BSBMGT617 Develop and Implement a

Business Plan
Task 3- (Written Report) Monitor performance
Executive Summary

Fast Track Couriers is a courier company operating in New South Wales for the last 15 years. The
company basically delivers medium to large size packages across metropolitan Sydney.

The main points and summary of this plan.

Strategic plan goals – Grow and increase business profits over the next 3 years by expanding delivery
routes to include regional NSW

Operational plan goals – commence deliveries to regional NSW within 12 months and increase sales by
40% in the next 3 years

Vision – maintain strengths and core values through expansion process.

Fast Track Couriers primarily targets small to medium-sized business which make up 80% of their
customer base.

The company will propose strategies to expand the business to the regional NSW without risking its
current financial stability or reputation, since potential clients had been lost due to its inability to deliver
in regional offices.

Proposed strategy – remove the need for two drivers per truck by installing an automatic lift gate to
avoid heavy lifting and purchase 10 new trucks.

Introduction

Fast Track Couriers has a stable status in the marketplace for reliability and value for money and
developed a solid reputation over the past 12 years. This has been reflected in its growth and profit
margins.

The company limits its delivery by its geographic location, which is only within Sydney’s metropolitan
area. Hence, the company is looking to move forward by delivering to regional areas in NSW, even
though sales and profits have increased by 5% each year. Fast Track Couriers has an admirable 87%
retention rate for existing customers.

Background on Fast Track Couriers

The owners of Fast Track Couriers are not risk takers and they are aware that the company’s ongoing
success is the result of a small, experienced team as well as their maintenance in personal ties with
clients. Their services are reputable for being reliable and low cost. The vision of the company is to
retain these strengths in their expansion of business. The strategic and operational plans were
developed as a result of external market research, indicating a shortage of delivery organizations
providing services to regional NSW towns. Fast Track Couriers were looking for their next growth
opportunity and saw that this was an ideal opportunity to be seized upon. Reports from the Sales
Manager indicated that contracts have been lost because some clients want to engage a courier who
can deliver to their regional offices, in particular Newcastle, Wollongong and the Central West. Fast
Track is currently unable to meet this demand and therefore, some potential clients have been lost. This
became a motive to expand operations for both financial and customer service reasons.

Company Structure

The company is family owned, with 3 family members acting as a Management Board and responsible
for approving all business decisions

Managing Director – responsible for daily operational management decisions

Logistics Manager – responsible for the scheduling of the trucks and drivers

20 truck drivers

5 office support employees – responsible for administration, accounts, human resources and sales

Facilities and equipment

Computers , Manuals , GPS ,PDA , Trucks

Marketing Activity

Direct sales ,Telephone ,Internet listings ,Mail-outs

Business Operations

The company communicates with employees via email for head office employees, and a printed monthly
newsletter for drivers. Policies and procedures are provided through employee manuals that are kept in
each truck. Trucks are fitted with a GPS system to assist drivers in navigating to each pick-up and drop-
off location. They are also assigned a PDA that provides drivers with details of each delivery and records
when a job starts and finishes. The data from this device is sent back to head office to compete
productivity reporting.

Strategy to Expand Business

Fast Track Couriers currently allocates 2 drivers per truck to ensure that drivers are able to load and
unload heavy packages. The strategy going forward is to remove the need for 2 drivers per truck by
installing an automatic lift gate on the back of each truck, at a cost of $10,000 per truck. This indicates
that only 1 driver is needed per truck, as no heavy lifting is required. Hence, it will allow Fast Track to
purchase 10 new trucks and use the existing drivers for regional routes. Each new truck will cost
$60,000, including installation of an automatic lift gate. The money to purchase the trucks will be
borrowed from the bank on a business plan.

Monitor Performance
The key to effective monitoring performance is to identify a range of methods – so company can then
choose the method that’s easiest to apply and most effective. Let’s begin with the easy part –
monitoring performance against quantifiable objectives.

Monitoring performance against quantifiable objectives Methods

- Sales reports, plans, proposals, budget forecasts, Accuracy reports, Error reports, Widgets
produced

These tend to be the monitoring methods most managers are comfortable with because they’re about
what the employee does. It’s easy to see if the company employee is achieving a sales target or
submitting accurate work and these are great monitoring methods for the quantity, quality and time
elements of the job The difficulty arises when these are the only monitoring methods a manager uses
because most jobs aren’t just about the ‘what’, they’re also about ‘how’ your employee’s do their job.

Review the business plan

Following information pertaining to the operation of B&A Toy Warehouse. Review and analyze the
information provided, and answer each of the five questions in this case study. Evaluating performance
measures after identifying the performance measures, Tony evaluated performance by comparing
current performance against the desired level of performance. This allowed him to determine areas for
improvement to assist the warehouse in achieving its productivity goal.

