Business Case
Recruitment of a new
Administration Assistant
Business Case
Document Owner: Dave Ferdinand
General Manager
Compiled by: Paul Langtry Consultant
Version No: 1
Date: 7 April 2020
TABLE OF CONTENTS
EXECUTIVE SUMMARY ...................................................................................................................... 3
Background ............................................................................................................................... 3
Key Points.................................................................................................................................. 3
Background ............................................................................................................................ 3
Current state .......................................................................................................................... 3
Desired state .......................................................................................................................... 4
ALTERNATIVES ANALYSIS ................................................................................................................. 5
SUMMARY ........................................................................................................................................................ 6
RECOMMENDATION ........................................................................................................................ 7
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EXECUTIVE SUMMARY
Background
The purpose of this business case is to recommend the recruitment of a new Administration
Assistant to improve the productively of the Ferdinand’s Flying Services Team. This
business case summarises the current state and provides justification for the
recommendation, including evidence of flexibility and cost efficiencies gained to the
organisation.
Key Points
Background
The Team currently consists of Dave Ferdinand who is the owner-manager and chief pilot.
Virgil Tracey is employed as the second pilot. The business also employs Neville Parker as a
mechanic / general hand, and Penelope Farrington Smyth as a part-time administration
officer.
Business has increased over the last year particularly in the passenger flights income
stream. Occupancy of flights has increased by 83.3% over the last quarter. Customer
satisfaction levels indicate that this increase is forecast to grow further.
It has been identified that there is a need to increase administrative efficiency to deal with
additional workloads that are generated by the increase in passenger flights. Part of this
efficiency can be achieved by the recruitment of a new staff member in the administration
team.
Current state
• Administrative support is currently provided part time by Penelope Farrington Smyth
on Mondays, Wednesdays and Friday mornings.
• On Tuesdays Thursdays and Friday afternoons, telephone enquiries and walk in
enquires are handled by the mechanic / general hand Neville Parker supported by
Virgil Tracey if he is not flying.
• Whilst Neville is capable of handling the enquiries, he is not appropriately dressed to
deal with walk in customers. He wears overalls which due to the nature of his duties
are often quite dirty. This does not present a professional image for the business.
More importantly the time spent dealing with customers, impacts negatively on his
ability to maintain the aircraft. Whilst Virgil also assists with reception duties, he is
often flying so his attendance cannot be relied upon.
• Parts for the aircraft and other deliveries arrive throughout the week. It is critical that
that the arrival of deliveries is recorded to ensure timely payment of invoices and to
ensure Neville can maintain airworthiness. Some of the invoicing for services
rendered and payments of invoices for goods received have been delayed due to
dealing with new customers who are also new potential revenue streams.
• All staff including the owner manager have been required to work additional hours to
ensure that administration is being kept up to date. Whilst this is possible to
undertake in the short term, in the longer term this approach is untenable and will
lead to a drop in staff morale and eventually to increased staff turnover.
•
Whilst my preference would be to recommend increasing the working hours of
Penelope to full time, she has indicated that due to child care responsibilities she
wishes to remain part time on her current work roster. Penelope has demonstrated
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that she is a reliable worker and capable of taking on increased administrative
responsibilities for the business (for example bookkeeping, accounts
payable/receivable and following up delinquent invoices) albeit continuing to work part
time.
Desired state
A new staff member to be recruited to the administrative team. The new administration
assistant would deal primarily with office reception and telephone duties. This will assist with
sales and marketing and marketing for the business and in the long to medium term has the
potential to assist in managing future growth. Secondary duties would be filing, word
processing and providing additional administrative support for the business.
Further consideration could also be given to increasing the responsibilities of the current part
time administration officer to include basic bookkeeping and accounts/payable receivable.
These task are currently being undertaken by the owner manager after hours.
It is proposed that the Administration Assistant position be considered full time with hours
8.30 – 5.00pm, Monday to Friday.
.
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ALTERNATIVES ANALYSIS
The following alternatives are analysed. The option that presents the best value for
money is Option 1.
The following information assumes the current officer is paid $10,200 per year (2550 per
quarter working Part Time 2.5 Days a week) and all values are GST exclusive:
Option 1.
