core business, UPS \line \up0 \expndtw-3\charscalex
100 believed that the Internet offered new opportunities \line \up0 \expndtw-3\c
harscalex100 to provide global commerce solutions for its \line \up0 \expndtw-3\
charscalex100 customers. To identify these \u8220?out of the box\u8221? \line \u
p0 \expndtw-2\charscalex100 opportunities, Joe Pyne created UPS e-Ventures, a \l
ine \up0 \expndtw-3\charscalex100 wholly owned subsidiary of UPS. e-Ventures was
an \line \up0 \expndtw-3\charscalex100 incubator that explored ideas generated
either \line \up0 \expndtw-2\charscalex100 internally or by potential alliance p
artners. The \line \up0 \expndtw-3\charscalex100 group had assessed more than th
irty ideas in its first \line \up0 \expndtw-3\charscalex100 year and senior mana
gement was funding four of \line \up0 \expndtw-2\charscalex100 those concepts as
new business initiatives. Each of \line \up0 \expndtw-3\charscalex100 the four
businesses was expected to quickly deliver \line \up0 \expndtw-6\charscalex100 p
rofits:\par\pard\qj \li6840\sb0\sl-252\slmult0 \par\pard\qj \li380\ri1277\sb6\sl
-252\slmult0 \up0 \expndtw-3\charscalex100 \ul0\nosupersub\cf32\f33\fs22 We\u821
7?re in the business of making money. Our \line \up0 \expndtw-2\charscalex100 in
vestors are not going to be thrilled if we \line \up0 \expndtw-2\charscalex100 s
tart losing money as a result of entering a \line \up0 \expndtw-2\charscalex100
new arena. So we don\u8217?t have the luxury of \line \up0 \expndtw-2\charscalex
100 going into those kinds of things and saying \line \up0 \expndtw-2\charscalex
100 well, maybe 5 or 10 years from now we\u8217?ll \line \up0 \expndtw-3\charsca
lex100 start to make a profit. The rules are a little \line \up0 \expndtw-3\char
scalex100 different for dot-coms than they are for us.\par\pard\qj \li2345\ri114
5\sb1\sl-255\slmult0\fi90 \up0 \expndtw-3\charscalex100 \u8212?Jim Kelly, CEO an
d \line \up0 \expndtw-2\charscalex100 Chairman of the Board\par\pard\ql \li9195\
sb0\sl-230\slmult0 \par\pard\ql \li2735\sb121\sl-230\slmult0 \up0 \expndtw0\char
scalex101 \ul0\nosupersub\cf3\f4\fs19 CISR Working Paper
{\shp {\*\shpinst\shpleft6120\shptop1154\shpright6140\shpbottom14565\shpfhdr0\sh
pbxpage\shpbypage\shpwr3\shpwrk0\shpfblwtxt1\shpz714\shplid0
{\sp{\sn shapeType}{\sv 0}}{\sp{\sn fFlipH}{\sv 0}}{\sp{\sn fFlipV}{\sv 0}}{\sp{
\sn geoRight}{\sv 20}}{\sp{\sn geoBottom}{\sv 13411}}
{\sp{\sn pVerticies}{\sv 8;5;(0,13411);(20,13411);(20,0);(0,0);(0,13411)}}
{\sp{\sn pSegmentInfo}{\sv 2;11;16384;45824;1;45824;1;45824;1;45824;1;45824;3276
8}}
{\sp{\sn fFillOK}{\sv 1}}{\sp{\sn fFilled}{\sv 1}}{\sp{\sn fillColor}{\sv 0}}{\s
p{\sn fLine}{\sv 0}}{\sp{\sn lineType}{\sv 0}}{\sp{\sn fArrowheadsOK}{\sv 1}}{\s
p{\sn fBehindDocument}{\sv 1}}{\sp{\sn lineColor}{\sv 0}}
}}\par\pard\sect\sectd\fs24\paperw12240\paperh15840\pard\sb0\sl-240{\bkmkstart P
g9}{\bkmkend Pg9}\par\pard\sect\sectd\sbknone\cols2\colno1\colw5740\colsr20\coln
o2\colw6340\colsr160\qj \li1080\sb0\sl-252\slmult0 \par\pard\qj \li1080\sb0\sl-2
52\slmult0 \par\pard\qj \li1080\sb0\sl-252\slmult0 \par\pard\qj \li1080\ri0\sb12
9\sl-252\slmult0 \up0 \expndtw-5\charscalex100 \ul0\nosupersub\cf17\f18\fs22 UPS
launched its first e-Venture, UPS e-Logistics, in \line \up0 \expndtw-6\charsca
lex100 August 2000. This venture recognized that many dot-\line \up0 \expndtw-5\
charscalex100 com organizations were focused almost entirely on \line \up0 \expn
dtw-4\charscalex100 the front-end of their businesses and were incapable \line \
up0 \expndtw-4\charscalex100 of fulfillment. UPS e-Logistics provided a complete
\line \up0 \expndtw-5\charscalex100 menu of \u8220?behind the scene\u8221? serv
ices that would\par\pard\qj \li1080\ri0\sb2\sl-254\slmult0 \up0 \expndtw-7\chars
calex100 manage the entire back-end logistics process from the \up0 \expndtw-5\c
harscalex100 time an order was placed on a customer\u8217?s web site to \up0 \ex
pndtw-5\charscalex100 the time the order was delivered. Services included \up0 \
expndtw-4\charscalex100 warehousing, inventory management, order\par\pard\ql \li
1080\ri0\sb0\sl-251\slmult0 \up0 \expndtw-5\charscalex100 fulfillment (pick, pac
k and ship), shipping and \up0 \expndtw-6\charscalex100 delivery, management rep

orting, returns management, \up0 \expndtw-5\charscalex100 customer care, and tel


ephone support:\par\pard\ql \li1080\sb0\sl-252\slmult0 \par\pard\ql \li1440\ri33
0\sb4\sl-252\slmult0 \up0 \expndtw-3\charscalex100 \ul0\nosupersub\cf32\f33\fs22
If you have a good idea and you\u8217?re a \line \up0 \expndtw-2\charscalex100
marketing company or a service company, \line \up0 \expndtw-2\charscalex100 but
you have no idea how to fulfill, we\u8217?ll \line \up0 \expndtw-2\charscalex100
bring our expertise to do that for you. So \line \up0 \expndtw-2\charscalex100
then you just have to market, sell your \line \up0 \expndtw-2\charscalex100 prod
uct or your service. And we\u8217?ll do \line \up0 \expndtw-2\charscalex100 ever
ything else.\par\pard\qj \li1965\ri55\sb1\sl-255\slmult0\fi420 \up0 \expndtw-2\c
harscalex100 \u8212?Joe Pyne, Senior Vice President, \line \up0 \expndtw-2\chars
calex100 Marketing and Corporate Development\par\pard\qj \li1080\sb0\sl-247\slmu
lt0 \par\pard\qj \li1080\ri37\sb15\sl-247\slmult0 \up0 \expndtw-3\charscalex100
\ul0\nosupersub\cf17\f18\fs22 If e-Logistics succeeded, UPS management would \up
0 \expndtw-3\charscalex100 have to decide whether to fold it into an existing \u
p0 \expndtw-3\charscalex100 business unit, such as Worldwide Logistics, or\par\p
ard\ql \li1080\ri0\sb2\sl-255\slmult0 \up0 \expndtw-3\charscalex100 continue to
operate it as a separate subsidiary. \line \up0 \expndtw-3\charscalex100 Managem
ent expected that the proliferation of new \line \up0 \expndtw-3\charscalex100 b
usinesses that would grow out of the e-Ventures \line \up0 \expndtw-2\charscalex
100 unit would make UPS a more complex business.\par\pard\ql \li1080\sb0\sl-264\
slmult0 \par\pard\ql \li1080\sb239\sl-264\slmult0 \up0 \expndtw-2\charscalex100
\ul0\nosupersub\cf33\f34\fs22 Managing IT for E-Commerce\par\pard\qj \li1080\ri1
60\sb0\sl-247\slmult0 \up0 \expndtw-3\charscalex100 \ul0\nosupersub\cf17\f18\fs2
2 UPS\u8217? e-commerce initiatives were built on an IT \up0 \expndtw-3\charscal
ex100 infrastructure that was highly centralized and\par\pard\qj \li1080\ri0\sb1
\sl-255\slmult0 \up0 \expndtw-3\charscalex100 standardized. A data center in Atl
anta replicated the \up0 \expndtw-2\charscalex100 operations of the main data ce
nter in Mahwah.\par\pard\qj \li1080\ri0\sb7\sl-247\slmult0 \up0 \expndtw-3\chars
calex100 Sensing that UPS could not afford down-time, Ken \up0 \expndtw-3\charsc
alex100 Lacy, the CIO, switched operations on a daily basis \up0 \expndtw-3\char
scalex100 between the two data centers to ensure that they\par\pard\qj \li1080\r
i179\sb2\sl-255\slmult0 \up0 \expndtw-3\charscalex100 could hand off operations
without interruption in \up0 \expndtw-2\charscalex100 case of a disaster.\par\pa
rd\qj \li1080\ri0\sb255\sl-255\slmult0 \up0 \expndtw-5\charscalex100 Centralizat
ion and standardization led to highly cost-\line \up0 \expndtw-3\charscalex100 e
ffective IT operations, which had long been a\par\pard\ql \li1080\ri0\sb3\sl-252
\slmult0 \up0 \expndtw-3\charscalex100 priority at UPS. In the mid-1990s, howeve
r, \line \up0 \expndtw-3\charscalex100 management wanted to leverage its infrast
ructure to \line \up0 \expndtw-3\charscalex100 become more flexible and responsi
ve to customer \line \up0 \expndtw-3\charscalex100 needs. UPS identified a varie
ty of ways that it could \line \up0 \expndtw-3\charscalex100 leverage its infras
tructure to generate value for its \line \up0 \expndtw-3\charscalex100 customers
. For example its customer information\par\pard\ql \li1080\sb0\sl-230\slmult0 \p
ar\pard\ql \li1080\sb0\sl-230\slmult0 \par\pard\ql \li1080\sb147\sl-230\slmult0
\up0 \expndtw0\charscalex102 \ul0\nosupersub\cf34\f35\fs19 Jeanne Ross\par\pard\
column \qj \li5760\sb0\sl-255\slmult0 \par\pard\qj \li5760\sb0\sl-255\slmult0 \p
ar\pard\qj \li5760\sb0\sl-255\slmult0 \par\pard\qj \li740\ri888\sb118\sl-255\slm
ult0 \up0 \expndtw-2\charscalex100 \ul0\nosupersub\cf17\f18\fs22 database mainta
ined information on each customer\u8217?s \up0 \expndtw-4\charscalex100 shipping
habits:\par\pard\qj \li1100\ri1157\sb241\sl-254\slmult0 \up0 \expndtw-3\charsca
lex100 \ul0\nosupersub\cf32\f33\fs22 Customers give us information so that we ca
n \up0 \expndtw-2\charscalex100 provide them with origin and destination\par\par
d\qj \li1100\ri1505\sb2\sl-255\slmult0 \up0 \expndtw-2\charscalex100 management.
If they\u8217?re shipping different \up0 \expndtw-2\charscalex100 products, the
n that\u8217?s fine, but if they\u8217?re\par\pard\qj \li1100\ri1251\sb0\sl-255\
slmult0 \up0 \expndtw-2\charscalex100 shipping similar products, we can say, \u8
220?You \up0 \expndtw-2\charscalex100 are shipping the same product out of six\p
ar\pard\ql \li1100\ri1151\sb2\sl-252\slmult0 \up0 \expndtw-3\charscalex100 diffe
rent warehouses, and if you really \line \up0 \expndtw-2\charscalex100 wanted to

