Frederick W. Smith FedEx Since its formation in 1971, FedEx remains as the market leader in an industry it helped to create. The person in charge of providing the strategic direction for all FedEx Corporation companies is its founder, Frederick W. Smith who is the Chairman, President and CEO. FedEx serves more than 220 countries and territories with operations that include 672 aircrafts and more than 80,000 vehicles. With a workforce of more than 290,000, FedEx handles more than 7.5 million shipments each day. FedExs commitment to total quality service has continued to strengthen its industry leadership over the past 47 years. FedEx was the first service company to win the Malcolm Baldrige National Quality Award in 1990. In addition to that, FedEx has consistently been ranked in Fortune magazines industry lists, including Worlds most Admired Companies, Americas Most Admired Companies, 100 Best Companies to Work For and Blue Ribbon Companies. With growth came the difficulties of coordination, maintaining efficiency, meeting customer expectations and managing employees. Smith realised that a rigid hierarchy of command-and-control groups would only magnify these difficulties. To give his employees the flexibility and freedom they need to move quickly and help FedEx remain as the dominant delivery service in the world, Smith decided to restructure FedEx by emphasizing the team approach to getting work done. He directed his leadership team to empower these groups by giving them the authority and the responsibility to make the changes needed to improve productivity and customer satisfaction throughout the Fed Ex system. With strong support from its managers, employees formed the Quality Action Team to overhaul their packaging-sorting techniques which were carried out successfully. FedEx also organised its clerical employees into super teams of up to 10 people. These teams operated as self-managed teams. Such teams managed to increase efficiency and reduce costs. FedEx teams have worked well because of the standards set and the reinforcements. Smith started the concept of the golden package, the idea that every package FedEx handles is critical and must be delivered on time. Whenever there is a problem, the team with the golden package takes charge to figure out how to make the delivery on time. Smith reinforces group performance by presenting a monthly Circle of Excellence award to the best FedEx station. Smith has also redefined the role of managers. There has been a shift in the mind set from the traditional leader-centered to the team centered leadership approach. FedEx managers perceive their role as facilitators and sometimes they are players. During emergencies, managers have been known to hurry down from their offices to help load packages onto the conveyor belts that are then loaded onto the companys planes. They practice team leadership by doing, not telling. 2 It is evident that Smiths leadership in pushing for a much more open, flexible, teambased organisation has been instrumental in keeping FedEx in the lead position in the delivery service industry. (Source: adapted from Lussier, Achua. (2010). Effective Leadership: International Edition, pg 280, Singapore: Cengage Learning)

1) Explain what motivates the staff of FedEx to remain highly engaged in their teams. (30 marks)