UPS Appoints New CIO - InformationWeek

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UPS Appoints New CIO

After a 27-year career that began as a part-time package loader, Dave Barnes takes on the role of CIO at United Parcel Service. Barnes is replacing Ken Lacy, who retired this week.

United Parcel Service Inc. has a new IT chief, and he's well-versed in the company's technology directives. "At UPS, business and technology priorities align," says Dave Barnes, who took on the job as CIO after 27 years at the company. "Business priorities are technology priorities, a key philosophy at UPS that has and will enable the company to grow."

Barnes, 48, replaces Ken Lacy, who announced his retirement from UPS on Tuesday after a 37-year career there. Barnes most recently served as VP of customer and operations application portfolios in UPS' information services department, overseeing the development activities of approximately 3,000 IT professionals.

Now, Barnes will oversee an IT team of 4,700 that custom-develops much of UPS' IT systems and an average technology investment of about $1 billion a year. The focus for much of that investment under Barnes' watch will be to improve the company's already high service levels with new products that support customer requirements.

For example, UPS will roll out this year in the United States, and internationally in 2006, the DIAD IV, the fourth generation of the Delivery Information Acquisition Device that many UPS drivers use to capture and secure electronic signatures and keep track of customer data. The handheld devices let UPS share package information with customers in near real-time.

The DIAD IV, co-developed with Symbol Technologies Inc., now supports 802.11b Wi-Fi radio, as well as historically Code Division Multiple Access or General Packet Radio Service WAN radio, depending on location. "Most of the software UPS uses is custom-built software, from the DIAD IV to the point-of-sale systems at the UPS stores, which are customer-facing applications," Barnes says. "Our sorting applications also are custom built, but we do use packaged software for things such as internal financial applications."

The infrastructure is built on Intel servers and desktops, as well as midrange and mainframe computers. The IT systems at the UPS Stores are tied into the company's back-end tracking applications, so customers can monitor the flow of packages from ups.com. UPS processes about 13.6 million packages and documents daily, not only from its stores, but through partnerships with companies such as Amazon.com and eBay. About 93% of the shipments require capturing data, which has made securing customer information a top priority, too.

The key to success at UPS is IT collaboration and support throughout the world. In December, UPS signed an agreement that will allow it to take direct control of its Chinese operation this year from state-owned Sinotrans. According to equity research firm Morgan Keegan & Co. Inc., UPS will take control of operations in 23 Chinese cities this year and expand operations to more than 200 cities by leveraging the company's strength in supply-chain management through its UPS Supply Chain Solutions division.

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