Just a few days ago, I had a conversation with a long-time business aviation. He was lamenting tome that his company was considering a major change in its aircraft operations.
That is, moving from an in-house FAR Part 91 operation to an aircraft management company.
To be sure, the aircraft management company business model can be a very good fit. In fact, the financing agreements for some aircraft actually require that a third party aircraft management company be utilized.
However, in this particular case, my colleague's Part 91 organization has operated two super mid-size aircraft for some time.
I sensed from our conversation that it seemed quite likely to my colleague that the decision would be made to "go outside."
So, I asked him the obvious question, "Why?"
The most quizzical look came over his face followed by his candid reply, "I really don't know."
"WOW!" I thought to myself in amazement.
It was clear that he was distraught over the possibility that his flight department might be outsourced. So, at the risk of having him shut me down, I decided to probe a little deeper.
Here's how our discussion went:
Jim: "How much are the aircraft being used?"
BizAv Director: "We're normally flying each aircraft about three days a week, virtually every week. We have both aircraft on a high-utilization maintenance schedule to maximize availability. If they want to use them, I want to fly them."
Jim: "How often are you meeting with your corporate-level reporting executive?"
BizAv Director: "Now, that's really one of my pet peeves! Responsibility for the flight department has been bounced from executive to executive. I would like to meet with him every month,but I can't get on his schedule.
The last time I requested a meeting, which was about three months ago, his Executive Assistant told me to submit an agenda with a concise PowerPoint deck highlighting the key topics for discussion. You know,I really want him to tell me what he wants to talk about. Why should I have to create a presentation to have a simple discussion? I think he's just trying to avoid me."
Jim: "How's the department doing relative to your financial plan? What do your budget-to-actual operating expenses look like?"
BizAv Director: "We run a tight ship around here and only spend as much as is necessary. I get a call from corporate if there's a question, but we don't see much in the way of reporting. Frankly, Accounting does my budget whenever it's needed."
Jim: "Okay, I see. Well, how's the stability of your workforce? Do you have all of the headcount you need?"
BizAv Director: "Are you kidding? Do you know how tough it is keeping people with what corporate wants to pay pilots and maintenance techs? Getting HR to re-evaluate these positions is next to impossible. So, of course, we have recently lost three pilots and one maintenance technician. We have replaced them, but we had to send all three new pilots to get their type ratings and the new maintenance tech won't be back from school until next week. And … one of the guys that quit wrote this long,complaining letter to the CEO.
In the meantime, we had a couple of trips last week that we couldn't crew, so the CEO had to go on a charter. That was one big check! But, I haven't heard any complaints from corporate, so I guess everything has blown over."
Jim: "Let me ask you about just a couple more things. When you ask the aviation reporting executive or the CEO of your company to describe the value that business aviation creates for the firm, and for them personally, what do they say?"
BizAv Director: "You know, I have never asked them that question. But I would guess that their answer would be…maybe…speed? They bought these aircraft to travel. So, wouldn't the answer be 'speed'? I am going to ask that question if I can ever get an appointment with either of them."
[End of conversation]
Key Takeaways - Don't Lose Your Part 91 Flight Department
Well, what do you think? Do you smell trouble? I did,and I told him so. Unfortunately, my concern was not met with a receptive ear.
Over the years, we at Gray Stone Advisors has had many similar discussions with our clients (Part 91 certificate holders) who are seated at the other side of the table: CEOs, COOs, CFOs, executives, managers and staff professionals who use business aviation extensively to achieve their business objectives.
When we asked them what was the most valuable product that their aviation departments could produce fort hem, their answers have been virtually synonymous: "more usable time!"
When we probe further,asking them how they would like "more usable time" delivered at the flight operator service level, their most common replies included:
- "Aviation should be a department that is well-run, with the professionalism and discipline of a support business within my core business."
- "No fanfare, no fuss."
- "Simple, efficient, timely"
- "No drama, no surprises."
So, the next time you talk with your colleagues and the topic of "alternative Part91 operator strategies" enters the conversation, you might want to start by asking them some diagnostic questions like those above.
The role of the flight department within the world's leading business environments, and especially the flight department's leadership, has been completely transformed over the last 5years to meet the current and future demands within an ever-changing global economy.
As business aviation leaders, we must inspire our organizations to deliver what our corporate leaders and owners are eager to leverage—more usable time—in a predictable,hassle-free and efficient manner.
To accomplish this, aviation leaders must be proactively connected and aligned with their firm's requirements while continually anticipating what will be needed not only today, but tomorrow, next week, next year and for the foreseeable future.
This is what today's corporate leaders expect. If you're not providing a "high-touch, high-service"Part 91 organization, they will find a leadership resource to deliver on their expectations.
As our northern friends have taught us, "If you're not the lead dog, the view never changes!" So, stay in the leadership position with quiet competence and confidence.
If you're at all concerned and would like to discuss strategies, you're welcome to call us for a free, 30-minute conversation at +1- 865-357-5077.