Volume 22, Number 1 - January 2006 through March 2006

A BSC Framework for Air Cargo Terminal

Design: Procedure and Case Study
by Mr. Chih-Hsien Chen and Dr. Shuo-Yan Chou

Peer-Refereed Article

KEYWORD SEARCH

Construction
Design
Management
Quality
Research
Transportation

The Official Electronic Publication of the National Association of Industrial Technology • www.nait.org
© 2006
 Journal of Industrial Technology • Volume 22, Number 1 • January 2006 through March 2006 • www.nait.org

A BSC Framework for Air

Cargo Terminal Design:
Procedure and Case Study
by Mr. Chih-Hsien Chen and Dr. Shuo-Yan Chou

Introduction three million metric tons (Moorman,

“Air cargo” is defined as “cargo de- 2000). When the airport is fully devel-
Mr. Chih-Hsien Chen is a doctoral student of Indus- livered by airfreight”. The airfreight oped, the cargo capacity will increase
trial Management at National Taiwan University of
Science and Technology in Taipei, Taiwan. He fo- business began in the early 1950s, as a to nine million metric tons per year.
cuses his research on the performance evaluation,
by-product of the airlines’ passengers Hong Kong is evaluating plans for two
continuous improvement, and process design for
logistics chain. Mr. Chen currently serves as lecture business. Only in 1975 did the business logistics centers in the airport, which
of Industrial Engineering and Management at Lee-
Ming Institute of Technology in Taipei, Taiwan. become independent and profit-orient- would enable companies to provide
ed. The demand for air cargo transpor- sourcing and distribution services to
tation has increased significantly over consignees. In the near future, some of
the last few years, because product life the Mainland’s 70 airports, including
cycles have shorted and the demand for Beijing, Shanghai and Guangzhou, will
rapid delivery has increased. be able to compete with Hong Kong,
which presently handles 40% of all
The air cargo industry incorporates an total foreign trade in China.
industrial supply chain, which includes
airlines, customs, ground services, air The Asia-Pacific is becoming the larg-
cargo forwarders, brokers, domestic est air cargo market, and the air cargo
transportation, air cargo terminals, volume of Taiwan CKS (Chiang-Kai-
distribution centers and integrated Shek) airport grew steadily over the last
international express services. Of these, 20 years. In 2001, the total capacity of
air cargo terminals are critical in the air the air cargo terminals at CKS airport is
Dr. Shuo-Yan Chou is a professor of industrial man-
cargo supply chain. A typical air cargo approximately 1.3 million metric tons.
agement at National Taiwan University of Science
and Technology in Taipei, Taiwan. His research terminal has three main users –airlines, After the new terminals have begun
interests include demand modeling, technology
lifecycle management, mobile commerce, and frac- air cargo terminal operators and for- operation and the present terminals
tal applications. He received his BBA in industrial warders/cargo-agents who are the prin- have been expanded, the total air cargo
management from National Cheng-Kung University, handling capacity of CKS airport will
Taiwan in 1993, his MS and PhD in industrial and cipal contributors to the revenue of air
operations engineering from the University of cargo terminals. The air cargo terminal be 3.7 million metric tons in 2006.
Michigan in 1987 and 1992.
operator must identify the requirements
of forwarders/cargo-agents in the design Purpose
of new facilities or services to serve best While focusing on air cargo terminals,
the interests of its users. Accordingly, this article proposes a novel proce-
the balanced scorecard (BSC) is used dure for designing such terminals by
to meet the design requirements for Industrial Technologists and others. It
customers, employees and stockholders. also presents a case study. The BSC
Additionally, quality function deploy- methodology is used herein to enable
ment (QFD) is applied to ensure concur- a company to develop a framework for
rently the quality of products/services establishing its design requirements.
during the design process. Additionally, a house of quality (HOQ)
is built for concurrent design, based on
Competition in the air cargo industry the QFD method. This study has two
has intensified recently. Hong Kong In- main purposes: to develop a procedure
ternational Airport, which sits on 1,200 for designing an air cargo terminal and
hectares of Chek-Lap-Kok Island, apply systematically the methodologies
handles around 32 million passengers of BSC and QFD in a case study of air
and 2.2 million metric tons of freight cargo terminals.
per annum, with an annual capacity of

