BUSINESS AND
CORPORATE
AVIATION
MANAGEMENT
On-Demand Air Transportation
John J. Sheehan
MCGRAW-HILL
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DOI: 10.1036/0071436006
DEDICATION
To Peggy, my True Course.
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CONTENTS
Foreword xi
Acknowledgments
Introduction xv
xiii
Chapter 1. Setting the Scene
1.1
On-Demand Air Transportation / 1.1
On-Demand Air Transportation Defined / 1.1
Personal Aviation / 1.3
Business Aviation / 1.4
The Beginnings / 1.7
Travel Is Important for Business / 1.9
The Reasons / 1.10
How Companies Use Aircraft / 1.13
Justifying Business Aviation / 1.19
Fortune 500 / 1.24
Safety / 1.25
The Future / 1.25
Aircraft / 1.27
Aircraft Characteristics / 1.27
On-Demand Aviation Methods / 1.33
Employee/Owner-Flown / 1.34
In-House Flight Department Using Owned/Leased Aircraft / 1.34
Management Company / 1.35
Joint Ownership / 1.35
Interchange / 1.35
Time Share / 1.35
Charter / 1.36
Fractional Ownership / 1.36
Choosing the Best Method / 1.37
Chapter 2. Determining the Need
Air Transportation Needs / 2.1
Why Individuals and Companies Use On-Demand Air Transportation / 2.2
Defining the Requirement / 2.3
Air Transportation Analysis / 2.5
Travel History / 2.7
The Future / 2.9
Solutions / 2.11
Choosing the Method / 2.16
What Users Want in On-Demand Air Transportation / 2.16
Methods / 2.18
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2.1
vi
CONTENTS
Running the Numbers / 2.27
Cost Components / 2.27
Evaluating the Options / 2.29
Chapter 3. Getting Started
3.1
First Things / 3.1
Aircraft Use Policy / 3.1
Chargebacks / 3.4
Oversight / 3.9
Staying Informed / 3.12
Owner/Employee-Flown Operations / 3.13
Purpose of the Business Aircraft / 3.13
Learning to Fly / 3.13
Role of the Owner/Employee-Pilot / 3.14
Acquiring the Aircraft / 3.15
Acquisition Assistance / 3.16
Insurance / 3.17
Flight Records / 3.17
Standards / 3.20
The Business of Safety / 3.21
Training / 3.21
Duty Time / 3.23
Limitations / 3.25
Maintenance / 3.25
Aircraft Charter / 3.27
Checking the Record / 3.27
Charges / 3.28
Evaluation / 3.29
Fractional Ownership / 3.30
Investigating the Service / 3.30
Managing It / 3.32
In-House Aircraft / 3.32
Finding the Right People / 3.33
Basing the Operation / 3.40
Acquiring the Aircraft / 3.41
Management Company / 3.44
The Contract / 3.44
Performance Measures/Reports / 3.46
Joint Ownership / 3.47
Other Methods / 3.48
Chapter 4. Running the Business
It Really is a Business / 4.1
Organization / 4.2
Scheduling / 4.4
Personnel / 4.4
Policy / 4.5
Procedure / 4.5
Scheduling Software / 4.6
International / 4.8
Administration / 4.8
Administrative Practice / 4.8
Developing Practices / 4.9
Talking With the Folks Downtown / 4.11
4.1
CONTENTS
vii
Organizational Conflict / 4.11
Get Them on Your Side / 4.12
Making House Calls / 4.13
Finance and Accounting / 4.14
Taxes / 4.15
Financial Planning / 4.16
Budgets / 4.16
Building the Budget / 4.19
Capital Budgets / 4.20
Controlling/Tracking Budgets / 4.22
Budget Justification / 4.23
Personnel / 4.24
Hiring / 4.24
Motivation / 4.25
Communicating Expectations / 4.25
Performance Evaluation / 4.26
Human Resources / 4.27
Career Development / 4.28
Leadership / 4.29
Planning / 4.30
Mission Control / 4.30
The Plans / 4.31
Flight Department Performance / 4.33
Efficiency versus Effectiveness / 4.34
Ratios / 4.34
Tracking It / 4.35
Comparisons / 4.35
Presenting the Information / 4.36
Information versus Data / 4.36
Reports / 4.36
Flight Department Evaluation / 4.38
Saving Money / 4.43
Seeking a Better Way / 4.43
Optimizing / 4.44
Know Thyself / 4.44
Outside Help / 4.45
All That Glitters Is Not Gold / 4.46
The Payoff / 4.46
Image of the Department / 4.46
Advertising the Department / 4.46
Customer Orientation / 4.48
Customer Surveys / 4.49
The Tools / 4.52
Presentation / 4.52
The Sale / 4.53
The Small Flight Department / 4.53
Communications / 4.54
Support Staff / 4.55
Networking / 4.55
Think Backup / 4.56
Planning / 4.56
Chapter 5. Flight Department Management
Management 101 / 5.2
The Basics / 5.2
Planning / 5.3
5.1
