Delivering new solutions: FedEx CEO challenges Honors College students at convocation

Posted on Sep 12 2017 - 10:51pm by John Touloupis

Frederick W. Smith, founder and CEO of FedEx Corporation, speaks at the Sally McDonnell Barksdale Honors College Fall Convocation on Sept. 12. (Photo By Anna Hayward)

The Sally McDonnell Barksdale Honors College celebrated its 20th year with its annual fall convocation last night in the Ford Center.

Speakers included Dean of the Honors College Douglass Sullivan-Gonzalez, former CEO of Netscape Communications and principal donor of the SMBHC James L. Barksdale and keynote speaker FedEx CEO and founder Frederick W. Smith.

Sullivan-Gonzalez opened the convocation by highlighting the strides the Honors College has made since its founding in 1997.

“In addition to numerically, the students’ sophistication of questions, their grit and their real passion for education has been improving year by year,” Sullivan-Gonzalez said.

Since its inception, the SMBHC saw record growth and just recently completed a multi-million dollar renovation. The class of 2021 included more than 425 students from 28 states and one foreign country whose average GPA was a 3.97 and average ACT score of 31.

Sullivan-Gonzalez introduced Barksdale, whose donations to the university and SMBHC have helped support and grow the school.

“I was approached by Chancellor Khayat to consider funding the Honors College or a couple other programs they dreamed up,” Barksdale said. “After coming here and talking to faculty and others, I was convinced the Honors College was the best place I could invest my money and my time at Ole Miss.”

Over the past 20 years, Barksdale has invested more than $31 million to the university and is a firm believer the SMBHC has changed the University of Mississippi.

“The university has become much more academically oriented than it used to be,” Barksdale said. “I don’t think we were as much of an academic institution back then, but we had a good time. I think the Honors College has played a key role.”

Barksdale welcomed Smith, the keynote speaker of the night, and one of the longest tenured and most successful CEOs throughout the country.

“Over 50 years ago, Fred was in his dorm room and came up with an idea for a paper based on his own observations about Connecticut, the Northeast and the United States on the need to move small parts to repair machines,” Barksdale said. “This would be the basis of FedEx.”

Smith graduated from Yale in 1966 and spent four years in the Marines, serving in Vietnam before founding FedEx in 1973.

“I was your age when I came up with the idea of the hub and spokes system to solve the problem that I’d first seen several years earlier at Yale,” Smith said. “Little did I know this idea would lead to the size and scope it is today.”

Smith began his address by explaining how FedEx is run. The company is organized into four different operating companies – Express, Ground, Freight and Services – to efficiently run the business.

“Often several of our operating companies work together to deliver solutions,” Smith said. “With Hurricane Harvey, FedEx Express, Freight and Services to get critical supplies to the disaster site that our relief organization partners wanted us to transport.”

However, the key to FedEx’s success, according to Smith, is its culture.

“The founding principle of FedEx is people, service, product – or PSP,” Smith said. “Any FedEx team member knows the purple promise – to make every FedEx experience outstanding.”

After telling FedEx’s story, Smith dove into the rules and regulations that allowed FedEx and other large retailers and online companies to grow during the last 40 years.

Smith testified before Congress in the 1970s to deregulate air cargo, allowing FedEx to expand without old regulations previously holding the company back.

“The airline deregulation act removed government control from fares, routes and created new passenger airlines. The changes sparked a surge in competition, which drove prices down,” Smith said.

In the 1980s, outdated regulations on trucking and freight industries allowed companies to offer more benefits to workers.

“Deregulation was a huge factor in transforming the economy you live in today,” Smith said. “It introduced innovation, competition and growth into industries that had become lackadaisical due to stifling government regulations.”

These deregulation laws faced tough opposition from shippers, unions and members of both parties of Congress. FedEx, along with other major companies, played a key role in helping craft these new transportation laws.

“Today’s political system could never accomplish this,” Smith said. “Red states have become redder and blue states bluer. There is a red Facebook and a blue Facebook.”

Transitioning from FedEx to current events in the United States, Smith criticized the toxic political climate, citing the rise of negative ads and the polarization of cable news.

Along with social media, he said people only see and hear what they want to hear, creating an echo chamber and volatile political climate. Furthermore, due to the low barrier of entry online, Smith said the creation of fake news and propaganda is an increasingly growing threat.

“With political parties gravitating toward extremes and unwillingness to listen and compromise, we can’t move America forward,” Smith said. “We can’t fix healthcare, we can’t replace antiquated tax laws and we can’t fix our country’s deteriorating infrastructure.”

Globally, Smith said there are serious international problems, ranging from economic and trade disagreements with China to nuclear war with North Korea and issues with Russia, Venezuela and terrorism.

Even through all of the global problems, there are some positives, according to Smith.

Smith said the recent French presidential elections gave him hope. Using volunteers and reaching out to people throughout France, Emmanuel Macron was able to break the two-party system and potentially usher in real change France hasn’t seen in years.

“I think the United States can learn from Macron,” Smith said. “Here with our congressional system, all it might take is for five or six senators who are willing to form a centrist party and attract a presidential candidate to lead them.”

Smith called for rational thinking and political will to fix America. He reiterated the words of Sen. John McCain, who said our political system relies on pragmatic problem solving and pragmatic compromise from even the most opposing sides, but it can no longer do so.

“If this country is to continue to be recognized as a world leader after World War II, we must find rational thinking and political will to fix America,” Smith said.

He ended his speech by calling for students to forge into the world with open minds and think critically open the problems facing the country.

“I think these answers can come from the Sally McDonell Barksdale Honors College,” Smith said. “I know you will be educated and good citizens, and as such, you’re the best hope for delivering new solutions.”