minimize warehouses, minimize \line \up0 \expndtw-2\charscalex100 the staffing


for those warehouses, reduce \line \up0 \expndtw-2\charscalex100 your inventorie
s, then you can do that out of \line \up0 \expndtw-2\charscalex100 one or two wa
rehouses. Let us show you how \line \up0 \expndtw-2\charscalex100 to do that wit
h our logistics group.\u8221? That lets \line \up0 \expndtw-2\charscalex100 us c
ome in with our site locators and help \line \up0 \expndtw-2\charscalex100 them
determine the right location to be able \line \up0 \expndtw-2\charscalex100 to s
taff, size, and fulfill their orders out of the \line \up0 \expndtw-2\charscalex
100 minimal number of warehouses. That\u8217?s the \line \up0 \expndtw-2\charsca
lex100 kind of thing we can do with data.\par\pard\qj \li2030\ri1145\sb1\sl-255\
slmult0\tx2925 \up0 \expndtw-2\charscalex100 \u8212?Mike Eskew, Vice Chairman an
d \line\tab \up0 \expndtw-2\charscalex100 Executive Vice President\par\pard\qj \
li5760\sb0\sl-250\slmult0 \par\pard\qj \li740\ri1205\sb10\sl-250\slmult0 \up0 \e
xpndtw-2\charscalex100 \ul0\nosupersub\cf17\f18\fs22 In addition, the IT unit ha
d started to create more \up0 \expndtw-3\charscalex100 modular applications that
could be re-used. This \up0 \expndtw-3\charscalex100 reduced development time,
so that applications \up0 \expndtw-2\charscalex100 could be delivered faster:\pa
r\pard\qj \li5760\sb0\sl-255\slmult0 \par\pard\qj \li1100\ri1700\sb1\sl-255\slmu
lt0 \up0 \expndtw-2\charscalex100 \ul0\nosupersub\cf32\f33\fs22 With the Interne
t, tracking was the first \line \up0 \expndtw-3\charscalex100 application, and t
hat was just reusing\par\pard\qj \li1100\ri1278\sb5\sl-250\slmult0 \up0 \expndtw
-2\charscalex100 mainframe-based technology. We wrote an \line \up0 \expndtw-2\c
harscalex100 interface module that was used originally to \line \up0 \expndtw-3\
charscalex100 interface customer service to our tracking \line \up0 \expndtw-2\c
harscalex100 environment. Then we extended it to the\par\pard\ql \li1100\ri1140\
sb4\sl-252\slmult0 \up0 \expndtw-2\charscalex100 Internet, and then extended it
for IVR.\ul0\super\cf36\f37\fs21\ul0\super\cf36\f37\fs20 6\ul0\nosupersub\cf32\f
33\fs22 It's \line \up0 \expndtw-2\charscalex100 just a query entrance, so basi
cally here\u8217?s the \line \up0 \expndtw-2\charscalex100 API, do a query, subm
it this data. It will go \line \up0 \expndtw-3\charscalex100 out, peruse all the
databases in two different \line \up0 \expndtw-2\charscalex100 data centers, pu
ll the data together, present it \line \up0 \expndtw-2\charscalex100 back in thi
s file format, and your application \line \up0 \expndtw-1\charscalex100 just use
s it.\par\pard\ql \li1310\sb1\sl-255\slmult0 \up0 \expndtw-2\charscalex100 \u821
2?Jim Medeiros, UPS Information Services\par\pard\ql \li5760\sb0\sl-251\slmult0
\par\pard\ql \li740\ri877\sb8\sl-251\slmult0 \up0 \expndtw-3\charscalex100 \ul0\
nosupersub\cf17\f18\fs22 As the firm learned to leverage its infrastructure, the
\up0 \expndtw-3\charscalex100 IT unit found that ideas for new systems applicat
ions \up0 \expndtw-2\charscalex100 rapidly multiplied. Meanwhile, the emergence
of e-\line \up0 \expndtw-3\charscalex100 commerce exacerbated the overwhelming d
emand \up0 \expndtw-3\charscalex100 for IT resources. CIO Lacy noted that heavy\
par\pard\ql \li740\sb1\sl-255\slmult0 \up0 \expndtw-2\charscalex100 demands for
IT resources led to a tendency on the\par\pard\qj \li5760\sb0\sl-232\slmult0 \pa
r\pard\qj \li5760\sb0\sl-232\slmult0 \par\pard\qj \li740\ri1023\sb80\sl-232\slmu
lt0 \up0 \expndtw0\charscalex102 \ul0\super\cf35\f36\fs21\ul0\super\cf35\f36\fs2
0 6\ul0\nosupersub\cf3\f4\fs19 IVR stands for Interactive Voice Recognition, wh
ich is \up0 \expndtw0\charscalex103 technology that accepts spoken input and con
verts it to \up0 \expndtw0\charscalex101 digital data.\par\pard\ql \li20\sb130\s
l-230\slmult0\tx3460 \up0 \expndtw0\charscalex101 \ul0\nosupersub\cf34\f35\fs19
Page\ul0\nosupersub\cf3\f4\fs19 \ul0\nosupersub\cf34\f35\fs19 6\tab \up0 \expnd
tw0\charscalex101 \ul0\nosupersub\cf3\f4\fs19 CISR Working Paper
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{\sp{\sn pSegmentInfo}{\sv 2;11;16384;45824;1;45824;1;45824;1;45824;1;45824;3276
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{\sp{\sn shapeType}{\sv 0}}{\sp{\sn fFlipH}{\sv 0}}{\sp{\sn fFlipV}{\sv 0}}{\sp{
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}}\par\pard\sect\sectd\fs24\paperw12240\paperh15840\pard\sb0\sl-240{\bkmkstart P
g10}{\bkmkend Pg10}\par\pard\sect\sectd\sbknone\cols2\colno1\colw6370\colsr110\c
olno2\colw5620\colsr160\qj \li1080\sb0\sl-255\slmult0 \par\pard\qj \li1080\sb0\s
l-255\slmult0 \par\pard\qj \li1080\sb0\sl-255\slmult0 \par\pard\qj \li1080\ri117
9\sb118\sl-255\slmult0 \up0 \expndtw-3\charscalex100 \ul0\nosupersub\cf17\f18\fs
22 part of business units to try to build their own \up0 \expndtw-4\charscalex10
0 solutions.\par\pard\ql \li1440\ri783\sb242\sl-253\slmult0 \up0 \expndtw-3\char
scalex100 \ul0\nosupersub\cf32\f33\fs22 How do you satisfy the appetite? We coul
d \line \up0 \expndtw-3\charscalex100 distribute IT resources [to address immedi
ate \line \up0 \expndtw-2\charscalex100 needs] and later bring them back. Becaus
e \line \up0 \expndtw-3\charscalex100 we keep IT centralized, people say, \u8220
?Well, I \line \up0 \expndtw-2\charscalex100 can do it cheaper and faster on my
own so \line \up0 \expndtw-2\charscalex100 I\u8217?ll go do it myself.\u8221? We
are fighting this all \line \up0 \expndtw-3\charscalex100 the time. But every t
ime they go out and do \line \up0 \expndtw-3\charscalex100 the front-end piece w
ith $250,000, then the \line \up0 \expndtw-2\charscalex100 back end piece doesn\
u8217?t work and they have to \line \up0 \expndtw-2\charscalex100 come back to m
e.\par\pard\ql \li1575\sb1\sl-255\slmult0 \up0 \expndtw-2\charscalex100 \u8212?K
en Lacy, Senior Vice President and CIO\par\pard\qj \li1080\ri954\sb255\sl-255\sl
mult0 \up0 \expndtw-3\charscalex100 \ul0\nosupersub\cf17\f18\fs22 Despite an ann
ual investment in IT of almost $1 \line \up0 \expndtw-3\charscalex100 billion, U
PS could not respond to every system\par\pard\qj \li1080\ri490\sb5\sl-250\slmult
0 \up0 \expndtw-2\charscalex100 development request that could show a positive R
OI. \up0 \expndtw-2\charscalex100 UPS management observed the need for governanc
e \up0 \expndtw-2\charscalex100 structures that would (1) allocate IT resources
to the \up0 \expndtw-3\charscalex100 most strategic opportunities and (2) preser
ve, as\par\pard\ql \li1080\sb1\sl-255\slmult0 \up0 \expndtw-2\charscalex100 appr
opriate, infrastructure standards.\par\pard\ql \li1080\sb263\sl-264\slmult0 \up0
\expndtw-3\charscalex100 \ul0\nosupersub\cf33\f34\fs22 Establishing IT Investme
nt Priorities\par\pard\qj \li1080\ri581\sb0\sl-244\slmult0 \up0 \expndtw-3\chars
calex100 \ul0\nosupersub\cf17\f18\fs22 An IT Steering Committee, consisting of f
our senior \up0 \expndtw-3\charscalex100 executives,\ul0\super\cf35\f36\fs21\ul0
\super\cf35\f36\fs20 7\ul0\nosupersub\cf17\f18\fs22 was charged with ensuring t
echnology \up0 \expndtw-3\charscalex100 direction. This included determining inv
estment\par\pard\qj \li1080\ri551\sb1\sl-255\slmult0 \up0 \expndtw-3\charscalex1
00 priorities. By the late 1990s, it was clear to senior \up0 \expndtw-3\charsca
lex100 management that customer solutions demanded end-\line \up0 \expndtw-2\cha
rscalex100 to-end processes and they wanted to focus IT\par\pard\qj \li1080\ri55
1\sb7\sl-247\slmult0 \up0 \expndtw-2\charscalex100 investment on supporting cros
s-functional processes \up0 \expndtw-3\charscalex100 within the firm. They ident
ified four key processes: \up0 \expndtw-3\charscalex100 customer relationship ma
nagement, customer\par\pard\qj \li1080\ri491\sb2\sl-255\slmult0 \up0 \expndtw-3\
charscalex100 information management, package management, and \up0 \expndtw-2\ch
arscalex100 product management. For each core process, a cross-\line \up0 \expnd
tw-3\charscalex100 functional team, headed by a senior executive,\par\pard\qj \l
i1080\ri610\sb4\sl-251\slmult0 \up0 \expndtw-3\charscalex100 determined its IT p

