Business Response to Dynamic MarketsGreg Reid

Senior Vice President and Chief Marketing Officer

Fortune Worst of ‘97

List

Fortune Worst of ‘97

List

In the wake of deregulation and intense competition, the transportation industry must radically change the quality and types of services it provides its customers.

Economist, Bureau of Labor Statistics

In the wake of deregulation and intense competition, the transportation industry must radically change the quality and types of services it provides its customers.

Economist, Bureau of Labor Statistics

Earnings Per Share 1994-1996

(0.14)

(0.94)(0.83)

1994 1995 1996

Yellow The Year’s

“Biggest Gainer”A 31% Jump In

Score

Yellow The Year’s

“Biggest Gainer”A 31% Jump In

Score

Yellow 2001 Ranked #1

• Innovativeness

• Quality of Services

Yellow 2001 Ranked #1

• Innovativeness

• Quality of Services

#1 in the Industry 2003, 2004, 2005

Two Perspectives - 1997

Our view of transportation

Our consumers view of transportation

Our view of transportation

Our consumers view of transportation

Our World

Revenue – $2.5b

Employees – 34,000

Trucking

Less Than Truckload (LTL)

Handling Freight

Revenue – $2.5b

Employees – 34,000

Trucking

Less Than Truckload (LTL)

Handling Freight

17,000 members

Consumer View

Services that

• Give peace of mind

• Satisfy needs

• Deliver on promises

When packages don’t arrive on timethings can’t get done,

people wait,clients leave,

customers get angry,reputations get ruined,

credibility goes out the window,orders get backed up,

jobs get lost,people get demoted,

bosses get angry,people get disappointed,

stores can’t open,assembly lines shut down,

factories shut down,accounts go to the competition,

money gets lost,meetings are missed,

conferences are cancelled,blood pressure goes up,businesses can’t open,

people can’t work,promises are broken,

trust is lost,opportunities are missed,

deals aren’t made,transactions never happen,

ideas aren’t shared,products don’t get made,

information is missed,and the person who used

the shipping companythat messed it up

looks really, really,really bad.

When packages don’t arrive on timethings can’t get done,

people wait,clients leave,

customers get angry,reputations get ruined,

credibility goes out the window,orders get backed up,

jobs get lost,people get demoted,

bosses get angry,people get disappointed,

stores can’t open,assembly lines shut down,

factories shut down,accounts go to the competition,

money gets lost,meetings are missed,

conferences are cancelled,blood pressure goes up,businesses can’t open,

people can’t work,promises are broken,

trust is lost,opportunities are missed,

deals aren’t made,transactions never happen,

ideas aren’t shared,products don’t get made,

information is missed,and the person who used

the shipping companythat messed it up

looks really, really,really bad.

When packages do arrive on timethe world works just fine.

When packages do arrive on timethe world works just fine.

CHANGE

resist

embrace

create

Deviant Leaders

“The source of all innovation, new ideas, services, personalities and ultimately new markets.”

Ryan Mathews and Watts Wacker Fast Company March 2002

“The source of all innovation, new ideas, services, personalities and ultimately new markets.”

Ryan Mathews and Watts Wacker Fast Company March 2002

Corporate culture works to eliminate deviant employees.

Corporate culture works to discourage deviant ideas.

Corporate culture punishes deviant behavior and attitudes.

“And of course, as a result, most large companies lose the opportunity to discover the future and get there first.”

Corporate culture works to eliminate deviant employees.

Corporate culture works to discourage deviant ideas.

Corporate culture punishes deviant behavior and attitudes.

“And of course, as a result, most large companies lose the opportunity to discover the future and get there first.”

The Challenge

Ryan Mathews and Watts Wacker Fast Company March 2002

Vision

Focus

ExecutionStrategy Plan

Vision

Plan

“It is not the strongest of species that survive,

nor the most intelligent, but those most

responsive to change.”

- Charles Darwin

“It is not the strongest of species that survive,

nor the most intelligent, but those most

responsive to change.”

- Charles Darwin

“There’s no business like show business, but there are several businesses like accounting”

- David Letterman

“There’s no business like show business, but there are several businesses like accounting”

- David Letterman

To be the leading provider of guaranteed, time-definite, defect-free,

hassle-free transportation services for business consumers worldwide

Yellow Vision

Strategy Plan

Yellow Roadway Overview

$9.5 billion global transportation services company

Focused on large shipments for business

Transportation services and logistics management

Over 70,000 employees

Over 1,000 locations worldwide

$9.5 billion global transportation services company

Focused on large shipments for business

Transportation services and logistics management

Over 70,000 employees

Over 1,000 locations worldwide

Earnings Per Share 1994-2004

* Highest EPS in company history

(0.14)

(0.94) (0.83)

1.84

1.09

1.55

2.13

1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

0.56

1.03

2.27

3.96*

2005 – 50,000 members

Focus

Plan

Guide and Inspire.

Is an organizations reason for being.

Gets at the deeper reasons for an

organization’s existence.

Is forever pursued but never reached.

Guide and Inspire.

Is an organizations reason for being.

Gets at the deeper reasons for an

organization’s existence.

Is forever pursued but never reached.

Core Purpose

Core Purpose

To make global commerce work by connecting people, places and information.

Core Values• Exceed customer expectations• Value our people• Work safely• Demonstrate good citizenship• Act with integrity• Embrace teamwork

Yellow Roadway Corporation

ExecutionPlan

Operational Metrics

Load average

Weight per shipment

Dock bills per hour

P&D bills per hour

Time through system

Load average

Weight per shipment

Dock bills per hour

P&D bills per hour

Time through system

Consumer Metrics

Top-box satisfaction

Purchase intent

Likelihood to recommend

On-time reliability

Percent of shipments delivered undamaged

Customer service responsiveness

Top-box satisfaction

Purchase intent

Likelihood to recommend

On-time reliability

Percent of shipments delivered undamaged

Customer service responsiveness

PASSION

P.I.E.

P.I.E.

Malcolm GladwellAuthor, Blink and The Tipping Point

General Colin. L. Powell, USA (Ret.)

Vision

Focus

ExecutionStrategy Plan