Transportation
A Comparision of Maclomn Mclean and Fred Smith.
According to the Wikipedia Encyclopedia, “Transportation is the movement of people and goods from one place to another”. It is a means through which goods get to the market. It is how people and goods move from one place to another. It is actually the key of survival for the industry and trade of today’s world.
There are different ways through which people or things travel from one place to another. It is through different modes of transport that a thing or people reach a destination and travel across a distance. For example, to cover a distance through land, rail transport is used. So, to cover the distance through land, air, road or water different vehicles are used. When two means or modes of transport are merged, it is called “inter modal transport”, which has a great importance and a very beneficial impact on world economy. In fact, in today’s fast paced world, it has not only helped in transporting a bulk quantity to a far off distance but it also promises swift delivery.
In this context, two giant names appear in the business world that is Malcolm McLean and Fred Smith who are actually pioneers of “inter modal transport” system. Both have introduced and have setup a new system of transportation, but their ideas are different and unique in their own ways. Malcolm MacLean has used the idea of transporting “trucks through sea” and for the first time has introduced containers for this purpose. On the other hand, Fred Smith merged the “air-ground system”.
To know how they both captured the achievement that they have today, it is important to know how they started and ended up where they are today.
Mclean was a “truck driver who reinvented shipping”, and it was in less than fifteen years that he bought the largest cargo shipping business in the world. The idea of transporting trucks on ships was not a new one. During World War II, this was a practice and it was in the early 1950’s that McLean decided to attempt it. With his only truck, McLean converted it into 1770 trucks and 32 terminals, making it the second largest trucking company in the United States. On Jan, 6, 1958, McLean trucking became the first trucking company in the nation to be listed on the New York stock exchange.
In 1969, R.J Reynolds purchased the company for $160 million. McLean’s Sea land industries ltd. 27000 trailer type container, 36 trailer ships and it had an access to every 3 port cities. By the end of the century, container shipping was transporting roughly “90% of world’s trade cargo”.
On the other hand, Fred smith started his business in 1970 by purchasing an aircraft maintenance company Ark Aviation sales. In 1970, he returned his focus to trade used jets. FedEx express was founded in Jan 18, 1971. it was built with Fred’s $4 million inheritance amount but it helped to raise $91 million in venture capital. His real focus was to develop an integrated “air-ground system” that was never actually experimented before. Now because of FedEx, companies do not have to deal with multiple suppliers to ship documents, parcels and large loads. They find all this integrated and have the conveniences to find about the material at any time. So, from 1973, it started offering services to 25 cities and with a fleet of 14 falcons 20 Jets. Today FedEx gives annual revenue of $30 billion, has more than 250,000 employees, 600 aircrafts and 70,000 surface vehicles. It handles approx. 6 million shipments a day in 200 countries.
Hence, both Malcolm McLean and Fred smith are great innovators who helped to restructure or reinvent an industry. They merged two modes of transportation and opened vast “possibilities in inter modal transportation”. It was only because of this that FedEx was one of the top ten of America’s Most Admired Companies by Fortune Magazine and McLean was inducted in the fortune magazine Hall of Fame.
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