riorities. Anyone could submit to \line \up0 \expndtw-3\charscalex100 any of the


cross-functional teams a project charter \line \up0 \expndtw-2\charscalex100 th
at spelled out the expected costs and benefits of a \line \up0 \expndtw-3\charsc
alex100 potential project. The process teams then submitted \line \up0 \expndtw4\charscalex100 their highest priorit y project charters to IT, who\par\pard\qj
\li1080\ri941\sb1\sl-255\slmult0 \up0 \expndtw-3\charscalex100 could provide the
needed resources or negotiate \up0 \expndtw-2\charscalex100 ways to scale back
the required resources. Dave \up0 \expndtw-3\charscalex100 Spedden, a representa
tive to the Customer\par\pard\qj \li1080\ri850\sb0\sl-255\slmult0 \up0 \expndtw3\charscalex100 Relationship Management Process, explained the \up0 \expndtw-4\c
harscalex100 funding process:\par\pard\ql \li1080\sb0\sl-232\slmult0 \par\pard\q
l \li1080\sb0\sl-232\slmult0 \par\pard\ql \li1080\sb0\sl-232\slmult0 \par\pard\q
l \li1080\ri561\sb133\sl-232\slmult0 \up0 \expndtw0\charscalex102 \ul0\super\cf3
5\f36\fs21\ul0\super\cf35\f36\fs20 7\ul0\nosupersub\cf3\f4\fs19 The Steering Co
mmittee consisted of Mike Eskew, Vice \up0 \expndtw0\charscalex102 Chairman and
Executive Vice President; Joe Pyne, Senior \up0 \expndtw0\charscalex103 Vice Pre
sident, Corporate Development and Marketing; \up0 \expndtw0\charscalex103 Jack D
uffy, Senior Vice President, Corporate Strategy; \up0 \expndtw0\charscalex101 an
d Ken Lacy, the CIO.\par\pard\ql \li1080\sb130\sl-230\slmult0\tx5755 \up0 \expnd
tw0\charscalex102 \ul0\nosupersub\cf34\f35\fs19 Jeanne Ross\tab \up0 \expndtw0\c
harscalex101 Page\ul0\nosupersub\cf3\f4\fs19 \ul0\nosupersub\cf34\f35\fs19 7\pa
r\pard\column \qj \li6480\sb0\sl-255\slmult0 \par\pard\qj \li6480\sb0\sl-255\slm
ult0 \par\pard\qj \li6480\sb0\sl-255\slmult0 \par\pard\qj \li380\ri1468\sb118\sl
-255\slmult0 \up0 \expndtw-3\charscalex100 \ul0\nosupersub\cf32\f33\fs22 There w
as a time at UPS where just about \up0 \expndtw-2\charscalex100 any idea was app
roved and worked on.\par\pard\qj \li380\ri1186\sb6\sl-247\slmult0 \up0 \expndtw2\charscalex100 We\u8217?ve gotten more into a budgetary process \up0 \expndtw-2
\charscalex100 and people are starting to see that all worthy \up0 \expndtw-3\ch
arscalex100 ideas may not get funded. The program\par\pard\qj \li380\ri1205\sb3\
sl-255\slmult0 \up0 \expndtw-3\charscalex100 management group (cross-functional
team) \up0 \expndtw-2\charscalex100 takes all the charters and decides whether o
r \up0 \expndtw-3\charscalex100 not each project is worth doing. Among\par\pard\
qj \li380\ri1311\sb1\sl-254\slmult0 \up0 \expndtw-2\charscalex100 those, they de
velop a cross-prioritization of \up0 \expndtw-2\charscalex100 where each belongs
based on return on\par\pard\qj \li380\ri1347\sb0\sl-251\slmult0 \up0 \expndtw-2
\charscalex100 investment, impact on other functionalities, \up0 \expndtw-2\char
scalex100 whether it is really good for the customer \up0 \expndtw-2\charscalex1
00 and the business, etc. It\u8217?s a pretty\par\pard\qj \li380\ri1186\sb0\sl-2
54\slmult0 \up0 \expndtw-3\charscalex100 complicated process that we go through
once \up0 \expndtw-3\charscalex100 every year usually in the third or fourth\par
\pard\qj \li380\ri1224\sb2\sl-255\slmult0 \up0 \expndtw-3\charscalex100 quarter
to set up the following year\u8217?s project \up0 \expndtw-2\charscalex100 budge
t, but it does continue throughout the \up0 \expndtw-2\charscalex100 year becaus
e ideas evolve all the time.\par\pard\qj \li20\ri1160\sb240\sl-255\slmult0 \up0
\expndtw-2\charscalex100 \ul0\nosupersub\cf17\f18\fs22 Spedden noted that proces
s managers encouraged \up0 \expndtw-3\charscalex100 business unit managers to su
bmit short-term\par\pard\qj \li20\ri949\sb0\sl-255\slmult0 \up0 \expndtw-3\chars
calex100 projects, because \u8220?if it takes more than 12 months to \up0 \expnd
tw-3\charscalex100 deliver, the business will probably change while\par\pard\ql
\li20\sb0\sl-255\slmult0 \up0 \expndtw-2\charscalex100 you\u8217?re in your cycl
e.\u8221?\par\pard\ql \li20\ri890\sb242\sl-253\slmult0 \up0 \expndtw-3\charscale
x100 In addition to funding new development and \line \up0 \expndtw-3\charscalex
100 maintenance, CIO Lacy emphasized to the other IT \up0 \expndtw-2\charscalex1
00 Steering Committee members the importance of \line \up0 \expndtw-3\charscalex
100 \u8220?refreshing\u8221? the infrastructure. The increasing use of \up0 \exp
ndtw-3\charscalex100 packages meant that UPS needed to periodically \line \up0 \
expndtw-3\charscalex100 update systems in order to retain vendor support. In \up
0 \expndtw-3\charscalex100 addition, standard technologies became outdated, \lin
e \up0 \expndtw-3\charscalex100 making them expensive to maintain. Of course, no
\up0 \expndtw-2\charscalex100 business unit wanted to pay to upgrade systems th

at \up0 \expndtw-3\charscalex100 were still working, so senior management provid


ed \up0 \expndtw-3\charscalex100 central funding and Lacy decided when systems a
nd \up0 \expndtw-3\charscalex100 technologies needed to be refreshed:\par\pard\q
l \li6480\sb0\sl-252\slmult0 \par\pard\ql \li380\ri1231\sb6\sl-252\slmult0 \up0
\expndtw-3\charscalex100 \ul0\nosupersub\cf32\f33\fs22 On the infrastructure I k
now that we must \up0 \expndtw-2\charscalex100 bite this off and do some each ye
ar. You can \up0 \expndtw-3\charscalex100 put things off, but eventually you\u82
17?re going to \up0 \expndtw-3\charscalex100 get caught. So I try to make sure t
here are \up0 \expndtw-2\charscalex100 funds available to continually refresh, w
hich \up0 \expndtw-2\charscalex100 is not a real popular thing.\par\pard\ql \li3
365\sb1\sl-255\slmult0 \up0 \expndtw-1\charscalex100 \u8212?Ken Lacy\par\pard\ql
\li6480\sb0\sl-264\slmult0 \par\pard\ql \li20\sb239\sl-264\slmult0 \up0 \expndt
w-3\charscalex100 \ul0\nosupersub\cf33\f34\fs22 Protecting Infrastructure Standa
rds\par\pard\qj \li20\ri874\sb0\sl-251\slmult0 \up0 \expndtw-3\charscalex100 \ul
0\nosupersub\cf17\f18\fs22 The IT Steering was committed to the principle of \li
ne \up0 \expndtw-3\charscalex100 technology standards, and members recognized th
at \up0 \expndtw-2\charscalex100 IT standards meant lower operations costs and e
asier \up0 \expndtw-4\charscalex100 integration:\par\pard\ql \li9195\sb0\sl-230\
slmult0 \par\pard\ql \li9195\sb0\sl-230\slmult0 \par\pard\ql \li2735\sb146\sl-23
0\slmult0 \up0 \expndtw0\charscalex101 \ul0\nosupersub\cf3\f4\fs19 CISR Working
Paper
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{\sp{\sn shapeType}{\sv 0}}{\sp{\sn fFlipH}{\sv 0}}{\sp{\sn fFlipV}{\sv 0}}{\sp{
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}}\par\pard\sect\sectd\fs24\paperw12240\paperh15840\pard\sb0\sl-240{\bkmkstart P
g11}{\bkmkend Pg11}\par\pard\sect\sectd\sbknone\cols2\colno1\colw6370\colsr110\c
olno2\colw5620\colsr160\ql \li1080\sb0\sl-250\slmult0 \par\pard\ql \li1080\sb0\s
l-250\slmult0 \par\pard\ql \li1080\sb0\sl-250\slmult0 \par\pard\ql \li1440\ri765
\sb137\sl-250\slmult0 \up0 \expndtw-2\charscalex100 \ul0\nosupersub\cf32\f33\fs2
2 The scale, the size, the integration with all \up0 \expndtw-3\charscalex100 th
e other systems, and the maintenance all \up0 \expndtw-2\charscalex100 beg for c
entralization and standardization. In \up0 \expndtw-2\charscalex100 so many case
s, though, our [IT unit] has\par\pard\qj \li1440\ri857\sb0\sl-255\slmult0 \up0 \
expndtw-2\charscalex100 been the slave of the masters (the business \up0 \expndt
w-2\charscalex100 units) that drive them. If you told them what \up0 \expndtw-2\
charscalex100 you wanted, they\u8217?d take care of your needs. \up0 \expndtw-3\
charscalex100 Probably, IT has been overly generous\u8230? We \up0 \expndtw-2\ch
arscalex100 have a product management group\par\pard\ql \li1440\ri774\sb2\sl-252
\slmult0 \up0 \expndtw-2\charscalex100 responsible for developing new [IT] \line
\up0 \expndtw-2\charscalex100 products. They use templates so that we don\u8217

?t \line \up0 \expndtw-2\charscalex100 bring in one group to develop a Saturday


\line \up0 \expndtw-3\charscalex100 delivery system and then another group to \l
ine \up0 \expndtw-2\charscalex100 develop a Sunday delivery system a totally \li
ne \up0 \expndtw-3\charscalex100 different way. Those are the kinds of things \l
ine \up0 \expndtw-3\charscalex100 that we\u8217?ve struggled with in the past. W
e\u8217?ve \line \up0 \expndtw-3\charscalex100 learned those lessons.\par\pard\q
j \li2370\ri775\sb13\sl-240\slmult0\tx3255 \up0 \expndtw-2\charscalex100 \u8212?
Mike Eskew, Vice Chairman and \line\tab \up0 \expndtw-2\charscalex100 Executive
Vice President\par\pard\ql \li2625\sb3\sl-255\slmult0 \up0 \expndtw-2\charscalex
100 Member, IT Steering Committee\par\pard\ql \li1080\ri1133\sb255\sl-255\slmult
0 \up0 \expndtw-2\charscalex100 \ul0\nosupersub\cf17\f18\fs22 Senior management
wanted to leverage the \line \up0 \expndtw-3\charscalex100 infrastructure wherev
er possible, but they also\par\pard\ql \li1080\ri565\sb7\sl-247\slmult0 \up0 \ex
pndtw-3\charscalex100 wanted to recognize when exceptions to standard \up0 \expn
dtw-3\charscalex100 were appropriate. For large projects, Joe Pyne might \up0 \e
xpndtw-3\charscalex100 work directly with CIO Ken Lacy to determine\par\pard\qj
\li1080\ri776\sb2\sl-255\slmult0 \up0 \expndtw-4\charscalex100 whether the techn
ology to enable a partic ular new \up0 \expndtw-3\charscalex100 business venture
should be developed within or\par\pard\qj \li1080\ri622\sb0\sl-255\slmult0 \up0
\expndtw-2\charscalex100 outside the core infrastructure. In other cases, an IT
\up0 \expndtw-3\charscalex100 Governance Committee resolved issues around\par\p
ard\qj \li1080\ri1252\sb0\sl-255\slmult0 \up0 \expndtw-3\charscalex100 infrastru
cture standards.\ul0\super\cf35\f36\fs21\ul0\super\cf35\f36\fs20 8\ul0\nosupersu
b\cf17\f18\fs22 Jim Medeiros, who \up0 \expndtw-3\charscalex100 orchestrated in
frastructure support of all\par\pard\qj \li1080\ri520\sb0\sl-250\slmult0 \up0 \e
xpndtw-3\charscalex100 subsidiaries, including e-Venture projects, noted that \u
p0 \expndtw-3\charscalex100 a natural tension existed between those who defined
\up0 \expndtw-3\charscalex100 unique business needs and those who protected\par\
pard\qj \li1080\ri565\sb1\sl-255\slmult0 \up0 \expndtw-3\charscalex100 infrastru
cture standards. His role was to negotiate \up0 \expndtw-3\charscalex100 these t
ensions so that each new development project \up0 \expndtw-3\charscalex100 withi
n the subsidiaries was built on the most\par\pard\ql \li1080\ri536\sb7\sl-247\sl
mult0 \up0 \expndtw-3\charscalex100 appropriate platform. Senior management, he
\up0 \expndtw-3\charscalex100 commented, encouraged ongoing debates around the \
up0 \expndtw-3\charscalex100 appropriateness of using standard platforms:\par\pa
rd\qj \li1080\sb0\sl-255\slmult0 \par\pard\qj \li1440\ri1385\sb2\sl-255\slmult0
\up0 \expndtw-3\charscalex100 \ul0\nosupersub\cf32\f33\fs22 I was giving a prese
ntation to our Vice \up0 \expndtw-3\charscalex100 Chairman and I was talking abo
ut a\par\pard\qj \li1440\ri924\sb5\sl-250\slmult0 \up0 \expndtw-2\charscalex100
particular [non-standard] technology that \up0 \expndtw-3\charscalex100 one of t
he subsidiaries was looking to use. \up0 \expndtw-2\charscalex100 He stopped me
in my tracks and said, \u8220?Why \up0 \expndtw-3\charscalex100 are you even dis
cussing it with them?\u8221?\par\pard\qj \li1080\sb0\sl-232\slmult0 \par\pard\qj
\li1080\ri504\sb103\sl-232\slmult0 \up0 \expndtw0\charscalex103 \ul0\super\cf35
\f36\fs21\ul0\super\cf35\f36\fs20 8\ul0\nosupersub\cf3\f4\fs19 The IT Governanc
e Committee, which was headed by \up0 \expndtw0\charscalex103 CIO Ken Lacy and c
onsisted of top IT managers, resolved \up0 \expndtw0\charscalex102 most disputes
so that the IT Steering Committee could\par\pard\ql \li1080\sb1\sl-223\slmult0
\up0 \expndtw0\charscalex103 focus on technology strategy.\par\pard\ql \li1080\s
b0\sl-230\slmult0 \par\pard\ql \li1080\sb142\sl-230\slmult0\tx5755 \up0 \expndtw
0\charscalex102 \ul0\nosupersub\cf34\f35\fs19 Jeanne Ross\tab \up0 \expndtw0\cha
rscalex101 Page\ul0\nosupersub\cf3\f4\fs19 \ul0\nosupersub\cf34\f35\fs19 8\par\
pard\column \qj \li6480\sb0\sl-255\slmult0 \par\pard\qj \li6480\sb0\sl-255\slmul
t0 \par\pard\qj \li6480\sb0\sl-255\slmult0 \par\pard\qj \li380\ri1217\sb118\sl-2
55\slmult0 \up0 \expndtw-2\charscalex100 \ul0\nosupersub\cf32\f33\fs22 Because i
n his view, it sounded like what we \up0 \expndtw-2\charscalex100 had they could
use. And that wasn't the case. \up0 \expndtw-4\charscalex100 But wh at he was t
rying to reinforce was,\par\pard\qj \li380\ri1142\sb0\sl-253\slmult0 \up0 \expnd
tw-2\charscalex100 \u8220?You know, you\u8217?ve got the stick.\u8221? But he\u8
217?ll \line \up0 \expndtw-2\charscalex100 also turn around in other meetings an

