Last year, there was a very well-known fiasco due to an increased amount of purchases on the internet. It was such an unforeseen forecast that it is now infamous and glued to UPS’ reputation. The harsh winter across the country and the spike in online orders, as opposed to brick and mortar stores where delivery is likely sufficient in absenteeism, are the two most cited reasons as to why there was such a failure in operations. The Christmas deadline guarantee is such an important concept to consumers who do not want to miss out on that magical Christmas morning that failing to abide by such explicit guarantees is harmful for business. Personally, I have not used UPS since this inexcusable fiasco caused multiple packages to be delivered after Christmas. Thankfully, out of coincidental luck, the one package that was late was to someone who was Jewish.

 

Now, online ordering is expected to grow even more. With the increased presence of mobile ordering through smart phones and tablets, online ordering is even easier and more accessible across the country. Amazon even offers a bar code scanner to instantly price check and of course purchase the scanned item when a customer is in a store. Often, Amazon can win these price wars; instead of a customer buying something in the store and bringing it home themselves this causes another package that must be delivered across the country. Amazon’s presence is so large in the online marketplace that about half of UPS’ packages have that familiar smile box.

 

The article claims that shippers are bracing for an even busier season: USPS is expecting to deliver 15.1 billion parcels which is the high end of the estimates. As we learned in class, forecasts are rarely accurate. However, there are certain reliability factors that UPS and FedEx have used to differentiate themselves from a more economical service (USPS).  Shouldn’t there be a higher standard when reliability is such an importance in the business component?

 

In addition to forecasting errors last year, there was a misattribution of efficiency. There was not enough workers to load the trucks, and it caused a severe backload of packages. This year, UPS has determined they need an additional 95,000 seasonal workers in the hopes this will be sufficient to combat demand.

 

Forecasting a holiday season is hard enough in such a fast-evolving marketplace, but adding in the operations component of worker efficiency, inventory management (they can’t have too many packages at one shipping hub or they won’t have enough room), and the unpredictability of the winter season it is almost an amazement they have been so reliable throughout the years.

 

Were you affected last year by the UPS fiasco?

Do you now trust UPS less due to their mistakes of the past?

Do you tend to purchase your products online or at a traditional store?

 

Sources:

http://money.cnn.com/2014/11/03/news/economy/holiday-shipping/index.html

These past few weeks an important topic drew the public’s attention about American corporations. Largely it has initiated a hot and emotional debate on the current political paradigm. A significant discussion is on companies’ tax-inversion. This is the practice of purchasing foreign company, and claiming that the company was a “parent” company. This way the “investor” is no longer obligated to pay U.S. income tax on any revenue made outside of the country. As a result, more organizations are taking advantage on tax avoidance. Due to these complaints President Obama and his administration is imposing new rules to oppose and disallow these loopholes.

Many fortune 500 organizations are considering this option. Recently Burger King, made headlines when they are trying to move their headquarters to Canada from Florida. They are working on purchasing the largest fast food service, Tim Hortons, Inc. which is based in Canada.

In management class we have learned that efficiency and effectiveness are some of the major keys in organization’s performance, as well as their ethical outlook. As a customers, we support businesses that have strong reputation and those companies that invest and contribute to the community well-being.
Today’s economy is very volatile and competitive place to do business in. Majority of large American companies are global, and they need competent people that are capable of tackling different issues to be productive and innovated. To achieve a greater goal you need also a great leadership; managers who must understand others, make responsible choices, and take proper actions to achieve the desired objectives.

I understand the frustration of people complaining about companies changing their “citizenship,” and consequently avoiding paying taxes on non-U.S. profits. Also, I do understand the government administration is trying to protect self-interests as they are losing revenue. However, when comparing the US with other developed countries, United States has one of the highest corporate tax rate. If businesses continue to pay high rates, they will be looking for other alternative methods to save money and as a result they will be unable to reinvest more in our people and our communities.
Instead of punishing companies that are moving abroad to avoid paying taxes, the government should try to lower the tax rate and encourage organizations to return and create more jobs back home.

