Carol Tomé was done. Honestly. She had retired from The Home Depot in 2019 after a legendary 24-year run, most of it as CFO. She was ready to enjoy the Wyoming air and her farm. Then, the world broke.
By early 2020, the pandemic had turned global logistics into a nightmare of surging demand and crumbling supply chains. UPS, a hundred-year-old titan of industry, needed a leader who didn't just understand spreadsheets but understood how to pivot a massive, legacy-heavy ship in a hurricane. They called Tomé. She said yes, becoming the first woman and the first outsider to lead the company.
It was a shock to the system. You’ve got to realize that UPS usually promotes from within. It’s a "brown blood" culture where drivers become executives. Bringing in a retail finance veteran was basically corporate heresy. But UPS CEO Carol Tomé didn't come to fit in; she came to gut the status quo.
The Pivot from Volume to Value
For decades, the math at UPS was simple: more packages equals more money. If you could touch every doorstep, you won. Carol Tomé looked at that math and basically threw it out the window.
She introduced a mantra that still makes some old-school logistics managers twitch: "Better, Not Bigger."
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Most people assume this just means raising prices. That's a mistake. It’s actually about customer segmentation. Tomé realized that chasing every single low-margin package from giants like Amazon was actually hurting the bottom line. It’s like a restaurant being so busy serving $1 coffee that they don't have room for the $50 steak dinners.
- The Amazon Glide-Down: By the end of 2024, UPS had intentionally shrunk its reliance on Amazon. In January 2025, Tomé confirmed that Amazon volume would be cut by over 50% by the second half of 2026.
- The SMB Surge: Small and medium-sized businesses (SMBs) are the "steak" in this metaphor. They pay more and require more specialized service. Under Tomé, SMB penetration hit nearly 30% of total U.S. volume by the end of 2024.
- Healthcare is King: If you're shipping a temperature-sensitive vaccine, you aren't looking for the cheapest rate; you're looking for the most reliable network. Tomé went heavy on healthcare logistics, acquiring companies like Frigo-Trans and Andlauer Healthcare Group to dominate the cold chain.
Hard Truths and the 2025 Reality Check
It hasn't been all sunshine and dividends. If you look at the stock price in late 2025, you'll see it’s been a rough ride. The market can be brutal.
Actually, the stock took a massive hit throughout 2025, dropping significantly as the "Better, Not Bigger" strategy faced the reality of a cooling global economy and fierce competition from the USPS. To keep the ship afloat, Tomé had to make the kind of decisions that don't make you popular at the company holiday party.
In late 2024 and throughout 2025, UPS slashed 12,000 management roles. Then, in October 2025, the company announced it was cutting another 48,000 jobs across operations and management. It was a staggering number.
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You might think that would sink morale, but Tomé’s approach to these cuts was weirdly transparent. She didn't hide behind corporate speak. She called it "Efficiency Reimagined." The goal? Save $1 billion by 2025 through automation and closing down nearly 100 older, manual facilities.
The Teamsters Tightrope
One of the biggest tests for UPS CEO Carol Tomé was the 2023 labor negotiations. People forget how close we came to a total collapse of the U.S. economy. 340,000 Teamsters were ready to walk.
Tomé didn't blink. She eventually signed off on a five-year contract that bumped part-time wages and added A/C to delivery vans (finally). Critics said she gave away the farm. They argued the high labor costs would make UPS uncompetitive against non-union FedEx or Amazon.
But Tomé’s logic was different. She knew that in a "People Led" company, an unhappy workforce is a liability you can't afford. She chose the "win-win-win" agreement to ensure service reliability, even if it meant a narrower margin in the short term. It was a massive gamble on human capital.
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Why the Next 12 Months Matter
We are sitting in early 2026, and the jury is still out on whether the "Better, Not Bigger" strategy can withstand the current trade tensions and tariff-driven disruptions.
Revenue in Q3 2025 was around $21.4 billion—decent, but the volume was still down. However, the operating margins in the U.S. domestic segment are starting to creep back toward that 10-11% sweet spot Tomé promised.
She’s basically rebuilding the engine while the truck is going 70 mph down the highway.
Real Insights for Business Leaders
If you’re watching Tomé to learn how to lead, don't look at the package counts. Look at the discipline. Most CEOs are addicted to growth for growth's sake. Tomé is addicted to profitable growth.
- Stop chasing bad revenue. If a client is 15% of your volume but 2% of your profit, they are a liability, not an asset.
- Automation isn't an option; it's survival. Moving 63% of volume through automated hubs (up from 60% a year ago) is the only reason UPS is still profitable with high union wages.
- Culture is a tactical advantage. One of Tomé's first acts was changing the name of the executive offices from "The Plaza" to "Casey Hall" to honor the founder and make the space feel less like a "ivory tower." It sounds cheesy, but symbols matter when you're asking 500,000 people to change how they work.
Your Next Steps to Understand the Industry
If you want to keep a pulse on where Carol Tomé is taking UPS next, you need to look beyond the headlines. Start by tracking the U.S. Domestic Operating Margin in the quarterly reports; that is the single most important number for her strategy. If that number stays above 10% despite lower volumes, her plan is working. Additionally, watch for the integration of the "Network of the Future" initiatives—specifically how many more manual sorting facilities are closed in favor of automated "SMART" hubs. These closures are the leading indicator for the company's long-term cost structure.