d say to \line \up0 \expndtw-3\charscalex100 business leaders, \u8220?Yes, go ou


t there and push \line \up0 \expndtw-2\charscalex100 the envelope on the technic
al side,\u8221? because \line \up0 \expndtw-2\charscalex100 these are all techno
logy-based businesses\par\pard\qj \li380\ri1592\sb0\sl-253\slmult0 \up0 \expndtw
-2\charscalex100 and sooner or later it comes down to the \up0 \expndtw-1\charsc
alex100 technology.\par\pard\ql \li590\sb1\sl-237\slmult0 \up0 \expndtw-2\charsc
alex100 \u8212?Jim Medeiros, UPS Information Services\par\pard\qj \li6480\sb0\sl
-255\slmult0 \par\pard\qj \li20\ri1007\sb4\sl-255\slmult0 \up0 \expndtw-3\charsc
alex100 \ul0\nosupersub\cf17\f18\fs22 Lacy wanted to be sure that, whenever poss
ible, old \up0 \expndtw-2\charscalex100 architectures were leveraged but that th
e IT\par\pard\ql \li20\ri1250\sb0\sl-255\slmult0 \up0 \expndtw-3\charscalex100 i
nfrastructure did not limit business creativity. \line \up0 \expndtw-3\charscale
x100 Moreover, with e-commerce initiatives, business\par\pard\qj \li20\ri1054\sb
0\sl-255\slmult0 \up0 \expndtw-3\charscalex100 units were often anxious to deliv
er systems quickly \up0 \expndtw-3\charscalex100 to test customer reaction. To p
rovide additional\par\pard\ql \li20\ri1056\sb0\sl-247\slmult0 \up0 \expndtw-3\ch
arscalex100 flexibility to the business units, Lacy noted that \line \up0 \expnd
tw-3\charscalex100 sometimes it would be appropriate for the business\par\pard\q
j \li20\ri993\sb1\sl-255\slmult0 \up0 \expndtw-3\charscalex100 units to build ne
w systems on their own, using local \up0 \expndtw-3\charscalex100 contractors. H
e insisted, however, that they comply \up0 \expndtw-3\charscalex100 with UPS sta
ndards:\par\pard\qj \li6480\sb0\sl-251\slmult0 \par\pard\qj \li380\ri1141\sb8\sl
-251\slmult0 \up0 \expndtw-2\charscalex100 \ul0\nosupersub\cf32\f33\fs22 When li
ttle companies start up, they want to \line \up0 \expndtw-2\charscalex100 make t
hings happen. They don\u8217?t want to wait \line \up0 \expndtw-2\charscalex100
in line for Big Brown. So where they can use \line \up0 \expndtw-2\charscalex100
the core, we\u8217?ll build on that. Where they have \line \up0 \expndtw-2\char
scalex100 to move forward quickly, they\u8217?ll get their\par\pard\ql \li380\ri
1197\sb4\sl-251\slmult0 \up0 \expndtw-3\charscalex100 own applications developme
nt staff\ul0\nosupersub\cf17\f18\fs22 \ul0\nosupersub\cf32\f33\fs22 and \line \
up0 \expndtw-2\charscalex100 develop their own applications. They can put \up0 \
expndtw-2\charscalex100 their servers in our data center, and we\u8217?ll \up0 \
expndtw-2\charscalex100 give them 24 X 7. But we\u8217?ll make sure they \up0 \e
xpndtw-2\charscalex100 know our standards.\par\pard\ql \li800\sb1\sl-255\slmult0
\up0 \expndtw0\charscalex100 \u8212?Ken Lacy\ul0\nosupersub\cf34\f35\fs19 , Sen
ior Vice President and CIO\par\pard\ql \li20\sb263\sl-264\slmult0 \up0 \expndtw2\charscalex100 \ul0\nosupersub\cf33\f34\fs22 Looking Ahead\par\pard\qj \li20\ri
1518\sb0\sl-247\slmult0 \up0 \expndtw-3\charscalex100 \ul0\nosupersub\cf17\f18\f
s22 In 2000 UPS had, arguably, exceeded Federal \up0 \expndtw-4\charscalex100 Ex
press\u8217? IT capability:\par\pard\qj \li380\ri1604\sb241\sl-255\slmult0 \up0
\expndtw-2\charscalex100 \ul0\nosupersub\cf32\f33\fs22 We did studies years ago
and found that \line \up0 \expndtw-3\charscalex100 Federal Express is perceived
as the high\par\pard\qj \li380\ri1235\sb3\sl-252\slmult0 \up0 \expndtw-2\charsca
lex100 technology company in transportation. Well, \line \up0 \expndtw-2\charsca
lex100 we track all those key factors by customers \line \up0 \expndtw-3\charsca
lex100 now and we\u8217?ve narrowed that gap to where \line \up0 \expndtw-3\char
scalex100 they may have an advantage in two or three \line \up0 \expndtw-2\chars
calex100 areas out of maybe 15 areas. Five to seven \line \up0 \expndtw-2\charsc
alex100 years ago, they had the advantage in all but \line \up0 \expndtw-2\chars
calex100 two or three.\par\pard\qj \li905\ri1145\sb1\sl-255\slmult0\fi420 \up0 \
expndtw-3\charscalex100 \u8212?Joe Pyne, Senior Vice President, \line \up0 \expn
dtw-2\charscalex100 Marketing and Corporate Development\par\pard\ql \li9195\sb0\
sl-230\slmult0 \par\pard\ql \li9195\sb0\sl-230\slmult0 \par\pard\ql \li9195\sb0\
sl-230\slmult0 \par\pard\ql \li2735\sb171\sl-230\slmult0 \up0 \expndtw0\charscal
ex101 \ul0\nosupersub\cf3\f4\fs19 CISR Working Paper
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{\sp{\sn pVerticies}{\sv 8;5;(0,20);(2880,20);(2880,0);(0,0);(0,20)}}