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CONTENTS
Execution / 5.3
Feedback / 5.4
No Shortcuts / 5.5
Theories of Management / 5.6
The Beginnings / 5.6
Behavioral Approaches / 5.6
Modern Theories / 5.7
Future Theories / 5.7
Learning It / 5.8
Management Skills / 5.9
Acquiring Skills / 5.10
The Flight Department Manager as a Business Executive / 5.11
Training the Boss / 5.15
Preparing the Next Generation / 5.16
Mentoring / 5.16
Teamwork / 5.17
Universal Mentoring / 5.18
Flight Departments in Trouble / 5.18
Normal Operations / 5.18
Warning Signs / 5.19
Bottom Line / 5.21
The Defining Moment / 5.22
Attention Getters / 5.22
Educating / 5.23
Communicating (Again!) / 5.23
It Only Takes Once / 5.24
Corporate Stages of Development / 5.24
Entrepreneurial Stage / 5.24
Growth Stage / 5.26
Consolidation Stage / 5.26
Mature Stage / 5.26
Decline, Renewal, or Acquisition / 5.27
Combinations / 5.27
Lessons Learned / 5.28
A Sense of Mission / 5.28
Standards / 5.29
Leadership / 5.29
Rapport with the Company / 5.29
Teamwork / 5.30
Chapter 6. Operations
Overview / 6.1
Is This Any Way to Run an Airline? / 6.1
Accident Rates / 6.2
Compliance / 6.2
Risk versus Reward: Cautionary Tales / 6.5
Critical Elements / 6.6
Attractive Awards / 6.7
Flight Operations Manual / 6.7
Building It / 6.8
Excuses, Excuses / 6.9
Changes / 6.10
Every Situation? / 6.10
Singing from the Same Hymn Book / 6.12
International Standards / 6.13
Standards for Life / 6.13
Needing Them / 6.13
6.1
CONTENTS
ix
Predictability / 6.15
Development / 6.15
Procedure or Technique? / 6.16
Checking Up / 6.16
Operations / 6.17
Dispatch Control / 6.17
Setting Limits / 6.17
Flight Crew Scheduling / 6.18
Flight Crew Duty Time Limits / 6.19
How Many Pilots? / 6.20
Checklists / 6.22
The Tyranny of Automation / 6.24
Aircraft Airworthiness / 6.26
Noise / 6.26
Helicopter Operations / 6.28
Chartering Aircraft / 6.29
Knowing the Regulators / 6.30
Training / 6.31
International Operations / 6.33
Airports / 6.34
Security / 6.35
Professionalism / 6.38
Job Security / 6.38
Technical Challenge / 6.38
The Professional Approach / 6.39
Chapter 7. Maintenance
Contract or In-House Maintenance / 7.1
Contract Maintenance / 7.2
In-House Maintenance / 7.4
Organization / 7.6
Small Flight Departments / 7.6
Larger Flight Departments / 7.6
Personnel / 7.7
Maintenance Operations / 7.9
Airworthiness Determination / 7.9
Maintenance Planning / 7.11
Maintenance Control / 7.11
Discrepancies / 7.12
Minimum Equipment List / 7.13
Maintenance Away From Home Base / 7.14
Aircraft Maintenance Reference Materials / 7.14
Parts Inventory and Control / 7.15
Duty Time / 7.16
Quality Control / 7.16
Maintenance Manual / 7.20
Aircraft Handling / 7.21
Security / 7.21
Evaluating Maintenance Performance / 7.21
Recordkeeping / 7.22
Regulations to Comply With / 7.23
Computerized Record Tracking Systems / 7.24
Training / 7.26
Maintenance Resource Management / 7.27
Passenger Handling / 7.27
Safety / 7.28
Safe Hangars for All / 7.29
Solo Technicians / 7.31
7.1
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CONTENTS
Upstairs, Downstairs / 7.32
Know the Regulators / 7.33
Selling Maintenance / 7.34
Chapter 8. Safety
8.1
Safety Programs / 8.1
Crafting the Safety Function / 8.1
Model Safety Program / 8.5
Building In Safety / 8.9
Passenger Safety / 8.13
Accident/Incident Planning / 8.16
The Plan / 8.16
Elements of the Plan / 8.17
Implement It / 8.20
Chapter 9. Putting It All Together
9.1
Institutional Flight Departments / 9.1
Most Admired / 9.1
Profit and Loss / 9.3
The Excellent Flight Department / 9.4
Ways and Means / 9.5
Attainment / 9.6
Safety, Service, Value / 9.7
Safety First, Last, Always / 9.7
Service with a Smile / 9.8
Good Value Creates Job Security / 9.8
Hierarchies / 9.9
When in Doubt / 9.9
Appendix A. Business Aviation Background
A.1
Appendix B. Air Transportation Requirements
B.1
Appendix C. Owner Flown Procedures
C.1
Appendix D. Budget Justification
D.1
Appendix E. Employee Jobs and Performance
E.1
Glossary
G.1
Index
I.1
About the Author
I.10
FOREWORD
Transportation is a necessary component of economic growth and improved quality of life.
