Dhl Strategic Management

COMPANY OVERVIEW 

DHL is the global market leader in international express, overland transport and air freight,



It is also the world's No.1 in ocean freight and contract logistics,



DHL's international network links almost 220 countries and territories worldwide,



Around 285,000 employees are dedicated to providing fast and reliable services that exceed customer’s expectations in 120,000 destinations in all continents.

MISSION AND VISION STATEMENTS 

Making the most of scale and experience– and passion – DHL’s mission is to be the first choice worldwide.



DHL’s vision for the future is nothing less than to transform the logistics industry – and to deliver beyond customer’s expectations.

DHL CORPARATE STRATEGIES 

DHL’s strategies have six interconnected components: • to intensify customer focus • to deliver consistent service excellence • to extend capabilities (creating local strength and driving practical innovation) • to attract, develop and retain talent • to relentlessly drive efficiency • to be proactive in social

DEUTSCHE POST WORLD NET AND DHL CONSOLİDATİON

At the end of 2002, DHL was 100%

owned by

Deutsche Post World Net. In 2003, Deutsche Post World Net consolidated all of its express and logistics activities into one single brand, DHL. The DHL brand was further strengthened by Deutsche Post World Net's acquisition of Exel in December 2005.

MICRO ENVIRONMENT CUSTOMERS 

In Industry base, Customer’s of DHL Express are includes this sectors: 

Automative



Engineering/Manufacturing



Healthcare



Chemical



Technology



Retail



Consumer Goods

IFE MATRIX for DHL Strengths

Weight

Rating (1-4)

Weighted Score

1. Strong Brand Image

.08

3

.24

2. Globalism

.09

3

.27

3. Well known, good reputation

.07

2

.14

4. eServices and technology

.08

3

.24

5. Kept the same strategies for years

.08

3

.24

6. Deutsche Bank and Deutsche Post adjust structure of Postbank contract

.07

2

.14

7. The president and the vice president have significant experiences and skills of management.

.06

3

.18

8. E – business

.07

2

.14

9. Deutsche Post is investing € 420 million in mail business.

.07

3

.21

10. Creativity and innovations are encouraged for improving the effectiveness of DHL.

.07

1

.07

Weaknesses

Weight

Rating

Weighted Score

1.

.07

2

.14

2. Mistakes in the Market-Share Estimate

.07

2

.14

3. Weak Visibility

.06

1

.06

4. Loyalty problems on customer behavior.

.07

1

.07

Total

1.0

High Prices

2.28

CPM FOR DHL FEDEX

UPS

DHL

Competitive Factor

Weight

Rating

Extende d

Rating

Extende d

Rating

Extende d

Quality of service

.13

4

.52

3

.39

2

.26

Price pressure

.15

3

.45

3

.45

2

.30

Strong consumer orientation, segmented approach

.10

3

.30

3

.30

2

.20

Completeness of service

.09

3

.27

3

.27

1

.09

Good quality for a competitive discount price

.12

3

.36

4

.48

2

.24

Reputation

.11

3

.33

1

.11

1

.11

Advertising

.10

2

.20

3

.30

4

.40

After sales service

.08

2

.16

1

.08

1

.08

Customization

.12

2

.24

4

.48

2

.24

Total

1

2.83

2.86

1.92

EFE MATRIX for DHL Opportunities

Weight

Rating (1-4)

Weighted Score

1. To Expansion Globally

.08

3

.24

2. Creating Joint-Ventures with the foreign countries’ local transportation companies

.08

3

.24

3. Expansion Of E-Commerce

.07

2

.14

4. One Of The Largest Sector in the World to Act

.07

3

.21

5. Increase In The Number Of Manufactured Goods

.08

3

.24

6. Taking The Products Directly From City To City

.07

2

.14

7. Top-Ranked Website In Customer Satisfaction Among Transportation Sites

.08

3

.16

8. DHL Was Profitable Major Transportation Company In Europe In 2008.

.08

2

.16

9. They Created A New Market Segment.

.07

3

.21

Threats

Weight

Rating

Weighted Score

1. Rules And Restrictions In Foreign Countries

.06

2

.12

2. Competitors Caught DHL Strategies

.05

2

.10

3. Economic And Political Conditions

.06

1

.06

4. Insurance Costs

.08

3

.24

5. New Tax System.

.07

2

.14

Total

1.0

2.4

SWOT ANALYSIS

SWOT ANALYSIS STRENGTHS  Strong Brand Image  Globalism  eServices and technology  Corporate symbiosis  Smart-truck Project

WEAKNESSES  High Prices  Market-Share Estimate  Weak Visibility  Not as well known as UPS and Fedex

OPPORTUNITIES  Expansion Globally  Joint-Ventures  Expansion Of Ecommerce  Increase In The Number Of Manufactured Goods

THREATS  Relations With Foreign Countries  Economic And Political Conditions  Restrictions  Economic Slow-down  Fuel prices can go up

COMPANY STRENGTHS 

Strong Brand Image: In 1997, DHL became the global express transportation company to obtain simultaneous system-wide ISO 9001 certification in international quality standards. DHL has also developed their own quality system that matches their customer’s standards.



