分类: 商业沙龙 |
Roger Frock, one of the founders on the executive team and
previous COO of FedEx, gave a surprisingly interesting talk
yesterday at Ross school of business.
I like stories, especially legendary business stories. And
Rodger is really a story-teller that reveals one story after
another. The stories were all about Federal Express, from a risky
start-up to a household name. However, such remarkable journey will
not be alone, although not many companies can ultimately become an
800 pounds giant as FedEx does, with annual revenue of $30B and 600
airplanes.
Fred Smith, the founder of FedEx, was a Yale graduate,
ex-pilot, Vietnam veteran, and a new entrepreneur. Fred has worked
on his business of trading corporate jets and made his
profit. Fred proposed to the Federal Reserve that
he can use aircrafts to ship bonds between reserve branches and the
central, and based on this proposal, Fred named his new venture,
Federal Express.
However, Federal Reserve turned down his proposal. Not
intimidated, Fred developed an innovative idea of using small cargo
airplanes for priority delivery, and he had foreseen that the
hub-and-spokes model was the only feasible system that could
deliver packages within a reasonable time frame, and of course,
with limited airplanes.
Fred is never just an idea developer, instead he is a person
that believes in his ideas and make them happen. One day, in 1971,
Fred came to A.T.Kearney for help. And Roger was in a supervisory
position at A.T.Kearney and has many years experience in consulting
in the aviation industry. A lot of experts at the
time shadowed doubts on FedEx's business model, as the costs of
operating and the risks of hitting the ceilings of aviation
regulation were so high. However, after scratching the surface,
Roger raised his interest in the venture. Roger outlined the
operating plan and wanted to help Fred seek after a general
manager. Fred said "why don't you just come here and make it work?"
Wow.
In last evening's talk, Roger told a story that propelled him
making the move. At the beginning, Roger didn't seriously consider
Fred's offer because Roger had everything to lose but too much risk
to gain. On a weekend when they were at a party, a gunman broke in
and asked everybody for money. Everyone gave his cash. Fred said to
the gunman, "stay cool, we will give you the money, and no one gets
hurt". Fred handed the only dime he had. As Roger recall, the
gunman seems to be on his first week out and his hands were shaking
so there was a quarter feel off. As the gunman collecting from
others, Fred calmly picked up the quarter and put it into his
pocket, which make him end up making a profit :)
Anyway, Roger saw the courage and the leadership in Fred, and
joined FedEx as its first COO.
The start-up journey of FedEx is nothing but difficulties. One
of the most legendary stories is that FedEx had to pay the fuel
provider on next Monday, but on Friday night there was almost
nothing left on their accounts. Then on the Monday morning when
Roger came to office, he was so surprised to find $27,000 showing
in FedEx's account. So he asked Fred where the money came from.
Fred said that on Friday the General Dynamics refused his plan, so
Fred was angry and went to Las Vegas. Then, guess what, he had good
fortune and made $27K back, which saved FedEx! Roger believed that
storied was true, but regardless whether it is purely an anecdote
it demonstrated the falter of FedEx in its cradle.
One inspiring note Roger made was that to be a true leader and
entrepreneur you have to stand up to voice yourself in some very
unfavorable situations. At one early point, the investors of FedEx
controlled the board, and they wanted to replace Fred with another
CEO. However, Fred was a charismatic leader and almost every idea
that he argued with the board turned out to be on his side later at
some points. Roger and another executive member decided to stand
up. They said to the board "If Fred goes, we go!" Eventually, the
board gave up, and the FedEx was again back on track from yet
another verge.
I got Roger's book: "Changing How the World Does Business:
FedEx’s Incredible Journey to Success - The Inside Story" after
his talk. I am still immersing myself in the numerous stories of
last-minute saves and turnarounds. It is like sipping the
entrepreneurialship out of the success journey of FedEx, one of
most admired company of America.
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