November 22nd, 2005
UPS: Driving cost savings by eliminating left-hand turns
UPS does IT on a very large scale: $1 billion in IT spending this year, nearly 5,000 IT staff, 384,000 employees, 15 mainframes, 8,700 servers, 250,000 PCs, 2,700 networked sites, 474 terabytes of storage, 500 applications, 10 million tracking requests per day, 88,000 vehicles, 90,000 handheld devices and the 9th largest airline. The massive array of technology and personnel is all focused on delivering more than 14 million packages a day across 200 countries. Last week I interviewed UPS CIO Dave Barnes [Watch the video] about managing IT on such a large scale and getting a return on tech investments.
UPS CIO Dave Barnes shows me the latest DIAD (Delivery Information Acquisition Device). The actual units are brown, of course.
Barnes, a 29-year veteran of UPS who started sorting packages while in college, told me how UPS expects to save $600 million per year through package flow technologies, which will enable a reduction of 100 million travel miles in the U.S. alone, which equates to 14 million gallons of fuel, he said. The package flow optimization includes constant wireless communications via the DIADs, smart labels (including RFID in the future) and preloading vehicles and directing drivers according to advanced analytics that calculate the most efficient routes, including avoiding left-hand turns, based on the package load.
Dan Farber, editor-in-chief of CNET News.com, has more than 20 years of experience as an editor and journalist covering technology. See his full profile and disclosure of his industry affiliations.
