Putting People First
By Michael Katz
Forest King couldn't believe the scene. Dozens of Federal Express employees were cheering as he and his wife stepped out of the chartered Boeing 747 airplane. King had come to Memphis with other Flying Tiger employees, whose company had recently been bought by Federal Express, to see if he wanted to relocate. The welcome, complete with a red carpet and a welcoming committee that included the mayor of Memphis and FedEx's CEO, was King's introduction to this unusual company.

According to King: "It seems to me that when another company takes you over, they are not necessarily obligated to give you a job in the first place. But everyone - and it was communicated in a memo and later in video - was offered a job."

CEO Fred Smith's "people first" management style can be summed up by one of FedEx's slogans: "People, Service, Profit," or "P-S-P. "Take care of our people; they, in turn, will deliver the impeccable service demanded by our customers, who will reward us with the profitability necessary to secure our future."

And FedEx does take care of its people. When the company's Zapmail program was shut down in 1986, all 1,300 of the employees who had worked in that department had first priority in internal job posting applications. Those employees who could not find positions with equivalent salaries could take lower-level jobs and retain their previous salary for up to 15 months, or until they found another higher-salary job.

And when FedEx discontinued much of its service within Europe and reduced its European work force from 9,200 to 2,600, FedEx received praise from The London Times, among others, for the way in which it went about the layoffs. For example, FedEx put full-page ads in several newspapers urging other employees to hire former FedEx workers. In Belgium alone, 80 companies responded to the ad with a total of 600 job offers.

FedEx people stick together in hard times.