Nur Syahirah Husaini GM 04674Sameena Siraj GM 04558Geetha A/P Valaidum GM 04556Philominah Arkappan GM 04502

COMPANY OVERVIEW• Founded in San Francisco more than 40 years ago by 3 budding

entrepreneurs - Adrian Dalsey, Larry Hillblom and Robert Lynn • DHL is the one of the global market leader in international express,

overland transport and air freight• DHL offers integrated services and tailored, customer-focused

solutions for managing and transporting letters, goods and information.

• DHL’s international network links almost 220 countries and territories worldwide

• Around 285k employees are dedicated to provide fast and reliable services that exceeds customer’s expectations in 120k destinations in all continents

MISSION & VISION

• Mission : to be the first choice worldwide

• Vision : for the future is nothing less than to transform the logistic industry and to deliver beyond customer’s expectations.

NEW MISSION & VISION

• Mission : enhances the business of our customers by offering highest quality express and logistics solutions based on strong local expertise combined with the most extensive global network presence.

• Vision : create and promote innovative logistics solutions that aims to deliver freight services that are beyond customers expectations

• "FedEx Corporation will produce superior financial returns for its shareowners by providing high value-added logistics, transportation and related information services through focused operating companies. Customer requirements will be met in the highest quality manner appropriate to each market segment served. FedEx Corporation will strive to develop mutually rewarding relationships with its employees, partners and suppliers. Safety will be the first consideration in all operations. Corporate activities will be conducted to the highest ethical and professional standards."

FedEx Mission & Vision

Mission & Vision supporting the Strategies

• DHL’s strategies : – To intensify customer focus– To deliver consistent service excellence– To extent capabilities– To attract, develop and retain talent– To relentlessly drive efficiency– To be proactive in social

Mission & Vision supporting the Strategies

• Statements of vision and mission of the company are a manifestation of the commitment of achieving success as these statements drive strategy. Strategies are founded on these statements hence are considered the idea of purpose

Internal Assessment

Organizational Chart

Market Positioning MapHigh Distribution Network

Moderate ServiceQuality Service

Low Distribution Network

FedEx

UPS

DHL

Nationwide

Skynet

City-LinkTNT

DHL’s Marketing Strategy• Aggressive promotion strategy (Promotion)• Just in Time• High quality service• Advanced technological support• Planning and scheduling• Horizontal management practices• Optimization of HR & OM (People)• Location (Place)• Product choice (Product)

DHL’s Website

DHL’s Strengths & WeaknessesStrengths Weaknesses

Strong Brand Image Not well-known globally

Globalism High Tariffs

Technology pioneers High Prices

Innovators Not fully operational in Domestic Markets

Corporate Symbiosis Customer loyalty issues

Reach and Frequency No difference of the services of DHL with competitors

Quick delivery due to dynamic route planning system

Weak to tap and venture against its potential domestically and internationally

Customers have control on what they purchase

Subject to stagnate market

Excellent e-commerce services

Clear visibility of supply chains all the time

IFE MatrixStrengths W R WS

Strong Brand Image 0.12 4 0.48

Globalism 0.08 2 0.16

Technology pioneers 0.09 3 0.27

Innovators 0.09 3 0.27

Corporate Symbiosis 0.08 3 0.24

Reach and Frequency 0.15 4 0.60

Quick delivery due to dynamic route planning system 0.03 1 0.03

Customers have control on what they purchase 0.03 1 0.03

Excellent e-commerce services 0.04 2 0.08

Clear visibility of supply chains all the time 0.04 2 0.08

Weaknesses W R WS

Not well-known globally 0.10 3 0.30

High Tariffs 0.08 1 0.08

High Prices 0.09 2 0.18

Not fully operational in Domestic Markets 0.12 3 0.36

Customer loyalty issues 0.02 1 0.02

No difference of the services of DHL with competitors 0.03 1 0.03

Weak to tap and venture against its potential domestically and internationally 0.04 2 0.08

Subject to stagnant market 0.03 2 0.06

TOTAL 1.00  2.67

Based on the results above, DHL’s Internal Factor Evaluation is slightly above average to their internal strengths and to abstain weaknesses.

External Assessment

Major competitors

• Federal Express• UPS• City-Link International• Nationwide Express• TNT Express Worldwide• Skynet Worldwide

DHL FedEx UPSLess expensive than UPS or

FedExGenerally more expensive

than USPS or DHLSomewhat expensive but

cheaper than FedEx

Offers fast delivery to some locations.

very quick delivery system Relatively fast delivery

Offers free boxes and other shipping supplies, but only

for their Air Express service (not DHL Ground).

