United Parcel Service: Business Transformation Through Information Technology

Nearing its 100th anniversary, United Parcel Service was the world's largest package delivery company. Senior management had adopted a strategy of "enabling global commerce" and was growing through both extensions of its core business and expansion into adjacent businesses. In pursuing growth, UPS examined the fit between new business opportunities and its core competencies. UPS counted its highly standardized and scalable information processing capability among its core competencies, but many acquisition opportunities did not require the scale of UPS' core business. Thus, as UPS diversified, it pursued alternative organizational structures and considered new IT architectures to meet the needs of its new businesses. This case examines the strategic, organizational, and technical issues UPS was addressing in early 2002. In particular, it describes the opportunities associated with two new business lines: logistics and capital. These new businesses were characteristic of both the opportunities and challenges UPS would encounter as it attempted to deliver on its "enabling global commerce" strategy.