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Tqm At Ups Essay

5143 words - 21 pages

In recent years, the economy changed from an economy based on manufacturing to an economy based on service. United Parcel Service has always maintained it stability and has always been aware of which direction it is going. Due to increased competition from companies such as Federal Express and new technological advancements it sparked an opportunity for a much needed change. United Parcel Services saw what was happening and decided to take a step in a new direction. In 1994, UPS announced the major changes it would undergo, which turned into a company-wide initiative to improve its total quality management system. From this, the corporate managers began to seek out the differences between ...view middle of the document...

Originally, UPS dominated the market, delivering small items such as letters, notes, and baggage. It then later changed its focused from a messenger service to a company focused on delivering merchandise to department stores. It eventually extended its operations to the east coast where it then made New York City the location of its home office. By 1950, UPS served stores in 16 metropolitan areas. But as people started to migrate towards the suburbs in the late 1940s, UPS began losing business. Because of this, Casey decided to concentrate on door-to-door delivery of small packages from any of its customers. This placed UPS in direct competition with the United States Postal Service. From this, the company’s revenue doubled from 1964 to 1969. By 1975, UPS was servicing the entire United States of America. Although UPS has experienced tremendous growth over the past century, increased competition has forced a shakeup in the company's operation strategy. After losing business to competitors like Federal Express and Roadway Packaging System, former UPS Chief Executive Officer, Kent Nelson, began overhauling the way UPS did business and changed its focus to customer satisfaction. "Once upon a time, there was a company named United Parcel Service. It had spent decades leveraging tried-and-true practices built upon tried-and-true strategies. It faced one competitor, the U.S. Postal Service. At Christmas time, those brown trucks were as reliable as Santa Claus' sleigh---which is why customers always did business pretty much the way UPS asked them to. Then one day the company looked upon its business and saw that times had changed. The practices had become 'inoperative' because the strategies had become outdated. The strategies had become outdated because smaller upstart rivals and old foes had become competitive. Profits declined. So UPS examined what its customers wanted, sought ideas from its employees, swallowed hard, and decided it had better start doing business differently--or there might not be any more business to do. So it did. Now UPS is living happily ever after once again. For now." (Leibowitz)
In order to achieve customer satisfaction UPS referenced its total quality management. But what is total quality management? Total quality management is the holistic approach to long-term success that views continuous improvement in all aspects of an organization as a process and not as a short-term goal. (Total Quality Management) Jim Kelly, former Chief Operating Officer, realized the company's journey toward Quality was at a competitive disadvantage in several areas. The areas needing improvement include:
* Time-in-Transit Performance
* Dependability of UPS Services
* On Time Delivery of Packages
* Improve Existing Operations and Develop New Businesses
* Training and Empowering Employees
One important aspect the company is concerned with is its need to overcome the misconception that their competitors were more...

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