#192 Jim Casey (Founder of UPS)
Founders
The Rise of UPS: Jim Casey's Journey
This chapter chronicles the formative years and challenges faced by Jim Casey, the founder of UPS, highlighting his work ethic and family influences as foundations for success. It covers the evolution of UPS from a local delivery service to a nationwide shipping giant while navigating obstacles like competition and regulatory frameworks. The narrative also reflects on the imperative of innovation and adaptation in the face of emerging rivals, particularly FedEx, underscoring the cyclical nature of business and the resilience required for growth.
What I learned from reading Big Brown: The Untold Story of UPS by Greg Niemann.
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Casey pursued a Spartan business philosophy that emphasized military discipline, drab uniforms, and reliability over flash.
I had heard stories about the company's tireless founder. He was a living legend. Jim Casey started working from the age of eleven to support a family of five.
Casey began at the bottom. He speedily delivered messages and packages on foot. Casey learned about efficiency by doing.
Seconds saved become minutes over the day and a few minutes each day mean big dollars.
To outsiders the UPS regime has always seemed excessive.
People have always bought more than they could carry, and a hundred years ago they had no cars to help them out. When Jim Casey and his partners began their delivery service, it served only department stores, and the UPS role was to complete the stores' retail transactions.
Humility was one of Jim Casey's most strongly held values.
Our real, primary objective is to serve. To render perfect service to our stores and their customers. If we keep that objective constantly in mind, our reward in money can be beyond our fondest dreams.
Service is the sum of many little things done well.
Good management is taking a sincere interest in the welfare of the people you work with. It is the ability to make individuals feel that you and they are the company–not merely employees of it.
Jim Casey watched the streets carefully. He watched movement. He watched what people sold and what people bought. He was an eternal puzzle solver, his mind constantly preoccupied by every sensory detail involving his core business, packages. He gravitated to them, mesmerized by how they were wrapped and how they were delivered.
When traveling between meetings Casey would frequently tell his driver to stop when he saw a UPS delivery in progress. Without identifying himself, Casey would ask UPS drivers what they thought of their job. He'd listen carefully and consider their answers seriously. These informal "man on the street" interviews became an invaluable way for him to assess the efficiency of UPS delivery operations in a way that a UPS manager's filtered version could not.
Jim Casey's office was a small stark room, occupied only by a desk, several chairs, and a coat tree. His door was never closed.
His answer for sluggish layers of management was decentralization, and his attitude toward employees was an unwavering belief in and respect for the individual.
Money and prestige did not push him. Excellence did.
Casey's personal code was discipline.
Hardly a shining star, Jim Casey was more a steadily burning flame.
Distill Jim Casey's lifelong message to its essence and you get: Neatness, humility, frugality, dependability, safety, strong work ethic, integrity.
This unassuming ascetic with an iron will based his company and his every move on ethics that he learned as a child. Jim Casey's parents greeted hardship with grit and ingenuity.
Jim was by then old enough to apprehend his parents' mounting anxiety, to understand that his father was not healthy by comparison with other men. The worried atmosphere undoubtedly had effect.
At the end of the nineteenth century, the number of American children in the workforce reached staggering proportions. Over two million children worked in mines, factories, and sweatshops, many in appalling conditions.
For the Caseys, there was no alternative. It was critical. With two younger brothers to protect and a mother and an ailing father to support, eleven-year-old Jim Casey had developed a maturity that belied his age. His family was in precarious straits, and it was up to him to solve the problem.
He worked more than ten and a half hours a day, and longer on Saturdays, starting at $3 a week. [He is 11]
He picked up and delivered telegrams, mail, and packages —working from 7 P.M. until 7 A.M.
It wasn't all telegrams. Many of the night calls were drug addicts summoning a messenger to help replenish their stash.
During winters, it rained and rained. Jim was often cold and wet. Wealthy people could afford fancy hotels. Jim often looked with envy at them through the windows, as they sat in the big hotel chairs looking out onto the rain from warm lobbies.
Thompson shot and killed Moritz. [Jim’s partner]The cold-blooded murder left the other two boys stricken.
The company, founded in that six-by-seven-foot basement office, would eventually become United Parcel Service.
Jim wrote to the Chambers of Commerce of every American city with a population over 100,000, asking for names of local delivery firms. He accumulated the names and then initiated a communications link that he called the "Parcel Delivery Service Bureau." The bureau was a means of sharing new methods, ideas, or systems that worked in different cities. Every once in a while, the correspondence disclosed a gem of an idea, which Jim would hurry to implement. [Founders allows you to do the same]
Mr. Carstens told them that he would not fund their venture, but that they should not interpret his resistance as a disincentive. He finished with the words "determined men can gave do anything." That comment became an invocation; Jim Casey would use it as a rallying cry time and again.
We have nothing to sell except service.
Rather than paying up front with cash, they funded these acquisitions by pledging what they had, which meant shares of UPS stock. UPS was to use this strategy numerous times in coming years.
The vision beyond retail store delivery made sense to Casey and he later related “Think of the scores of millions of additional packages we would handle if we delivered all those going into each territory, rather than what goes out of the stores we happen to serve."
UPS would take on the ICC one city, state, or multistate area at a time.
Like Aesop's tortoise, UPS was sure and steady, plodding toward its objective of providing delivery service all over America, moving forward with perseverance and a humility that bordered on stealth. Big Brown was slowly but inevitably taking over the country.
As Jim Casey commented “Employee-ownership is credited by the people inside and outside the company with having done more than any other thing toward making our company and our people so notably successful financially and otherwise."
Fred Smith and his FedEx was sheer genius. That FedEx was established in 1973 as an airline, not a ground delivery company, is an important legal distinction, because the company was exempt from onerous common carrier regulations. Airlines fall under a different regulatory body (the FAA), not the ICC that regulated trucking companies.
And FedEx didn't intend to start up city by city as UPS always had. The concept was hatched nationwide, with its one hub, from the very beginning.
Most UPSers took the ostrich approach, ignoring the new company. Some denigrated it, saying, for instance: How are they going to deliver them on the ground? Their network's too small. People don't need that much delivered overnight. Costs are too high. They'll probably go under.
Business building, to Casey, depended on the hard work and loyalty that the stock ownership inspired. "The basic principle which I believe has contributed more than other to the building of our business as it is today, is the ownership of our company by the people employed in it."
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Transition seldom comes easily. Of course, we cannot clearly see all of the steps ahead. It is always easier to see difficulties than to develop methods of solving them. But first, let us take sight of a goal. The difficulties will be solved in ways we cannot now see.
First is the dream, then development, followed by improvement until the dream becomes a reality. Later a new dream makes the products of an earlier one obsolete. This has been the course of industrial history, and in its path have been the victims and the victors of progress. —Jim Casey
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