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UPS served as the Official Logistics and Express Delivery Supporter of the London 2012 Olympic Games. UPS was responsible for the pick-up and delivery of everything from documents to heavy freight as well as the operation and management of the Games Logistics and Command Centre, where all materials associated with the Games were inventoried, warehoused and processed. In addition, UPS provided logistics planning services to ensure optimal efficiency in the Olympic supply chain and customs to get shipments cleared through customs quickly and efficiently. UPS moved 30 million items to the London games; from beds to toilet brushes, basket balls and boxing gloves. So, this business report will discuss and analyse Operational Management issues that United Parcel Service (UPS) have experienced during the Olympics. The main contents of this report will be based on the theory about operations management applied in the business.
As the size of this event was much larger than any other UPS has ever managed, therefore it had to get it right with no second chance.
Operations Management Issues
(Slack et al., 2010) attempted to critically approach the definition of operations, as processes that take inputs and converts them into outputs.
HR: In accordance with the author, there are other two set of inputs to any operations process, which are transforming resources: facilities and staff. In the case of UPS at the Olympics, (Dossetter, 2012) states that, most of the short-term contract employees UPS employed for the logistic project were those with considerable experience of events logistics, where locations are quickly equipped and broken down and return to normal with equal speed, for a major big audience event such as a concert. According to Alan Williams, the reason behind this is because there are many similarities with the games.
In terms of quality, the importance of quality will be given in the report
In terms of quality, it is possible to state that UPS met the requirements, as used its technology so LOCOG can have the ability to track UPS inbound and outbound shipments and delivery status, this provided their team visibility of the supply chain from pickup and shipping to final destination.
UPS employees were grouped based on technical and professional knowledge. The advantages of the functional organisation means employees can get better growth prospects and promotion opportunities. Employees at UPS are satisfied and the company has a retention rate of more than 90%, according to their annual report.
With this project the company focused on a number of areas, with the three most noticeable were: warehousing, distributions and the venue village.
UPS as any other businesses compete to survive and also seek to gain competitive advantage. For instance maintaining revenue stream and sustain its position in the market. In accordance with (Jones and Robinson, 2012) businesses should be aware of the importance of maintaining a revenue stream, as a company can become bankrupt even though it is profitable.
Number one priority was to develop an IT system to support logistics operations, as well as securing warehouses and logistics centres.
The current business strategy being employed by UPS is the Total Quality approach. They apply this strategy across all parts of their business. The reason behind the selection of this approach which was implemented in 1994 according to their previous CEO was because they wanted to make the quality of UPS the best in the world. The application of this form of business strategy was done in order to improve their productivity, efficiency and quality. One of the key benefits of implementing this strategy is that it emphasizes on continuous improvement. It works as a cross functional, management led philosophy which results in improving customer satisfaction. The reason that UPS is very affective with this business model is because they have all the basics for the implementation of this philosophy. Their top management actively supports this model and makes sure every department in their organization implements it. The other reason is due to the fact that this model goes hand in hand with UPSî€€s corporate culture. UPS believes in being highly adaptable in order to improvetheir services and TQM focuses on continuous improvement. (Duffy and Tom, 1996)From putting this model into practice UPS makes sure their staff member from the variousdepartments are pro active and involved in order to make the development work. They alsohave many work teams who are self managed and due to this model they are more involvedbecause they understand the vision of the organization and apply strategies and ideas whichbrings the vision to life.
Competitive Advantage: UPS is a leader in the package delivery services. According to …the company has gained competitive advantage in accessing up-to-date information as quickly and immediately as possible. This information system helps the management of UPS to make decision which helps the company to sustain its competitive advantage.
Innovation and creativity
This area appears to be a present opportunity for the company. UPS has already acknowledged that they need to be more innovative.
Agile and Lean Principles
Leanness means developing a value stream to eliminate all waste, that includes time, and to enable a level schedule. Whereas, agility means using market knowledge and a responsive supply network to exploit profitable opportunities in a volatile market.
The assembly of flat pack furniture was originally planned to take place in basement areas on the site, however as the apartment blocks were built UPS realised access would not be adequate. So instead, assembly took place in UPS's Tilbury warehouse. This particular task has employed all in total 80 employees. Half of them planned the moving and the other half to move the furniture in.
Environmental and Sustainability
LOCOG explained the enormity of the logistics operation which was all about balancing budget and sustainability. LOCOG also made a commitment to make this operation the greenest games. Hence, the environmental issues were at the forefront of the UPS logistics plans, while keeping within the budget. It is argued that UPS has met the agreement, as there are evidences demonstrate that 57 per cent of all materials moved into the Olympic Park have come by sustainable transport. This logistics project was carbon-free delivery of games, as UPS used a dedicated fleet with up to 150 vehicles, including hybrid and electric zero-emission vehicles (logisticsmanager, 2009). Some of these vehicles were fuelled by biomethane. According to Peter Harris EMEA Director of sustainability for UPS, each unit of biomethane would cut emissions well to wheel by at least 20 per cent compared to diesel (businessgreen, 2012). UPS has chosen this type of fuel, for two reasons; one because it's one of the few alternative fuels that can work at the heavy end of vehicle spectrum. Second, it has great potential for reducing carbon because the fuel is generated from producing waste and it is one of the world's most environmentally friendly vehicle fuels yet. However, there was a restricted fuel supply due to short supply of fuel, as there is only one supplier of biomethane in the UK and
For instance, UPS in order to reduce the carbon emission of transport, it moved the furniture shipped from China to the games site along the river.
Conclusion and Recommendations
The company has developed the competitive advantage in its functioning and became the market leader in package delivery and logistic system. If UPS wants to remain the leader in package delivery industry then it has to sustain and innovate new methods and techniques of information sharing and IT development.
UPS is targeting a global market of producers and consumers, while making a move to become the supply chain integrator of choice in e-commerce.