{\sp{\sn pSegmentInfo}{\sv 2;11;16384;45824;1;45824;1;45824;1;45824;1;45824;3276
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p{\sn fLine}{\sv 0}}{\sp{\sn lineType}{\sv 0}}{\sp{\sn fArrowheadsOK}{\sv 1}}{\s
p{\sn fBehindDocument}{\sv 1}}{\sp{\sn lineColor}{\sv 0}}
}}
{\shp {\*\shpinst\shpleft6120\shptop1154\shpright6140\shpbottom14760\shpfhdr0\sh
pbxpage\shpbypage\shpwr3\shpwrk0\shpfblwtxt1\shpz687\shplid1
{\sp{\sn shapeType}{\sv 0}}{\sp{\sn fFlipH}{\sv 0}}{\sp{\sn fFlipV}{\sv 0}}{\sp{
\sn geoRight}{\sv 20}}{\sp{\sn geoBottom}{\sv 13606}}
{\sp{\sn pVerticies}{\sv 8;5;(0,13606);(20,13606);(20,0);(0,0);(0,13606)}}
{\sp{\sn pSegmentInfo}{\sv 2;11;16384;45824;1;45824;1;45824;1;45824;1;45824;3276
8}}
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p{\sn fLine}{\sv 0}}{\sp{\sn lineType}{\sv 0}}{\sp{\sn fArrowheadsOK}{\sv 1}}{\s
p{\sn fBehindDocument}{\sv 1}}{\sp{\sn lineColor}{\sv 0}}
}}\par\pard\sect\sectd\fs24\paperw12240\paperh15840\pard\sb0\sl-240{\bkmkstart P
g12}{\bkmkend Pg12}\par\pard\sect\sectd\sbknone\cols2\colno1\colw5740\colsr20\co
lno2\colw6340\colsr160\qj \li1080\sb0\sl-255\slmult0 \par\pard\qj \li1080\sb0\sl
-255\slmult0 \par\pard\qj \li1080\sb0\sl-255\slmult0 \par\pard\qj \li1080\ri0\sb
118\sl-255\slmult0 \up0 \expndtw-5\charscalex100 \ul0\nosupersub\cf17\f18\fs22 I
n the future, UPS expected to be able to leverage its \up0 \expndtw-3\charscalex
100 data and systems to further improve service. For\par\pard\ql \li1080\ri127\s
b4\sl-250\slmult0 \up0 \expndtw-3\charscalex100 example, if a consignee would no
t be home to \line \up0 \expndtw-3\charscalex100 receive a delivery, that consig
nee could specify \line \up0 \expndtw-3\charscalex100 where the package should b
e dropped off. UPS \line \up0 \expndtw-2\charscalex100 would enter the address i
nto the database and the\par\pard\qj \li1080\ri0\sb1\sl-255\slmult0 \up0 \expndt
w-4\charscalex100 truck-loading algorithm would recognize the change \line \up0
\expndtw-5\charscalex100 so that the package could be re-routed without delay:\p
ar\pard\qj \li1440\sb0\sl-240\slmult0 \par\pard\qj \li1440\ri170\sb27\sl-240\slm
ult0 \up0 \expndtw-2\charscalex100 \ul0\nosupersub\cf32\f33\fs22 We\u8217?re goi
ng to treat each package and each \up0 \expndtw-3\charscalex100 customer like it
\u8217?s the only one we have.\par\pard\qj \li2370\ri55\sb2\sl-255\slmult0\tx325
5 \up0 \expndtw-2\charscalex100 \u8212?Mike Eskew, Vice Chairman and \line\tab \
up0 \expndtw-2\charscalex100 Executive Vice President\par\pard\ql \li1080\sb0\sl
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-230\slmult0 \par\pard\ql \li1080\sb0\sl-230\slmult0 \par\pard\ql \li1080\sb0\sl
-230\slmult0 \par\pard\ql \li1080\sb0\sl-230\slmult0 \par\pard\ql \li1080\sb0\sl
-230\slmult0 \par\pard\ql \li1080\sb0\sl-230\slmult0 \par\pard\ql \li1080\sb0\sl
-230\slmult0 \par\pard\ql \li1080\sb0\sl-230\slmult0 \par\pard\ql \li1080\sb0\sl
-230\slmult0 \par\pard\ql \li1080\sb0\sl-230\slmult0 \par\pard\ql \li1080\sb0\sl
-230\slmult0 \par\pard\ql \li1080\sb0\sl-230\slmult0 \par\pard\ql \li1080\sb0\sl
-230\slmult0 \par\pard\ql \li1080\sb0\sl-230\slmult0 \par\pard\ql \li1080\sb0\sl
-230\slmult0 \par\pard\ql \li1080\sb0\sl-230\slmult0 \par\pard\ql \li1080\sb0\sl
-230\slmult0 \par\pard\ql \li1080\sb0\sl-230\slmult0 \par\pard\ql \li1080\sb0\sl
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102 \ul0\nosupersub\cf34\f35\fs19 Jeanne Ross\par\pard\column \qj \li6480\sb0\sl
-255\slmult0 \par\pard\qj \li6480\sb0\sl-255\slmult0 \par\pard\qj \li6480\sb0\sl
-255\slmult0 \par\pard\qj \li740\ri919\sb118\sl-255\slmult0 \up0 \expndtw-3\char
scalex100 \ul0\nosupersub\cf17\f18\fs22 Even as it looked to enhance customer se
rvice in the \up0 \expndtw-3\charscalex100 package delivery arena, UPS was commi
tted to\par\pard\qj \li740\ri995\sb12\sl-240\slmult0 \up0 \expndtw-3\charscalex1
00 expanding its services and entering new businesses. \up0 \expndtw-3\charscale
x100 Jim Kelly noted that in attempting to address\par\pard\qj \li740\ri1070\sb2
\sl-255\slmult0 \up0 \expndtw-2\charscalex100 customer needs, UPS would enter ne
w businesses \up0 \expndtw-3\charscalex100 that could leverage UPS\u8217? infras
tructure, brand, and \up0 \expndtw-2\charscalex100 reputation. In doing so, he e
xplained, UPS was\par\pard\ql \li740\sb0\sl-255\slmult0 \up0 \expndtw-3\charscal
ex100 addressing the inevitable:\par\pard\ql \li6840\sb0\sl-247\slmult0 \par\par
d\ql \li1100\ri1227\sb14\sl-247\slmult0 \up0 \expndtw-2\charscalex100 \ul0\nosup
ersub\cf32\f33\fs22 You can\u8217?t stop e-commerce and you can\u8217?t \up0 \ex
pndtw-3\charscalex100 stop globalization. So you\u8217?d better figure out \up0
\expndtw-2\charscalex100 a way to participate in that environment.\par\pard\qj \
li3080\ri1129\sb3\sl-255\slmult0\fi75 \up0 \expndtw-2\charscalex100 \u8212?Jim K
elly, CEO and \line \up0 \expndtw-2\charscalex100 Chairman of the Board\par\pard
\ql \li5760\sb0\sl-230\slmult0 \par\pard\ql \li5760\sb0\sl-230\slmult0 \par\pard
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\ql \li5760\sb0\sl-230\slmult0 \par\pard\ql \li5760\sb0\sl-230\slmult0 \par\pard
\ql \li5760\sb0\sl-230\slmult0 \par\pard\ql \li5760\sb0\sl-230\slmult0 \par\pard
\ql \li5760\sb0\sl-230\slmult0 \par\pard\ql \li5760\sb0\sl-230\slmult0 \par\pard
\ql \li5760\sb0\sl-230\slmult0 \par\pard\ql \li5760\sb0\sl-230\slmult0 \par\pard
\ql \li5760\sb0\sl-230\slmult0 \par\pard\ql \li5760\sb0\sl-230\slmult0 \par\pard
\ql \li5760\sb0\sl-230\slmult0 \par\pard\ql \li5760\sb0\sl-230\slmult0 \par\pard
\ql \li5760\sb0\sl-230\slmult0 \par\pard\ql \li5760\sb0\sl-230\slmult0 \par\pard
\ql \li5760\sb0\sl-230\slmult0 \par\pard\ql \li5760\sb0\sl-230\slmult0 \par\pard
\ql \li5760\sb0\sl-230\slmult0 \par\pard\ql \li5760\sb0\sl-230\slmult0 \par\pard
\ql \li5760\sb0\sl-230\slmult0 \par\pard\ql \li5760\sb0\sl-230\slmult0 \par\pard
\ql \li5760\sb0\sl-230\slmult0 \par\pard\ql \li5760\sb0\sl-230\slmult0 \par\pard
\ql \li5760\sb0\sl-230\slmult0 \par\pard\ql \li5760\sb0\sl-230\slmult0 \par\pard
\ql \li5760\sb0\sl-230\slmult0 \par\pard\ql \li5760\sb0\sl-230\slmult0 \par\pard
\ql \li5760\sb0\sl-230\slmult0 \par\pard\ql \li5760\sb0\sl-230\slmult0 \par\pard
\ql \li5760\sb0\sl-230\slmult0 \par\pard\ql \li5760\sb0\sl-230\slmult0 \par\pard
\ql \li5760\sb0\sl-230\slmult0 \par\pard\ql \li5760\sb0\sl-230\slmult0 \par\pard
\ql \li5760\sb0\sl-230\slmult0 \par\pard\ql \li5760\sb0\sl-230\slmult0 \par\pard
\ql \li5760\sb0\sl-230\slmult0 \par\pard\ql \li5760\sb0\sl-230\slmult0 \par\pard
\ql \li5760\sb0\sl-230\slmult0 \par\pard\ql \li5760\sb0\sl-230\slmult0 \par\pard
\ql \li20\sb101\sl-230\slmult0\tx3460 \up0 \expndtw0\charscalex101 \ul0\nosupers
ub\cf34\f35\fs19 Page\ul0\nosupersub\cf3\f4\fs19 \ul0\nosupersub\cf34\f35\fs19
9\tab \up0 \expndtw0\charscalex101 \ul0\nosupersub\cf3\f4\fs19 CISR Working Pape
r
{\shp {\*\shpinst\shpleft6120\shptop1154\shpright6140\shpbottom4695\shpfhdr0\shp
bxpage\shpbypage\shpwr3\shpwrk0\shpfblwtxt1\shpz230\shplid0
{\sp{\sn shapeType}{\sv 0}}{\sp{\sn fFlipH}{\sv 0}}{\sp{\sn fFlipV}{\sv 0}}{\sp{
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{\sp{\sn pVerticies}{\sv 8;5;(0,3541);(20,3541);(20,0);(0,0);(0,3541)}}
{\sp{\sn pSegmentInfo}{\sv 2;11;16384;45824;1;45824;1;45824;1;45824;1;45824;3276
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p{\sn fBehindDocument}{\sv 1}}{\sp{\sn lineColor}{\sv 0}}
}}\par\pard\sect\sectd\fs24\paperw12240\paperh15840\pard\sb0\sl-240{\bkmkstart P
g13}{\bkmkend Pg13}\par\pard\ql \li5445\sb0\sl-276\slmult0 \par\pard\ql\li5445\s
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3\sl-276\slmult0 \up0 \expndtw-11\charscalex93 \ul0\nosupersub\cf37\f38\fs24 EXH