Key performance objectives

Key result Areas Indicators of performance

Return/ profits Return on revenue to sales ratio net profit
Productivity $ sales per unit emplouee delivery/month
People Development Percent days of training/ employee
Market penetration Percent of market share.
Percent growth by product

Financial performance measure Non-financial performance measure

Customer retention ratio Number of defects
Reduction in operation cycle time Number of order back
Reduction in accident rate Number of customer complaints

Business owners set different types of objectives, including financial objectives, to give them a solid plan
for moving in the direction of long-term success. Common financial business objectives include
increasing revenue, increasing profit margins, retrenching in times of hardship and earning a return on
investment. The most concern financial objective will be: Profit Profit objectives are a bit more
sophisticated than revenue growth goals. Any money left over from sales revenue after all expenses
have been paid is considered profit. Profit, or bottom-line earnings, can be used in a number of ways,
including investing it back into the business for expansion and distributing it among employees in a
profit-sharing arrangement. Non-financial company objectives also aid in improving the company as a
whole. The nonfinancial improvements help round out the company's strengths in areas like customer
service, production quality and employee satisfaction. These areas create a stronger company as a
whole that is able to perform better in the market, increasing profits.

The most concern non- financial objective will be: Quality The quality of work produced by your
company affects your reputation and amount of business you receive. Whether you sell a product or a
service, you want every sale from your company to be top-notch. Consistency is another key factor in
the quality of a company. When you offer consistently high-quality products or services, your company
gains a positive reputation that potentially leads to more business and repeat customers.

for each objective/s:

 describe the performance measure system

A performance measurement system that creates and manages key performance indicators (KPIs)
needs to be management’s eyes to the process. It needs to stimulate the most appropriate behaviour.
Successful performance measures contain a naturally balanced organizational set of measurements
which provides an unbiased process performance assessment For financial objectives:

Balance scorecard The balanced scorecard is a strategic planning and management system that is used
extensively in business and industry, government, and nonprofits organizations worldwide to align
business activities to the vision and strategy of the organization, improve internal and external
communications, and monitor organization performance against strategic goals

For non-financial objectives: Customer Satisfaction

Customer satisfaction is the most important criteria that can determine the performance of your
business. Every business wants to earn profits by satisfying and fulfilling the needs and requirements of
their clients and customers. However, in the end, if your customers are not happy with your product or
services, then you have not only wasted your time and effort, but also other valuable resources. That is
why it is very important to measure the satisfaction levels of your customers. This can be done in various
ways, by asking them or through surveys forms or questionnaires. This will enable you to compile the
necessary data pertaining to important aspects of your business, and to make changes if necessary.

identify appropriate timeframe to monitor performance

A business plan is a comprehensive document that outlines key elements of how you operate your
business. The plan typically includes an assessment of your market and your competition, your operating
budget breakdown, and your short and long-term business goals. While many business owners write a
marketing plan to obtain business loans, the plan can be a useful tool for monitoring and controlling
ongoing operations.

For financial objectives:

Create Plan Review Dates

Business plans should be reviewed on a regular basis, especially if a business is expanding quickly,
experiencing cash flow problems, adding new products or services or reaching into new markets. Align
your review dates with the short-term and longterm goals outlined in the original business plan and
conduct a comparative analysis. Depending on your business, this could be a monthly, quarterly or
annual review.

For non-financial objective:

Make Changes When Necessary

A business plan is not an unchangeable document. Consider it a fluid plan that can be tweaked and
updated as your business changes and grows. Don’t cling to elements of your plan that are outdated or
no longer useful.

identify relevant stakeholders who will require the information

o Managing Director – responsible for daily operational management decisions

o Logistics Manager – responsible for the scheduling of the trucks and drivers

o 20 truck drivers

o 5 office support employees – responsible for administration, accounts, human resources and sales

Increasing net profit up to 10% by 2 year

Profit: This goes without saying, but it is still important to note, as this is one of the most important
performance indicators out there. The company will analyze both gross and net profit margin to better
understand how successful your organization is at generating a high return.

Develop and increasing online customer to be more than 2000 customer by 2 year

One of key drivers in company’s value is the value of customers. Analyzing customer profitability and
maximizing a customer’s lifetime value are highly important and essential to any business. To increase
customer base, it is necessary to stay in constant contact with potential and existing customers and the
more value your business can offer, the more likely they will remain loyal.

Performance information is used for two main purposes

- To report on performance to key stakeholders

- To compare against targets as part of ongoing performance management.

 Testing the performance measures

Two years ago, the warehouse implemented a custom-built electronic warehouse management system
(WMS) which has had an enormous impact on productivity. The company required to follow the step of
Testing the performance measures: The best practice performance measurement systems have the
following features:

- Financial consideration, Customer satisfaction, Internal business operations, Employee

satisfaction, Community and shareholder satisfaction

Acceptable levels of variances to planned objectives

- Indicate how well the goals and objectives are being met
- Be simple, logical, easy to understand and repeat –
- Be timely
-

