Starting a logistics revolution? FedEx collaborates with Microsoft

The two firms want to combine their world-leading might to 'revolutionize commerce'.
22 May 2020

FedEx is on a route to digitize its business model. Source: Shutterstock

  • FedEx launched an autonomous delivery bot last year in collaboration with local merchants
  • FedEx and Microsoft’s partnership will see enhanced visibility to the delivery and shipment route
  • Microsoft’s suite of advanced AI and cloud technologies are key to fulfilling FedEx’s goal of enhancing their courier delivery services 

With the accelerated development of autonomous driving technology and air-mobility taking off with some unique collaborations announced this year, like the partnership between Hyundai and Uber wanting to bring flying taxis to the skies, global logistics solutions are on the path to a revolution. 

Early this year, United Parcel Service (UPS) unveiled their plans to purchase 10,000 electric-powered delivery trucks from UK-based Arrival, adding on to their preexisting fleets in Europe and North America. Simultaneously, Waymo was enlisted to help UPS deliver packages in suburban Phoenix with self-driving minivans. 

Meanwhile, rival FedEx is also making progress in this sphere by incorporating next-gen technologies to supercharge their delivery services.  

Playing catch up to advance their global courier delivery services, FedEx has also been experimenting with autonomous technology as well, marked by their launch of autonomous delivery bot last summer.

Aware of the appeal and popularity of same day delivery services to consumers, FedEx has collaborated with companies that include Pizza Hut, Target, and Walmart to cater for customers living near these retailers. 

FedEx’s press release states: “On average, more than 60 percent of merchants’ customers live within three miles of a store location, demonstrating the opportunity for on-demand, hyper-local delivery.”

The FedEx SameDay Bot is designed to help local retailers meet the rising expectations of their customer base. With delivery destinations in close proximity, the circumstances provide a perfect opportunity for the delivery giant to trial and enhance their last-mile autonomous delivery bots. 

The FedEx bot even guest-starred in NBC’s The Tonight Show Starring Jimmy Fallon, as seen in the clip below.

FedEx’s innovation train doesn’t stop here as the delivery giant recently announced a multi-year technology and logistics partnership with tech titan Microsoft.

Chairman and CEO of FedEx, Frederick W. Smith said, “Together with Microsoft, we will combine the immense power of technology with the vast scale of our infrastructure to help revolutionize commerce and create a network for what’s next for our customers,” as reported on Microsoft’s news page.

The partnership sees FedEx combine its global digital and logistic network with Microsoft’s intelligent cloud computing and artificial intelligence (AI) capabilities. 

The solution, named FedEx Surround, aims to leverage data to enhance their existing services.

As the pioneer of package scanning and tracking more than four decades ago, FedEx plans to introduce near-real-time analytics into shipment tracking, pushing for more precise logistics and inventory management.

Presently, shipment tracking is limited to only several updates of a package’s journey, but FedEx Surround aims to provide close to real-time updates such as a package’s arrival in a particular ZIP code.  

As a result of such granular updates on shipment tracking, the courier delivery company can leverage this capability to bolster highly time-sensitive deliveries, tapping into new market avenues. For instance, the delivery of medical freight will be more secure as visibility in tracking is enhanced.

Any business with a supply chain will be attracted to this feature, including when manufacturing facilities find themselves in need of a replacement part or a machine to be delivered rapidly to avoid a complete operation shutdown. 

This added visibility in delivery tracking will foster a high level of trust and confidence among businesses and customers as their near-real-time updates can be accessed. 

In the bigger picture, FedEx can expand the enhanced tracking system to their international deliveries.

With data collected from a multitude of IoT (internet of things) devices, FedEx can utilize Microsoft’s array of AI, machine learning and analytics solutions to analyze the troves of data.

Churning them into valuable insights, the logistic giant can provide participating businesses with enhanced knowledge of global commerce conditions and challenges happening in near-real-time. For instance, delay in shipment due to “severe weather or natural disasters, mechanical delays, clearance issues, and incorrect addresses.”

“This unprecedented level of data-driven insight will give FedEx Surround customers the opportunity to intervene early and act to avoid logistical slowdowns before they occur to reduce friction and costs,” the announcement notes.