In Biblical times, King Solomon’s power was tied to his system of roads that enabled the
peoples of his domain to be effective traders. Nations with the most capable sailing fleets
dominated European trade in the centuries before trains and planes. The first U.S. president,
George Washington, urged his newly formed Congress to build roads and canals, for to do
so would reap rewards. President Lincoln pledged if elected in 1860 to complete the
transcontinental railroad to bind the nation and advance commerce. In the mid-twentieth
century, President Eisenhower championed legislation that resulted in the interstate highway system, which proved to facilitate significant advances in the nation’s economy and
the well being of its citizens.
Today, aviation is the principal form of transportation for business. No other means of
communication supports the fast pace of commerce. Fax machines, cell phones, videoconferencing, and all the marvels of the communications revolution have not negated the need to
travel. Rather, they have simply quickened the pace of business and necessitated the need
to be face-to-face with a company’s customers and enterprise partners before someone
from the competition gets there first.
Think about your own business life. Has your cell phone caused you to slow down or
travel less? Has your fax machine taken the place of a visit to a customer or potential customer? Are you comfortable building a bond of trust using the Internet? Do you want to
launch your development plans using the telephone or e-mail?
Nothing takes the place of face-to-face in keeping clients and growing your business.
While there is universal acceptance that transportation is a necessity for economic
development, many business leaders think only of scheduled airlines as a means of satisfying their travel needs. They have yet to understand and use a particularly advantageous
form of travel known as business aviation.
Scheduled airlines provide safe, secure, and frequent connections between major cities
throughout the world, albeit lacking the flexibility to serve many less populated cities and
ill structured to provide time-efficient travel itineraries involving multiple stops. Limited
by the strictures of their self-imposed hub and spoke system, scheduled airlines provide frequent and timely service to about 10 percent of the 429 commercial airports that have
scheduled operations by air carriers. In fact, nearly three-quarters of all airline passenger
enplanements occur at fewer than 50 locations.
Business aviation, the use of general aviation aircraft for business transportation, provides safe and secure access to about 5000 locations within the United States and many
more internationally. With the ability to transport employees in a timely fashion, unencumbered by limited airline service and inefficient schedules, companies are able to
enhance the productivity of a firm’s two most important assets—people and time.
Increasingly, business leaders and planners are looking to business aviation as an effective tool for enhanced productivity and growth. No longer misunderstood or maligned by
the specter of an uninformed press, business aviation has emerged as an important travel
resource that should be part of a company’s travel equation. Over 10,000 U.S. companies
own business aircraft, and about 90 percent of the public companies that return the highest
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xii
FOREWORD
dividends and capital gains to shareholders employ some form of business aviation.
Worldwide, nearly 14,000 companies own company aircraft. Knowledgeable travel specialists, however, suggest that the number of companies that could employ some form of
business aviation advantageously exceeds 100,000.
Business aviation complements rather than competes with scheduled airlines. Members
of the National Business Aviation Association (NBAA) are the most active users of business
aviation in the world, yet they purchase over $10 billion in airline tickets annually.
Companies need to travel, and the most enlightened firms use the airlines when it is most
efficient to do so and employ business aviation when that form of transportation is most productive. Thus, understanding business aviation and determining how it can be applied profitably to serve a company’s travel needs is a challenging yet beneficial management task.
Also, business aviation comes in several forms, ranging from chartering an aircraft for
occasional use, through owning a fractional share of an aircraft managed by a fractional
ownership provider, to full ownership by a company and the establishment of a corporate
flight department. The enlightened user has access to all aspects of business aviation,
selecting the form that best satisfies the company’s varying needs. Thus the company with
an established in-house flight department also should know when and how to select supplemental lift using charter, for example. The availability of business aviation options
reflects the sophistication of this form of business transportation.
Business and Corporate Aviation Management by John Sheehan is a most appropriate
and authoritative reference for the company or individual seeking a full understanding of
business aviation and its capabilities. Authored by an aviator, educator, and lecturer with
40 years of relevant experience, this handbook encompasses John Sheehan’s considerable
knowledge of the business aviation community gleaned from years of consulting with the
world’s safest and most successful flight departments. In his role as a safety auditor over
the past 20 years, John has earned the respect of business aviation’s leading practitioners.
He has prepared and presented seminars on flight department management for the NBAA
for more than a dozen years and is scheduled for continuing activity for NBAA members
in the areas of business aviation operations.
Good management concepts and techniques are essential to capitalizing on the benefits
of business transportation. I recommend Business and Corporate Aviation Management by
John Sheehan for seasoned flight department managers as well as for company travel
department personnel who are exploring how business aviation can benefit their company.
This handbook also should be required reading for students seeking to grasp the breadth of
transportation capabilities inherent in business aviation. Furthermore, John Sheehan covers
the elements of business aviation as a transportation resource in a comprehensive and
insightful manner that adds to the handbook’s value.
John W. Olcott
President
National Business Aviation Association
November 2002
ACKNOWLEDGMENTS
The following people made material contributions to this book through their ideas, experience, and encouragement: Roger Phaneuf, of PAI; Jack Olcott, David Almy, Bob Blouin,
and Greg Jackson, of NBAA; Jim Cannon, Rich Messina, Steve Nielsen, Jim West, Len
Beauchemin, Pat Cunningham, and Steve Hawkes, flight department managers par excellence; Walter Kraujalis, Bloomer DeVere, and Mark Twombly, of WestWord; Frank
Hofmann, of IAOPA; Dennis Wright, of FlightTime; Steve Quilty, of BGSU; and Shelley
Carr, of McGraw-Hill.
