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Ups Strategy Case

In: Business and Management

Submitted By hbrower
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Introduction
United Parcel Service (UPS), as of 2005, has become the world’s largest package-delivery company as well as offering specialized transportation and logistics services. However such success is likely attributed to the strategic planning of the executive leaders of the company. Mike Eskew, the Chairman and CEO, said, “the future of our company will be no better or worse than the quality of planning we do to prepare for it.” Eskew realized that preparing strategy for a company is the most vital catalyst for success. While typically strategy is set with short period goals, UPS found it necessary to develop a set of long-term goals for which they can make decisions that impact their company years down the road.

The way that UPS decided to set their long-term framework was through scenario planning. Scenario planning is a strategic method that has the team map driving forces defined by two axes, creating four quadrants. These four quadrants are then identified by combining the forces into four possible outcomes known as scenarios. Overtime, the scenarios are defined and written out such as positives and negatives of each scenario, a description of how it might come to fruition as well as naming each scenario so that it is easily referred to in future strategy decisions.

Over a period of almost 20 years, UPS decided to take strategy planning seriously:
1991 Coporate Mission and Strategy Statement introduced
1996 Strategy Advisory Group and Corporate Strategy Group formed
1997 First scenario planning session
1999 UPS Charter completed and broadly communicated
2002 Management Committee off-site, resulting in Centennial Plan Strategy Road Map developed
2004 Second scenario planning session
2005 Management Committee review and update of Strategy Road Map
Exhibit 3 pg. 17

Mike Eskew asked the Corporate Strategy Group (CSG) to recommend...

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