Timeframe for each report

- Monthly and quarterly report

Benchmarking

Benchmarking is the process of comparing your business results with the results of similar businesses.
Benchmarking can result in innovation and improved performance. There are a number of different
types of bench-marking, which are driven by different motivating factors and thus involve different
comparisons. Some of the major types of benchmarking are as follows: Metric benchmarking is the use
of quantitative measures as reference points for comparisons. Best-practice benchmarking focuses on
identifying outstanding techniques. Information technology benchmarking includes data processing,
systems analysis, programming, end-user support, and networks. Infrastructure benchmarking includes
data centers, networks, data/information, end-user support, and distribution remote centers.
Application benchmarking includes system analysis, development and maintenance programming, and
functionality. Strategy benchmarking includes skills assessment, information technology strategy,
business-technology alignment, and delineation of roles and responsibilities. It challenges assumptions,
flags opportunities, identifies necessary change and helps rectify problems. It's about performance
standards that can come from your industry or other sources. Benchmarking helps you identify areas of
opportunity and it's normally a process of continuous improvement. Bench marketing may be conducted
across the following areas

Profitability

Customer focus

Key stakeholder for each report

- General Manager, Sales manager, Warehouse manager, HR manager

 Key Stakeholders Type of reports Timeframe Benchmarking Methods
Management team Sales Return on revenue report Quarterly basis Best practices
manager Finance benchmarking can
manager provide you with hard
facts about how your
operations rate and
about where and by how
much you can improve
Logistic manager Sales Monthly sales target Quarterly basis Strategic Benchmarking:
manager Finance Identify the fundamental
manager Management lessons and winning
team strategies that have
enabled high performing
companies to be
successful in their
marketplaces.
HR manager Logistic Employee performance Monthly basis Internal benchmarking:
manager Management and training target comparison of practices
team and performance
between teams,
individuals or groups
within an organization
Logistic manager Sales Market share growth Quarterly basis Performance Metrics:
manager Finance “Performance metrics”
manager Management give numerical standard
team against which a client’s
own processes can be
compared. These metrics
are usually determined
via a detailed and
carefully analysed survey
or interviews. Clients can
then identify
performance gaps,
prioritize action items,
and then conduct follow-
on studies to determine
methods of
improvement.

Reporting failure and variances

The root causes for variances need to be determined and addressed. Simply shifting savings (low
expenditure – money not spent) or additional income (excessive income – extra money received) to
overruns on costs or to offset a lower than expected income area is not addressing the cause. It has the
potential to mask the true position which, if left uncorrected, will get worse. Analyse the performance
information and report the issues to relevant managers to develop corrective actions; revise objectives
and their indicators to ensure they are SMART; provide additional staff training; implement more
targeted marketing; improve customer service; provide value-added products; the making
improvements to processes or method. For this case study is the company should be worry about failure
to reach target sales and failure to achieve projected profit

Stakeholder management

Stakeholders are who have an interest in the implementation of change, its activities and its
achievements. These may include partners, employees, shareholders, or owner. Everyone plays a very
important role in the change implementation. So, it is very important to consult with the entire
stakeholder before the implementation of any kind of change within the organization.

Communicate with all relevant people within the organization

Communication about the new change implementation with all relevant managers employees is very
important. Because everyone should know about the change or what is going to change in the
organization. Because the change has an impact on the people, process, technology and structure of the
organization. A change has impact on all the department of the organization. There are many ways to
communicating with all relevant people.

Conduct a staff meeting, Via emails, Notice on notice board, One- on –one meeting, Focus groups

Audience Message (with strategic When communication person

elements)
Management Change management 2 pm to Email (invite with HR manager
team strategy – duties of HR 3pm agenda) Face to
manager face (office
training room
Trucking team Change management 9 am to Email HR manager
strategy impact to trucking 10 am (assistant may
team. Duties of draft)
truckersProvide an
explanation of what will be
required. Business need-
Gain support by emphasizing
possible effects on jobs.
Training schedule-
Emphasize mandatory
nature and threaten
performance review
consequences for
noncompliances
Sales team Change management 11 am to Face to face Sales manager to
strategy summary. Benefits 11.30 (office training run team meeting
to organization room
 Office team Change management 11.30am Face to face office Office manager to
strategy summary. Benefits to 12 pm training room run team meeting
to organization

There are many different ways to gather feedback from the employees such as

One on one, During work , Via emails, From the feedback forms

Feedback from employee

Employees do not want change, They are not happy, They are thinking management is not trusting on
them,Implementation of a new change and learning process is a time wasting, Some employees do not
like the change (Truck team)

Result of the survey

The result of survey is most of the employees do not want the change in their work routine. Because
they are used to them and they do not want to change it. The fast track courier company’s employees
are used to work two people team. They are enjoying while working. Mostly people think that the
learning of new technology is a time wasting. The driver’s view is that their preferred team is two-man
driver team and they only see the benefits of that specific working arrangement.

Risk/Barrier Impact Likelihood Strategies for mitigating risk

Lack of trust regarding High impact Medium Communication and training to
use of productivity outline business need. Address
data. Refusal of employees’ concerns
implementation
Industrial Action High impact Medium Address employees’ concerns
Gain trust and acceptance

Conclusion

In conclusion, the expansion in Fast Track Couriers’ business operation is seemingly promising even
though there may be risks of losing drivers. Based on the forecasts of annual sales and profits, the
progression in operation for the company is so much bigger compared to its current state. Hence, it is
advisable that Fast Track Couriers proceed with the proposed strategy to retain its existing customers so
that customers would not be lost to its competitors.