In a larger sense, all my clients and workshop participants through the years actually
wrote this book; I just recorded their experiences and observations.
A special thanks to my wife, Peggy, without whose ideas, encouragement, editing, and
moral support, this book would never have seen the light of day.
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INTRODUCTION
WHY THIS BOOK WAS WRITTEN
This book was written as a consequence of 13 years spent helping individuals and companies to choose the types of aircraft they needed to fulfill their on-demand air transportation
needs and to evaluate their flight departments. Certain central themes and patterns of success in business aviation operations have emerged over the years, ideas that I felt should be
shared with those desiring to engage in on-demand air transportation.
Finding the Right Aircraft and Method of Delivery
The advantages of having one’s own aircraft are evident—creating your own travel scheduled, time saved, security, and the ability to go many places that the airlines cannot are all
compelling reasons to use on-demand air transportation. Yet few people are sufficiently
familiar with the breadth and detail of this form of aviation to choose efficiently among the
options available.
Deciding to use on-demand air transportation consists of two tasks: selecting an aircraft
and the method of delivering the service. Choosing the aircraft is not as simple as buying
an automobile; there are many different types of aircraft, each incorporating a variety of
features not apparent or well appreciated by the novice buyer. Seating capacity, runway
performance, range versus payload tradeoffs, and interior appointments and amenities all
make a difference in how the service is delivered. The days of the boss asking the board of
directors for $30 million to buy a Gulfstream aircraft without justification are a fond memory in most companies; the board and the boss want to know what they are getting for their
money and what the downstream consequences of their purchase are. Likewise, an individual selecting an aircraft and delivery method is faced with a wide variety of choices and
combinations much too complex to absorb at a single inquiry.
The common issue left out of the aircraft acquisition equation is, “What are my/our
on-demand air transportation needs?” Many acquisitions are made on the recommendation
of a trusted acquaintance, senior corporate officer, or aircraft broker, none of whom have a
good idea of your total transportation needs or those of the company or what value the aircraft will bring to the equation. An air transportation analysis must be done to determine
the types and number of aircraft needed and how the service should be delivered.
While thousands of individuals and companies own and operate aircraft worldwide, other
options exist: charter, aircraft management companies, fractional ownership, joint ownership, and combinations of these. Service levels and both capital and operating costs vary
widely depending on the type of transportation delivery method chosen. Unfortunately,
many of these essential points are lost in the rush to acquire an aircraft or sign up for a fractional share.
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xvi
INTRODUCTION
The first three chapters of this book address these important issues, attempting to provide insights that will be useful in creating a substantial understanding of how people and
companies use their aircraft and decide how the service is to be delivered.
Operating the Flight Department
Running a flight department effectively and efficiently seems to be easy for some but difficult for others. My evaluations originally consisted of examining flight departments for
compliance with Federal Aviation Administration (FAA) regulations and the operator’s policies to ensure that they were safe. While this was a major responsibility (and the principal
factor in causing the evaluation to take place), my work increasingly looked at the business side
of the operation. Management, business skills, handling people, administration, reports,
planning—all the elements necessary for the effective operation of a flight department became
increasingly important in my evaluations. Not that the safety and compliance aspects were
any less important, but it soon become evident that there were some clear distinctions
between the good and the not-so-good departments I visited. The single element that made
the difference between the two types of departments boiled down to management. The desire
to take the department's operations beyond tomorrow's flight schedule and the ability to systemize processes, to create control mechanisms, and to handle people well—all these elements of management became evident either by their presence or absence shortly after my
arrival at the departments.
At first, it seemed so simple—to detect the differences, catalog them, prescribe remedies, and rapidly leave town. However, it slowly came to me that many of the people with
whom I left my remedies did not understand the management process. They had never been
trained, never been expected to create order out of a complex operation, did not appreciate
the value of control and feedback, and never worked in a corporate environment. Many
of the flight department managers, chief pilots, and directors of maintenance were winging
it! These people were fish out water, out of their natural environment. These good people
were used to thinking in terms of flight plans, weather forecasts, air traffic control clearances, maintenance inspection schedules, life-limited parts, and recordkeeping—not budgets, reports, human resources, and long-range plans.
With very few exceptions, these people were bright, well-motivated, sincere people; I
knew they could be helped. How best to help them? Some had had elementary management
training at a point in their past, some had business degrees, and some had no training at all.
There was little common ground from which to start. Thus I fell on the idea of writing a
book that would link the theoretical tenets of management with the practical needs of dayto-day flight department operations.
Over the past 11 years, I helped to develop and present workshops for the National
Business Aviation Association (NBAA) on developing flight department maintenance and
operations manuals and managing small flight departments. These workshops provided me
with a wealth of information as a consequence of facilitating thousands of participant interactions about how flight departments should and should not be operated.
