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Contingencies are Our Business

December 17, 2008

At FedEx we pride yourself on both planning and execution. Since we operate in a worldwide arena, everyday we are forced to operate in some type of contingency situation. As a result, redundancy is a key to our success.

Let me give you some examples:

  1. Each night we get about 140 inbound aircraft at the MEM HUB. These aircraft come from over 120 origin locations around the world. Let’s say you are a customer in DFW (Dallas) and for whatever reason the aircraft in DFW has a mechanical issue. Do we give up? No, from a planning standpoint we have scheduled “flying spares”. These aircraft are usually the last flights coming into MEM and they are planned not to be full so if an a/c breaks or we have overflow, these aircraft drop into that location for recovery.
  2. The MEM HUB gets 4 feeds from the local Power Company to power our 2.5mm square ft facility. If we lose one feed, no problem, we have redundancy as we only need 3 feeds. If we lose two feeds what happens? No problem we switch over to our massive back up generator system which has the ability to run the whole facility all by itself.
  3. We have automated scanners which read bar codes and, based on what is read, the packages are automatically diverted to the destination “build up location” within the HUB. But what happens if a shipper puts the bar code on the box incorrectly at the seam? What happens if the printer at the origin customer’s loading dock has an ink issue and the bar code is not readable? No problem, any package that is not read by our scanners is diverted to a special recovery area where we replicate the bar code based on the data we collected when the package was picked up and the package moves on its way.
  4. A customer calls or looks on fedex.com and wants to know the status of their package. It’s not due for delivery until tomorrow, but they just need to know if it is moving. Sure, no problem, at FedEx we scan every package an average of 16 times at different touch points during its journey. So that means, we know when it has left your dock, the origin city, origin airport and when it arrives at the HUB, departs the HUB and when it arrives at the destination and when it was delivered..
  5. There’s a snowstorm in the Midwest and you are concerned your package will get trapped and never leave the origin. It must get there. We are well ahead of you. We have seen the storm building for days — we have our own team of 15 meteorologists who forecast weather for every origin and destination airport location. They are the best in the business. But what happens if it snows in MEM, you guys don’t see snow often? Well, we have 69 De-ice trucks that we position in car wash like pads that spray a/c as they move through them. Our employees start training in the late summer spraying layover a/c with water just in case the de-ice opportunity comes to fruition in the winter.

Probably our greatest strength is our pursuit for best. Better is never good enough. We have a daily operations conference call at 08:30 each morning which is led by our Managing Director of the Command and Control team. The call is attended by representatives from all our operational units from around the world. The focus of the meeting is 48 hours. The last 24 hours as well as the upcoming 24 hours. Our goal is to always improve on what we have done and to be prepared for what lies ahead.

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