One of the things I admire about UPS is its willingness – despite a very strong, structured culture – to embrace change when necessary. UPS will turn 103 years old this year and in that time, it’s developed and pursued five different business plans that required transformation.
In the beginning, company founder Jim Casey set out to change the way messenger delivery companies worked. He developed a business approach that emphasized service, well-trained and neat employees, 24-hour-a-day availability and low rates.
With the spread of telephone service, Casey realized his messenger business was doomed. So he merged with a competing package delivery business and convinced the department stores of Seattle to rely on him to deliver goods to their customers. This model led to a name change from the American Messenger Service to Merchants Parcel Delivery and a successful platform to grow across the country.
In the process of growing, Casey came to understand that the personal automobile and development of shopping centers would undercut the need for department store delivery services. So he transformed again, turning UPS into a so-called common carrier, offering service to all interested parties in competition with the U.S. Postal Service.
The fourth transformation began in the 1970’s when UPS recognized the growing importance of technology and international trade. The result was a decision to start building a platform to track packages while expanding around the world and launching its own airline. This era would see the company ultimately build a network infrastructure to cover more than 200 countries and territories.
The fifth – and current – transformation began in 1997 and 1998 when the company conducted an extensive strategic review that took another hard look at its future. The results pointed to a need to broaden the company’s capabilities in order to play an even more central role in helping customers grow. In 1998, UPS changed its “purpose” in the company charter to, “We enable global commerce.” In 1999, the company went public on the New York Stock Exchange and proceeded to acquire more than 40 companies that now form the heart of its supply chain and freight segment.
UPS Supply Chain Solutions is a streamlined organization that provides logistics, global freight, financial and mail services. SCS and UPS Freight now are an $8.9 billion business. And no one at UPS thinks this transformation is the last.