Supply Chains

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The logistical problems that FEDEX faces in this article are the flight delays. When flights are delayed it causes a snowball effect. It delays the sorting process which then delays the scheduled departures, which then delays destination arrivals. These are logistical problems because they involve the management of flow to get items from one origin to its destination to meet requirements. These delays lead to great consequences. The delay of a single flight cost the business a significant amount. The flight delay leads to employee overtime as well as other related costs. Costs also include package delay fees that are more than the cost of fuel and the flight crew. The new technology, Metron Aviation’s Surface Management System, which FEDEX implemented in 2002, has made operations more efficient. With the new system they are now able to see new data feeds that are helpful in sequencing arrivals. They are now provided real time information that allows them to make strategic decisions to be made to have flights arriving as much as 30 minutes prior to their scheduled times. I am not sure what can help FedEx improve their logistics. Maybe having better management of their Supply chains. The concept of outsourcing supply chain and logistics activities is becoming increasingly more productive with shipping businesses. Having an efficient supply chain will help benefit the company and improve their profits. FedEx will be helping supply chains to have visibility of their inventory, they will be reducing the supply chains inventory levels, and reducing their warehousing costs. It is a win win for both FedEx and the supply chain.
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