For the corporation that as acquired another company, merged with another company or been acquired by another company, evaluate the strategy that led to the merger or acquisition to determine whether or not this merger or acquisition was a wise choice.
United Parcel Service Inc (UPS) started out as a messenger company in the United States; UPS has grown into a multi-billion-dollar corporation by plainly focusing on the goal of enabling commerce around the globe (UPS, 2013). Overnite Corporation is a leading interstate trucking company serving all 50 states. The states also include Canada, Mexico, Puerto Rico, and the U.S. Virgin Islands. The company transports a variety of products such as machinery, tobacco, textiles, plastics, electronics, and paper products (Overnite Corporation History, 2013).
In 2005, UPS and Overnite entered into an agreement for UPS to acquire Overnite Corporation for $43.25 per share. It will allow UPS to expand its service portfolio by offering a variety of less-than-truckload and truckload services to its North American customers (Widgets RSS, 2013). In order to achieve a greater marketing power, UPS will use acquisitions which are a strategy used to buy a controlling, or 100 percent, interest in another firm with the intent or making the acquired firm a subsidiary business with its portfolio (Hitt, Ireland, Hoskisson, 2013, p. 196).
The deal with the acquisition is expected to close during its third quarter, is an all-cash transaction that will require regulatory approvals and the approval of Overnite company shareholders. UPS chairman and CEO, Mike Eskew stated that “Overnite is a perfect strategic fit for UPS Company”. They want to offer their customers the broadest portfolio of transportati...
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... products using the cost leadership strategy would be the best thing for the company to use to figure out how they can save money on their goods and services. If Overnight Corporation uses the cost leadership strategy correctly, the company will earn above average returns in spite of the competitiveness of other companies.
Corporate level strategy specifies actions a firm takes to gain a competitive advantage by selecting and managing a group of different businesses competing in different product markets. I would recommend that Overnight Corporation should think about using the Dominant business diversification strategy, where the company would generate between 70 and 95 percent of its total revenue within a single business area. By using this strategy Overnight could become more diversified in its goods and services (Hitt, Ireland, Hoskisson, 2013, p.164-166).
Frank, Allan D. (1997) “After the UPS Settlement: Who gained, who lost, and what will
In 2003 in an unprecedented move, UPS teamed up with rival FedEx to keep DHL from entering the US parcel market. DHL had purchased Airborne Express in an attempt to enter the US market. UPS and FedEx identified that DHL would distort US competition because DHL could subsidize its competitive activities with revenues gained from its postal monopoly in Germany. Unable to compete against the two US shipping giants, DHL announced in 2013, it would close its North American operations. In May 2013 DHL started outsourcing some of its operations to UPS.
Wathen, J. (2013). FedEx or UPS: A Rivalry Worthy of Your Attention. The Motley Fool. Retrieved Nov 13, 2013, from http://beta.fool.com/valuemagnet/2013/07/15/fedex-or-ups-a-rivalry-worthy-of-your-attention
Real Threat of Substitute Products or Services: High customer satisfaction earned through conscientious drivers, high reliability, and Internet-based tools has kept UPS at the top. UPS has created an economic advantage by assembling a dense integrated global shipping network that is unlikely to be matched by any but a few global players.
UPS is the largest parcel delivery service in the world. They also help their customers its customers with supply chain management, logistics, and financial services. UPS used to be a trucking company with technology, now it¡¦s a technology company with trucks. One of the UPS¡¦s key success factors is the way they manage their operations. Their carefully designed network of vehicles, sorting facilities, and hubs combined with their IT system, allows them to pick up 13 million packages each day from 2 million addresses for delivery to over 6 million commercial and residential addresses worldwide with highest levels of reliability, efficiency, and speed. Also the integration of its air and ground operations gave UPS the ability to optimize utilization of its assets while still meeting customer service requirements. Other key success factor is UPS¡¦s human resource management. UPS has lowest turnover rates in the industry and succeeds in developing a portion of its workforce for management positions each year. The company¡¦s unique culture emphasized accountability and efficient execution at every level of the organization.