Provide boxes free of charge

Insurance for valuables worth up to $100 is

included free of additional charge.

Provides online tracking at no additional cost, but not

as detailed as FedEx

Provides the most detailed online tracking system.

Ground, Express, and Freight shipping services

are available, as well as extra fast same-day and

overnight options.

Competitive Profile MatrixFedEx UPS DHL

W R E R E R E

Service Quality 0.13 4 0.52 3 0.39 2 0.26

Price Pressure 0.15 3 0.45 3 0.45 2 0.30

Strong consumer orientation, segmented approach

0.10 3 0.30 3 0.30 2 0.20

Completeness of service 0.09 3 0.27 3 0.27 1 0.09

Good quality for a competitive discount price

0.12 3 0.36 4 0.48 2 0.24

Reputation 0.11 3 0.33 1 0.11 1 0.11

Advertising 0.10 2 0.20 3 0.30 4 0.40

After sales service 0.08 2 0.16 1 0.08 1 0.08

Customization 0.12 2 0.24 4 0.48 2 0.24

Total 1 2.83 2.86 1.92

The result shows UPS is dominating on critical success factors because the total weighted score is higher compared to FedEx and DHL

PESTLE Analysis

• Political Environment– Europe is a stable environment where no major

political changes are expected. – European Union has removed border lines and has

made trade and business more accessible– Enable bigger exports, free movement of services.

Economical Environment

– companies should not stop their investment plans because of economic crisis.– It is important in current situation to strengthen position in the market and expand if possible. –Emerging markets represent a potential of rapid economy growth. –E.g restructuring or outsourcing –reduced cost

Socio-cultural Environment

• affect customers' needs and wants• Research & Development - to respond to changes in

society quickly not to loose market share and demand for services.

• Customer satisfaction surveys, market surveys, employee surveys play important role in building company's brand and image in the market.

Technological Environment• IT is the most important technology factor for logistics

business because speed and reliability are equal to success. However, there is an indisputable constant threat of falling behind.

• Investments to the modernist technologies are evitable and in times of economic crisis are much more important then anytime before.

• Company has to decide if it runs internal IT organization or if it outsources most of the services and reduce cost.

Legal Environment

• obligations - directives, taxes and rules that they must be aligned with to be able to operate in the market.

• Liberalization - Removal of border lines enabled building and strengthening of positions in the logistics market. There are no special and expensive authorizations necessary in CEP industry which is another benefit for companies

Environmental Analysis

• Air pollution globally – transportation industry• Projects have been implemented – smart

truck project

External AnalysisOpportunities Threats

Global Expansion Rules and restrictions of other countries

JV with foreign countries’ local transportation companies

Competitors improvising DHL’s strategies

Expansion of E-Commerce Economic and Political condition of the country

Increasing number of manufactured goods

Insurance costs

Delivery products from city to city New Tax System

Creation of new market segmentation Increase in fuel price

Largest world sector Tough competitors

EFE Matrix

Opportunities W R WS

Global Expansion 0.08 3 0.24

JV with foreign countries’ local transportation companies 0.08 3 0.24

Expansion of E-Commerce 0.07 2 0.14

Increasing number of manufactured goods 0.08 3 0.24

Delivery products from city to city 0.07 2 0.14

Creation of new market segmentation 0.07 3 0.21

Largest world sector 0.07 3 0.21

Threats W R WS

Rules and restrictions of other countries 0.06 2 0.12

Competitors improvising DHL’s strategies 0.05 2 0.10

Economic and Political condition of the country 0.06 1 0.06

Insurance costs 0.08 3 0.24

New Tax System 0.07 2 0.14

Increase in fuel price 0.08 2 0.16

Tough competitors 0.08 1 0.08

Total 1 2.32

Based on the results above, DHL’s External Factor Evaluation is below average to the environment for exploiting opportunities and to overcome threats.

