D. SCOTT DAVIS IS THE 10TH CHAIRman and CEO in UPS’s 102-year history, and
the first to depart from the traditional path
to the top. All of his predecessors had spent
their entire careers with UPS before ascending to the chairmanship. Not so Davis. Prior
to joining UPS, he served as the chief financial officer and later, chief executive officer
for an Oregon technology company called II
Morrow, which UPS acquired in 1986.
From 1991 to 1998, Davis held positions
of increasing responsibility at UPS, serving as treasury
manager, financial reports and plans manager, and
accounting manager. In late 1998, he moved to Overseas
Partners Ltd., a Bermuda-based reinsurance company,
where he served as CEO before returning to UPS in 2000.
He joined the UPS Management Committee in 2001, when
he was named CFO. Davis assumed the top posts in January
2008 and has been responsible for leading UPS during one
of the most difficult periods in the company’s history.
D. Scott Davis
UPS is an operations-driven enterprise and its culture is to promote from within. Yet you are consid- Q
ered more of a finance guy and, unlike other CEOs, you are
not a lifer. What was the most challenging aspect in adapting to the company’s cultures and traditions?
A Some people here call me the “new guy” after 22 years. After fulfilling my contract with
II Morrow and helping with the transition, I was asked to stay on at UPS.
But my inclination, up to that point,
had been to follow a more entrepreneurial path, and I had really intended to stay on that track—perhaps go
find another startup and help build
another small company. I had never
really considered joining a large corporation like UPS.
But I saw something in this company that was unique—
people who lived up to their promises, a willingness to take
risks and to change when change was required, managers
who led by example and who took personal ownership in
the company’s success. And I saw a company with a horizon
that really had no limits, that was developing service innovations driven by new technologies, expanding its portfolio
of solutions, and staring at untapped global growth opportunities. I wanted to be a part of it.
It wasn’t really hard to adapt to that kind of culture and
opportunity. I just had to make sure that my efforts and
contributions spoke for themselves, because it is a very
demanding culture.
public has m
about going public, and what have been the
most enduring lessons learned from the tran-
sition from a private to a publicly held entity?
A We are absolutely convinced that going public was the right thing to do. The
primary reason at the time was the need to
make acquisitions to expand our global foot-
print. We needed a publicly traded equity to
ensure we had the financial capability to exe-
cute on that strategy.
But more than that, I believe that being
ade UPS more aggressive, quicker to make
tough decisions, leaner, and more competitive. We have an
incredible array of capabilities, the fastest-growing international business in the industry, a successful and profitable
supply chain business—I do not believe we would have
been the same company had we stayed private.
The enduring lesson is whether you are a public or private company, don’t lose sight of the long term. We know
our shareholders expect us to perform well every quarter,
but we also make decisions with the long-term interests of
the company in mind.
me to talk about a l
The last four UPS chairmen and CEOs have put their
own stamp of legacy on the company. For John Q
Rogers, it was international growth. For Oz Nelson, it was
the building of the IT platform. For Jim Kelly, it was the
1999 IPO that took the company
public. For Mike Eskew, it was
expanding into areas beyond package
delivery to make the company a true
full-service transport and logistics
provider. What do you see as your
imprimatur?
A That is so foreign to the way we think around here, it is hard for
egacy. I can tell you where UPS is head-
ed. We need to be recognized as a solutions company, not
merely a transportation company or logistics company that
provides a menu of services. UPS will be successful to the
extent that our customers view UPS as a provider of solutions that help them succeed.
“We need to be recognized
as a solutions company, not
merely a transportation or
logistics company.”
This year marks the 10th anniversary of UPS’s becoming a public company. Judging by the stock price, it Q
has been a volatile ride. Does the company have any regrets
UPS has long been considered a proxy for the domestic economy because the company alone moves the Q
equivalent of 6 percent of U.S. GDP. Do you see any light at
the end of the tunnel, and when do you suppose we will see
a turn?
A UPS is a good concurrent indicator of the economy, not really a leading indicator. But I will share my personal opinion. At the end of 2008, the optimists were calling for an upturn by mid-year and the pessimists were saying end of year. Now the “end of year” people are the optimists, and they’re probably right.