I find that there acquisitions were in all respects good buys, broadening the company's overall service reach, into new technologies and what not. But their lack of integration and push to get them to buy into the EnClean ideal wasn't very good; they simply focused too much on short term gains of the current people who were running the acquired companies instead of putting in management that would do the job right. What they ended up with was lost time, and money, which would have been better spent better getting the acquired company to better fit into the service aspect that EnClean had setup. I also think they started jumping the gun on certain buys, such as the AlphaChem acquisition. Why they did not realize or at least consider that they were not a distribution company, and that AlphaChem had no clear strategy is beyond me.
“Northwest Airlines is engaged principally in the commercial transportation of passengers and cargo.” (5) NWA is a complete full service air transportation carrier that is the forth-largest air carrier in the world that services over 750 destinations located in 120 different countries on 6 continents. They operate 2,600 flights daily around the world and operate more than 200 nonstop between the United States and Asia each week. Headquarters is based in Minneapolis/St. Paul. The main connecting hubs are located at Detroit, Minneapolis, Memphis, and Tokyo. Northwest employs 50,600 employees nationwide as of Dec. 31, 1998. (6) NWA also has 1269 Stockholders as of Feb. 26, 1999. (6) Northwest continues to improve cargo shipping by proudly dedicating 12 Boeing 747 aircraft and easily becoming one of the largest cargo airlines in the world. (4) Cargo is very profitable for Northwest because “Northwest has predicted cargo revenue will top the 900 million mark in 2000”. (3) The enormous fleet of aircraft contains 400 airplanes. (1) Northwest has subsidiaries wholly owned (Unless otherwise indicated by NWA) by Northwest Aircraft, Northwest Aerospace Training corps, MLT Inc, Express Airlines, and Express Airlines I. (6)
In August of 1971, Smith started his venture by buying controlling interest in Arkansas Aviation Sales. While operating his new firm, Smith recognized the tremendous difficulty in getting packages delivered within one- to- two days. This dilemma motivated him to do the necessary research for resolving the current inefficient distribution system. Thus, the idea for Federal Express was born: a company that revolutionized global business practices and now defines speed and reliability1.
Cost-Leadership strategy is a strategy in which a firm in the market reduces its economic costs, lower than its competitors in the market, to gain competitive advantage over them. The strategy can only work if its different from the strategies that other competitors are using, and it should be as such that it affects them. If the strategy does not affect the competitors, it will be useless.
UPS is a global parcel transportation company, if we look at the numbers we could say that UPS is the third biggest parcel delivery company in the world.
A successful business strategy will identify changes in the external trends in the market place. Plan out what the company’s future direction is. Set out the goals for the management team. It will identify a vision of where the company wants to be in the future. Keep all employees informed of the direction of the company.
For the purpose of our paper, we will be discussing FedEx Corporation. Federal Express was originally founded in 1971 by Frederick W. Smith, a Yale University undergraduate. The idea for such a company came to Smith while writing a term paper. He saw the logistical challenges that many firms faced in terms of delivering urgent shipments. Therefore, his idea started a new industry, one in which time-sensitive shipments were accommodated to be delivered in a timely fashioned. His idea came to fruition after he first handly saw the challenges of getting packages deliver in a day or two. From here, Federal Express was up and running thus revolutionizing business practices to the point of becoming synonymous with speed and reliability.
158). It is expected that a corporate-level strategy will help the firm earn above-average returns by creating value. The corporate level strategies that are used by Seprod are vertical integration and diversification.
Potential new entrants: With positive economic outlook, fine business environment, and increasing number of population growth rate, it is expected that there will be more companies coming in the industry;
That reminded me from the case study the director how to plays round of the company to succeed this Colombian Memorial Hospital. External control view of leadership, situations in which external forces where the leader has limited influence determine the organization 's success. Strategy, the ideas, decisions, and actions that enable a firm to succeed. competitive advantage firm 's resources and capabilities that enable it to overcome the competitive forces in its industries. Operational effectiveness, Performing similar activities better than rivals. Intend strategy, strategy in which organizational decisions are determined only by analysis. Realize strategy, strategy in which organizational decisions are determined by both analysis and unforeseen environmental developments, unanticipated resource limitations, and changes from managerial preferences. Strategy analysis studies of firms ' external and internal environments, and there with organizational vision and goals. Strategy formulation, decisions made by firms regarding investments, commitments, and other aspects of operations that create and sustain competitive advantage.