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FLIGHT DEPT BASICS

Finding the right business airplane

Choosing an aircraft and the ownership model and operating structure can be daunting. A successful outcome depends on a measured approach to matching needs and alternatives.

By Don Van Dyke
ATP/Helo/CFII, F28, Bell 222
Pro Pilot Canada Technical Editor


Efficient identification and communication of transport needs distinguishes requirements from exceptions, using appropriate expertise to "trust but verify" all opinions.

As world economies inch toward recovery, many companies will be considering how travel will feature in their strategies.

Competitive organizations often use travel to create corporate advantage, selecting modes appropriate to their business. Increasingly, small to medium-size companies may consider dedicated aircraft for the first time, believing that business aviation may fill gaps left by other transportation forms.

Professional pilots who understand aircraft selection, ownership and operating models can clarify concepts and jargon which decisionmakers may find complex and confusing. This article suggests a basic, needs-based strategy to match travel profiles and the aviation market that seeks to serve them.

Opportunity

For the business traveler tied to short-term planning, an airline seat may be increasingly unsuitable, either because it is scarce, expensive or unattractive.

The alternatives are clear—gain use of an aircraft through charter, lease or prepaid time cards, buy all or part of an aircraft, fly the airlines or don't travel.

Since the onset of the global recession in 2008, companies have greater concern both for the value-yield of corporate aircraft and for avoiding the appearance of corporate excess.

If aviation is to be considered for employment, related decisions must be founded on a robust business case.

Process

Airlines operate to a business model whose goal is profit. In business aviation, the objective is utility. The idea is not to select the aircraft first and then explore how it can best be used—rather, it is first to quantify and evaluate needs, then acquire a "best-match" aircraft using the following process:

• First, develop a travel profile, including metrics by which its accuracy can be measured. To get benefits from metrics, 3 things are needed—a valid benchmark identifying best practices, repeatability over time, and actionable outcomes that can lead to system improvement.

• Second, complete the process of aircraft selection using a framework which optimizes capital outlay, operating costs and other factors. Identify related metrics to measure the appropriateness of the selection.

• Third, operate the aircraft while using the metrics to measure the achievement of objectives.

• Finally, evaluate outcomes and adjust requirements and means as necessary.

The travel profile

A US DOT report states that, in 2000, 10 major airlines accounted for 90% of total domestic passenger air traffic. In 2012, the number stands at 5 and could drop to 4 with expected near-term consolidation.

Between 2007 and 2012, airlines reduced the number of scheduled domestic flights by 14%, leading to increased passenger loads and higher fares on regional flights.

A travel profile is a structured collection of information that considers business needs, business travelers and travel patterns. Travel profiles which focus primarily on aircraft and service providers as ends rather than means risk producing unfulfilled expectations and dissatisfaction as outcomes.

The business needs profile identifies needs as the opening stage of the user decision process. A business need is a required quality such as efficiency—but productivity may be more important to a corporation than almost any other factor.

In pursuing commercial superiority, businesses are relying increasingly on intangible assets like competitive, economic, social and enterprise value. Business aviation should be quantified in these terms, emphasizing how it will allow new connections to be made quickly and efficiently, accelerating activity and enhancing business relationships.

A business needs profile may include elements such as those shown in above table.

Metrics for the business needs profile quantify "value-added" terms to describe the return on investing in productivity and time.

The business traveler profile includes a statement of passenger characteristics and preferences regarding configuration, services, systems and amenities. According to the Bureau of Transportation Statistics (BTS), the typical business traveler is likely to be male, work in a professional, managerial or technical position, be 30–49 years old and have an income well above the average for the population.

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