What strategy did it follow, and what obstacles did it have to overcome?

Strategy
Federal Express (Fedex), express transportation company, relies upon several suppliers
such as fuel suppliers, airports, shipping materials, and manufacturers for business
operations. In order to grow its core packages business, supply chain capabilities introducing
new services and alliances, they used IT as a corporate strategy to take advantage of
international markets. Fedex used international compatibility of wireless applications like
Fedex Super Tracker (Provides shipping information and status) and Fedex e-business
website.
As part of their global strategy, Fedex standardize its products and services and adopts
uniform marketing to achieve homogeneity of customers response to the marketing mix.
Fedex also focused on cost reduction strategies, established centralized control where top
management taking all decisions and extending its geographical coverage through
acquisition. Fedex capitalized on its first mover advantage in international expansion to
achieve cost reduction through learning effect. By having tight control in different
geographical locations resulted in facilitating coordination, consistency of decision, avoid
duplication and easier to incorporate changes.
In general, Fedex adopted a strategy of acquisition in entering the global market. Acquisition
of different companies worldwide enabled Fedex to grow its portfolio of services along with
strengthening its delivery services around the globe. In 1984 FedEx made its first
acquisition, Gelco Express, a Minneapolis-based package courier that served 84 countries.
Hoping to recreate its U.S. market dominance overseas, the company made further
acquisitions in Britain, the Netherlands, and the United Arab Emirates. (FundingUniverse,
1997). Other subsidiaries of Fedex includes: Tiger International Inc. (Facilitated in
international airfreights), Caliber system Inc. (facilitated in growing portfolio of services in
ground small package carrier), Tower Group International Inc. WorldTariff Ltd. (provided end-
to-end transportation and customs clearance solutions around the world), American
Freightways Corp, Kinko's Inc., Parcel Direct, ANC Holdings Limited, Watkins Motor Lines,
Flying Cargo Hungary Kft, Tianjin Datian W. Group Co., Ltd, Prakash Air Freight Pvt. Ltd.,
AFL Pvt. Ltd./Unifreight India Pvt. Ltd., Servicios Nacionales Mupa, S.A. de C.V. (MultiPack),
Opek Sp.z o.o., TATEX, and Rapido Cometa.(Fedex.com, Acquisition History)


http://www.fundinguniverse.com/company-histories/fedex-corporation-history/
(FundingUniverse, 1997)
http://investors.fedex.com/phoenix.zhtml?c=73289&p=irol-overviewPortfolioHistory
(Fedex.com, Acquisition History)


Obstacles/ Challenges
With all the advantages of going global, Fedex also came across some cross-cultural
problems with global strategy in management effectiveness. Global strategy increases Fedex
reliance on national regulations (especially towards air regulations). For example in Asia,
management of airlines is very strict for government. Also, after having mergers its quite
difficult for reduce pressure from labor unions and maintain its performance.
With the step of going Global Fedex came across a challenge of understanding the nature of
operations and infrastructure facilities of a leading global third party supply chain
management solutions provider . Also, they had to get an insight into the various supply
chain management services offered by FedEx. (ICMR, 2004)
http://www.icmrindia.org/casestudies/catalogue/Operations/OPER029.htm (ICMR, 2004)