Adam Smith worked for one employer, FedEx, for almost a quarter of a century.
But for the past 50 years, and for most of Mr. Smith's tenure, FedEx itself has not operated as a single business. The shipping company's various operations (FedEx Ground, FedEx Services, FedEx Express, etc.) were all managed independently. His IT leaders in these business units were given autonomy to seek unique technology solutions that best fit the specific service offerings they provided to their customers.
Businesses were to “compete collectively, operate independently, and manage cooperatively.” Revenues have increased, but technology has also become more complex.
That's changing as Mr. Smith and other executives rethink what it means to be “one FedEx.”
“What we're really focused on right now is how do we as a company leverage technology and data to become more efficient and efficient and how do we support our customers,” Smith said. speaks. He started his career at FedEx in 2001 as a senior programmer analyst, then served as director and vice president before becoming CTO in April 2020.
That led FedEx to look anew at the technology that can help deliver packages as they zigzag across the roads and skies. “FedEx has a whole lot of technology in it,” Smith says.
By June, FedEx's express, ground and service divisions will be combined into Federal Express Corporation. FedEx says a more efficient and intelligent network will be better able to deal with curveballs such as severe weather by altering volumes within different business units when a storm hits. Smith is also streamlining vendor relationships and rethinking technology systems that were developed separately by different departments.
One visible example is the handheld devices used by couriers to track parcels sent by courier or ground. Previously he had two different devices developed. One is to ensure delivery is delivered at the exact time by the next day, and the other is a completely different device designed to track deliveries up to a certain number of days. FedEx currently uses a single handheld device for both types of deliveries.
FedEx last year announced a goal of reducing costs by $4 billion by the end of fiscal 2025 under its new “One FedEx” integrated delivery model, and technology integration is key to achieving that goal, including improving the efficiency of technology supporting back-office functions such as legal, finance and human resources.
Another way FedEx wants to become more efficient under a single entity is by making data more easily available and shared. “We have a lot of data that we've collected over the years,” Smith says. “How can we leverage that data and make it available to our customers?”
The data can help FedEx share more detailed information about delivery timing and improve supply chain management for large customers. This is accomplished through technology such as FedEx's photo-based proof of delivery tool. Launched in 2022, the tool sends customers a photo showing their exact location once the package is delivered to their address.
Smith said the proof of delivery feature was made possible because of FedEx's commitment to the cloud. FedEx works closely with Microsoft Azure, but also has some workloads with Google and Oracle. FedEx aims to close all of its data centers and eliminate all of its mainframe computers by the end of this year, saving $400 million a year.
Automation presents new technology opportunities for Smith. He envisions future “dark docks,” cargo facilities that are humanless and use robots and other autonomous tools to load and unload pallets on trailers.
And then there's generative artificial intelligence. Smith categorizes these solutions into his three groups. The first is to leverage capabilities developed by his FedEx vendors, including Microsoft, Salesforce, and ServiceNow. The second is streamlining the work we do at FedEx, including making developers more efficient with tools like GitHub Copilot. Finally, generative AI could help him transform FedEx's core collection and delivery operations.
Smith said that for now, FedEx is “focused on the edge” of generative AI because the technology needs to mature a bit more before it can fully dive in. He's also casting a wide net and not locking in on any particular solution or vendor.
“There are so many things coming to market every day,” Smith says. “With all of these capabilities coming to fruition, it's a challenge just to stay on top of where the real opportunities are.”
John Kell
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P.S.: We'll be discussing AI and other topics at Fortune's annual invitation-only Brainstorm Tech Summit in July. Confirmed speakers include Jeff Dean, Chief Scientist at Google Deep Mind, Anthony Guarino, EVP of Global Production and Studio Technology at Paramount, and Susan Emerson, SVP of AI, Analytics, and Data at Salesforce. Interested in attending? Register here.
News Packet
CIOs are faced with the challenge of integrating project management software. Chief information officers looking to reduce the number of software vendors used within their companies are facing resistance from employees who don't want to give up their favorite project management tools, The Wall Street Journal reports. However, such tools can be expensive, with costs per user ranging from $12 to $45 per month. And while project management software vendors say differentiation and edged solutions are some of their selling points, CIOs still find it difficult for companies to negotiate discounts and avoid high integration costs. , you may find yourself favoring fewer vendors to reduce your cyber attack surface.
Microsoft announces Copilot for Teams. At this week's Build developer conference, Microsoft announced the new Team Copilot. It integrates with the tech giant's video conferencing app and helps you manage meeting agendas and take notes that all meeting participants can collaborate on. Team Copilot functionality will be available in preview mode later this year, with Copilot licenses starting at $30 per user per month. Copilot aims to help employees be more productive and improve workflows, but some companies have been cautious about how many employees sign up to take advantage of these features.
Palo Alto Networks' outlook points to a slowdown in cybersecurity services. Palo Alto Networks' lackluster fourth-quarter fiscal revenue outlook suggests customers are tightening budgets even in the face of rising attacks, raising new concerns about spending fatigue on cybersecurity services occurred. Analysts say Palo Alto Networks and its peers are facing weak firewall sales, while other product categories face intense competition resulting in shorter contract terms, Bloomberg reports. It states that
adoption curve
A recent study conducted by accounting giant KPMG found that although some hurdles remain, such as uncertain investment returns and regulatory compliance, companies are leveraging AI for financial reporting and auditing to reduce risk and improve risk. This technology is increasingly being deployed for data analysis, fraud detection, and predictive analytics.
Only 1 in 10 companies have widely implemented AI in financial reporting, but 72% are piloting or using the technology selectively, and 27% plan to do so. , says KPMG that within three years, nearly all companies will be using AI for financial reporting. Based on a survey of 1,800 companies.
The study showed that larger companies are more likely to be leaders in AI-powered financial reporting, with technology, media and communications being the three industries with the most adoption. industrial manufacturing. Energy, natural resources and chemicals. KPMG also found that AI accounts for 10% of his IT budget and is expected to “significantly increase” in the future.
job radar
employment:
– Theo AI, which uses predictive analytics to forecast the outcomes of legal disputes, is hiring a CTO based in the San Francisco Bay Area. Advertised salary range: $200,000 to $250,000 per year.
– Home furnishings retailer Williams-Sonoma is hiring a vice president of technology, security and compliance (CISO) based in San Francisco. Published salary range: $250,000-$300,000/year.
– Logistics company Brambles is seeking an IT VP for the Americas division, based in Washington. Published salary range: $271,000 to $406,000/year.
Recruitment:
– Cleveland Clinic has named Sarah Hatchett SVP and CIO, effective May 16, after serving in the role on an interim basis since August 2023. During her time at her clinic in Cleveland, Ms. Hatchett has led her IT integration of multiple hospitals that participate in the hospital system.
– StorMagic appointed Dr. Julian Chesterfield as CTO, having previously served in CTO and other technology leadership roles at companies including Xensource, Citrix and OnApp.
– Planet Home Lending has hired Bill Schuller as EVP and CIO to drive the company's technology growth and improve operational efficiency. Prior to joining Planet, Shuler served as President of WPS Advisors, LLC, providing consulting services to mortgage companies and private equity firms.
– Media.Monks has appointed Laurent Farci as CIO. In his new role, he will be responsible for technology platform integration and standardization.
– International Media Investments has appointed Dr. Craig Martell as CTO. He brings 20 years of experience to his IMI, including as chief digital and AI officer for the Department of Defense and group CIO for his MultiChoice Group.
– Sanctuary Wealth names Robert Coppola as CTO, who will report to CEO Adam Malamed and hone the company's digital strategy around new solutions, including AI.