Strategy Formulation

SWOT Analysis

Strengths Weaknesess

• Strong Brand Image• Globalism• Technology pioneers• Innovators• Corporate Symbiosis• Reach and Frequecy

• Not well-known globally• High Tariffs• High Prices• Not fully operational in Domestic Markets

Opportunities SO Strategies WO Strategies• Global Expansion

• Joint Ventures• Expansion of E-Commerce

• Increasing number of manufactured goods

• Advertise new technologies and online ordering system

(S2,S3, O4)

• Create joint ventures with local logistics companies (W1,

O1, O2)• Promoting business in China

and India (W1, W4, O1)Threats ST Strategies WT Strategies

• Rules and Restrictions• Economic and Political

condition• Slow and stagnant economic

growth• Relationship with foreign

countries• The increase in fuel prices

• Promotions when using online ordering system during

economic slow-down or restrictions (S2, S3, S6, T1, T3)

• Enhance the Smart-Truck Project to overcome fuel price

increment (S3,S4,T5)

• Acquire small local companies abroad to catch up with competitors (W1,W4,T4)

SPACE MatrixA SPACE MATRIX RATINGS TOTAL AVERAGE

Financial Strength (FS)      Revenue 4.00   Cost reduction 2.00   Asset utilization 3.00 9.00 3.00Industry Strength (IS)      Technology Savvy 6.00   Large distribution network 5.00   Brand 4.00 15.00 5.00Environmental Stability (ES)      Risk in business -3.00   Increase in fuel prices -2.00   High rivalry in market -5.00 -10.00 -3.33Competitive Advantage (CA)      Innovation -4.00   Service quality -5.00   Product choice -3.00 -12.00 -4.00CONCLUSIONDirectional Vector X-axis: CA + IS = -4.00 + (+5.00) = 1.00 Y-axis: FS + ES = 3.00 + (-3.33) = -0.33Strategy to pursue is Competitive Strategies

FS

CA

ES

IS

Competitive

Conservative

Defensive

Aggressive

SPACE Matrix

BCG Matrix

• DHL has been analyzed in 3 categories of its businesslike – mail, express and logistic

• 1) mail – market growth rate

• DHL Market Growth Rate 53212 – 40935 X 100% = 30%

40935

BCG Matrix indicates that DHL is placed in Cash Cow. This means DHL’s market growth rate is low, but its market share is high so it should milk as much profit as possible

BCG Matrix

Grand Matrix Strategy

Weak competitive position Strong competitive position

Rapid Market Growth

Slow Market Growth

QSPMSTRATEGIC ALTERNATIVES

   

Enhance & focus on innovation

Expand business & acquire more logistics companies domestically and internationally

Key Factors Weight AS TAS AS TAS

Opportunities          

Global Expansion 0.08 3 0.24 4 0.32

JV with foreign countries’ local transportation companies

0.082 0.16 4 0.32

Expansion of E-Commerce 0.07 3 0.21 3 0.21

Increasing number of manufactured goods 0.08

3 0.24 4 0.32

Delivery products from city to city 0.07 -   -  

Creation of new market segmentation 0.07

-   -  

Largest world sector 0.07 -   -  

Threats          Rules and restrictions of other countries 0.06 2 0.12 3 0.18

Competitors improvising DHL’s strategies 0.05 -   -  

Economic and Political condition of the country 0.06 -   -  

Insurance costs 0.08 -   -  New Tax System 0.07 -   -  Increase in fuel price 0.08 3 0.24 2 0.16Tough competitors 0.08 4 0.32 4 0.32Total 1.00        Strengths          Strong Brand Image 0.08 3 0.24 3 0.24Globalism 0.07 2 0.14 4 0.28Quick delivery due to dynamic route planning system 0.03 -   -  

Customers have control on what they purchase 0.03 -   -  

Excellent e-commerce services 0.04 -   -  Clear visibility of supply chains all the time 0.04 -   -  

Technology pioneers 0.07 4 0.28 3 0.21Innovators 0.07 4 0.28 3 0.21Corporate Symbiosis 0.06 3 0.18 4 0.24Reach and Frequency 0.09 2 0.18 4 0.36

Weaknesses          Customer loyalty issues 0.02 -   -  No difference of the services of DHL with competitors 0.03

-   -  

Weak to tap and venture against its potential domestically and internationally

0.04 -   -  

Subject to stagnate market 0.03 -   -  Not well-known globally 0.07 2 0.14 2 0.14High Tariffs 0.06 2 0.12 2 0.12High Prices 0.08 3 0.24 3 0.24Not fully operational in Domestic Markets 0.09

4 0.36 3 0.27

Sum Total Attractiveness Score 1.00   3.69   4.14

Recommendation• Enhance & focus on innovation

– Make difference to have new customers and increase their half market share

– Making little difference on the current product or services to be better

– Delivery will be faster and cut cost by using less fuel

Recommendation

• Expand business & acquire more logistics companies domestically and internationally– By acquiring small local companies in different

countries like China, India, USA, will give presence in that countries.