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 Journal of Industrial Technology • Volume 22, Number 1 • January 2006 through March 2006 • www.nait.org

Conceptual Background and be sensitive to changes to improve- framework for improving performance.
The design process is highly compli- ments or management actions. Chen analyzed the cause-and-effect re-
cated because it depends on factors such lationships of strategies and developed
as the complexity of the process, the Ahn (2001) employed the BSC frame- a strategy map of a company’s mission,
range of product/service functions, the work proposed by Kaplan and Norton values and vision, and then explicated
industrial environment and the volume (1992, 1993) to integrate a company’s strategic themes and derived perfor-
of components. Yang, Hsu and Ching mission, values, vision, strategy into mance improvement measures.
(2002) employed the five logical tools of the four perspectives of BSC, which
the thinking process to analyze the three subsequently evolve into the company’s Akao introduced QFD in 1972 in Japan,
product designs to facilitate manufactur- performance targets and indicators. as part of his work at the Mitsubishi
ing, shorten time-to-market, and produce Heavy Industries Kobe Shipyard. QFD
more customer-oriented products. With respect to the non-financial related can be used to store the desires and
Meanwhile, the Pre-Requisite Tree and evaluation, van Veen-Dirks and Wijn requirements of customers, supporting
Transition Tree of the five logical tools (2002) claimed that companies should customer satisfaction (Evans & Dean,
can be applied to deploy the specifica- focus more on non-financial perfor- 2003; Wasserman, 1993). Nahm and
tions of air cargo terminal design. mance indicators, given rapid changes in Ishikawa (2004) claimed that QFD is
the environment. not just a quantitative evaluation tool
In 1961, 91% of the time taken to ship but also a means of planning used in
air cargo was spent on the ground. Lobo With respect to applications of BSC to concurrent engineering (CE). All major
and Zairi (1999a) found that an air cargo information management and informa- functions that contribute to getting
shipment passed through an average 40 tion technology, Protti (2002) employed a product/service to market involve
hands and was associated with 12 indi- BSC to evaluate the applications of an continuous product/service develop-
vidual documents as it moved from the information system of National Health ment. They depend on the realization
shipper to the customer. The air cargo Service (NHS) in UK. The results of the original concept in sales, use and
shipment took a total of six days in revealed that analyses of the positive disposal. QFD is implemented not only
1988. Hence, the air cargo industry has and negative effects of an informa- in physical product design, but also in
been focusing on process design/man- tion system through the applications of non-physical product design. J. Chen
agement beyond organizational boundar- BSC could result in the development of and J. C. Chen (2001) systematically
ies. Performance variables must still be important performance indicators of the studied a case study to select textbooks
identified to design better the air cargo NHS. In 2003, Stewart and Mohamed for use in manufacturing-related tech-
terminal with improved efficiency and (2003) used BSC as a framework to ana- nology courses based on a QFD-based
quality of service. lyze the benefits of exploiting informa- framework.
tion technology to project management.
Fielding, Glauthier and Lave (1978) Lee and Ko (2000) established a frame-
and Dajani and Gilbert (1978) ad- With respect to applications in the field work for developing and implementing
dressed standard variables and per- of transportation, Poli and Scheraga a corporate business strategic plan. The
formance indicators for monitoring (2003) designed a BSC framework to framework has two steps. The first step
and managing transportation and elucidate customer satisfaction from is to conjoin the SWOT matrix with
transit systems. Some of the devel- five perspectives. The results revealed the BSC to construct a systematic and
oped guidelines can thus be applied to that transportation operators must find holistic strategic management system,
identify variables that correlate with the a balance among all quality perspec- and the second step uses the QFD
performance of an air cargo terminal. tives and prioritize the needs of key method with the BSC and the main
Humphreys and Francis (2000) stated customers. Rouse, Putterill, and Ryan strategies of Sun Tzu. SWOT, which
that the measures most commonly (2002) spent four years monitoring the stands for strength, weakness, opportu-
associated with airport performance performance and studying the control nity and threat, is a systematic tool for
measurement include overall cost, gen- systems used by international air- developing strategies. Lee, Lo, Leung
erated revenue, productivity of labor lines in maintenance. The monitoring and Ko (2000) presented a framework
and productivity of capital. Seneviratne and control system evolved from the for formulating a vocational educa-
and Martel (1991, 1994) claimed that a mathematical model of BSC eventu- tion strategy by linking SWOT, BSC,
variable should satisfy certain criteria ally became an integrated performance QFD and MBNQA (Malcolm Baldrige
before it can be considered a useful evaluation system. The results of that National Quality Award). Their strategy
index of performance. It should reflect work supported the development of formulation framework has four parts
specific management goals; be simple an accurate and effective performance - SWOT analysis, linking SWOT with
to define and quantify; not require feedback system. C. H. Chen and Chou BSC, deploying all indices of MB-
extensive and expensive data collection, (2004) was the first to apply BSC in air NQA, and merging BSC with MBNQA
cargo terminal research to develop a using the QFD method.