Globalism: DHL operates on a global scale. They operate in more than 220 countries. They provide services that appeal to most of the world. They have such a large market in which to operate, and thus realize tremendous revenues. They can also achieve global economies of scale.

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eServices and Technology: DHL uses and continues to search for new technology. They spend nearly 10% of total revenues, for information technology. DHL also has excellent eServices that provide access to systems that ensure customers have control and visibility of their supply chains at all times. Products can be tracked, queried and ordered online.



Corporate symbiosis:DHL has developed its own organizational structure to serve the global market, which it has called “corporate symbiosis.” This approach encompasses the empowerment of the DHL personnel at a local level, at the same time recognizing the interdependence of the parts of DHL as a corporate whole.



Smart-Truck Project: It is the programme which allows DHL to deliver faster. The data are transmitted directly to the dynamic route planning system, which recalculates the routes, depending on the current order situation and volume

of traffic.

COMPANY WEAKNESSES 







High Prices: DHL’s prices are above their competitors. This can be a weakness if their customers do not perceive a difference between DHL and its competitors’ services. Mistakes in Market-Share Estimate: The biggest weakness is DHL’s market-share estimate. It is difficult to estimate even when the market is stagnant and contains few competitors, and all market-share estimates should be viewed with circumspection. Weak Visibility: It has weak visibility in the community compared with its potential Not Well-known in USA as UPS and Fedex

COMPANY OPPORTUNITIES 







Expansion Globally: DHL can continue to expand globally, including the other companies under DHL. Joint-Ventures: DHL can form joint ventures to enjoy the growth of integrating their customer bases. Expansion of e-commerce: DHL already has a major presence of shipping online. They should keep finding Internet companies to contract delivery of their products. Since the growth of e-commerce is rapid now, DHL could enjoy both profits and brand name recognition from this kind of expansion. Increase In The Number Of Manufactured Goods: The World Trade Organization estimates that the rate of world trade in manufactured goods will increase exponentially up to 2010.

COMPANY THREATS 

Relations with Foreign Countries: Through DHL’ expansions globally, they are subject to laws and regulations of all foreign countries. There could be major problems in this area, stunting growth and raising costs.Everywhere DHL goes, they are at risk for regulations that hinder their operations or efficiency.



Economic and Political Conditions: DHL is subject to the entire world’s economic and political condition in the areas of fuel prices and supply, customer purchase of their services, and relations with foreign countries. As a global company, they are subject to much more risk than domestic companies.



Restrictions: Some restriction like ‘To prevent import from China’ are big problems in the logistic sector

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Economic Slow-down: Economic slow-down is decreasing the number of products that are produced.

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Price of fuel can go up: Even if the price of fuel goes up, DHL can pass that along to the customer but fuel is always a concern both in price and availability

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S2,3,6 - O4 In order to find new clients and increase their market share in increasing the number of manufactured goods all over the World, they need to make advertisements about their new technologies and on-line ordering system.



S1,2,3 – T3,4

To decrease the negative effects of the economic slow-down and restrictions, they need to focus on more promotions on using on-line ordering system 

S2,3,5 – T4,5

Enhance the Smart-Truck project to decrease the threat of fuel prices can go up

W1, O2 To decrease their prices by cutting costs and to increase their market share, they need to create joint ventures with the local logistics companies.  W4, O4 Creating some promotions in China and India like making discounts in the bigger orders they can introduce themselves all over the World  W1,2, T1,2,3 To decrease their prices as the competitors, and the negative effects of the restrictions in the foreign markets, begin to acquire small local companies abroad. 

GRAND STRATEGY MATRIX Rapid Market Growth Quadrant I

Quadrant II

Weak  Competitive  Position

Market Development Market penetration Product Development Forward Integration Backward Integration Horizontal Integration Related Diversification Strong  Competitive  Position

Quadrant III

Quadrant IV Slow Market Growth

•Evaluate present approach •How to improve competitiveness •Rapid market growth requires intensive strategy

RECOMMENDATION 1 

ENHANCE THE SMART-TRUCK PROJECT Because of the stage of recession and high competition, the companies need to make difference to have new customers and increase their market share. To invent completely new product can be very expensive and take very much time. So, making little difference on the current product or service can be better. At this time, we need to talk about innovation. As a CEO of DHL Logistics, enhancing the Smart-Truck Project is going to be my first strategy. This project will allow our company to deliver faster and cut cost by using less fuel.To achieve this goal, we will follow some steps: a) Increase the budget of R&D 10%. b) Prepare an office for a new innovation team and assign a leader to work on this project. c) Also pay premium for new and creative ideas whoever gives it (even juniors). So this will provide us innovative atmosphere.

RECOMMENDATION 2 

ACQUIRE SMALL-SIZED LOCAL LOGISTICS COMPANIES By acquiring small local companies in different countries like China, India, USA, will give us precense in that countries. Also, this will decrease the threat of restrictions in those companies. Even they are small companies, they can have creative solutions to different problems. So we are acquiring new brains at the same time. We can get some ideas from them to improve our skills. I mean we are not firing people who were working there actually, we are hiring them to work with us.

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