The result of my observations and interactions, which you hold, represents my learning
experiences from working closely with people in hundreds of aviation organizations over
the past 13 years. This is a composite of large and small aviation organizations, low and
high usage operations, companies with large jet transports and those with a single pistonpowered twin, and one-person departments and those with more than 100 people. I have
attempted to draw on the best practices from each segment of the aviation community, but
in doing so, I must issue a note of caution: There is no single right way to make any orga-
INTRODUCTION
xvii
nization work effectively and efficiently. Rather, there are as many ways as the human imagination and creativity can conjure; there are literally thousands of right ways.
Flight department management must constantly evaluate the organizational culture,
economic environment, personnel assigned, mission, and resources to adapt their operations to meet user needs. It is this ability to adapt, to reorient, and to intelligently change
the organization and its procedures that makes the difference between the good and not-sogood departments. However, adherence to core value systems and cultural norms is necessary to provide substance and integrity to any organization. Therefore, it is the balance
between maintaining values and adjusting to the demands of the environment that can mean
the difference between success or failure.
THE AUDIENCE
This book was written with two basic types of people in mind:
Individuals seeking information about how to get into the on-demand air transportation
business, whether for business or personal reasons
❷ Flight department managers, their bosses, and those who would become flight department
managers
❷
While all these types of people are closely related, they are not necessarily close in outlook, immediate and long-term needs, or background. Yet they all need varying amounts of
practical, real-world information to do their job; this is the factor that links them in their
common quest for providing safe, reliable, and efficient on-demand air transportation.
Individuals
Whether visiting grandchildren, traveling to a vacation home, or talking with an advisor,
individuals have found that going via aircraft and their own scheduled makes life simpler
and enjoyable. The aircraft may work out to be a modest single-engine piston-powered
four-seater or a medium-sized turbojet, yet selecting and operating the aircraft sometimes
can be a confusing and lengthy task. Where does one begin to understand both the aircraft
options and the methods of delivery? And once the decision is made, how is the service to
be managed? Similarly, those who work with and advise individuals must understand these
features if they are to properly assist their clients and friends.
Business Executives
The harried entrepreneur, chief executive officer (CEO), and senior manager are all victims
of the same deficiency: not enough time. This is usually coupled with the need to visit with
customers, deal makers, and company personnel who will make a difference for their
future. They slowly come to realize that they must make more time for themselves. Doing
so can be difficult, but if they travel frequently, cutting down on their travel time will enable
them to get out and back more quickly, spend fewer days (and nights) on the road, and be
more productive enroute. All these features are the reasons why businesspeople choose
on-demand air transportation.
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INTRODUCTION
The chairman, CEO, and senior staff are prime candidates for this book, but others
within the company will benefit as well. Foremost is the staffer charged with either seeking the right answers to the air transportation questions or attempting to justify the decision
made regarding an aircraft type or delivery method made somewhere above his or her level.
Such a staffer probably has not thought of all the potential uses of the service nor of the different means of providing it. In doing so, he or she will feel much better about his or her
choice and confident about implementing it.
Human resources, finance and accounting, risk management, planning, and legal personnel also need to understand why the company either has an aircraft or will soon get one.
Theirs is a need to justify or comprehend the process but, more important, to assist the flight
operation in succeeding in its mission. By understanding the operation and needs of the
flight department, they can become partners in its success.
Finally, for middle managers or salespeople who are desperately attempting to satisfy
their pressing travel needs, this book will provide ideas about how to get management’s
attention and justify their own on-demand air transportation needs. Business aircraft are not
just for the few executives at the top of the company, they are business tools that should be
used where they make the most sense.
Flight Department Managers
Flight department managers, including the department manager, chief pilot, head scheduler, director of maintenance, and chief inspector, are the front-line, buck-stops-here people who must produce reliable, safe, and on-time on-demand air transportation. Yet their
one- or two-aircraft airline does not have the depth of personnel or virtually any other
resource an airline has. They must keep a number of balls in the air constantly; they are
master jugglers, with few assistants to relieve them of their many tasks. Before we become
overwhelmed with pity for these poor souls, it is well to realize that they also have some of
the most rewarding jobs in aviation.
They are highly autonomous, operating in a location remote from the corridors of power
and often with a financial independence that is the envy of their peers within the company.
In the great majority of cases, they are “aviation junkies,” having risen through the ranks
of pilot, scheduler, or aviation maintenance technician; they love airplanes and get paid to
work with them. What could be better?
This question takes on a new relevance when the CEO is waiting for a mechanical problem to be fixed on the only available aircraft, or the budget proposal is 20 percent over what
the boss wants, or word just arrived that the Gulfstream’s left engine melted down and it is
in Melbourne (Australia, not Florida)! As the old adage goes, this is why they pay the manager the big bucks.
With privilege comes responsibility. With responsibility comes the need to organize, plan,
foresee events, and grasp the big picture of where the organization should be in 1, 3, or 5
years. The pilot or technician fresh from the ranks, testing the heady mantle of boss, manager,
or leader, may not have had the opportunity to practice the types of skills necessary to assume
the responsibilities that accompany the title. He or she rapidly learns that the skills needed to
run the show are considerably different from those required of one of the performers.
