‘Technology company’ UPS investing $1 billion a year in intelligent logistics
With its $1 billion-a-year investment in technology, UPS is empowering its intelligent logistics network with more efficient delivery routes that save money and reduce emissions while advancing such leading-edge tools as 3-D printing, drones and robotics.
“We really feel we are a technology company,” said David Abney, chairman and chief executive officer of the global supply chain megafirm, which boasts fleets of more than 600 aircraft and 100,000-plus delivery vehicles – and an information technology network that can hold more than 20 quadrillion bytes of data.
“We have a lot of planes; we have a lot of trucks,” Abney said at a June 30 gathering at UPS headquarters in Atlanta suburban Sandy Springs, Georgia. “But we really are a technology company.”
Since the company was initiated in 1907 by two Seattle teens as a messenger service and especially from around the time Abney began his UPS career in the mid-’70s using strip maps to navigate his delivery route in Greenwood, Mississippi, UPS has clearly moved to the logistics industry forefront when it comes to technology.
“Technology is really a foundation for our growth initiatives,” Abney said, noting that it is facilitating UPS expansion in international markets, encompassing more than 220 countries and territories, while serving demands of e-commerce and such fast-growing segments as healthcare and aerospace.
Indeed, for a company that in 2015 took in $58.4 billion in revenue, the $1 billion annual technology outlay isn’t seen as an expenditure.
“We clearly look at that as an investment, not an expense,” said Mark Wallace, UPS senior vice president for global engineering and sustainability, who, like Abney, relied on strip maps to find his way through his early UPS career.
No fewer than 40 scientists and engineers have been engaged in development and delivery of the company’s ORION technology, which combines package-level detail and customized online map data – what Wallace called “Mapquest on steroids” – with expansive fleet telematics and advanced algorithms to provide drivers with the most efficient routes for some 16 million daily deliveries in the United States alone.
UPS even employs meteorologists to provide input on routings and plan around potential and impending weather events.