I was reading about a proposed takeover of a Dutch-based shipping company on Yahoo! Business. I was thinking that this is a simple way of looking at over coming competition by taking them over, but that would be too simple. Instead, I was thinking about the Hedgehog concept in Good to Great: you see, I believe UPS and TNT Express both realize what they are good at. Unfortunately for TNT, they are not able to be as profitable as they like doing what they do best.
On the otherhand, we look at UPS who is very good at keeping low marginal costs and have an efficient system. They are not good at breaking into existing markets. To counter, they are willing to spend money to buy a company in an existing market and make them profitable. We see everyday that they have a passion for shipping: even their employees move quickly to get things done as well as possible. This is a company that is fully capable of helping TNT Express profitable for their shareholders.
In the end, we look at the three circles of the hedgehog: UPS is the best at delivery, UPS has passion for delivery, and UPS makes money in delivery. TNT lacked the latter and that is why it makes sense for TNT Express to at least entertain UPS as a courter.
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