In his groundbreaking book, “Mega trends—Ten New Directions Transforming Our Lives,” John Naisbitt boldly identified the major global shifts.
Many of which had a profound impact on the world at the time.
I’ll leave it to you to validate how many of his observations actually came to pass (many indeed have).
But, the beginning of the New Year is an appropriate time take stock of the key trends occurring in any industry.
At Gray Stone Advisors, the work that we do with numerous flight departments provides us with a unique perspective of the business aviation industry and the changes that are taking place within it.
Five Key Business Aviation Trends
There are five key trends underway that have the potential to significantly change the face of business aviation as we know it today.
In this blog, I’ll share the most significant shifts with you. Then, in subsequent blogs, we’ll delve deeper into each one and give you some thoughts on how to leverage them for success within your own flight department.
As we begin, bear in mind the words of John Naisbitt, “Trends,like horses, are easier to ride in the direction they are already going.”
Following are five key business aviation trends we’re seeing:
1. The Shift from Isolation to Alignment
Today, flight departments that still cling to the out of sight, out of mind philosophy are finding it very difficult to succeed. The line of thinking that advocated that the flight department should “stay off the radar screen” was found to be ineffective somewhere in the late 20th century. The shift now is to be come fully engaged and aligned with the parent company or host organization.
There is no way that an aviation operation can succeed if it does not clearly define its mission, is not sharply focused upon it and does not take proactive measures to ensure that it understands precisely what produces value for the parent company or host organization.
2. The Shift from Aircraft Operator to Strategic Business Partner
It used to be that the flight department was viewed by corporate as “the folks at the hangar,” whose job was strictly to transport senior executives from Point A to Point B. There is no doubt that the strategic executive transportation aspect of the mission remains vitally important, but these days, there’s a lot more.
The most effective flight departments today have shifted to the role of strategic business partner and now have a seat at the strategic planning table. They are engaged in business planning discussions and aviation is fully integrated into the business planning process for the enterprise.
3. The Shift to Lower Corporate Reporting Positions
Historically, the flight department reported at very senior levels within the parent company, frequently to the Chairman, CEO or another senior-level executive in the parent company. Such a reporting position resulted in the flight department being fully supported and resourced without much effort on its part.
Over the last several years, there is a noticeable shift to flight departments reporting lower within the parent company. Often, the reporting executive is not an authorized user of company aircraft. In such cases, the flight department must invest extraordinary efforts to familiarize the reporting executive with business aviation and the value proposition provided to the parent company.
The flight department of today has often lost its “preferred”status within corporate (with respect to resourcing), and must work aggressively with all other corporate functional groups to compete for the resources it needs to execute its mission.
4. The Shift from Technical Expert to Credible Influencer
Because of the lower reporting position in the parent company, today’s flight department leaders need a new set of skills and competency sets to succeed, largely business related.
However, these skills sets are very frequently not resident within the organization. Prime among them is the ability to successfully make compelling business cases to obtain the scarce resources it needs to execute its mission.
Such resources can include budget,manpower or capital equipment.
The competition for corporate resources is fierce, and the flight department must become highly skilled at creating the compelling business rationale that can justify the resources requested.
Other functional group leaders who report to the aviation reporting executive are competing in the same limited resource pool and are usually very good at doing so.
Aviation must retain its technical prowess, but become an equally adept credible influencer to obtain the resources it needs to execute its mission.
5. The Shift to Outside On-Demand Aviation Providers
Why are the above industry shifts so important to the flight department of today? One merely needs to look at the trend toward external management companies to understand the answer.
With each passing week, more flight departments are being outsourced to management companies.
We at Gray Stone Advisors are hearing more and more from corporate leaders that “there’s too much drama in the flight department and they require too much effort to manage effectively.”
We believe that there are many good reasons that management companies exist, but one of them should not be that “the flight department is too hard to handle.”
Flight departments must be very good at leading themselves effectively as the “business within a business” that they truly are.
For further insight, refer to Jim Lara’s comments in last year’s article in Aviation International News.
How Does a Flight Department Adapt?
In subsequent blogs, we’ll look further into these business aviation industry shifts and provide some insight into how flight departments can effectively adapt and in fact be highly successful in today’s rapidly evolving corporate environment.
In the meantime, I leave you with another quote from John Naisbitt, “When you make a decision that is compatible with the overarching trend, the trend helps you along”
What other major shifts or trends do you see in business aviation today? Please feel free to share them with us in the comments section below.