External environment and capabilities
One of the factors affecting the external environment at FedEx is the current socio-cultural environment in its target markets. The socio-cultural environment consists of cultural elements like the values shared by the clients and the laws governing ethics for the company. The elements also include technology, and the aesthetics held paramount by the society in relation to the conduct of business with the company.
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Social elements include client organizations, business groups and their partnerships with the company, and the social status of its clients. Over the past several years, the most influential socio-cultural issue in the company has been technology development. While the use of technology has increased over the past several years, only the younger generation has taken up the use of technological devices actively.
The older generation is yet to come to terms with the use of technology (Mc Namara, 2011). This element has affected the business processes at FedEx because the company has to develop strategies that satisfy the needs of the different generations of people it serves. Each generation has its specific needs, and this has affected the company in the marketing segment.
Technology provides an opportunity for the company to enhance its market share by luring higher clientele from the younger generation. It also poses a threat to the company because a shift to the use of technology exclusively would result in a huge loss of clients from the older generation.
The recommended strategy to solve this issue is for the company to stick to its traditional marketing strategies while targeting the clients from the older generation, and to use technology to lure more clients from the younger generation. The company should focus on maintaining its current market share while using technology to target new clients to increase its profitability (Grant, 2010).
Substitutes are part of the aspects that comprise the internal environment at FedEx. The company has been in the market for quite a long time, and it has established a very strong brand in the industry. The threat of new entrants in the business has always been low because of the operational costs of the business.
It is apparent that as more companies engage in diversified business strategies, there is a possibility that some companies may venture into the business. Current rivals to the company also pose high threats in luring its customers to use their services through competitive prices (Berger, 2011). The advancement in technology, especially the fast growth in the use of the internet is a very great force affecting FedEx.
The ability for clients to use their technological gadgets for faster communication has seen a decline in the demand for some services offered by the company. The internet has provided its clients with a faster and more convenient way to send messages and to access information, leaving FedEx in a disadvantaged position.
While this threat is all too real for the company, FedEx has developed a new platform that allows its clients to send their electronic documents through its website (Chen et al., 2004). This strategy has helped the company to maintain its younger clients, and to help the clients from the older generation to transition into the use of technology.
FedEx should continue to embrace technology in its service delivery to maintain the competitive nature of its brand because the world is shifting to the use of technology in service delivery (The Internal Environment, 2014). The company should also look into developing more channels for its clients to send and retrieve messages while maintaining loyalty to the company.
Berger, A. (2011). Case Study A FedEx Corporation. Munich: GRIN Verlag.
Chen, C., Duong, L., Yang, H., Susanty, M., Vellandi, M., & Betro, A. (2004). FedEx Corporation: Strategic Audit. Web.
Grant, R. M. (2010). Contemporary Strategy Analysis. New Jersey: John Wiley & Sons.
Mc Namara, F. K. (2011). FedEx Stakeholder Analysis. Web.
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