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 Journal of Industrial Technology • Volume 22, Number 1 • January 2006 through March 2006 • www.nait.org

Procedure for BSC-based Air ensure outstanding internal processes, in the first matrix (“WHATs”). The sec-
Cargo Terminal Design which will in turn be the basis of in- ond and the third matrices include the
ternal process, customer, and financial “HOWs” and the relationship matrix,
BSC to Meet Design Requirements perspectives. However, the organiza- as determined by BSC analysis. Finally,
The BSC framework is used to develop tional climate is the leading indicator of the technical importance matrix and the
the customer requirements and design the employee turnover rate, employee importance of customer requirements
requirements to meet in air cargo termi- productivity and internal process matrix are determined by using HOQ
nal design. It ensures that all employees perspective. Additionally, employee and a questionnaire survey.
are in line and are striving toward a competence is not only a leading
common mission. This is one of the indicator but also the basis of the BSC Case Study
most important values of a BSC. A mis- framework. Case Study Profile
sion is the origin of work. The vision of Taiwan CKS airport is geographically
a company helps to develop a flexible QFD for Concurrent Engineering better located than any other main
and adaptive strategy from the missions The core of QFD is the matrix, called Asia-Pacific cities (Hong Kong, Shang-
and core values. The vision is the pic- the HOQ. It comprises two main parts - hai, Manila, Soul, Tokyo, Singapore,
ture that includes the targets to be met the “WHATs”, and the “HOWs”. When Sydney) in terms of average flight time
in the next five, ten or 15 years. A vi- QFD is employed, the most important between these cities. The costs of labor
sion should not be abstract—but should tasks are to define and understand the and property in Taiwan are lower than
be as clear as possible in outlining the “WHATs”, which are the needs of the those in Hong Kong, Tokyo and Sin-
organization’s themes and providing internal and external customers, and to gapore. Additional, Taiwan has better
the organization with a basis for setting define the “HOWs” to meet the custom- trade and industrial bases than Manila,
strategies and targets. ers’ requirements. The four perspec- with greater resources for courier
tives of BSC constitute the “WHATs” service providers. There, the United
Based on Kaplan and Norton (1996, of QFD. The procedure for formulating Parcel Service, Inc. (UPS) established
2004), the financial perspective remains the key performance indicators (KPIs) its Asia-Pacific transit center at CKS
an important tool for companies, since it can be applied to derive the “HOWs” airport in 1991. Table 1 reveals that the
reflects the results of any actions taken associated with QFD. mean annual growth rate of the cargo
to improve customer satisfaction and volume in CKS airport over the last
loyalty, process efficiency, quality and Integrating BSC and QFD facilitates 20 years is 11.3%. In 2004, the total
innovation, all to produce financial bene- CE toward the common goal of ensur- import and export cargo volume to and
fits. Improving customer satisfaction and ing the satisfaction of shareholders, from CKS airport was 1.7 million met-
increasing customer loyalty to achieve employees and external customers. The ric tons, representing an annual growth
the goal of financial perspective are the concept of QFD for product develop- rate of 13.4% over the preceding year.
main strategic objectives of customer ment, elucidated in Ermer and Kniper Air cargo terminals and the airlines
perspective. Acquiring customers, reten- (1998), can be translated into a design in Taiwan are still expanding quickly,
tion of customers, and meeting cus- framework for an air cargo terminal. as they seek to exploit Asia’s robust
tomers’ expectations are typically key The voices of shareholders, employees growth in trading and manufacturing.
determinants of customer perspective. and external customers are incorporated

