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Researched Ryder Systems Inc. using online database and telephone interviews with personnel • Assessed corporation’s current state of operations and their position within their competitive environment •Proposed specific management, operational, and financial strategies in the form of a comprehensive paper and power point presentation
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Ryder Systems, Inc.
Chris Jursek
Chris Murphy
Mike Rothstein
Jeff Shields
Shane Tompkins
Company Summary
• As a global leader in transportation and supply chain management, Ryder Systems operates in two major business segments:– Fleet Management Solutions (FMS)– Supply Chain Solutions (SCS)
• Employs 28,900 people • Maintains a fleet of 209,500 vehicles
Company History
• 1933: Jim Ryder begins Miami, FL concrete hauling business with a single 1931 Model “A” Ford
• 1939: Ryder fleet grown to 50 trucks while changing its focus from distribution to leasing
• 1960: Ryder Systems, Inc. incorporates as a publicly traded company and is listed on the New York Stock exchange in 1960 under the symbol “R.N”.
• 1978: total revenue exceeds $1 billion. • 80’s & 90s: Steadfast expansion and innovation, Ryder Systems
listed in the Fortune® 500 largest companies in the United States. • In the new millennium, Ryder Systems has continued to provide
top tier services while supplementing organic growth though acquisitions.
Vision, Mission, and Values
• Bring compelling value to customers through outsourcing.
• To provide innovative supply chain and fleet solutions that are reliable, safe, and efficient; enabling customers to deliver on their promises.
• Trust, Innovation, Collaboration, Expertise, Safety
Key Personnel
• Robert E. Sanchez
-Chair of the Board, President, CEO• Art A. Garcia
-Executive Vice President, CFO• Dennis C. Cooke
-President of Global Fleet Management Solutions• John H. Williford
-President of Global Supply Chain Solutions
Organizational Structure
Goals
• Fleet Management Solutions– Drive fleet growth through marketing, innovation, and
acquisitions– Deliver industry-leading maintenance program– Optimize asset utilization and management
• Supply Chain Solutions– Provide differentiated quality of service and best execution– Develop capabilities that can be applied and utilized in Ryder’s
targeted industry verticals– Create a culture of innovation, fostering new and high value
solutions for customers– Focus on continues improvement and standardization– Successfully implement targeted sales and marketing strategies
Current Strategies
Grand Strategy
• Grow fleet management and supply chain outsourcing services by targeting private markets and key industry verticals
• Supported by key organizational priorities– Operational Excellence– Innovation– Growth Focus– Talent & Culture– Information Technology
Business Strategy
• Fleet Management Solutions– By outsourcing fleet management to Ryder,
customers can focus on core business and improve efficiency and productivity, while also lowering costs
• Supply Chain Solutions– Organizes customer supply chain, aligned by
industry verticals (Automotive, Industrial, Consumer Packaged Goods, Hi-Tech, and Retail)
Functional Strategies
• Marketing– Implements initiatives designed to compel private fleet
operators and for-hire carriers to outsource all or some portion of their fleet management needs
– Marketing and sales operations are heavily dependent on building a value added brand through customer service and relationship selling
• Capital Structure– Debt financing ($4,189,425,000)– Equity financing ($1,896, 714,000)
Functional Strategies
FMS (63% of revenue)
– Full Service Lease (64%)– Commercial Rental– Contract Maintenance– Related Maintenance– Fleet Support System
SCS (37% of revenue)
– Dedicated Carriage (57%)– Professional Services– Distribution Management– Transportation Management
• Operations
• Operates in many industries such as R&CPG, Automotive, Hi-Tech, Industrial, Food and Beverage, while also providing business & personal service.
Financial Analysis
Liquidity
2013 2012 2011 Ind. Avg.
Current Ratio 0.86 0.82 0.93 1.85
Quick Ratio 0.81 0.71 0.87 -
Working Capital -$168,646 -$232,428 -$85,650 -
D
Solvency
2013 2012 2011
Debt Ratio 82% 82% 79%
Debt-Equity 3.80 4.67 4.78
LT Debt-Equity 2.07 2.35 2.36
Times InterestEarned 2.69 2.16 2.10
C
Activity
2013 2012 2011 Ind. Avg.
Asset Turnover 0.71 0.75 0.79 0.50
Inventory Turnover 79.27 78.00 72.91 144.01
Acc Rec Turnover 8.26 8.07 8.02 8.06
Working Capital Turnover 0.03 0.04 0.01 0.03
B
Profitability
2013 2012 2011 Ind. Avg
Gross Profit 20.6% 20.03% 20.57% 35.7%
Net Profit 3.70% 3.36% 2.81% 6.20%
Return on Assets 2.73% 2.65% 2.38% 2.3%
Return on Equity 14.14% 15.08% 12.47% 12.7%
EBIT (Operating Income)
7.64% 4.84% 4.62% 8.12%
Earnings per Share $4.57 $4.11 $3.31 -
C
Competitive Environment
Macro
• Political– High degree of regulation at the federal, state, and local
levels
• Economic– Stabilized, future conditions unknown
• Environment– Introduction and development of natural gas and other
alternative fuels
• Global– Organizational globalization
Industry
Direct
Internal
Internal
SWOT Analysis
Organizational Strengths
• Operations– Ryder is known for having effective and efficient
operations within both (FMS and SCS) business segments along with excellent customer service
• Financials– Ryder has been able to consistently and reliably
pay interest, effectively managing their financial obligations
Organizational Weaknesses
• Operations– High costs are apparent in gross profit margin
• Finances– Carrying significant amount of debt– Sensitive to fluctuations in economic conditions– Approximately $1.4 billion maturing in 2016
Organizational Opportunities
Organizational Threats
Models for Strategic Analysis
Abell’s Strategy Evolution
Product Life Cycle
Hofer’s Market Life Cycle/Competitive Strength
BCG Portfolio Matrix
Ansoff’s Product/Market Matrix
GE 9-Cell Matrix
Dawar & Frost Strategy Options for Local vs Global Competitors
Pearce & Robinson International Strategy Options
Christensen, Berg, & Salter Grand Strategy Matrix
Problems
Debt
Operating Costs
END
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