Information Systems FedEx

Company Description FedEx Express is a logistics company, focusing on overnight delivery service, though offering slower services as well. The company operates globally, using a hub and spoke model. The company ships from each depot to one of several centralized depots, where the packages are sorted and dispatched to the different outbound aircraft (FedEx.com, 2015). Not surprisingly, information systems are critical to managing millions of packages each night, and ensuring that they arrive in their destination anywhere in the world the next day.

One Critical System One of the information systems that is critical to FedEx is the one that manages the tracking of packages as they move through the centralized sorting facility. Each package has a bar code with which it is tracked. At the different stages of the handling, that code is scanned. This allows the packages to be sorted more efficiently, and it allows both FedEx and the customers to know where in the system a package is.

This helps act as a critical control to ensure that the packages arrive on time, and if not, that they can be recovered and delivered. This is a source of competitive advantage for the company, as FedEx has long maintained leadership in this sort of tracking technology, providing better security and service to its customers (Baldwin, 2013). If this system was down for any length of time, the following would occur. First, the packages would take longer to sort.

Part of the benefit of this system is that it allows packages to work their way through the massive sorting facilities in a short period of time. Some of this process is automated, so it is important that the tracking system works. The customer would also have less information to rely on -- not knowing where the package is in the system. The minute that the package is late, this would be a critical customer service issue.

Moreover, the tracking system is tied into the information systems that the company uses to gauge demand. It would be a challenge for management at individual depots, as they might not receive their usual information about incoming freight, which would compromise service at the depot level. So the company would lose efficiency in sorting, increase the risk of something going wrong, and would lose competitive advantage because its customers would have no information about packages. Being the innovator has long been a source of competitive advantage for FedEx (Gruman, 2004).

An outage even for one night would be a problem, for more than that would start to cost the company a lot of money. One Non-Critical System A non-critical information system is the one that tracks the productivity of individuals. The company tracks, for example, the productivity of each driver on a daily basis. This is not as critical a system, because it is used in performance evaluations, and to a lesser extent in designing routes.

The tracking system is immediate -- everything is related to a very short time frame. With the productivity system, the changes are things like employee performance, and take a longer time. As such, a few days of downtime really does not matter too much. The data set used in evaluation will still be statistically significant. Moreover, there are no negative outcomes for the customer, just for internal performance.