Question

Decision Making Technology at UPS

Regardless of the specific decisions a manager makes, the decision-making process is either programmed or nonprogrammed. Programmed decision making is a routine, virtually automatic process. Programmed decisions are ones that have been made so many times in the past that managers have developed rules or guidelines to be applied when certain situations inevitably occur. In programmed decision making, managers do not need to repeatedly make new judgments about what should be done. They can rely on long-established decision rules that can be developed to regulate all routine organizational activities. Nonprogrammed decision making is required for nonroutine decisions, in response to unusual or novel opportunities and threats, and when there are no ready-made decision rules that managers can apply to a situation.

Programmed decision making occurs when managers have the information they need to create rules that will guide decision making. There is little ambiguity involved in assessing when the stockroom is empty or counting the number of new students in a class. Companies like UPS have found that effectively using technology is essential to reap the benefits of programmed decision making.

Read the case below and answer the questions that follow.

UPS is unrivaled in its use of programmed decision making. In 2013, the company developed software called ORION which stands for On-Road Integrated Optimization and Navigation. This is the company's mapping software that determines the most efficient way for drivers to complete their routes. While this software was successful and made programmed decisions easier, in 2015, UPS went on to develop EDGE, which stands for Enhanced Dynamic Global Execution. This is comparable to ORION in that EDGE software uses real-time data to optimize the company's inside package operations and ORION focuses on its on-road operations. By the end of 2018, the company plans to have EDGE fully deployed where it expects to generate $200 to $300 million in annual savings and cost avoidance.

Chief Information and Engineering Officer, Juan Perez, has described how UPS uses a variety of technology and data to boost efficiency. He says it takes a lot of data and computer power to do this effectively, efficiently, and consistently. The company has the right IT people, the necessary computer power, and the data to increase volume growth and maximize its profits. Another example of the company's solid technology strategy is through My Choice where its operational technology is connected to the company's drivers and to its Access Points.

UPS is also working with Artificial Intelligence (AI), a new data-driven technology that Mr. Perez is excited about using. This type of technology is integrated with the drivers’ handheld devices as well as the supervisors’ mobile devices to help them all make better decisions that meet customers’ needs and preferences. More and more customers want to customize their delivery preferences, and UPS is here to do just that!

Clearly, by using technology, UPS can shift from offering mass services to customized services that are tailored to its patrons. EDGE helps the company share real-time data across operations to improve real-time decision-making. UPS uses data to locate all operations assets instantly, and mobile tools in its operations to ensure the team is provided with real-time information to optimize its operating plans and reduce costs. UPS prides itself on the fact that EDGE makes its logistics network smarter.

By using this technology in its customer service centers, on its websites, and on its mobile data apps, along with many other technologies that UPS is consistently implementing, Artificial Intelligence will make it easier for UPS customers to get questions answered while ensuring programmed decisions are made efficiently and effectively.

Sources:

“Technology Driving Efficiency, Customer Experience.” UPS Pressroom. Accessed Aug. 2018.

“UPS Facility Technology Wins Prestigious Innovation Award.” UPS Pressroom. Accessed Aug. 2018.

Woyke, Elizabeth. “How UPS Delivers Faster Using $8 Headphones and Code that Decides When Dirty Trucks Get Cleaned.” MIT Technology Review. Feb. 2018.

The use of programmed decision making at UPS

Multiple Choice

• helps drivers manage the uncertain and unexpected demands on them.

• requires constant revisions to the rules.

• is only employed occasionally.

• is a trivial concern for managers.

• is a major component in organizational culture.

Answer 1

The use of programmed decision making at UPS

- helps drivers manage the uncertain and unexpected demands on them.

Programmed decision making is done with help of information and data collected using technology and then providing solutions based on efficiency and effectiveness based on the defined method of performing the task or delivery.