managing risk at fedex express bill logue evp & chief operating officer, express u.s. october 9,...
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Managing Risk At FedEx ExpressBill Logue
EVP & Chief Operating Officer, Express U.S.
October 9, 2008
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Topics
Size & Scope of Express NetworkOur Business Planning StructureHow We Plan The Shape & Form Of Our
NetworkDaily Operational ExecutionDisaster Relief & Business Continuity
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About FedEx Express
Time-definite delivery to 220 countries and territories worldwide and every address in the U.S.
Average daily volume of 3.4 million packages
1,503 daily flight departures 672 aircraft 43,900 motorized vehicles 131,000 employees
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Domestic U.S. Operating Divisions
Division Responsibility
U.S. Operations
• Pickup / Delivery• Retail Operations• Vehicle Maintenance
Air Ground Freight Services
• Hub Operations• Ramp Operations• Express Freight
Air Operations
• Crew Resources• Safety / Regulatory• Aircraft Maintenance• A/C Engineering
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Risk
Risk is the potential for loss caused by an event (or series of events) that can adversely affect the achievement of a company’s objectives.
Organizations that are most effective and efficient in managing risks to both existing assets and to future growth will, in the long run, outperform those that are less so.
Deloitte, Risk Intelligence Series
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Risk Management Starts With Our Business Planning Process
Global Strategic
Plan
Long Range Outlook:Six Year
View
Fiscal Year Start
June 1
• Business Baseline & Interpretation
• Hypothesis Testing
• Identify / Evaluate / Prioritize Initiatives
Divisional Operating Plans
Annual
• Execution• Forecast U.S. & International Volume
• Capacity Plan: Aircraft, Vehicles & Facilities
• Operating Plan: Flights, Manpower, Operating Requirements
• Capital & Expense Plan
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System Form Planning
Long Range Planning: 1 – 5 yr
Business Planning: 9 - 15 mo
Current Scheduling & Operational Planning: present - 6 mo
“Satisfy service requirements based upon forecasted volume”
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Daily Operational Control & Risk Management
Daily operational oversight resides in our Global Operations Control (GOC) Center
GOC exercises command and control of the FedEx Express linehaul system.
GOC is the highest level of command in our system, monitoring our worldwide line-haul and implementing emergency and contingency action plans as necessary.
Daily!
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Disaster Relief – Event Management
FedEx among worldwide first responders to catastrophes:
– Tsunami relief in Southeast Asia– Earthquake Relief in South Central Asia and
South America– Alliances with relief agencies, including Red
Cross and Heart to Heart International
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Business Continuity
DRACO (Disaster Recovery and Contingency Operations) Consolidating all Business Continuity and Disaster Recovery
under one umbrella Major Components
Airport Reconstitution Hub/Operations Reconstitution Contingency Aircraft and Truck Schedules IT System Reconstitution Infrastructure Plan
– Safety Issues– Security Issues
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Managing Risk Is What We Do
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Supply Chain Risks
Fuel–Price–Availability
Economic DisruptionGeopolitical (regional)Terrorism IT NetworkSystem Replication/Duplication
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Open Discussion
Questions?