New Administration officer recruited:
Estimated Costs
Salary – including “super” (see justification below)
Recruitment advertising
Additional office equipment
Consultancy fee (including assistance with selection)
Net cost of recruitment for one year (12 mths)
$16320.00
$500.00
$2000.00
$1500.00
$20230
Assumptions and justification
As a new staff member undertaking a reduced level of tasks from that of the
current administration officer, it is proposed that this administration assistant
be paid at a base rate that is 80% of that of the current administration officer.
This salary package can be reviewed at the beginning of every financial year
to ascertain the contribution to business income that is being made. A reward
package based on successful bookings might also be negotiated in the future
but probably not during the training /probation period.
If requested our consultancy can manage and implement the administration
assistant recruitment process on your behalf. We would organise advertising,
shortlist applicants (you can make the final review) organise interview
timings, assist with the conduct of interviews (we assume you would like to
be the head of the selection panel), conduct reference checks and organise
medical checks.
Business Impact:
Whilst administrative costs may be difficult to analyse, revenue from
bookings has increased. This means that there must be demand for the
company’s services in the community.
It is possible that we may have missed potential bookings and sales due to
adhoc telephone answering processes and an unstaffed reception desk.
Asking other staff to cover gaps may work in the short term but will have
negative impacts in the long term as described above.
Option 2.
No Administration officer recruited:
Scenario 1: Business continues as is current practice:
Estimated Costs:
Cost of lost business from calls not answered
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Cost of additional overtime for other staff to answer
calls and greet potential customers
Cost of lowered mechanic productivity
Cost of lowered staff morale
Cost of owner-manager’s time spent with family
It is difficult to put a specific dollar amount to all of these costs however it is clear
that the cost of not doing anything will have serious long term impact.
Business Impact:
Cost of lost business the business is growing. This situation could
change at any time as different economic factors come into play.
Satisfied customers serviced during the good times will more often than
not stay with the business during a down turn, albeit at reduced rates of
business. We cannot afford to let potential customers go unattended.
Cost of additional overtime for other staff it is not economical to pay
additional time to a mechanic to complete mechanical work after hours
because he is busy during the day answering phones. The cost for the
second pilot to answer phones is even more inefficient.
Cost of lowered airworthiness and safety the importance of safety in
the aviation industry is paramount. Administration tasks cannot be
allowed to interfere with ongoing maintenance as the potential
consequences are catastrophic. Even a minor maintenance issue could
lead to customer mistrust and a resulting loss of business.
Cost of lowered staff morale People who undertake tasks that are not
their usual responsibility and that are not associated with their normal
duty statement will eventually lose motivation and become less
productive in their primary tasks. This could lead to staff absenteeism
and eventually employee turnover.
Cost of owner-manager’s time spent with family the ownermanager is already taking on the majority of the flying and other
managerial decision making duties. The flying duties mean that he is
often away from home overnight on executive passenger charter
business. The owner-manager is also undertaking most of the
bookkeeping for the business and following up on negligent invoices.
Adoption of this proposal will allow the current part time Administration
Officer to take on some of these more senior administrative
responsibilities relieving some workload from the owner-manager.
SUMMARY
The assumptions made in this analysis are made on the basis of the current economic status of the
company based on the current Profit and Loss statement.
Business has increased over the last year and it has been identified that to deal with additional
workloads and the potential for new business more administrative support is required.
The current part time administration officer staffing means that potential walk in clients are not
greeted appropriately on days when she is not working. Using the mechanic and second pilot to
deal with customer reception is also not efficient and could lead to resentment and a loss of staff
morale.
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The increase in business has generated additional high levels of administrative work including
invoicing and the payment of accounts.
A new administration assistant recruited to the business would deal primarily with office reception,
telephone duties and assist with sales /marketing, and other administrative support.
It is further recommended that the responsibilities of the current part time administration officer be
increased to include basic bookkeeping and accounts/payable receivable.
This proposal will establish an increase in efficiency and productivity will potentially increase in the
take-up of new business.
RECOMMENDATION
It is recommended that:
1.
Option1 is formally endorsed and approved
2.
A net capital budget of approximately $20230 be approved
Consultant Recommendation:
Name:
Signature:
Approved Capital Budget:
Manager Approval:
$
Mr Dave Ferdinand _______________________
Date:
March 2020
Project Cost Centre:
Name:
_______________________________________
Signature:
_________________ Date:________________
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