IBIT ONE \par\pard\ql \li4200\sb1\sl-256\slmult0 \up0 \expndtw-3\charscalex100 U
PS Financial Summary 1997-1999 \par\pard\li1140\sb0\sl-253\slmult0\par\pard\li11
40\sb8\sl-253\slmult0\fi0\tx6045\tx7110\tx7905 \up0 \expndtw0\charscalex100 \ul0
\nosupersub\cf47\f48\fs22\ul Income Statement:\ul0\tab \up0 \expndtw0\charscalex
100 \ul0\nosupersub\cf47\f48\fs22\ul 1997\ul0\tab \up0 \expndtw0\charscalex100 \
ul0\nosupersub\cf47\f48\fs22\ul 1998\ul0\tab \up0 \expndtw0\charscalex100 \ul0\n
osupersub\cf47\f48\fs22\ul 1999(a)\par\pard\li1140\sb2\sl-253\slmult0\fi0\tx5680
\tx6745\tx7795 \up0 \expndtw0\charscalex100 \ul0\nosupersub\cf39\f40\fs22 Revenu
e\tab \up0 \expndtw0\charscalex100 $ 22,458\tab \up0 \expndtw0\charscalex100 $ 2
4,788\tab \up0 \expndtw0\charscalex100 $ 27,052\par\pard\li1140\sb3\sl-253\slmul
t0\fi0\tx5745\tx6810\tx7860 \up0 \expndtw0\charscalex100 Compensation and Benefi
ts\tab \up0 \expndtw0\charscalex100 (13,289)\tab \up0 \expndtw0\charscalex100 (1
4,346)\tab \up0 \expndtw0\charscalex100 (15,285)\par\pard\li1140\sb1\sl-253\slmu
lt0\fi0\tx5880\tx6945\tx7995 \up0 \expndtw0\charscalex100 Other Operating Expens
es\tab \up0 \expndtw0\charscalex100 (7,471)\tab \up0 \expndtw0\charscalex100 (7,
352)\tab \up0 \expndtw0\charscalex100 (7,779)\par\pard\li1140\sb18\sl-253\slmult
0\fi0\tx5745\tx6810\tx7860 \up0 \expndtw0\charscalex100 Total Operating Expenses
\tab \up0 \expndtw0\charscalex100 (20,760)\tab \up0 \expndtw0\charscalex100 (21,
698)\tab \up0 \expndtw0\charscalex100 (23,064)\par\pard\li1140\sb17\sl-253\slmul
t0\fi0\tx5990\tx7056\tx8105 \up0 \expndtw0\charscalex100 Operating Profit\tab \u
p0 \expndtw0\charscalex100 1,698\tab \up0 \expndtw0\charscalex100 3,090\tab \up0
\expndtw0\charscalex100 3,988\par\pard\li1140\sb1\sl-236\slmult0\fi0\tx6060\tx7
125\tx8175 \up0 \expndtw0\charscalex100 Other Income (Expense)\tab \up0 \expndtw
0\charscalex100 (145)\tab \up0 \expndtw0\charscalex100 (188)\tab \up0 \expndtw0\
charscalex100 (114)\par\pard\li1140\sb20\sl-253\slmult0\fi0\tx5990\tx7056\tx8105
\up0 \expndtw0\charscalex100 Pre-Tax Income\tab \up0 \expndtw0\charscalex100 1,
553\tab \up0 \expndtw0\charscalex100 2,902\tab \up0 \expndtw0\charscalex100 3,87
4\par\pard\li1140\sb3\sl-253\slmult0\fi0\tx6060\tx6945\tx7995 \up0 \expndtw0\cha
rscalex100 Income Taxes\tab \up0 \expndtw0\charscalex100 (644)\tab \up0 \expndtw
0\charscalex100 (1,161)\tab \up0 \expndtw0\charscalex100 (1,549)\par\pard\li1140
\sb31\sl-253\slmult0\fi0\tx6182\tx7056\tx8105 \up0 \expndtw0\charscalex100 Net I
ncome\tab \up0 \expndtw0\charscalex100 909\tab \up0 \expndtw0\charscalex100 1,74
1\tab \up0 \expndtw0\charscalex100 2,325\par\pard\li1140\sb0\sl-253\slmult0\par\
pard\li1140\sb65\sl-253\slmult0\fi0\tx5987\tx7053\tx8102 \up0 \expndtw0\charscal
ex100 \ul0\nosupersub\cf38\f39\fs22 EBITDA\tab \up0 \expndtw0\charscalex100 2,80
3\tab \up0 \expndtw0\charscalex100 4,241\tab \up0 \expndtw0\charscalex100 5,241\
par\pard\li1140\sb0\sl-253\slmult0\par\pard\li1140\sb4\sl-253\slmult0\fi0\tx6045
\tx7110\tx8160 \up0 \expndtw0\charscalex100 \ul0\nosupersub\cf47\f48\fs22\ul Bal
ance Sheet:\ul0\tab \up0 \expndtw0\charscalex100 \ul0\nosupersub\cf47\f48\fs22\u
l 1997\ul0\tab \up0 \expndtw0\charscalex100 \ul0\nosupersub\cf47\f48\fs22\ul 199
8\ul0\tab \up0 \expndtw0\charscalex100 \ul0\nosupersub\cf47\f48\fs22\ul 1999\par
\pard\li1140\sb2\sl-253\slmult0\fi0\tx5830\tx6177\tx6817\tx7867 \up0 \expndtw0\c
harscalex100 \ul0\nosupersub\cf39\f40\fs22 Cash & Marketable Securities\tab \up0
\expndtw0\charscalex100 $\tab \up0 \expndtw0\charscalex100 460\tab \up0 \expndt
w0\charscalex100 $ 1,629\tab \up0 \expndtw0\charscalex100 $ 6,278\par\pard\li1
140\sb2\sl-253\slmult0\fi0\tx5990\tx7056\tx8105 \up0 \expndtw0\charscalex100 Acc
ounts Receivable\tab \up0 \expndtw0\charscalex100 2,405\tab \up0 \expndtw0\chars
calex100 2,713\tab \up0 \expndtw0\charscalex100 3,167\par\pard\li1140\sb2\sl-253
\slmult0\fi0\tx5990\tx7056\tx8105 \up0 \expndtw0\charscalex100 Other Current Ass
ets\tab \up0 \expndtw0\charscalex100 1,612\tab \up0 \expndtw0\charscalex100 1,08
3\tab \up0 \expndtw0\charscalex100 1,693\par\pard\li1140\sb2\sl-253\slmult0\fi0\
tx5868\tx6933\tx7983 \up0 \expndtw0\charscalex100 Property, Plant & Equipment (N
et)\tab \up0 \expndtw0\charscalex100 11,007\tab \up0 \expndtw0\charscalex100 11,
384\tab \up0 \expndtw0\charscalex100 11,579\par\pard\li1140\sb2\sl-253\slmult0\f
i0\tx6182\tx7247\tx8295 \up0 \expndtw0\charscalex100 Other Assets\tab \up0 \expn
dtw0\charscalex100 428\tab \up0 \expndtw0\charscalex100 258\tab \up0 \expndtw0\c
harscalex100 326\par\pard\li1140\sb0\sl-253\slmult0\par\pard\li1140\sb4\sl-253\s
lmult0\fi0\tx5868\tx6933\tx7983 \up0 \expndtw0\charscalex100 \ul0\nosupersub\cf3
8\f39\fs22 Total Assets\tab \up0 \expndtw0\charscalex100 15,912\tab \up0 \expndt

w0\charscalex100 17,067\tab \up0 \expndtw0\charscalex100 23,043\par\pard\li1140\


sb0\sl-253\slmult0\par\pard\li1140\sb4\sl-253\slmult0\fi0\tx5990\tx7056\tx8105 \
up0 \expndtw0\charscalex100 \ul0\nosupersub\cf39\f40\fs22 Current Liabilities\ta
b \up0 \expndtw0\charscalex100 3,398\tab \up0 \expndtw0\charscalex100 3,717\tab
\up0 \expndtw0\charscalex100 4,198\par\pard\li1140\sb2\sl-253\slmult0\fi0\tx5990
\tx7056\tx8105 \up0 \expndtw0\charscalex100 Long-Term Debt\tab \up0 \expndtw0\ch
arscalex100 2,583\tab \up0 \expndtw0\charscalex100 2,191\tab \up0 \expndtw0\char
scalex100 1,912\par\pard\li1140\sb2\sl-253\slmult0\fi0\tx6182\tx7247\tx8297 \up0
\expndtw0\charscalex100 Accumulated Postretirement Benefit Obligation\tab \up0
\expndtw0\charscalex100 911\tab \up0 \expndtw0\charscalex100 969\tab \up0 \expnd
tw0\charscalex100 990\par\pard\li1140\sb2\sl-253\slmult0\fi0\tx5990\tx7056\tx810
5 \up0 \expndtw0\charscalex100 Deferred Taxes, Credits, & Other Liabilities\tab
\up0 \expndtw0\charscalex100 2,933\tab \up0 \expndtw0\charscalex100 3,017\tab \u
p0 \expndtw0\charscalex100 3,469\par\pard\li1140\sb2\sl-253\slmult0\fi0\tx5990\t
x7056\tx7983 \up0 \expndtw0\charscalex100 Shareowners' Equity\tab \up0 \expndtw0
\charscalex100 6,087\tab \up0 \expndtw0\charscalex100 7,173\tab \up0 \expndtw0\c
harscalex100 12,474\par\pard\li1140\sb0\sl-253\slmult0\par\pard\li1140\sb19\sl-2
53\slmult0\fi0\tx5868\tx6933\tx7983 \up0 \expndtw0\charscalex100 \ul0\nosupersub
\cf38\f39\fs22 Total Liabilities and Equity\tab \up0 \expndtw0\charscalex100 15,
912\tab \up0 \expndtw0\charscalex100 17,067\tab \up0 \expndtw0\charscalex100 23,
043\par\pard\ql \li1140\sb0\sl-253\slmult0 \par\pard\ql\li1140\sb4\sl-253\slmult
0 \up0 \expndtw-7\charscalex100 \ul0\nosupersub\cf47\f48\fs22\ul Notes: \par\par
d\ql \li1140\sb7\sl-253\slmult0 \up0 \expndtw-4\charscalex100 \ul0\nosupersub\cf
39\f40\fs22 (a) 1999 Net Income excludes the tax \par\pard\qj \li1140\ri6827\sb0
\sl-250\slmult0 \up0 \expndtw-5\charscalex100 assessment charge incurred in the
second \up0 \expndtw-3\charscalex100 quarter. The tax assessment reduced 1999 \u
p0 \expndtw-4\charscalex100 net income by $1.442 billion. \par\pard\li1155\sb0\s
l-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmu
lt0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pa
rd\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\
sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218
\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\p
ar\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li
1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\s
l-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb18\sl-218\slm
ult0\fi0\tx2340\tx5775\tx9270 \up0 \expndtw0\charscalex102 \ul0\nosupersub\cf34\
f35\fs19 Jeanne Ross\tab \up0 \expndtw0\charscalex102 8/2/01\tab \up0 \expndtw0\
charscalex102 Page\ul0\nosupersub\cf3\f4\fs19 \ul0\nosupersub\cf34\f35\fs19 10\
tab \up0 \expndtw0\charscalex102 \ul0\nosupersub\cf3\f4\fs19 CISR Working Paper
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ventory and order management, transportation network management, value\up0 \expn
dtw0\charscalex100 added services, customer service and reverse logistics. \par\

pard\ql \li1155\ri1549\sb132\sl-230\slmult0 \up0 \expndtw0\charscalex100 The uni


t analyzes, designs and manages complex global supply chains. Value-added servic
es include kitting, product \line \up0 \expndtw0\charscalex100 configuration, qu
ality inspection, customized packaging and labeling, returns management and inte
rnational trade \line \up0 \expndtw0\charscalex100 management. \par\pard\ql \li1
155\sb120\sl-218\slmult0 \up0 \expndtw0\charscalex101 \ul0\nosupersub\cf42\f43\f
s19 Service Parts Logistics \par\pard\ql \li1155\sb22\sl-218\slmult0 \up0 \expnd
tw0\charscalex100 \ul0\nosupersub\cf3\f4\fs19 UPS Logistics Group-Service Parts
Logistics includes the analysis, design and management of critical parts distrib
ution \par\pard\qj \li1155\ri1008\sb0\sl-240\slmult0 \up0 \expndtw0\charscalex10
0 networks. A worldwide network of transportation carriers, central distribution
facilities, and field stocking locations make it \up0 \expndtw0\charscalex100 p
ossible to deliver critical parts in 1,2,4 and 24 hour time windows. \par\pard\q
j \li1155\ri1261\sb121\sl-220\slmult0 \up0 \expndtw0\charscalex100 The Service P
arts Logistics unit also provides technical repair services for telecommunicatio
ns and computer equipment, \up0 \expndtw0\charscalex100 providing warranty turna
round service in 24-48 hours. \par\pard\ql \li1155\sb122\sl-218\slmult0 \up0 \ex
pndtw0\charscalex101 \ul0\nosupersub\cf42\f43\fs19 Transportation Services \par\
pard\ql \li1155\sb22\sl-218\slmult0 \up0 \expndtw0\charscalex100 \ul0\nosupersub
\cf3\f4\fs19 Transportation Services includes the reengineering, design and mana
gement of multimodal transportation networks. \par\pard\qj \li1155\ri1445\sb0\sl
-240\slmult0 \up0 \expndtw0\charscalex102 Customer benefits include load optimiz
ation, improved transit times, more reliable delivery schedules and greater cost
\up0 \expndtw-1\charscalex100 efficiency. \par\pard\ql \li1515\sb123\sl-218\slm
ult0 \up0 \expndtw0\charscalex100 Transportation management includes: \par\pard\
ql \li1515\sb2\sl-218\slmult0 \up0 \expndtw0\charscalex100 \ul0\nosupersub\cf43\
f44\fs19 \ul0\nosupersub\cf3\f4\fs19 Design: network analysis and reengineerin
g \par\pard\qj \li1515\ri1733\sb141\sl-220\slmult0\tx1875 \up0 \expndtw0\charsca
lex100 \ul0\nosupersub\cf43\f44\fs19 \ul0\nosupersub\cf3\f4\fs19 Planning: shi
pment processing, multimodal carrier selection and routing, load building and co
nsolidation; \line\tab \up0 \expndtw0\charscalex100 backhaul management \par\par
d\ql \li1515\sb122\sl-218\slmult0 \up0 \expndtw0\charscalex100 \ul0\nosupersub\c
f43\f44\fs19 \ul0\nosupersub\cf3\f4\fs19 Customer service: shipment visibility
, call centers, documentation \par\pard\qj \li1515\ri1247\sb124\sl-240\slmult0\t
x1875 \up0 \expndtw0\charscalex100 \ul0\nosupersub\cf43\f44\fs19 \ul0\nosupersub
\cf3\f4\fs19 Management: carrier selection and performance reporting, claims a
dministration, liability and risk management, \line\tab \up0 \expndtw0\charscale
x100 staffing, auditing and freight payment, on-site management. \par\pard\ql \l
i1515\sb119\sl-218\slmult0 \up0 \expndtw0\charscalex100 Other specialized servic
es include: \par\pard\ql \li1515\ri1171\sb16\sl-226\slmult0\tx1875\tx1875\tx1875
\up0 \expndtw0\charscalex100 \ul0\nosupersub\cf43\f44\fs19 \ul0\nosupersub\cf3\
f4\fs19 \ul0\nosupersub\cf48\f49\fs19\ul Dedicated Contract Carriage\ul0\nosup
ersub\cf3\f4\fs19 - dedicated transportation solutions, enabling companies to u
se their resources more \line\tab \up0 \expndtw0\charscalex100 efficiently; gain
transportation flexibility; eliminate insurance and liability issues; and reduc
e overall distribution \line\tab \up0 \expndtw0\charscalex100 costs. These solu
tions frequently involve providing a complete package that includes fleet equipm
ent, fuel, \line \tab \up0 \expndtw0\charscalex100 maintenance systems, skilled
drivers and an experienced management team. \par\pard\ql \li1515\sb141\sl-218\sl
mult0 \up0 \expndtw0\charscalex100 \ul0\nosupersub\cf43\f44\fs19 \ul0\nosupersub
\cf3\f4\fs19 \ul0\nosupersub\cf48\f49\fs19\ul Freight Services: \ul0\nosupersu
b\cf3\f4\fs19 a full spectrum of shipping options regardless of destination, siz
e, weight or special handling \par\pard\qj \li1875\ri1129\sb0\sl-240\slmult0 \up
0 \expndtw0\charscalex100 requirements. This includes scheduling pick-up and del
ivery, preparing the bill of lading, providing full track and \up0 \expndtw0\cha
rscalex100 trace services, auditing and paying the carrier\u8217?s invoice. \par
\pard\qj \li1515\ri1629\sb121\sl-220\slmult0\tx1875 \up0 \expndtw0\charscalex100
\ul0\nosupersub\cf44\f45\fs22 \ul0\nosupersub\cf3\f4\fs19 \ul0\nosupersub\cf4
8\f49\fs19\ul Intermodal Services:\ul0\nosupersub\cf3\f4\fs19 UPS Logistics Gro
up owns and operates the largest trailer-on-flat-car (TOFC) fleet of \line\tab \