The Boss
This is person to whom the flight department manager reports either in a company or in
private operation. This is the person to whom the CEO or principal casually assigned
INTRODUCTION
xix
management and oversight of the aviation department, not appreciating that this person’s
total aviation experience comes from enjoying the perquisites of the first class section of
an airliner. In a significant number of cases, the addition of the aviation department to
this manager’s already impressive list of tasks was not something for which he or she
would have volunteered.
These people are typically an executive vice president, senior vice president of administration, vice president of finance, or director of facilities. As far as they are concerned,
taking on the aviation department is like assuming the job of elephant master at the circus;
airplanes, pilots, and mechanics are strange and sometimes messy animals. However, the
fact that they have been put in charge brings pressure to bear—how can they manage it if
they do not understand it? Certainly, they must accept the word of their subordinates within
the flight department, but this sort of trust only goes so far when the safety of lives and a
$2 million annual budget are involved. What are they to do?
The advice of getting smart fast about corporate aviation may be good but largely unattainable for most. The new reporting senior can talk to peers in other companies, talk to his or her
friends on the golf course, read everything he or she can lay hands on, or hire a consultant. If
only there were a single source of information about everything that goes on out at the airport.
This book obviously does not have all the answers, but it will provide a sturdy foundation.
Would-be Managers
An axiom in the airline business states that if you take the most senior line captain and make
him or her the chief pilot, you lose the best pilot and gain a lousy manager. This presumes
that the captain never had any management training or experience—a reasonable assumption, given the normal career progression of a professional pilot. The same situation is probably not true for an aviation maintenance technician, since there is a logical progression of
positions within the maintenance world that requires supervisory and management skills.
All this spawns close parallels within the corporate flight department business.
The existing flight department manager may receive a better offer, finally decides to
retire, or cannot pass the aviation medical exam—this sets the stage for the senior pilot or
technician to succeed to the throne. The call comes from the company reporting senior for
a meeting, the offer is made and accepted, and yesterday's happy-go-lucky pilot or technician has just landed in the fire. It is likely, too, that this new-found manager has not been
privy to the inner workings and hidden mechanisms that make the flight department run. In
essence, this person’s new boss has unceremoniously thrown him or her into the deep end
and told him or her to start swimming.
The old adage that the best time to know an emergency procedure and the worst time
to learn it is in an emergency applies here. If the fresh-caught manager has been preparing for this eventuality for more than a few months, he or she has a head start. With no
preparation, the new kid on the block is at a real disadvantage. This book was not specifically designed as a cookbook to be used in the heat of the kitchen, but it will enable the
new manager to keep the departmental potatoes from burning while the peas and chicken
are tended to.
Finally, the student who is taking a course in aviation management will gain valuable
insights regarding the real world of business aviation by reading the book. Note that I said
reading, not studying; this material may enhance and bring reality to a more basic text.
Therefore, this book should be considered supplementary reading and not a primary
text, since I do not cover all the basic elements associated with planning, finance, personnel
management, and the like. With luck, I may convince someone starting in an aviation career
to gravitate toward business aviation instead of an alternative.
xx
INTRODUCTION
Satisfying the Needs
Each of these people has a significant need to know how a flight department should be run
and the tools required to make that happen. Much of what they use to accomplish this task
comes from prior experience in aviation or outside it. In most cases, this experience is neither
appropriate nor fitting to the job at hand. Thus this book attempts to describe a range of flight
department operations and present alternative management methods that will enable the preceding classes of individuals to cope and perhaps thrive.
However, this book alone will not solve all the needs or problems of those interested in
business aviation and how it operates; this is just a beginning, a guide, a starting point for
those would manage. It takes curiosity, tenacity, sensitivity, resoluteness, and vision—a
wide range of characteristics and traits that mark both leader and manager. These are the
skills that draw primarily from life experience, character, and values. The principal characteristic that makes it all work is the individual's will to manage or motivation to do the
job; without these, this book is of little value.
THE BOOK
This book was written to be a practical guide for those who would undertake to manage an
on-demand aviation operation, large or small. While the book contains some theory, the
majority of its contents are very practical, based on a variety of observations and insights
gained from my work with on-demand flight operations. Experiences gained from working
with airlines, repair stations, and air taxi operations are used liberally throughout as well.
I realize that there are many different ways to operate a flight department, some of which
may be better or more appropriate to a specific situation than a suggestion made within this
book. However, it is my intent to provide the uninitiated and those seeking solutions to problems with a starting point for many of the common situations faced by companies and individual operators. Some of the more significant situations described herein contain several
alternatives in an attempt to provide flexibility and options, but many offer just a starting point.
While the book may be read cover to cover as a conventional text, the real value should
come from its use as a reference. Regardless of how the book is used, however, Chapters
4, “Running the Business,” and 5, “Flight Department Management,” should be read by all.
These chapters serve as starting points for the neophyte and as a refresher for the old hand.
Some sections of this book are more detailed than others, recognizing the fact that some
aspects of the manager's job have proved to be either more important or more interesting to
managers. Sections as diverse as small flight departments, budgets, safety, working with
people in the parent company, and marketing the flight department have been chosen for
special, extended treatment. Choosing these aspects of running the flight department over
others was difficult, but it is these subjects that have given flight department managers the
most trouble or provided the greatest advantages.
