Laura Stevens, A Test for UPS: One Day, 34 Million Packages, In Wake of 2013 Christmas Snafus, High-Tech Upgrades Made to Handle Deluge, Wall Street Journal, Dec. 21, 2014.
United Parcel Service Inc. all year has been focused on one day above the rest: Monday Dec. 22, when it will deliver 34 million packages, more than any other in its history.
It is a big test for the delivery giant after last year’s embarrassing and costly holiday debacle in which millions of packages didn’t arrive in time for Christmas. To avoid a recurrence, UPS has spent about $500 million preparing for the holidays with projects including automated sorting systems to rapidly identify ZIP Codes and swiftly reroute packages in the event of bad weather.
That automated system—known as its “Next Generation Sort Aisle”—is now operating at three hubs around the country. The new technology scans packages and quickly flashes instructions to workers so they can process 15% more packages a day, or as many as 47,000 parcels an hour, as measured at one of the hubs.
Rosemary Etheredge, who has worked at a UPS facility in Atlanta for 10 years, used to have to memorize more than 120 ZIP Codes to determine how to route a package among a complex system of chutes and belts.
Now Ms. Etheredge moves a parcel under a bar-code scanner, after which there is a loud beep and the name of a color-coded chute where the package needs to go is projected on a metal beam overhead. “For new employees, it is much better,” Ms. Etheredge said. “That’s a lot of ZIP Codes to remember.”
Home delivery from online shopping has been a drag on UPS profitability in the U.S. And with e-commerce soon to account for half of all U.S. packages, the company is trying to automate and digitize its operations to boost profitability and improve productivity of its more than 400,000 global employees, while reducing the over $500 million it spends a year training those workers by simplifying their tasks.
The sorting system has transformed hundreds of skilled UPS jobs at sorting facilities to unskilled ones. UPS says it doesn’t change wages, but allows the same number of workers to handle more volume.
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