The internal process perspective com- Table 1. CKS airport cargo volume
prises innovation, operation and post-
sales service. Innovative process flow is Volume Growth Volume Growth
used to design or develop new products 1984 214,479,600 17.2% 1995 754,489,258 13.9%
or services, to attract new customers 1985 234,338,300 9.3% 1996 796,459,768 5.6%
and to satisfy customers’ requirements.
The operation process flow begins with 1986 286,961,200 22.5% 1997 913,519,573 14.7%
receiving an order and ends with the 1987 345,652,600 20.5% 1998 932,052,762 2.0%
delivery of products or services. It must 1988 343,453,600 -0.6% 1999 1,057,236,939 13.4%
be highly efficient, consistent with ser- 1989 384,372,100 11.9% 2000 1,208,838,480 14.3%
vice time and include on-time delivery.
The post-sale service process increases 1990 400,597,000 4.2% 2001 1,189,873,251 -1.6%
the value-add of products or services 1991 451,032,712 12.6% 2002 1,380,748,058 16.0%
used by customers. 1992 522,448,895 15.8% 2003 1,500,070,877 8.6%
1993 559,192,235 7.0% 2004 1,701,020,000 13.4%
Strategic objectives and performance
indicators of employees’ learning and 1994 662,256,874 18.4% Average Growth 11.3%
growth perspective are used mainly to Source: Aviation Department, Transportation Ministry, Taiwan

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 Journal of Industrial Technology • Volume 22, Number 1 • January 2006 through March 2006 • www.nait.org

Taiwan’s air cargo terminals have been gation of the company’s documents, industrial bases than other Asia-Pacific
expanding rapidly in recent years. The an analysis of forces driving industry countries. The opening of the market,
privatization of Taiwan Air Cargo Ter- competition and a SWOT analysis. Fi- regional competition, and political tur-
minal Logistics (TACT) was completed nally, the four perspectives of BSC are moil are potential threats to the further
in the year 2000 and by converting to used to derive corresponding measures. development of the company in the
the Build-Operation-Transfer (BOT) Figure 1 presents the process for devel- case study.
business model. In this BOT model, the oping the BSC strategy.
case company built and operated the air The aim of the cause-and-effect rela-
cargo terminal of Taiwan under an ex- The industrial environment and strat- tionships chart is to help the company’s
clusive permission by the government. egy are analyzed, using the analysis employees understand swiftly the
When the permit expires in 20 years, of forces driving industry competition relationships among strategies, as dis-
the operation as well as the facilities (Porter, 1980) and SWOT analysis. Fig- played in Figure 3. As well as helping
will be transferred back to the govern- ure 2 and Table 2 provides the results of employees understand the priorities and
ment without any financial reciproca- the analysis. According to the analysis relationships among the four perspec-
tion. In 2002, it conducted an expan- of forces driving industry competition, tives of BSC, the cause-and-effect
sion project, increasing its annual cargo the room to negotiate prices is small for relationships chart can also help in
capacity to 1.5 million metric tons. the case company because it is a BOT deriving strategic objectives associated
business and has cross-holding rela- with the four perspectives. Interviews,
Evergreen Air Cargo Service Corp. tionships with downstream companies. documentary analyses, questionnaire
(EGAC) was established in March With respect to the forces associated surveys from 2002 and 2003 on for-
2000, and began operating in 2002. Its with new entrants and substitutes, the warders where the respective sample
annual cargo capacity was half a mil- entry barrier in Taiwan appears to be sizes are 108 and 109, strategic analy-
lion metric tons. Far Glory Air Cargo high. The threat from the substitutes sis and a cause-and-effect relation-
Terminal Co., Ltd (FGAC) and Ever in the short term is unclear, but the ships chart were used to derive a BSC
Terminal Co., Ltd (EverTer) in the area threat over the long term is evident. model of the case company, as part of
surrounds the airport, have an annual The SWOT analysis indicates that the a strategy map, as shown in Figure 4.
cargo capacity of 300,000 metric tons. technologies transfer and the retention An overview of the case company’s
Far Glory Air Cargo Park, a free trade of old customers from the pre-BOT strategy, with its strategic theme as
zone (FTZ) inside the airport, and the company are strengths. The weak- the main focus, is clearly presented.
Guanyin Logistic Zone in Tao-Yuan nesses of the case company are the old The strategy map of the case company
County, are expected to begin op- facilities and poor quality of operating provides three benefits to its employ-
erations in 2006. The planned annual procedures. The opportunities are based ees: it improves communication among
cargo capacity of FTZ is one million on the fact that Taiwan is geographical- departments, understanding of the op-
metric tons, with an area of 45 hectares. ly well located and has better trade and erating targets associated with the four