up0 \expndtw0\charscalex100 temperature-controlled trailers in North America. \p


ar\pard\ql \li1155\sb93\sl-253\slmult0 \up0 \expndtw-4\charscalex100 \ul0\nosupe
rsub\cf1\f2\fs22 Logistics Technologies \par\pard\ql \li1155\ri1317\sb6\sl-255\s
lmult0 \up0 \expndtw-4\charscalex100 \ul0\nosupersub\cf17\f18\fs22 A team of inhouse IT professionals develop proprietary technologies and integrate them with
best-of-breed \line \up0 \expndtw-2\charscalex100 technology to create supply ch
ain management information systems that provide total visibility of orders and \
line \up0 \expndtw-4\charscalex100 products as they move from origin to destinat
ion. This information enables UPS Logistics Group to better \line \up0 \expndtw4\charscalex100 manage complex global supply chains for improved reliability, or
der accuracy, cost management and market \line \up0 \expndtw-4\charscalex100 res
ponsiveness. \par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmu
lt0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pa
rd\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb61\sl-218\slmult0\fi0\tx2340\tx57
75\tx9270 \up0 \expndtw0\charscalex102 \ul0\nosupersub\cf34\f35\fs19 Jeanne Ross
\tab \up0 \expndtw0\charscalex102 8/2/01\tab \up0 \expndtw0\charscalex102 Page\u
l0\nosupersub\cf3\f4\fs19 \ul0\nosupersub\cf34\f35\fs19 11\tab \up0 \expndtw0\c
harscalex102 \ul0\nosupersub\cf3\f4\fs19 CISR Working Paper\par\pard\sect\sectd\
fs24\paperw12240\paperh15840\pard\sb0\sl-240{\bkmkstart Pg15}{\bkmkend Pg15}\par
\pard\ql \li1155\sb0\sl-260\slmult0 \par\pard\ql\li1155\sb0\sl-260\slmult0 \par\
pard\ql\li1155\sb0\sl-260\slmult0 \par\pard\ql\li1155\ri1073\sb85\sl-260\slmult0
\up0 \expndtw-2\charscalex100 \ul0\nosupersub\cf17\f18\fs22 In addition to supp
ly chain solutions support, the Logistics Technologies unit also creates commerc
ial software, \up0 \expndtw-2\charscalex100 specializing in routing, scheduling
and dispatching. These products are sold under the brand names Roadnet \up0 \exp
ndtw-3\charscalex100 5000 and MobileCast. \par\pard\qj \li1155\ri1085\sb220\sl-2
60\slmult0 \up0 \expndtw-2\charscalex100 \ul0\nosupersub\cf33\f34\fs22 UPS Capit
al Corp.\ul0\nosupersub\cf17\f18\fs22 is a subsidiary whose mission is to provi
de a variety of financial products and services that \up0 \expndtw-3\charscalex1
00 enable and assist companies in growing and expanding their business. \par\par
d\qj \li1155\ri1054\sb120\sl-260\slmult0 \up0 \expndtw-2\charscalex100 \ul0\nosu
persub\cf33\f34\fs22 UPS e -Ventures\ul0\nosupersub\cf17\f18\fs22 is the resear
ch, development and incubation arm of UPS e-commerce. This company\u8217?s goal
is \up0 \expndtw-2\charscalex100 to identify and develop new businesses related
to e-commerce and supply chain management. \par\pard\qj \li1155\ri1025\sb137\sl240\slmult0 \up0 \expndtw-2\charscalex100 \ul0\nosupersub\cf33\f34\fs22 UPS e -L
ogistics\ul0\nosupersub\cf17\f18\fs22 is the first company developed by UPS e-V
entures. The group plans to offer complete, end-to-\line \up0 \expndtw-3\charsca
lex100 end business solutions for the rapid, cost effective launch of e-commerce
startups. \par\pard\ql \li1155\sb110\sl-253\slmult0 \up0 \expndtw-2\charscalex1
00 \ul0\nosupersub\cf33\f34\fs22 UPS Customhouse Brokerage Inc.,\ul0\nosupersub\
cf17\f18\fs22 one the five largest Custom brokerages in the world, operates in
31 \par\pard\qj \li1155\ri1445\sb2\sl-260\slmult0 \up0 \expndtw-2\charscalex100
countries. This company provides duty services for shippers moving goods across
national borders and also \up0 \expndtw-3\charscalex100 provides a full range of
customs documentation. \par\pard\qj \li1155\ri1036\sb100\sl-260\slmult0 \up0 \e
xpndtw-2\charscalex100 \ul0\nosupersub\cf33\f34\fs22 UPS Aviation Technologies,
Inc.\ul0\nosupersub\cf17\f18\fs22 is a top provider of advanced aviation electr
onic equipment. This company is \up0 \expndtw-2\charscalex100 the leading design
er of new ADS-B technology that promises to transform airspace safety systems. \
par\pard\qj \li1155\ri1202\sb120\sl-260\slmult0 \up0 \expndtw-2\charscalex100 \u
l0\nosupersub\cf33\f34\fs22 UPS Strategic Enterprise Fund\ul0\nosupersub\cf17\f1
8\fs22 is a corporate venture capital fund created to research, evaluate and in
vest in \up0 \expndtw-4\charscalex100 emerging companies that are exploring new
markets and technologies. \par\pard\qj \li1155\ri1088\sb137\sl-240\slmult0 \up0
\expndtw-4\charscalex100 \ul0\nosupersub\cf33\f34\fs22 Business Communication Se
rvices (BCS)\ul0\nosupersub\cf17\f18\fs22 is a call center services division th
at offers a full range of customer \up0 \expndtw-4\charscalex100 care services a
nd solutions customized to individual businesses needs. BCS uses the most advanc
ed computer \up0 \expndtw-5\charscalex100 telephone technology in the industry.

\par\pard\qj \li1155\ri1500\sb124\sl-260\slmult0 \up0 \expndtw-2\charscalex100 \


ul0\nosupersub\cf33\f34\fs22 Professional Services, Inc. (PSI)\ul0\nosupersub\cf
17\f18\fs22 is a global management consulting firm that offers business solutio
ns by \up0 \expndtw-2\charscalex100 using innovative technologies, providing fin
ancial analysis and time-proven logistics know-how. \par\pard\ql \li1155\sb0\sl253\slmult0 \par\pard\ql\li1155\sb233\sl-253\slmult0 \up0 \expndtw-2\charscalex1
00 Source: Derived from information found on {\field{\*\fldinst {HYPERLINK "http
://www.pressroom.ups.com/about/subsidiairies/" }}{\fldrslt {\ul0\nosupersub\cf17
\f18\fs22 www.pressroom.ups.com/about/subsidiairies}}} \par\pard\li1155\sb0\sl-2
18\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0
\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\
li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0
\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\sl
mult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\
pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li115
5\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-2
18\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0
\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\
li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0
\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\sl
mult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\
pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li115
5\sb91\sl-218\slmult0\fi0\tx2340\tx5775\tx9270 \up0 \expndtw0\charscalex102 \ul0
\nosupersub\cf34\f35\fs19 Jeanne Ross\tab \up0 \expndtw0\charscalex102 8/2/01\ta
b \up0 \expndtw0\charscalex102 Page\ul0\nosupersub\cf3\f4\fs19 \ul0\nosupersub\
cf34\f35\fs19 12\tab \up0 \expndtw0\charscalex102 \ul0\nosupersub\cf3\f4\fs19 CI
SR Working Paper\par\pard\sect\sectd\fs24\paperw12240\paperh15840\pard\sb0\sl-24
0{\bkmkstart Pg16}{\bkmkend Pg16}\par\pard\qj \li5160\sb0\sl-260\slmult0 \par\pa
rd\qj\li5160\sb0\sl-260\slmult0 \par\pard\qj\li5160\sb0\sl-260\slmult0 \par\pard
\qj\li5160\ri4925\sb105\sl-260\slmult0\fi150 \up0 \expndtw-11\charscalex94 \ul0\
nosupersub\cf37\f38\fs24 EXHIBIT THREE \line \up0 \expndtw-11\charscalex95 UPS O
n-Line Tools \par\pard\qj \li1155\ri1120\sb260\sl-260\slmult0 \up0 \expndtw-2\ch
arscalex100 \ul0\nosupersub\cf17\f18\fs22 At the end of 2000, UPS allowed custom
ers to download, free of charge, electronic tools (APIs) that interfaced \up0 \e
xpndtw-3\charscalex100 with UPS systems to provide the following services: \par\
pard\ql \li1155\ri1038\sb137\sl-240\slmult0\tx1515\tx1515 \up0 \expndtw-3\charsc
alex100 \ul0\nosupersub\cf44\f45\fs22 \ul0\nosupersub\cf17\f18\fs22 \ul0\nosup
ersub\cf49\f50\fs22\ul UPS Tracking\ul0\nosupersub\cf17\f18\fs22 : Both the ship
per and recipient of a package can track the status of the package directly from
\line\tab \up0 \expndtw-2\charscalex100 the UPS website. Information available
from the tracking system includes location of the package on its \line\tab \up0
\expndtw-2\charscalex100 journey from shipper to recipient and estimated time of
delivery of the package. \par\pard\ql \li1155\ri911\sb124\sl-260\slmult0\tx1515
\tx1515 \up0 \expndtw-3\charscalex100 \ul0\nosupersub\cf44\f45\fs22 \ul0\nosuper
sub\cf17\f18\fs22 \ul0\nosupersub\cf49\f50\fs22\ul UPS Rates & Service Selecti
on\ul0\nosupersub\cf17\f18\fs22 : A tool that allows a customer to estimate the
cost of sending a package. The \line\tab \up0 \expndtw-3\charscalex100 customer
enters the size and weight of the package, pick-up and drop-off locations, and r
equested service \line\tab \up0 \expndtw-4\charscalex100 type then a quotation i
s provided for the cost of sending the package. \par\pard\qj \li1155\ri1353\sb10
0\sl-260\slmult0\tx1515 \up0 \expndtw-3\charscalex100 \ul0\nosupersub\cf44\f45\f
s22 \ul0\nosupersub\cf17\f18\fs22 \ul0\nosupersub\cf49\f50\fs22\ul UPS Time in
Transit\ul0\nosupersub\cf17\f18\fs22 : Customers can use this tool to estimate
the ground transportation time for sending \line\tab \up0 \expndtw-4\charscalex1
00 packages from the package pick-up point to the final destination. \par\pard\q
l \li1155\ri1443\sb129\sl-250\slmult0\tx1515\tx1515 \up0 \expndtw-3\charscalex10
0 \ul0\nosupersub\cf44\f45\fs22 \ul0\nosupersub\cf17\f18\fs22 \ul0\nosupersub\
cf49\f50\fs22\ul UPS Address Validation\ul0\nosupersub\cf17\f18\fs22 : To reduce
the risk of packages not arriving at the correct destination or being \line\tab
\up0 \expndtw-4\charscalex100 delayed; this tool validates the address and ZIP

