Airborne Express
In a highly competitive industry the structure of a firm is very important to its success. Today firms are moving away from the centralized structure of the past, and adopting a more decentralized structure (Management Challenges in the 21st Century p 315). The air express industry is no exception. FedEx, the leader in the air express industry since the late eighties, is also leading U.P.S. in the race to become decentralized. Airborne Express is not even in the race. In order to compete in today's changing environment, Airborne Express needs to move away from its old fashioned centralized structure and form a more decentralized structure. The old fashioned structure is not the only variable that makes Airborne the follower in the air express industry. The Internet and information systems are transforming the air express market into an electronic commerce market, and Airborne needs to transform it's operations to meet this growing market. This report describes the strengths and weakness of the organizational structure of Airborne Express. Furthermore, it also gives recommendations for future changes in Airborne Express. The first section of this report addresses how the organization of the firm evolved, and what changes
Management Challenges in the 21st Century. P 315. St. Paul Minnesota: West Publishing Online. Internet 16 Feb. 1999 www.associatedpress.com The last few years have plagued the air express industry with labor problems that have kept CEO's of major companies like UPS, FedEx, and Airborne Express on their toes (The New York Times Nov 1998). Since the UPS strike of 1997, air express companies are fighting to keep good relations with their workers. The Teamsters' strike with UPS over part-time and full-time help taught small business not to rely on one express company. UPS is not the only company having labor problems. With the use of lengthy negotiations and hefty salary promises FedEx has settled a labor dispute with its pilots, and are entering the year 2000 without labor problems (Institute for Technology and Enterprise P 12). Airborne Express, however, is experiencing major labor disputes with its pilots. Although under contract, Airborne pilots are not happy with management. A representative for Airborne claims "Airborne management has failed to implement key provisions in the contract". This failure plus the firing of an Airborne pilot has the pilots angry (Traffic World P 1). Since the pilots are under contract, they can not strike, but they can stop flying volunteer overtime, which makes up 15 percent of Airborne's flights. In November of 1998 the pilots voted to stop flying overtime (Traffic World P 3). Airborne needs to smooth over relations with its pilots soon, because the contract expires May of 2001. Therefore, unless Airborne settles this dispute, it will be facing an imminent strike. Another labor issue affecting Airborne is the Teamsters Union. Airborne signed a five-year contract with the Teamsters Union in 1998. There are three major provisions in this contract (Associated Press online p 2). Commerce Backbone for the Future. P 12. April 1998 Online. Internet 3 Mar. 1999 www.ite.poly.edu.com Today the air express industry is faced with a technology that will force express companies to change organizational structure and basic operations. This technology is electronic commerce, or better known as the Internet. Presently, Internet sales make up 15 percent of the retail market, and are expected to make up 55 percent of the market by 2005 (Institute for Technology and Enterprise p 1). In order to compete in this growing market, many retail companies are changing their operations and selling products over the Internet. Because of this, there is a need for air express companies that can cater to the needs of online retailers. Express companies need to
Some common words found in the essay are:
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Approximate Word count = 1759
Approximate Pages = 7 (250 words per page double spaced)
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