Doug Duncan, architect of FedEx Freight, to retire in February
John D. Schulz, Contributing Editor -- Logistics Management, 11/1/2009
Douglas G. Duncan, the first and only president and CEO of FedEx Freight (FEF) who oversaw the company’s explosive growth and reach to become the second-largest LTL carrier in the country, stunned the freight and logistics industry with the announcement that he’s retiring next Feb. 28.
In an exclusive interview with Logistics Management, Duncan said that the timing was based partially on FEF’s ability to recover from the economic recession and was solely his idea. He says he plans on remaining semi-active in the industry through participation in corporate boards and trade groups such as the American Trucking Associations.
“It’s something I’ve been planning for a while, but I wanted to find the right time,” the 58-year-old Duncan said. “I didn’t want to leave when the market was in complete freefall. I think the worst is behind us and things are getting better. The timing works out better for me and the company.”
Part of the reason for Duncan’s success in creating FedEx Freight was his long-time experience in both marketing and operations. But part of it was philosophical as well. Duncan always emphasized placing his customers’ needs first, then tailoring services to meet those needs.
“Companies like FedEx are in business to serve the supply chain—not to run a truck line,” Duncan said. “My fate is tied to serving our customers’ supply chains.”
While no successor was immediately named to lead the Memphis, Tenn.-based carrier, Duncan’s surprise move set off a scramble within the FedEx executive suites to lead the innovative LTL giant during the anticipated economic rebound in 2010. Among the names being mentioned is Patrick Reed, 50, the COO of FedEx Freight, and former president of American Freightways, a company that FedEx bought to be part of FEF.
Duncan is leaving at a time of turmoil and uncertainty in the LTL sector. The largest LTL carrier, $7 billion-a-year YRC Worldwide, has posted losses in excess of $2 billion in the last 10 quarters. If YRC were to liquidate or further downsize, that would open opportunities for carriers such as FEF to take market share and boost pricing.
“I’m surprised because I thought he would stay until he was 60,” said Satish Jindel, principal of SJ Consulting that analyzes the LTL sector. “But considering all the accomplishments he has had there, and the change of executives at FedEx Ground (founder Dan Sullivan retired before 60), I guess it was time.”
Duncan is credited with moving FedEx, which until 2001 had no presence in the heavy freight sector, to a company with more than $4 billion in LTL revenue. If Yellow had not bought Roadway, a $3 billion acquisition in 2003, FedEx Freight would be the largest LTL carrier. In fact, Duncan credits being part of the $38 billion FedEx Corp. for part of the LTL unit’s success.
“Certainly the brand was a huge help. But I think more than anything it was the culture and the support we needed from a people-first standpoint,” Duncan said. “The transportation business, stripping away the trucks and the technology, is still very, very much a people business. When we made these acquisitions it was wrong to jam them together. We needed to take time to bring people together and let them accept change; and that understanding of integration and culture had everything to do with our success in being able to create FedEx Freight.”
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