code to which the package is to be delivered while the \line\tab \up0 \expndtw-5
\charscalex100 delivery request is being entered. \par\pard\ql \li1155\sb108\sl253\slmult0 \up0 \expndtw-2\charscalex100 \ul0\nosupersub\cf44\f45\fs22 \ul0\nos
upersub\cf17\f18\fs22 \ul0\nosupersub\cf49\f50\fs22\ul UPS Signature Tracking:
\ul0\nosupersub\cf17\f18\fs22 In addition to tracking a package, businesses can
also obtain valuable Proof of \par\pard\ql \li1515\sb7\sl-253\slmult0 \up0 \exp
ndtw-2\charscalex100 Delivery (P.O.D.) information including a digitized signatu
re and delivery address. This powerful tool \par\pard\qj \li1515\ri1029\sb10\sl250\slmult0 \up0 \expndtw-2\charscalex100 enables companies to obtain P.O.D. of
goods often needed to collect on an invoice. UPS Signature Tracking \up0 \expndt
w-2\charscalex100 provides P.O.D. in seconds, enabling companies to shorten the
time between the sale and the collection of \up0 \expndtw-3\charscalex100 funds.
This tool advances UPS\u8217? tracking technology. \par\pard\ql \li1155\sb128\s
l-253\slmult0 \up0 \expndtw-3\charscalex100 \ul0\nosupersub\cf44\f45\fs22 \ul0\n
osupersub\cf17\f18\fs22 \ul0\nosupersub\cf49\f50\fs22\ul UPS Shipping: \ul0\no
supersub\cf17\f18\fs22 With the UPS Shipping Tool, businesses can bring UPS webbased shipping to their \par\pard\ql \li1515\sb1\sl-237\slmult0 \up0 \expndtw-4\
charscalex100 employees\u8217? desktops. The tool also allows a company to cust
omize the interface to meet their business \par\pard\ql \li1515\ri986\sb9\sl-255
\slmult0 \up0 \expndtw-4\charscalex100 needs. Whether it is creating greater eff
iciencies in the mailroom, increasing the level of customer service or \up0 \exp
ndtw-2\charscalex100 lowering overall costs due to better controls over shipping
activities, this UPS OnLine Tool can streamline \up0 \expndtw-2\charscalex100 s
hipping without the addition of expensive hardware or software. The tool is idea
l for shipping from one \up0 \expndtw-2\charscalex100 location to many, or from
many locations to one. It's also one way to network the shipping activities \lin
e \up0 \expndtw-2\charscalex100 occurring within different retail locations, dea
lers or branch offices. \par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\
sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slm
ult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\p
ard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155
\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-21
8\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\
par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\l
i1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\
sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slm
ult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\p
ard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155
\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-21
8\slmult0\par\pard\li1155\sb45\sl-218\slmult0\fi0\tx2340\tx5775\tx9270 \up0 \exp
ndtw0\charscalex102 \ul0\nosupersub\cf34\f35\fs19 Jeanne Ross\tab \up0 \expndtw0
\charscalex102 8/2/01\tab \up0 \expndtw0\charscalex102 Page\ul0\nosupersub\cf3\f
4\fs19 \ul0\nosupersub\cf34\f35\fs19 13\tab \up0 \expndtw0\charscalex102 \ul0\n
osupersub\cf3\f4\fs19 CISR Working Paper\par\pard\sect\sectd\fs24\paperw12240\pa
perh15840\pard\sb0\sl-240{\bkmkstart Pg17}{\bkmkend Pg17}\par\pard\ql \li5355\sb
0\sl-276\slmult0 \par\pard\ql\li5355\sb0\sl-276\slmult0 \par\pard\ql\li5355\sb0\
sl-276\slmult0 \par\pard\ql\li5355\sb0\sl-276\slmult0 \par\pard\ql\li5355\sb0\sl
-276\slmult0 \par\pard\ql\li5355\sb111\sl-276\slmult0 \up0 \expndtw-11\charscale
x94 \ul0\nosupersub\cf37\f38\fs24 EXHIBIT FOUR \par\pard\ql \li3855\sb4\sl-276\s
lmult0 \up0 \expndtw-7\charscalex100 UPS Web-Supported Products and Services \pa
r\pard\ql \li1155\sb0\sl-253\slmult0 \par\pard\ql\li1155\sb10\sl-253\slmult0 \up
0 \expndtw-3\charscalex100 \ul0\nosupersub\cf33\f34\fs22 UPS Document Exchange \
par\pard\ql \li1155\sb1\sl-237\slmult0 \up0 \expndtw-2\charscalex100 \ul0\nosupe
rsub\cf17\f18\fs22 This service allows customers to send electronic documents ca
lled e-packages to recipients with email \par\pard\qj \li1155\ri1253\sb0\sl-260\
slmult0 \up0 \expndtw-2\charscalex100 addresses. E-Packages are encrypted and pa
ssword protected when they are transmitted. The sender can also \up0 \expndtw-2\
charscalex100 specify the time of delivery irrespective of the size of the e-Pac
kage being transmitted. Management tools are \up0 \expndtw-2\charscalex100 provi
ded to manage receipt confirmations, mailing lists, and the content of the messa

ge sent. \par\pard\ql \li1155\sb0\sl-253\slmult0 \par\pard\ql\li1155\sb0\sl-253\


slmult0 \par\pard\ql\li1155\sb4\sl-253\slmult0 \up0 \expndtw-2\charscalex100 \ul
0\nosupersub\cf33\f34\fs22 UPS Returns Services \par\pard\ql \li1155\ri987\sb0\s
l-247\slmult0 \up0 \expndtw0\charscalex100 \ul0\nosupersub\cf3\f4\fs19 This serv
ice provides firms that ship through UPS (shippers) the ability to facilitate th
eir recipients\u8217? processes for returning \line \up0 \expndtw0\charscalex102
or exchanging goods. Two levels of service are provided. In the first case the
end customer calls the shipper to request \line \up0 \expndtw0\charscalex102 ret
urn service. The shipper than contacts UPS electronically to arrange for pickup
from the customer\u8217?s site. UPS picks up \line \up0 \expndtw0\charscalex100
the package from the recipient and returns it to the shipper. In the second case
, the shipper includes return labels with each \line \up0 \expndtw-3\charscalex1
00 package \ul0\nosupersub\cf17\f18\fs22 sent. The recipient then has the option
of notifying UPS for a pickup or of dropping the package off at a \line \up0 \e
xpndtw-2\charscalex100 UPS collection site. In September 2000, the company intro
duced UPS Returns on the Web, an advanced, \line \up0 \expndtw-3\charscalex100 I
nternet-based returns solution that simplifies the returns process for both busi
nesses and consumers. The new \line \up0 \expndtw-2\charscalex100 service is des
igned to provide consumers with an on-screen label that can be printed on standa
rd paper directly \line \up0 \expndtw-2\charscalex100 from their PC, complete wi
th a list of nearby UPS drop-off locations, as well as color maps to those locat
ions. \line \up0 \expndtw-2\charscalex100 Alternatively, UPS return packages can
be handed directly to one of UPS\u8217?s 70,000 drivers. Once shipped, \line \
up0 \expndtw-2\charscalex100 shoppers can then track packages directly from the
merchant\u8217?s site or from UPS\u8217?s site at {\field{\*\fldinst {HYPERLINK
"http://www.ups.com./" }}{\fldrslt {\ul0\nosupersub\cf17\f18\fs22 www.ups.com.}}
}\ul0\nosupersub\cf17\f18\fs22 Behind \line \up0 \expndtw-3\charscalex100 the
scenes, merchants - even those routing returns back to multiple suppliers -- can
use the service to precisely \line \up0 \expndtw-3\charscalex100 manage their r
eturns process and analyze returns data for customer behavior and logistics tren
ds. Internet \line \up0 \expndtw-2\charscalex100 superstore buy.com (Nasdaq: BU
YX), which offers 950,000 products through 11 online specialty stores, piloted \
line \up0 \expndtw-3\charscalex100 the new service --providing its customers wit
h labels that print in seconds, whereas traditional returns services \line \up0
\expndtw-3\charscalex100 can leave customers waiting for labels anywhere from fi
ve to seven days. The new UPS service also reduced \line \up0 \expndtw-3\charsca
lex100 buy.com\u8217?s incoming returns calls by 40 percent - a clear indication
that their customers prefer using the Internet \line \up0 \expndtw-4\charscalex
100 rather than the telephone. \par\pard\ql \li1155\sb0\sl-253\slmult0 \par\pard
\ql\li1155\sb0\sl-253\slmult0 \par\pard\ql\li1155\sb15\sl-253\slmult0 \up0 \expn
dtw-4\charscalex100 \ul0\nosupersub\cf33\f34\fs22 UPS Internet Shipping \par\par
d\ql \li1155\ri998\sb0\sl-246\slmult0 \up0 \expndtw-4\charscalex100 \ul0\nosuper
sub\cf17\f18\fs22 This service is a \u8216?one-stop\u8217? service to allow cust
omers to complete all their shipping requirements from the UPS \line \up0 \expnd
tw-4\charscalex100 web site. The customer is provided with a userid and password
to access {\field{\*\fldinst {HYPERLINK "http://www.ups.com;/" }}{\fldrslt {\ul
0\nosupersub\cf50\f51\fs22\ul www.ups.com\ul0\nosupersub\cf17\f18\fs22 ;}}}\ul0\
nosupersub\cf17\f18\fs22 once logged in the \line \up0 \expndtw-2\charscalex100
customer can schedule a pick-up, print the appropriate UPS packages labels and
shipping documentation, and \up0 \expndtw-3\charscalex100 finally track the pack
age to its final destination. \par\pard\li1155\sb0\sl-218\slmult0\par\pard\li115
5\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-2
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li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0
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mult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\
pard\li1155\sb0\sl-218\slmult0\par\pard\li1155\sb0\sl-218\slmult0\par\pard\li115
5\sb0\sl-218\slmult0\par\pard\li1155\sb182\sl-218\slmult0\fi0\tx2340\tx5775\tx92
70 \up0 \expndtw0\charscalex102 \ul0\nosupersub\cf34\f35\fs19 Jeanne Ross\tab \u

p0 \expndtw0\charscalex102 8/2/01\tab \up0 \expndtw0\charscalex102 Page\ul0\nosu


persub\cf3\f4\fs19 \ul0\nosupersub\cf34\f35\fs19 14\tab \up0 \expndtw0\charscal
ex102 \ul0\nosupersub\cf3\f4\fs19 CISR Working Paper\par\pard\sect\sectd\fs24}