Risk assesment techniques in industrial organizations - Management Analysis of Risk in DHL International GmbH

1.CONTEXT IDENTIFICATION

1.1 GENERAL DATA

DHL is a firm that provides international package delivery, courier, and mail services. The founders of DHL were Adrian Dalsey, Larry Hillblom, and Robert Lynn, who founded the courier company in 1969 in San Francisco, California. The company's headquarters are in Bonn, Germany.

Aid & Relief Logistics, Marine Logistics, Perishable Logistics, Wine & Spirits Logistics, Go Green Solutions, Special Expertise, Medical Express, Bicycle Courier, and many others are among DHL's primary products and services.

DHL's annual revenue in 2020 is expected to be 72,413 million dollars, according to estimates. The corporation made a profit of 2840 million dollars from this. However, the courier company employs around 571,900 people around the world to run its operations.

FedEx, UPS, Royal Mail, CEVA Logistics, USPS, DACHSER, Planzer Transport, and others are among DHL's main competitors.

This paper examines the concept of risk assessment regard to DHL Express, a wholly owned subsidiary of Deutsche Post AG that completed a 100% acquisition of the company in 2002. DHL Express operates in over 220 countries and territories, making it the world's most worldwide company (Deutsche Post DHL, 2013a). According to Deutsche Post DHL (2013a), the corporation employs 475,000 people in over 220 countries, providing a wide range of services to customers ranging from parcel delivery to cargo delivery, with a focus on both 'Business to Business' and 'Business to Customer' customers.

1.2.VISION AND STRATEGY

The company's vision is to become The World's Logistics Company.

They want to be the logistics company that people turn to — the first choice for all shipping needs, as well as employment and investment opportunities, and the global benchmark for responsible business practice.DHL plans to do so by revolutionizing the logistics business and striving to exceed client expectations. DHL's mission is to be the world's first choice for logistic services by leveraging scale and experience, according to their mission statement:

- “We want to simplify the lives of our customers”;

- “We make our customers, employees and investors more successful”;

- “We make a positive contribution to the world”;

- “We always demonstrate respect when achieving our results”.

DHL's strategy is to pursue three primary objectives in order to realize its vision and mission statements:

- To become the provider of choice for customers;

- To become the employer of choice for our staff and prospective employees;

- To become an attractive investment for shareholders.

"Strategy 2025 - Delivering excellence in a digital world" is building the groundwork for the world's largest logistics firm, Deutsche Post DHL Group, to maintain its successful growth trajectory. The company's core logistics businesses will be focused even more systematically on capturing the sustained potential for profitable long-term growth. It will also accelerate the Group's digital transformation, which is already ongoing across all business segments.

Their Mission: Excellence. Simply delivered

They accomplish their mission with excellent execution along the three bottom lines in a sustainable way:

- Employer of Choice

Motivated and skilled employees deliver exceptional quality.

- Provider of Choice

Exceptional quality delights the Customers and leads to loyalty.

- Investment of Choice

Customer loyalty leads to profitable growth.

Strategy 2025 in numbers:

- Investing EUR 2 billion cumulatively through to 2025 in digitalization to enhance customer experience, to improve employee experience as well as increase operational excellence

- Expecting a yearly run rate benefit of at least EUR 1.5 billion by 2025

1.2.2 STRATEGIC PLANNING

Management may utilize a variety of strategies to improve strategy formulation, including the BCG Matrix that is often used in strategic planning of a company.DHL's top management is responsible for formulating the strategy that is used to position the firm to take advantage of future commercial prospects as a courier and logistics organization. Other difficulties that the organization's management must resolve include determining whether the organization needs to enter new markets, determining which products are worth investing in, and determining which products or markets should be exited. These strategic decisions will have a direct impact on DHL's logistics as a firm. The BCG matrix's four quadrants, which comprise the Star, Dog, Question mark, and Cash Cow, may be used to analyze the company's product and market mix.The BGC matrix compares the market share of the strongest competitor to market growth statistics as its environmental component and relative market share as its corporate component. A product that is regarded as dog will not be worth investing by DHL because their mission is to be an attractive company for investors to invest in and to be the employer of choice for the talents.

However, many organizations have several product portfolios that have the presence of a dog on them, and many organizations would like to keep such product, perhaps for strategic reasons, or perhaps because it is the product that the organization started with, and they believe it would be unappealing to discard such product.

A star is a market or service that DHL must nurture and develop; these products must have the potential to become cash cows, and their growth feasibility is easily discernible. If not properly managed, a star product can devolve into a liability for the organization. As a result, adequate funding must be set aside to ensure market or service stability. In questionable markets or services, the organization should select only products with potential and use cost-cutting measures to promote them. For example, in order to maintain customer and supplier relationships, the most cost-effective approaches should be used, while inventory management and valuation must be meticulously carried out.

1.2.3 VISION AND OBJECTIVES

In 2014, the company's key aim was to enhance profitability and create cash, and to guarantee that these goals were met and that no deviations occurred, progress on these goals was assessed on a regular basis using financial ratios, which serve to measure and control performance .DHL's main competences include worldwide air and ocean freight, bespoke logistics solutions, and project forwarding, all of which are supported by world-class information technology systems and e-business solutions .These core competences are founded on personal dedication and commitment, proactive solutions, and global local strength, all of which are employed by the organization to set itself apart from competitors . DHL stands out from the competition because of these qualities.

DHL is divided into four primary divisions: mail, express, global forwarding and freight, and supply chain. Each division develops business plans that are supplemented by Group-wide strategic initiatives that help to accomplish these aims. Since the organization intends to be the first choice for international logistics and courier services, the company's corporate strategy is based on its mission and vision. This strategy consists of six main components that are interconnected, namely:

- To increase customer focus;

- To improve on its capabilities by strengthening its local strength in countries where it is present and driving innovation by developing new products;

- To attract, develop, and retain talent;

- To drive efficiency relentlessly: and

- To be socially proactive