FREDERICK W. SMITH

August 11, 1944 marks a special day in history, not because a local, tiny hospital recorded another birth at their facility, or that the humble little town in Marks, Mississippi added another “member” to their thriving population of about 1,500; it marks a day when a little boy, born of modest means, would grow and learn how to make an honest dollar and eventually lead the corporate world, through savvy business relationships and exemplary leadership practices, to a place never before thought possible, the place of overnight logistics with next-day, on-time delivery.
Frederick Wallace Smith, the son of a successful businessman, grew up in a tiny town in rural Mississippi. His father, James Frederick Smith, owned a chain of restaurants known as Toddle House; he also owned Smith Motor coach Company (renamed the Dixie Greyhound Lines after the Greyhound corporation bought a controlling interest in 1931). Fred Smith’s father died, however, when the boy was only 4 years old, leaving him to be raised by his mother and uncles. –Kouzes and Pousner (Kouzes, 2003) Now, some may say that the longstanding legacy of hard work, honest business practices and sound leadership ethics died with the passing of Smith’s father; I, however, beg to differ. I believe that the young Fred Smith, despite his early age, saw a man of character and a leader in his father who, in his time, helped shaped the face of fine dining and cross-country travel the way we’ve come to know it today. All of this was not accomplished overnight though and not without years of toil and sweat, trial and error, and a few hard- knocks along the FREDERICK W. SMITH

way. “Smith attended Presbyterian Day School in his early years and later finished High School at Memphis University School. He entered Yale University in 1962 and while a student there, wrote a paper for his Economics class, wherein he outlined overnight delivery service in a computer information age. Some rumors suggest that he received his usual “C” grade, while others claim Smith has stated that in order for him to receive a better than “C” grade, his professor told him, “the idea would have to be feasible”. -CNN
Little did Smith’s professor know that this idea would turn out to be a $25 billion dollar company with almost 300,000 employees!
Back in 1971when Fred Smith took the reins of a failing logistics company formerly known as FDX until the year 2000, he had some big ideas for promoting growth and change. Utilizing the leadership and management he’d received from prior business ventures was a definite asset, however, he credits his years as a United States Marine as the most influential and developmental in the force-shaping of FedEx as we know it today.
During his time as a United States Marine, Smith, who had served with various air crews, was often in a position where he could analyze Marine Corps logistics, both from the air and on the ground where he studied the movement and tracking of mail, supplies, and other viable Military assets. It was here where Smith began exploring the avenues of swifter and more efficient logistics possibilities and time-

FREDERICK W. SMITH

effective ways to create them. Already a master at commanding troops, Mr. Smith began to assemble a plan where he could employ his vast leadership skills, combine them with a worldwide logistics idea and serve the entire home delivery and business world overnight. -CNN
Frederick W. Smith, CEO of Federal Express, a shareholder company, attributes the success of the Fortune 500 Company to his employees. He steadfastly maintains a “we” concept in all of his communications and states that, “no man can do it alone”.
-Frederick W. Smith.
His number one key to success in any business, however, no matter how large or small, is leadership. Leadership, Smith says, “is easy”. A leader’s willingness to place the welfare of others before his own can have rippling and positively resounding effects felt by all who are under the purview of such and is one of many sound principles outlined in Smith’s core values. In fact, leadership plays such a huge and vital role in the success of the FedEx mission that Smith has developed a leadership program called LEAP. The Leadership Evaluation and Awareness Process is a program tailored for every level of the organization. “It was implemented to improve leadership effectiveness and retention within FedEx and clearly shows Mr. Smith’s commitment to excellence in leadership. The purpose of LEAP is to evaluate a candidate’s leadership potential and ensure that the individual carefully considers his or her interest in, and aptitude for, leadership. This ensures that all management levels are properly prepared to lead and understand the FREDERICK W. SMITH

company’s position. It is also compulsory for any employee who wants to progress to management-level positions within the company”. Kouzes and Pousner (Kouzes, 2002).
Around 2005, Smith, in his seemingly infinite wisdom, decided to implement, through his progressive Human Resources departments, a Rewards Program wherein FedEx recognizes and rewards the contributions of his team at every level of the organization. These rewards and benefit account for 50% of FedEx spending. They include: 1. Salary increases- based on individual performance 2. Variable Pay- incentives to reward individual and team contribution 3. Tuition Assistance- subsidy for continuous learning and education 4. Paid Time Off and Vacation- includes paid leave for marriage maternity and paternity 5. Retirement Scheme- Financial security in retirement 6. Health Insurance- 7. Life and Accidental Death Insurance-financial protection for beneficiaries 8. Reduced Shipping Rate- Exclusive discounts for personal shipping 9. Discounted Travel- Discounted airfares 10. Jumpseat- Free travel on FedEx aircraft -Kouzes and Pousner (Kouzes, 2003)

