United Parcel Service Crisis Management. 2 UPS Network Planning Group Founded: August 28, 1907, in Seattle, Wash., USA World Headquarters: Atlanta, Ga.,

United Parcel Service

Crisis Management

UPS Network Planning Group 2

Founded: August 28, 1907, in Seattle, Wash., USA

World Headquarters: Atlanta, Ga., USA

World Wide Web Address: www.ups.com

Chairman & CEO: Scott Davis

2009 Revenue: $45.3 billion

Employees: 408,000 Worldwide (340,000 U.S.; 68,000 International)

2009 Revenue: $37.9 billion

2009 Delivery Volume: 3.8 billion packages and documents (15.1 million per day)

Service Area: More than 200 countries and territories; Every address in North America and Europe

Operating Facilities: 1,801

Delivery Fleet: 96,105 package cars, vans, tractors, motorcycles, including 2,060 alt-fuel vehicles

UPS Jet Aircraft Fleet: 214 in service (253 aircraft total; among Top 9 in the world)

United Parcel ServiceWorldwide Facts


Crisis Management Mission Statement

• We seek to maintain a constant state of readiness should UPS become exposed to an unexpected act of a critical magnitude

• We maintain a crisis management strategy model to assist us in the prevention, response and restoration of our business

• We strive to protect the reputation and interests of UPS, Our People, Our Customers, Our Shareowners, and Our Communities

• We will conduct ourselves responsibly, sincerely, honestly and with the utmost integrity to ensure the safety, security and well-being of all of our stakeholders

United Parcel ServiceCrisis Management


United Parcel ServiceCrisis Management

Crisis Management

• Corporate team to address needs of company during crisis situations

• Cross functional team to insure minimal disruption and visibility to our customers

– Department heads or designee from each function

– Designated members from function to provide detailed planning for all levels

– Operations, Human Resources, Communications, etc.

The following slides will address the transportation portion of the Crisis Management structure at UPS


United Parcel ServiceCrisis Management - Transportation

Contingency

• Short term

• Usually weather related

Alternate Ops

• Long term

• Disaster situation



Contingency

• Short term operating disruption– Winter storms, hurricanes, etc

• Diversion of volume– Alternate locations– Minimize service impact

• Alternative modes of transportation– Delay movement into affected area

– Rail vs Ground– Ground vs Air

– Temporary, ad-hoc changes

• Customer notification– Service impact



Contingency

• Planning handled locally

• District implementation

• Support from Regions/Corporate

– Scope of situation will determine support requirements

• Return to normal operating plans



Contingency - Consequences

• Staffing– During disruption (individuals affected)– Post disruption (catching up)

• Cost– Transportation around affected area– Staffed operations with no work– Insufficient staffing when “catching up”

• Service– Local delays during disruption are expected– Network delays due to disruption are not expected



Contingency – Keys to Success

• Communication

– Our people

– Our customers

• Managing expectations

– Our people

– Our customers



Alternate Ops

• Long term operating disruption– Loss of facility (catastrophe, pandemic, etc)

• Diversion of volume– Alternate locations– Minimize service impact

• Alternative modes of transportation– New trains– Re-routing of ground feeds– Re-routing aircraft– Permanent, long-term changes

• Transparent to customer– Service impact



Alternate Ops

• Planning handled through Corporate

• Pre-determined plans

• Corporate/region team implementation

• Plan becomes the “norm”



Alternate Ops - Consequences

• Staffing– Available workers are not in area where recovery operations exist– Existing workers not available due to disaster (Pandemic)

• Cost– Initial contingency operation until Alternate Op in place– Alternate Op typically a more expensive plan

• Service– Initial contingency will cause temporary service issues– Cost vs maintaining existing service levels

– Alternate Ops are planned at current service levels– Operating costs could be reduced with change of service



Alternate Ops – Keys to Success

• Communication

– Our people

– Our customers

• Managing expectations

– Our people

– Our customers



SUMMARY

• Maintain good Contingency and Alternate Op plans

– Update as necessary when operating conditions change

– Make sure employees understand the plan

• Role play scenarios to ensure actions are sound

– Make sure everyone knows their role

• Hope that you never have to use plans, but if you do, communicate clearly with the people and the customers

United Parcel Service

Thank you!

Documents

United Parcel Service Crisis Management. 2 UPS Network Planning Group Founded: August 28, 1907, in Seattle, Wash., USA World Headquarters: Atlanta, Ga.,