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Strategic Sourcing and Supply at Federal Express 1 Prepare a set of detailed responses to the following questions after reading the case: 1. What are...

Fed Ex Case Study in supply chain management. Material is attached. 

Strategic Sourcing and Supply at Federal Express 1 Prepare a set of detailed responses to the following questions after reading the case: 1. What are the key elements that must be completed at each stage of the strategic sourcing process? 2. How does the governance structure for supply chain management at Federal Express support the strategic sourcing process? 3. Are there elements of the strategic sourcing process used at Federal Express that apply to other companies? Background – Federal Express FedEx Corporation is a $20 billion market leader in transportation, information, and logistics solutions, providing strategic direction to the five main operating companies. These include: FedEx Express: The world's largest express transportation company. Leveraging its unmatched air route authorities and extensive air/ground infrastructure, FedEx Express connects markets, within just 1 to 2 business days that comprise 90% of the world's economic activity. FedEx Ground: North America's second-largest ground carrier for business- to-business small-package delivery. Provider of innovative new residential delivery service – FedEx® Home Delivery – in key U.S. cities and a pioneer in applying advanced information technology to meet customer needs FedEx Freight: A $1.9 billion leading provider of next-day and second-day regional LTL freight services. FedEx Freight is comprised of two independent yet complementary operating companies, American Freightways and Viking Freight, known for exceptional service, reliability and on-time performance. FedEx Customer Critical: North America's largest time-specific, critical- shipment carrier provides exclusive-use, non-stop, door-to-door delivery throughout the U.S. and Canada and within Europe – 24 hours a day, 365 days a year. FedEx Trade Networks: A full-service customs brokerage, trade consulting, and e-clearance solutions organization designed to speed shipments through customs using advanced e-commerce programs. FedEx Services: Provides customer access to the full range of FedEx transportation, logistics, e-commerce and information services by integrating sales, marketing and information technology 1 This case was developed by Robert Handfield of NC State University based on interviews with Federal Express associates, working with Brenda Liker and Jaymie Mitchell in developing best practices in sourcing for the Bank of America.
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FedEx Center-Led Initiative Prior to the purchase of the Ground, Freight, and other non-express based services, Federal Express had re-organized all of its major indirect spend in information technology, aircraft, facilities/business services, vehicles/fuel/ground service equipment, and supply chain logistics groups under the “Strategic Sourcing and Supply” group, led by Edith Kelly-Green. After the purchase of these different businesses occurred, the supply management function was re- organized into a Center-led Supply Chain Management sourcing model. Over the last two years, FedEx Supply Chain Management has been focusing on leveraging sourcing and contracting for all of the Fedex family of companies. For office supplies, instead of having each company run a contract, SCM has a single corporate contract for all of the negotiation effort, but allowing for different transactional approaches. It has been a gradual migration to getting to a centralized view to how procurement will happen. It is central for the larger spend areas, and different policy requirements. A big component of this model is the integration of Ariba Buyer – expanding the use of it to other operating companies, and processing requisitions within the SCM group. Most of the best practices discussed in this case are associated with FedEx Express, but is slowly being migrated across all of the operating companies. 2 ILLUSTRATIVE FedEx is much more than your typical air express carrier The world's largest express transportation company. Leveraging its unmatched air route authorities and extensive air/ground infrastructure, FedEx Express connects markets, within just 1 to 2 business days, that comprise 90% of the world's economic activity. North America's second-largest ground carrier for business-to-business small- package delivery. Provider of innovative new residential delivery service – FedEx® Home Delivery – in key U.S. cities and a pioneer in applying advanced information technology to meet customer needs North America's largest time-specific, critical-shipment carrier provides exclusive-use, non-stop, door-to-door delivery throughout the U.S. and Canada and within Europe – 24 hours a day, 365 days a year. A full-service customs brokerage, trade consulting, and e-clearance solutions organization designed to speed shipments through customs using advanced e- commerce programs. Provides customer access to the full range of FedEx transportation, logistics, e- commerce and information services by integrating sales, marketing and information technology A $20-billion market leader in transportation, information, and logistics solutions, providing strategic direction to the five main operating companies FedEx Freight is a $1.9 billion leading provider of next-day and second-day regional LTL freight services. FedEx Freight is comprised of two independent yet complementary operating companies, American Freightways and Viking Freight, known for exceptional service, reliability and on-time performance. The Sourcing Process FedEx established a seven step sourcing process. Step 1: First step is an assessment of the category that profiles that industry and commodity. The team will ensure that they are clear on the user requirements from the corporation, and try to define what that category amounts to. For example, on promotional items – where should the boundaries be drawn? How does the team define these? This involves doing a lot of research on the nature of existing purchasing activity,
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Date of submission: 1. What are the key elements that must be completed at each stage of the strategic
sourcing process? Solution
The sourcing process is a seven stage process that starts...

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