OUTSTANDING CUSTOMER SERVICE AT FED EX STARTS WITH FORECASTING
FedEx is the world’s largest express transportation company. To support its global transportation network FedEx has established 51 customer service call centers throughout the world. The 16 call centers located in the United States handle about 500,000 calls a day. The service-level goal for all of its call centers is to answer 90 percent of all calls within 20 seconds or less. There are three major networks that are supported by these call centers domestic, international, and freight.
For each network, FedEx has developed four types of forecasts, based on forecasting horizons. The strategic or long-range plan which is revised and updated once a year forecasts the number of incoming calls the average handling time per call staffing requirements and the number of technology handled calls (i.e calls not requiring a customer service representative). The business plan addresses the same items as in the strategic plan but is revised on an as needed basis as decided by upper management. The tactical forecast provides a daily forecast of incoming calls and Is done once a trend obviously reflects a straight continuous relationship. An S-curve is typical of a product’s growth and maturity cycle. The critical points on the S curve are where the trend makes a transition from slow growth to fast growth and from fast to slow. An asymptotic trend starts with the highest demand growth at the beginning, which then tapers off. Such a curve could happen when a firm enters an existing market with the objective of auto rating and capturing a large share of the market. An exponential curve is common in products with explosive growth as is often experienced with new high technology products. The exponential trend suggests that sales will continue’ to increase rapidly for some period of time-an assumption that may be questionable for longer time periods.