The Index should lead readers to the desired topic, if not the general subject area.
Readers are encouraged to seek answers to questions in several different topic areas rather
than just a single one. The Glossary is designed primarily for those not experienced in aviation issues, attempting to give them a head start in the arcane and voluminous jargon
endemic to the world of aviation.
For those wishing to cut to the chase, to get to the real answers of how to run a flight
department successfully, see Chapter 9, “Putting It All Together.” There I try to sum up
the superior performance and wisdom I have witnessed over the years to portray the best
methods of serving your company and ensuing flight department survival.
INTRODUCTION
xxi
The Chapters
Chapter 1, “Setting the Scene,” provides a background to on-demand air transportation,
relating reasons for its existence, its definitions and characteristics, and a means for justifying it. An attempt is made to predict the future of the genre, done with more enthusiasm
than precision. Each method of delivering this service—employee/owner-flown, in-house
flight department, charter, fractional ownership, etc—is further defined and explored to
provide a brief idea of how each one works and might be used to satisfy a company’s air
transportation needs.
The big issue of determining the shape and size of the air transportation need is discussed in Chapter 2. The air transportation analysis process, evaluating the options for service delivery and evaluating the costs of the venture, is examined. Most important, advice
on how to select from among the alternatives is presented in a straightforward manner.
“Getting Started” is the title of Chapter 3, showing in brief form how to begin one of the
several types of aviation operations. Emphasis and detail are given to owner-flown and inhouse methods, since these are the most common types of operations. Practical advice on finding the right people, setting up a schedule method, and arranging for maintenance is provided.
Chapter 4, “Running the Business,” examines the planning, administrative, human
resources, and financial details of operating a flight department. A special section is
devoted to the small flight department, those operating two or fewer aircraft. This is the
most common form of flight department and the type with the greatest burden because of
their many tasks and few people available to complete them.
“Management 101” may be a better title for Chapter 5, “Flight Department Management.”
This covers the background and elements of the practice of management, attempting to show
how they can best be used in the context of running a flight department. The chapter examines the flight department manager as a business executive, putting this person into the larger
corporate frame of reference.
How the flight operations details of the department work is the subject of Chapter 6,
“Operations.” It is in this chapter that the details of the flight department are explored:
scheduling, standard operating procedures, security, training, and safety. Particular emphasis is placed on the subject of standards and limits to be used in a flight department.
“Maintenance,” Chapter 7, is a short but meaty chapter. While much of the glamour
associated with flying goes to the operations end of the hangar, maintenance is what really
makes it go. The somewhat obscure but essential issues regarding maintenance are covered
to provide perspective for technician, pilot, and nonaviation manager alike.
Safety is given special treatment in a chapter of its own, Chapter 8. The enviable safety
record of business aviation does not happen by accident; dedicated staff and a conscious
adherence to safe operating procedures make it happen. The chapter provides a number of
insights and sampled safety programs to use.
Chapter 9, “Putting It All Together,” attempts to take all the information imparted in the
previous chapters and put it into perspective, attempting to achieve the maximum utility
from the more detailed sections of the book. Skim this chapter first, since it contains many
of the valuable insights my clients have taught me.
Finally, a Glossary and Appendix provide useful reference sections. And then, for
research, the Index permits fast access to the variety of information provided in the body of
this book.
No one book can possibly contain sufficient material to cover a subject it in its entirety.
This book is no exception, primarily because of the great diversity of operations represented within on-demand aviation. However, this book also contains references that will
lead readers to a variety of other, more comprehensive material on the subject. Again, no
one work can be truly comprehensive; this is just a beginning.
xxii
INTRODUCTION
Being of a mindset that I should continue to improve my work until I get it right, I
would sincerely appreciate reader comments about this book. I would especially be grateful for comments concerning the mix of information and appropriateness of material
included for all types of flight departments. You can reach me through the publisher—the
second edition will be better because of your comments.
John J. Sheehan
Wilmington, North Carolina
November 2002
CHAPTER 1
SETTING THE SCENE
Four years ago we had four plants and today we have eleven and the only way we
have been able to expand our company and to get these locations has been in our
own aircraft.
—CORPORATE CEO
ON-DEMAND AIR TRANSPORTATION
Within all forms of transportation there are two basic divisions, scheduled and nonscheduled.
Scheduled is self-explanatory and well understood. Airlines, railroads, buses, and ferry
boats operate according to set schedules. Nonscheduled requires further explanation; the
term expresses a sense of randomness or irregularity, concepts not useful when attempting
to define the process. However, on-demand transportation is a more descriptive term, signifying that the transportation should be available when requested or needed. Therefore, the
purpose of this book is to describe the various types of on-demand air transportation and to
tell readers how they can best choose and use the methods comprising it.
Many different people use on-demand air transportation: Individuals, corporate executives, technical troubleshooters, sports teams, entrepreneurs, and families all benefit from
the advantages brought by this form of flying. The object for all is to travel to some distant
point as safely and comfortably as possible. Some wish to do so in high style, others more
economically; some rapidly, others at a more leisurely pace; some doing the flying themselves, others leaving those tasks to professional flight crews. However, all do so because
they want to create and maintain their own schedule and control their lives more fully.