– Creative solution for problems and acquiring new brain

Strategy Implementation

EPS/EBIT ANALYSIS

• Earnings per share: Year 2011 € 1Y(Million) Q4(Million)• EBIT 2436 599• EPS 0.96 0.14 (0.82 for 9 months)

EPS/EBIT ANALYSIS• Earnings per share: Year 2012 (9 Months) € (Million)• EBIT 1838• INTEREST 270• EBT 1568• TAXES 452• EAT 1116• SHARES 1209• EPS 0.92

Mail : €678

Express €829

Freight €346

Supply Chain €301

Others €-315

Consolidation €-1

EPS/EBIT ANALYSIS (assumption)

Capital needed € 5000 millionEBIT range € 2000 to 4000millionInterest rate € 5%Tax rate 25%Stock Price € 15.20Shares outstanding € 2019 million

EPS/EBIT ANALYSIS (assumption)

100% DEBT 100% STOCK 50/50 DEBT/STOCK

EBIT 2000 4000 2000 4000 2000 4000

INTEREST 250 250 0 0 125 125EBT 1750 3750 2000 4000 1875 3875TAXES 438 938 500 1000 469 969EAT 1312 2812 1500 3000 1406 2906SHARE 2019 2019 2348 2348 2184 2184EPS 0.65 1.39 0.64 1.28 0.64 1.33

EPS/EBIT ANALYSIS (CHART)

CONCLUSION:THE BEST FINANCING ALTERNATIVE IS 100% DEBT SINCE THE EPS VALUE ARE LARGEST; THE WORST FINANCING ALTERNATIVE IS 100% STOCK SINCE THE EPS VALUES ARE LOWEST.

RATIO ANALYSIS OF DHL

2012 2013Current Ratio € = 12750 20000

13449 18600

0.95:1 1.08:1Debt Equity ratio € = 22929 29161

34544 6426466.38% 45.38%

2012 2013Return on Sales € = 1838 3701

40935 532124.49% 6.96%

Return on Asset € = 1196 238640935 532122.92% 4.48%

RATIO ANALYSIS OF DHL

FUTURE ASSUMPTION BY DHL

• The group intends to generate annual EBIT

growth by an average of 13to 15% through 2015• EBIT Range 2.6 to 2.7billion• Dividend Payout ratio will be 40 to 60%• Number of employees in 2012 ( 426,104) tend to

increase by 10% in 2013

• CEO of DHL Logistics, enhancing the Smart-Truck Project is going to be his first strategy. This project will allow their 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

FUTURE ASSUMPTION BY DHL

The Financial PerspectiveStrategic Themes

Strategy Revenue Growth & Mix

Cost Reduction/Productivity Improvement

Asset Utilization

Growth

Strategic Objective

Improve Market Penetration

Improve Revenue Productivity

Efficient use of resources

Improve wallet share

Improve Channel Mix

Improve market share

Reduce Operating Expenses

Ensure Loyalty

Strategy Evaluation – Balance Scorecard

The Financial PerspectiveStrategic Themes

Strategy Revenue Growth & Mix

Cost Reduction/Productivity Improvement

Asset Utilization

Growth

Strategic Objective

Improve Market Penetration

Improve Revenue Productivity

Efficient use of resources

Improve wallet share

Improve Channel Mix

Improve market share

Reduce Operating Expenses

Ensure Loyalty

The Customer PerspectiveThe Customer Value Preposition

Strategy Product/Service Attributes

Image and Reputation

Customer Relationship

Growth

Strategic Objectives

Price/Performance Brand Image Contractual Responsiveness

Ease of Use Brand Equity Flexibility

Product Availability Honesty and Openness

Buying Experience

Customer Feedback

The Business Process PerspectiveTypes of Business Processes

Strategy Innovation Operations Post-sales Service

Strategic Objectives

Growth

Identify emerging needs of customers

Reduce order fulfillment cycle time

Enhancing support centres

Improve communication process between customer and company

Response time for solving customer problems

Learning and GrowthCategories

StrategiesEmployee

CapabilitiesInformation System

CapabilitiesMotivation

Empowerment and Alignment

Growth

Strategic Objectives

Strategic skills (improve selling

skills, analyst skills, technical support)

Improve Intellectual Property

Staff Empowerment

Skill leverage (multiple product

selling)

Tracking privacy Personal goals alignment with corporate goals

Morale

Conclusion

• DHL already established themselves and holding the third largest logistic company in the world

• Based on all the strategies matrix above, will be able to aid DHL future performance and overtake their competitors

THANK YOU