FREDERICK W. SMITH

The aforementioned benefits and rewards are only a few examples of the many wonderful perks FedEx offers to its employees who strive to produce excellence in logistics on a daily basis and as a proud FedEx employee, I must say that after researching many other top-rated civilian businesses and corporations’ benefits programs, many of them pale in comparison.
Another critical aspect in the development and maintenance of a successful leadership program is Delegation. In Smith’s own words, “ You cannot do it alone, so you must work well with others to put your plan into action. This means hiring the right people and trusting them to do their jobs once you hire them; it also means persuading, motivating and even inspiring these people. Delegating authority is a result because you will not be able, or perhaps even qualified to make all the decisions”. – Frederick W. Smith
Employee morale, in any organization, is paramount, and in most cases, the life-blood of its success. Smith recognizes this, so every April, an SFA, or Survey Feedback Action analysis is conducted, wherein each and every employee at every organizational level participates in an online survey, exclusive to FedEx, which gives the employees an opportunity to express their opinions of management’s leadership performance. Results are tabulated, and managers then hold feedback sessions to discuss the survey findings and identify problems within and outside their department. As a group, they develop formal written action plans for solving these problems. Groups usually review plans throughout the year to determine whether FREDERICK W. SMITH

problems were solved successfully. SFA has become a problem-solving tool that operates throughout the organization. If employees still have a complaint with the management, they can take advantage of the respected and benchmarked grievance system, Guaranteed Fair Treatment (GFT). The program provides three levels of managerial review and appeal for employee grievances, including an ultimate review by Smith and other top corporate officers. –Kouzes and Pousner (Kouzes, 2003)
It is no secret that since the beginning of time man has taken risks of all varieties. It is an innate to our nature, and many times, determines the success or failure of our ventures. Some believe that with great risks come great rewards, others are content to stay in their comfort zone and not bet the farm, or, color outside the lines. Whatever the case, whether by calculated, well-informed decision-making, Divine intervention, or just plain dumb luck, some folks still manage to always land on their feet, while others lose everything. Some are able to recover and use the lessons learned approach as a launch pad to propel them forward, and others never recover.
Knowing this, Mr. Smith, not afraid of failure, decided back in 2002, to launch a program called Zapmail, a program to electronically transmit documents between FedEx offices. The idea, to put a fax machine in every office, would radically reconfigure the center of their network, thus slashing costs. The idea failed. Two years later and hundreds of millions of dollars lost, FedEx pulled the plug on Zapmail, allowing it to vanish without a trace. Kouzes and Pousner (Kouzes, 2003)

FREDERICK W. SMITH

“I’m not afraid to take a swing and miss”, Smith told me in a recent interview. –Frederick W. Smith.
It has become increasingly apparent to me throughout my last ten weeks in this amazing, informative, and highly enlightening Leadership course, combined with my interview with Mr. Smith, that leadership is a critically important, multi-faceted, and sometimes extremely convoluted process. It is one that requires, among other things, patience, wisdom, foresight, the ability to remain flexible, yet firm, trust, vision, commitment, integrity, and strong communication. Ethics, in my opinion, however, plays the most crucial and vital role and is, without a doubt, the foundation, upon which, anyone and everyone must build his/her life or business. It simply must be our center and the core of our very existence. Being an ethical leader is something that requires us to conduct great personal inventory and an honest evaluation of our every interaction. You, Mr. Martin have elicited a heightened sense of my personal ethical awareness; you’ve been the cause of my recent introspection and frankly, brought about a positive change in, not only my business dealings, but, more importantly, the communication aspect in my relationship with my wife and daughter who, besides God, are more important to me than anything else.
I believe that Abraham Maslow had it right when he developed his hierarchy of needs, which seems to encompass most all of the leader/follower core basic

FREDERICK W. SMITH necessities. Beginning with Self Actualizing Needs, employees are given the latitude to perform to their full potential and to be creative while having complete control over their jobs. Esteem Needs are equally important because employees feel appreciated and their performance is rewarded through monetary recognition, among other things, and the opportunity for advancement. Social Needs, for those requiring such, present a unique opportunity for employees to enjoy organizational based social interaction and encourage camaraderie. Safety Needs are, what I consider to be, the basic safety net we all require to operate above and without which, walking the employment tightrope, at least by today’s standards and given our current economic condition, could spell peril for those unequipped. Physiological Needs are most certainly a necessity where breaks, adequate pay and working conditions are concerned. They help fulfill employee expectations and ultimately contribute to a better work environment.
Charismatic and Transformational Leadership encompasses, in my opinion, all of the basic core qualities an organizational leader must possess in order to be an effective leader. This ingenious, 10 step process, if followed correctly, is, I believe, not only a recipe for success, but, THE recipe for success in any organization. It contains all of the necessary ingredients required to make the near perfect “dish”. “Both

FREDERICK W. SMITH

leadership types are good at knowing what (facts) followers need to know, when(timing) they need to know, who(appropriate audience) needs to know, and where(media choice) the information needs to be for access. –Leadership. Theory, Application, and Skill Development 5 e Lussier/Achua. Pg. 337

CONCLUSION In closing, it is my firm belief that without the inclusion and earnest application of the sound leadership principles learned over the last 10 weeks via our gracious instructor and our text, we as leaders interrupt the cycle of influence and render ourselves ineffective to our followers.
Frederick W. Smith exemplifies, in my opinion, many of the qualities and attributes requisite to the success of, not only FedEx, but to any business, regardless of the magnitude. Mr. Smith had, as a young man, a vision of creating a world-wide logistics empire that would service the needs of millions globally, incorporated the wisdom learned from other visionaries, combined it with a strong sense of ethics, has become the embodiment of the type of leader I strive to be, and is someone, for whom, I am proud to work.

FREDERICK W. SMITH

CITATIONS

* -Leadership Theory, Application, and Skill Development 5 e Lussier/Achua. Pg 337 * CNN * Pouzes and Kousner (Kouzes, 2003) * Frederick W. Smith