Development
Figure 1. BSC strategy developing flow
Before the cause-and-effect relation-
ships are analyzed and the KPIs are
determined, the mission, core values
and vision of the enterprise must be
established. The mission, core values
and vision for the case company are
elucidated and analyzed through a se-
ries of interviews with senior managers
and an investigation of the company’s
documents, including planning propos-
als, project plans and research reports.
However, the questionnaire submitted
by the customers at the company in
the case study for the last three years,
revealed that the most unsatisfactory
items are inefficiency of the internal
process and poor quality. The strategy
theme will involve an expansion project
and ongoing improvement activities to
increase efficiency and quality through
the questionnaire analysis, an investi-

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 Journal of Industrial Technology • Volume 22, Number 1 • January 2006 through March 2006 • www.nait.org

perspectives and their relationships, and variables from the responded question- as an estimate, which is one fourth of
the establishing of consensus in striving naires. the total weights. This is based on the
for a common goal. recommendation in Kaplan and Norton
Absolute importance = (very important (2001), where they propose a balanced
A customer orientation is critical to × 3) + (normal × 1) – (unimportant × weighting scheme with the financial
ensuring that QFD satisfies customers’ 1) – (very unimportant × 3) (1) measures receiving only 22% of the
expectations of products and services. relative weight. Moreover, the absolute
The questionnaire surveys of customer The importance index for the financial importance measure can be transformed
satisfaction toward forwarders con- perspective could not be obtained from into a relative importance measure, by
ducted in 2002 and 2003 yielded KPIs in the questionnaire. Alternatively, the dividing the importance of individual
the perspectives of customer and internal average of the values measured from perspective over the sum of the impor-
process. Indices of learning and growth the other three perspectives is adopted tance of overall perspectives.
are derived, based on the eight evalu-
ation items of Hellriegel and Slocum Table 2. SWOT analysis
(1974) and Hoy, Smith, and Sweetland
(2003), to measure the impact of the Strength Weakness
goal of an open and healthy organi-
zational climate. Lantz and Friedrich 1. Technology transfer 1. Old facilities
(2003), Kor (2003) and Clasen, Meyer, 2. The retention of old customers 2. Lack of instant information
Brun, Mase, and Cauley (2003) posited 3. Operation team 3. Not convenient in custom operation
that functional competence, cogni- 4. Cargo volume increasing steady 4. Limited by government regulations
tive competence, human relationships 5. Business entrance barrier
competence and work experience govern
overall employee competence.
Opportunity Threat
Developing KPIs is one of the most 1. Geographically better located in Asia- 1. Market open for foreigners after join-
important tasks in BSC. Not only are Pacific’s area ing WTO.
KPIs useful in evaluating performance, 2. Business diversification 2. Global economic cycle
but they also serve as a basis for com- 3. Asia-Pacific transit center 3. More competitors in the Asia-Pacific
panies to redesign an air cargo termi- 4. Cargo volume growth resulting from Area and PRD A5
nal by QFD. The strategic theme, a new air cargo park 4. New competition from domestic
cause-and-effect relationships analysis, 5. Aviation city development and high companies
and a discussion and alignment of the speed train ready soon 5. Terrorism threat
strategy map, were considered to derive 6. Intermodal air-sea transportation 6. Threat of regional wars
the strategies, strategic objectives and 7. High-Tech industry development and 7. Political turmoil
KPIs for the balanced business score- short transportation time needed 8. Industries moving to other countries
card of the company in the case study
(as shown in Table 3). All of these
in Table 3 are used to establish the Figure 2. Forces driving industry competition in air cargo industry in Taiwan
customer requirements (“WHATs”), the
design requirements (“HOWs”) and the
relationship matrix.

