National Air Express Case Study Essay

1610 Words Aug 28th, 2013 7 Pages
National Air Express
The business problem facing National Air Express is the majority of customers want pickups as late as possible, around 5:00 p.m., but there are not enough drivers to satisfy this need. I would say a major problem is that the station manager, Frank Smith, is focusing on the budget constraints, which is important; however, the needs of the customers must be met. He is considering adding capital expenses when business does not seem to be increasing. Smith is preparing his quarterly budget report, which will be presented at the Southeast regional meeting in the following week. He is very concerned about adding capital expense to the operation, to meet the demands of current customers, when business has not increased
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Many customers’ needs have not been met, meaning the drivers were unable to meet the scheduled pickups requested. Overall, there has not been an increase in the number of pickups, and they do not feel it is financially responsible for another truck and driver to be hired, which would be at a cost of $1,200 a week. From what was discussed in the case study, it does not appear that any action has been taken thus far to resolve the customer dis-satisfaction regarding pickups (Heizer & Render, 2013).
National Air Express has seen a lag in their overall productivity over the past quarter. Smith recognizes the problem in his budget report as he is contemplating the addition of new capital expenditures to help increase operations. The concept of adding new capital expenditures needs to be evaluated and justified based on the current operations and whether or not the company can take on new expenses. In my position, it is necessary to provide all details that are pertinent to purchase the new capital. Part of the details should include why the capital is needed, how it will affect the operations, and how the cost will be recovered. If there is not sufficient reason for this large expense, $1,200 a week, the company will most likely not approve the transaction.
I recommend that National Air Express conduct a customer satisfaction survey as a method to evaluate the performance