Someone may say that tax inversion loophole creates incentives for companies to put their self-interest above others and act unethical. From the stockholders perspective at the end of a day the most essential goal is to accelerate and satisfy returns on investments to shareholders.

Do you think companies should continue taking advantage on tax inversion? Or should they receive tax benefit and expand their operations right here in U.S.? How about the ethical issues? What behavior is appropriate or inappropriate for organizations?

http://en.wikipedia.org/wiki/Tax_inversion
http://en.wikipedia.org/wiki/Tim_Hortons
http://www.philly.com/philly/business/20141029_Pfizer_CEO__still_exploring__tax_inversion__tactic.html
http://ourfuture.org/20140923/administrations-new-rules-for-companies-renouncing-citizenship
http://www.opednews.com/articles/Tax-Dodging-Deal-Fails-Tha-by-Dave-Johnson-Corporations_Politicians_Taxes-141102-630.html

Supply Chain sustainability.

 

The customer is always right. Every salesman dies a little inside when he hears those words. However, group of customers all can be profited from, thus they are always right. People do not drive business. Their money does. A firm’s main goal is to turn a profit among competing companies. Competition in business is fierce and companies always look to be the first to uncover ‘the next big thing’.  Once upon a time it was customer satisfaction, then it was marketing, and most recently, globalization.

 

This land is your land. However, today, the globe is a small place. No longer is globalization a ‘new’ area that companies are diving into, many are veterans and some are titans. An inconvenient truth is that the economy is no longer local, regional, or even national. An American based company that sells coffee cannot afford to ignore the political, labor, and environmental conditions of the African or South American Country that provides the coffee beans.

 

This land is my land. I was green before it was cool. McDonalds, a global titan, has a heavy focus on sustainability.  In Europe McDonalds sources 100% of its non-decaf coffee beans from farms that carry Rainforest certified beans (McDonalds). However, in America that number drops to 15%. Simply, American consumers are not yet interested, on a mainstream level, about sustainability.

 

This land was made for you and me. I foresee that sustainability, within the next decade, will be the new ‘it’ thing for companies. Once the ‘titan’ companies feel the effects of non-sustainable business practices via reduced profits. Hopefully brought on by consumers interested in a sustainable and renewable quality of life the rest of the smaller companies will follow in their footsteps.

 

The problem is competition and prices. Will consumers be willing to pay more for a cup of coffee if it comes from a sustainable bean? I don’t think so. Not until the attitude of the consumer base changes. Being sustainable means nothing to me if I do not understand it. I think what must first happen is a public perception shift away from the current one to a more environmentally conscious one. We can see the first ripples of this today. I am willing to pay a little more for organic fruit than non organic, I am willing to spend a little more money on clothes that are of better quality than not. I see this with many of my peers as well. It seems that money to today’s youth, as in the cost of products (to a degree) is not as important as it was to our parents. Fewer people I know today look at the cost of the product first. Rather they look for source, quality, and environmental sustainability when making their choices.

 

McDonald’s only has 15% its coffee beans sourced from rainforest certified suppliers not because it is a bad company, but because we as consumers do not demand them to. At the moment we simply cannot be bothered to care. This, I feel, will change.  The youth and 20somethings growing up around the country are a lot more community and people focused than our parents were. The world is becoming a warmer place.

 

 

 

What do you feel is the next step in sustainability and supply chain for companies?

 

Are you more interested in sustainable products, if so is pricing a big factor to you? Let’s say the product becomes about 5% more expensive.

 

 

 

 

 

http://www.theguardian.com/sustainable-business/mcdonalds-coffee-sustainability

 

http://www.aboutmcdonalds.com/mcd/sustainability/signature_programs/coffee_story.html

 

http://en.wikipedia.org/wiki/Rainforest_Alliance#Sustainable_agriculture_certification