In 2004, a questionnaire survey on for-

warders where the sample size is 100
was conducted to analyze the impor-
tance of the three perspectives. Based
on the 2004 questionnaire survey, the
customers’ priorities concerning ser-
vices were analyzed from three per-
spectives (customer, internal process,
learning and growth), and customer
requirements were determined to have
absolute importance values of 112, 139
and 94. The importance values 112,
139 and 94 are calculated by using
Equation1 with the values of the input

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 Journal of Industrial Technology • Volume 22, Number 1 • January 2006 through March 2006 • www.nait.org

Wasserman (1993) noted a formula for matrix. In addition, the design require- dicator, but also it is the basis of bench-
the importance of design requirements, ments of all inter-correlations are as- marking for improving performance.
as presented in Equation 2, in which the sumed to be positively correlated with Lobo and Zairi (1999a) set the target
technical importance of design require- each other; the inter-correlation matrix ROI to 20% as an example of financial
ment is the importance of customer and competitive evaluation are exclud- benchmarking of the expansion plans of
requirements multiplied by relationship ed, which fact is one of the limitations the case company. Customer satisfac-
indices. on this work. tion is the leading indicator of customer
loyalty. The interviews with customers
Wj =Σ( di × Ri,j ) From the financial perspective, the in this investigation reveals that the
(2) increase in cargo volume is the leading availability of parking, service attitudes
where indicator of profitability; not only is it and professionalism most strongly af-
the traditional financial performance in- fect customers’ perspectives.
Wj: absolute, technical importance of
design requirement j; j = 1,2…n.
Figure 3. Cause-and-effect relationships chart
di: degree of importance of customer
requirement i; i=1,2,…,m.

Ri,j: quantified relationship index

between customer requirement,
i, and design requirement, j; i =
1,2,…,m; j = 1,2,…,n.
The relationship indices between
customer requirements and design
requirements are represented on a
1-3-5-9 scale. The relative technical
importance indices are the same cal-
culation procedure as described in the
relative importance measure. Finally,
the authors developed five matrices of
the HOQ—the customer requirement
matrix, the design requirement matrix,
the relationship matrix, the importance
of customer requirement matrix and
the technical importance matrix—as
presented in Figure 5. Figure 4. Strategy map

Discussion
The relationship matrix in Figure 5 is
developed based on cause-and-effect
relationships of BSC (Figure 3) and
the frequency of customer complaints
obtained from surveys conducted in
2002, 2003, and 2004 for forwarders
and airlines. The technical importance
matrix is subsequently calculated by
the relationship matrix and the matrix
representing the relative importance of
customer requirements. With the results
of technical importance matrix, it can
be used not only to deploy the QFD
continuously, but also to plan and con-
trol the budget of this expansion project
by considering the evaluation of current
status, the benchmark analysis and the
cost factors in the design requirement

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 Journal of Industrial Technology • Volume 22, Number 1 • January 2006 through March 2006 • www.nait.org

Figure 5. HOQ for air cargo terminal design

Table 3. Balanced business scorecard

Strategies Strategic objectives KPIs/”HOWs”

1. Profitability Steady, continuous operation and profit 1. Cargo volume growth
Financial

2. Cargo volume growth growth. 2. Space effectiveness

3. Market share
4. Net income
5. ROI
1. Customer loyalty Through the enhancement of customer sat- 1. Service attitude
Customer

2. Customer satisfaction isfaction, improve customers’ loyalty and 2. Aavailability of parking

cargo volume growth. 3. Professionalism
4. Top ten customer volume
5. Customer retention
1. Post sale process Improve customer satisfaction through the 1. Non-general cargo service
2. Operation process enhancement of innovation, operating effi- 2. Degree of automation
Internal process

3. Innovative process ciency, security and after sales service flow. 3. MHS
4. Density of storage position
5. Process efficiency
6. Cargo safety
7. Accuracy of invoices
8. Compensation for cargo missing/damaged
1. Employee productivity Through the learning and growth of em- 1. Employee productivity
Learning and

2. Employee turnover rate ployee, and company to reduce the em- 2. Employee turnover rate
3. Organizational climate ployee turnover rate, increase the produc- 3. Organizational climate
growth

4. Information technology tivity, then improve the internal process. 4. Information technology IT infrastructure
IT infrastructure 5. Employee competence
5. Employee competence

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 Journal of Industrial Technology • Volume 22, Number 1 • January 2006 through March 2006 • www.nait.org

