Fedex Balanced Scorecard – Learning and Growth Perspective
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FedEx Balance Scorecard: Learning and Growth Perspective The FedEx Corporation, founded in 1971, is a global courier and information technology service provider that is currently operating in 220 different countries and territories and employs over 300,000 people. The company is divided into various divisions, such as FexEx Express, FedEx Ground, FedEx Frieght, and FedEx SmartPost. According to their 2014 annual reports, they ship over 9 million packages daily and produced $45.6 billion in revenue and a net income of $2.1 billion.1 FedEx is a company that operates on a highly global level, so being able to effectively connect employees from such diverse backgrounds and maintain a level of quality and customer satisfaction, regardless of where in the world your package is going to or coming from, is no easy task. In order to accomplish this, FedEx created some basic objectives: First, promote diversity and inclusion in the domestic workforce; having domestic employees with various cultural backgrounds and traditions, allows for the company to connect with international customers as well. Second, promote training and development of employees. Third, provide incentives for employees and departments that show positive annual results and provide incentives to employees that have shown employer loyalty, by being a member of the FedEx team for a number of years. Finally, improve technology to improve international communication internally and automate customer services as much as possible.2 For their first objective, FedEx has a developed a domestic workforce, in which nearly half are minorities. Furthermore, about a third of their employees are women and over 20% of the management positions globally are serviced by women as well. FedEx monitors these statistics to ensure they maintain a workforce that is well diversified so they may relate to people all around the world. The second objective is accomplished by offering online and hands-on training to employees. Training programs include, job-training, skills-training, project and people-management training, and leadership programs. FedEx has also established their own “Code of Business Conduct and Ethics” course to maintain high standards and integrity. Currently, employees average over 20 hours a year in additional training. FedExs training has resulted in $2.5 million dollars in net savings as a result of developing quality teams with better customer satisfaction.3
FedEx understands that developing quality employees is beneficial, but not if the employees are not retained. Therefore, management believes in incentives and awards for exemplary employees and divisions. FedEx offers a number of awards not just for excellent job performances, but also humanitarian efforts, safety, and long-term (5+ years) service. Finally, to continue to grow, FedEx management believes in being on the forefront of information technology. FedEx is on an ongoing mission to make as much of their services as automated as possible. This is evident in their website, where you can print and pay for shipping labels, schedule pick-ups, customize delivery times, and track packages from around the world, just to name a small sample of their online services. FedEx has shown positive result since 2013; shares in 2014 are about 50% higher and their operating margin rose to 7.6% from 5.8% in 2013.4Part II For FedEx, I can confidently say that they have been very successful in stetting up their balanced scorecard. As I read and analyzed my partners essay, it is clearly evident that there is a flow of logic in the decision making. From the learning and growth perspective, we see that FedEx is heavily invested in being at the forefront of technology and developing their employees in the skills necessary to use that technology and provide exceptional community service. From this, we see that it flows nicely into the internal process perspective. The internal process focuses on utilizing technology, like real-time package tracking, to provide a simple, fast, convenient service to the customer, and to be able to connect to customers in all 220 countries they operate. In the customer perspective, it is clear that improving technology for better communication with the customers results in better customer service. Customers recognizes the advantages to choosing a company that is more automated and customer-service oriented. This leads to more business and greater financial growth. In the financial perspective, FedEx declares their financial goals, which is expected to be the result of following their plan in accordance with their balanced scorecard. FedEx declares that they want to increase their operating margin by 10% and increase profits for their shareholders.