Strategic Management - USA Truck Case Study

The company also provides a free toll phone number where the customers can call, as well as an online tracking capacity.

Operations

The operations are coordinated so as to ensure the company's strategic objectives. The capacity to track the routes online, notably where the products are at a certain point, is a great operational advantage. On the other hand, the company has also entered the truck sales market, offering tractors maintained in good condition to interested third parties.

IV. Financial Analysis:

While the company's base revenue has remained at similar figure in 2006 as in 2005 (around $400 million), the company's net income has dropped from just under $16 million to a bit above $12 million. The growth itself was affected by the decrease in demand, due to the general decreasing trend in the U.S. economy throughout 2006. Further more, the company has not yet managed to fully control costs, which is why this is one of the company's projected objectives for the future, along with margin expansion.

The operating ration decreased from a high of 96.5% in 2002 to 91.1% in 2005, only to rebound in 2006 to 93.1%. Cash flows from operations also increased with up to 34.8% in 2006 (see Appendix 1 for more relevant financial and operating information).

V. Assumptions/challenges/objectives

The challenges for the company are likely to come both from general economic and business factors, as well as from those deriving from the highly competitive and fragmented market in which the company is operating. In terms of the general economic and business factors, things that can raise overall operation costs, such as the increase in fuel price, for example, is something to be taken into consideration. On the other hand, the high competition on the market will ensure the survival only of companies able to provide the best quality services at the lowest prices.

The company has already fixed its objectives, both in terms of strategic and operational objectives. The strategic objectives have been previously emphasized in one of the former chapters.The operational objectives include increasing service to shippers, controlling costs, increasing operational efficiency and continuing the technological development.

VI. Alternatives

The company's alternatives are determined by the objectives previously defined. In fact, at this point the company can, at a strategic level, decide either to become more competitive and remain in the business, or enter a different or alternative business. The latter alternative is not feasible, since the managerial team has already formulated clear objectives for the future.

However, the implementation of the preferred alternative, remaining in the trade, will imply that the company will monitor its costs and attempt to increase its overall efficiency and profitability. The costs can be improved by technological advance and by further motivating the drivers and other employees.

VIII. Resolution/implementation/control

The monitoring and control function will need to constantly refer to the financial and operational objectives that have been fixed by the managers. In this sense, control will virtual reflect on the company's capacity to cut down on its costs, as well as its capacity to increase productivity and employee efficiency. At the end of a fiscal year, the operating ratio can be calculated and the proper conclusions drawn from this.

Appendix 1

Appendix 2

Bibliography

1. Investors Relations. On the Internet at http://www.usa-truck.com/.Last retrieved on September 16, 2007.

2. Sector Snap: Freight Carriers Mixed. September 2007. On the Internet at http://biz.yahoo.com/ap/070914/freight_carriers_sector_snap.html?.v=1.Last retrieved on September 16, 2007

3. Yahoo Finance. On the Internet at http://finance.yahoo.com/q/co?s=USAK.Last retrieved on September 16, 2007

4. 2006 Annual Report. On the Internet at http://www.usa-truck.com/.Last retrieved on September 16, 2007

Investors Relations. On the Internet at http://www.usa-truck.com/.Last retrieved on September 16, 2007.

Sector Snap: Freight Carriers Mixed. September 2007. On the Internet at http://biz.yahoo.com/ap/070914/freight_carriers_sector_snap.html?.v=1.Last retrieved on September 16, 2007

Yahoo Finance. On the Internet at http://finance.yahoo.com/q/co?s=USAK.Last retrieved on September 16, 2007

2006 Annual Report. On the Internet at http://www.usa-truck.com/.Last retrieved on September 16, 2007.....