All the indicators of the internal pro- be used to predict problems in advance nal Logistics and China Engineering
cess perspective are the driving factors of operation, financial or post sales Consultants, Inc. (CECI) under CECI
of the customer perspective. Some of service during the design stage. (2002) Contract No. 002326. The
the KPIs of the internal process per- authors are also greatly indebted to col-
spective are the results of questionnaire Although the financial indices are the leagues from Lufthansa Consulting for
analyses performed in 2002 and 2003. lagging indicators of the other three co-working on this project.
Of these, facility utilization, facility perspectives, employees and sharehold-
efficiency, storage turnover rate and ers of the case company assert that References
waiting time should be considered by financial indices are some of the most Ahn, H., (2001). Applying the balanced
the case company in redesigning and important during the design stage. Ad- scorecard concept: an experience
improving its operational flows. Lobo ditional, the desires of both customers report. Long Range Planning, 34,
and Zairi (1999a, 1999b, 1999c) stated and terminal managers were studied in 441-461.
that FedEx could handle cargos of any the customer perspective. Three con- Chen, C. H. & Chou, S. Y. (2004, July).
weight, size or shape in non-general secutive years of questionnaire study A BSC framework for air cargo ter-
cargo service. Singapore Airlines pro- reveals that most of the complaints minal performance improvement: a
vides special containers to maintain the were about service attitude, availability case study, ISPE international Con-
temperature of perishable goods for 48 of parking, and professionalism. Ac- ference on Concurrent Engineering,
hours. KLM has 80 years of experience cordingly, the case company improved China, 11, 823-828.
in handling live animals. these issues with strong weightings in Chen, J. & Chen J. C. (2001). QFD-
the customer perspective as part of its based technical textbook evalua-
Finally, the KPIs of learning and expansion. From the view of terminal tion—procedure and a case study.
growth comprise qualitative and quan- managers, KPIs of the internal process- Journal of Industrial Technology,
titative indicators. The learning and es must be measured to redesign the 18(1), Retrieved March 14, 2005,
growth of the organization constitute terminal. Restated, the utilization, the from http://www.nait.org/jit/Ar-
the basis for the success of BSC from availability and efficiency of material- ticles/chen110701.pdf
the financial, customer and internal pro- handling equipment, the utilization and Clasen, C., Meyer, C., Brun, C., Mase,
cess perspectives. The QFD required turnover rate of the storage positions W. & Cauley, K. (2003). Develop-
by the customers is determined from and space, and the process operating ment of the competence assessment
the opinions of internal and external efficiency should be addressed. tool—mental health, an instrument to
customers. Accordingly, learning and assess core competencies for mental
growth are the most important per- The BSC framework is such that learn- health care workers. Psychiatric Re-
spectives in relation to both BSC and ing and growth perspectives represent habilitation Journal, 27(1), 10-17.
QFD. The organizational climate is the a basis for reaching financial, customer Dajani, J. S. & Gilbert, G. (1978). Mea-
leading indicator of employee turnover and internal process design targets. The suring the performance of transit
rate, employee productivity and internal case study indicates that enhancing the systems. Transportation Planning
process perspective. information technology infrastructure and Technology, 4, 97-103.
and employee competence, and mak- Ermer, D. S. & Kniper, M. K. (1998).
Conclusion ing the organizational climate open Delighting the customer: quality
This study proposes a design frame- and healthy, can improve employee function deployment for quality ser-
work for air cargo terminals, based productivity and reduce the employee vice design. Total Quality Manage-
on BSC methods. The BSC method- turnover rate. The case company ment, 9(4/5), 86-91.
ology involves three main groups of should focus on information technol- Evans, J. R. & Dean, J. W., Jr. (2003).
people—employees, shareholders and ogy infrastructure more strongly than Total quality: Management, orga-
customers. This work concerns the de- on employee competence in designing nization, and strategy (3rd ed.).
sign goals of the case company during their expansion. Learning and growth Mason, OH: South-Western.
expansion. The conceptual framework is the most difficult perspective to Fielding, G. J., Glauthier, R. E. & Lave,
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terminal are established. These per- requirements will be included in future measures, research and contingen-
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the heart of balanced business score- Journal, 17, 255-280.
card and are applied to identify design Acknowledgments Hoy, W. K., Smith, P. A. & Sweetland,
requirements for air cargo terminals The authors are grateful for the spon- S. R. (2003). The development of
based on the HOQ of QFD. QFD can sorship of Taiwan Air Cargo Termi- the organizational climate index for

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