UPS is now leveraging its decades of expertise managing its own global delivery network to manage logistics and supply chain activities for other companies. It created a UPS Supply Chain Solutions division that provides a complete bundle of standardized ser-vices to subscribing companies at a fraction of what it would cost to build their own systems and infrastructure. These services include supply chain design and management, freight forwarding, customs brokerage, mail services, multimodal transportation, and financial services, in addition to logistics services. In 2006, UPS started running the supply chains of medical device and pharmaceutical companies. For example, at UPS headquarters in Louisville, Kentucky, company pharmacists fill 4,000 orders a day for insulin pumps and other supplies from customers of Medtronic Inc., the Minneapolis-based medical-device company. UPS pharmacists in Louisville log into Medtronic's system, fill the orders with devices stocked on site, and arrange for UPS to ship them to patients. UPS's service has allowed Medtronic to close its own distribution warehouse and significantly reduce the costs of processing each order. UPS and other parcel delivery companies are investing in giant

warehouses that service multiple pharmaceutical companies at once, with freezers for medicines and high-security vaults for controlled substances. UPS has partnered with Pratt & Whitney, a world leader in the design, manufacture, and service of aircraft engines, space propulsion systems, and industrial gas turbines, to run its Georgia Distribution Center, which processes 98 percent of the parts used to overhaul Pratt & Whitney jet engines for shipment around the world. UPS and Pratt & Whitney employees together keep track of about 25,000 different kinds of parts and fulfill up to 1,400 complex orders each day—ranging from a few nuts and bolts to kits comprising all the parts needed to build an entire engine. On the receiving side of the 250,000-square-foot building, UPS quality inspec-tors check newly arrived parts against blueprints. Sources: Jennifer Levitz and Timothy W. Martin, 'UPS, Other Big Shippers, Carve Health Care Niches,' The Wall Sara Journal, June 27, 2012; 'Logistics in action: At Pratt & Whitney Facility, Silence Is Golden,' UPS Compass, August 2012; Bob DuBois, 'UPS Mobile Goes Global,' UPS Compass, January 27, 2011; Jennifer Levitz, 'UPS Thinks Out of the Box on Driver 1TaMing,• The Wall Street Journal, April 6, 2010; Agam Shah, 'UPS Invests SI Billion in Technology to Cut Costs,' Bloombag Businetsineek, March 25, 2010.

What Would Happen If the UPS’s Information System Was Not Available?

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The information system formed an important part of the organizatio... View the full answer