Planning the impact of fog, snow and rain at UPS to prevent delivery delays

A Wall Street Journal article (Dec 23, 2011) describes the 120 million packages delivered by UPS in the week of Dec 25, with late shipments creating costs between $5 and $ 30. UPS claims that its monitoring of the weather and rerouting have saved 1 million packages and $ 20 million in revenues.  One main concern is fog – which usually rolls in about the time that the cargo planes land.  Should delivery guarantees to customers be linked to weather to decrease the costs faced by express delivery companies  ? Given the differential impacts of weather across trucks and airplanes – how should the transport modes be changed to compensate for weather patterns ? Should pricing for delivery across modes be adjusted by time of year and weather pattern to better reflect delivery costs ?

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About aviyer2010

Professor
This entry was posted in Operations Management, Service Operations, Supply Chain Issues and tagged , , , , , , , . Bookmark the permalink.

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