CHAPTER 5

LEVERAGING CULTURE FOR INNOVATION AND COMPETITIVE ADVANTAGE

WHAT IS FEDERAL EXPRESS’S COMPETITIVE ADVANTAGE in the air package industry? Not price. Rather, there is a widely shared perception by its customers that it will, in the words of an old advertisement, “Absolutely, positively get it there overnight.” A belief in this reliability is what differentiates FedEx from the competition. One large firm has a corporate contract with a competitor. But managers told us that for really critical deliveries, they relied on FedEx—even if they had to pay for it themselves.

If reliability is a key to competitive advantage at FedEx, what critical tasks ensure it? Undoubtedly, there are many, including the need to invest in the latest technology, ...

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