This book will examine this form of aviation from two basic perspectives: personal and
business aviation. This distinction is made because of the fundamentally different motivation for each, one to serve a personal lifestyle and one to create efficiency in the workplace.
On-Demand Air Transportation Defined
The International Civil Aviation Organization (ICAO) states that all civil aviation operations
are divided into three categories: commercial air transportation, general aviation, and aerial
work. They are defined as follows:
●
●
●
Commercial air transport. An aircraft operation involving the transport of passengers,
cargo, or mail for remuneration or hire.
Aerial work. An aircraft operation in which an aircraft is used for specialized services
such as agriculture, construction, photography, surveying, observation and patrol, search
and rescue, or aerial advertisement.
General aviation. An aircraft operation other than a commercial air transport operation
or an aerial work operation.
1.1
Copyright © 2003 by John J. Sheehan. Click here for Terms of Use.
1.2
CHAPTER ONE
For the purposes of this book, we will consider only the first and last types, since they
both provide on-demand air transportation, with the fundamental difference being whether
the operation is conducted for compensation or for hire (Fig. 1.1).
On-Demand Air Transportation—The transportation of passengers and cargo by
aircraft from one point to another in a manner and at a time designated by the person exercising operational control.
Personal aviation may be provided by the owner-operator’s own aircraft or by a commercial venture supplying air transportation on demand. Therefore, personal aviation may
be a subset of either commercial or general aviation.
Civil Aviation
Aerial
Work
General
Aviation
Commercial
Air Transport
Scheduled
Recreation
Nonscheduled
Personal
Personal
Business
Business
Cargo
Employee Flown
Corporate
FIGURE 1.1
Civil aviation elements.
O
n
D
e
m
a
n
d
SETTING THE SCENE
1.3
Business aviation covers all types of aircraft operations flown in pursuit of business
matters. Within this broad classification are employee-flown and corporate operations.
Employee-flown operations are predominately owner-flown aircraft, yet these flights may
be piloted by any employee, carrying other employees or customers. The key factors involved
in employee-flown operations are that the aircraft is operated by a company using a pilot
or pilots not specifically employed or compensated to fly the company aircraft. Corporate
aircraft operations are distinct from employee-flown operations in that they are operated by
a company for its business purposes, using professional pilots (normally two) compensated
specifically for their piloting duties. The National Business Aviation Association (NBAA)
defines corporate aviation as “aircraft owned or leased and operated by a corporation or
business firm for the transportation of personnel or cargo in furtherance of the corporation’s
or firm’s business and which are flown by professional pilots receiving a direct salary or
compensation for piloting.” Note that in either employee-flown or corporate methods, the
aircraft does not necessarily have to be owned or leased by the company; it can be rented
or even borrowed (some restrictions apply to these operations, however).
Aircraft charter and fractional ownership also may be used to satisfy business requirements for on-demand air transportation.
Personal Aviation
The best means of explaining this segment of air transportation may be via an analogy. Both
buses and automobiles are available to people wishing to travel, yet the automobile dominates our ground transportation for obvious reasons: comfort, convenience, and schedule.
The automobile provides ground-based on-demand transportation to individuals and
groups willing to pay for the service. This is preferred to public transportation for the reasons listed. Perhaps the most important reason for our preference for the automobile is that
we wish to create our own schedule and change it at will. Buses (and airliners) seldom
permit us this luxury.
There are approximately 350,000 general aviation and aerial work aircraft worldwide,
of which an estimated 150,000 are used at least in part for personal transportation. Perhaps
one-third of these are used for true on-demand purposes, possessing the ability to fly in
weather and to carry two or more passengers. Therefore, personal air transportation constitutes a significant worldwide activity, complementing other forms of transportation that
support the needs of individuals. Whether it be a family seeking the fastest and most hasslefree transportation to the ski slopes, an individual flying to a mountain retreat, or a person
seeking the best shopping venue in a major city, personal aviation has come of age. These are
just a few of the reasons individuals, families, and friends use aircraft.
Some people use an aircraft for recreational, sightseeing, or sport purposes, but these do
not constitute on-demand air transportation because transportation, i.e., flying people or
things from point A to point B.
Personal air transportation uses a wide range of aircraft, from small, four-seat, singleengine, piston-powered aircraft to large, multiengine turbojets carrying scores of people
over intercontinental distances. However, in this book I will concentrate on three broad
classes of personal air transportation: owner-flown operations, those provided by a company as a service, and in-house flight departments using professional flight crews.
Personal and business aviation are separated by a single factor: purpose. The organization,
regulations, and mechanics of the two operations are essentially the same; only the motivation
for the on-demand air transportation services is different. At the lower end of aircraft types
used, single-engine aircraft capable of carrying more than two passengers during instrument meteorological conditions (IMC), personal aviation generates an estimated 80 percent
1.4
CHAPTER ONE
of usage worldwide; at the upper end of the spectrum, turbine-powered aircraft are used an
estimated 90 percent of the time for business purposes.
Yet both types are organized, regulated, and operated in a similar fashion—the principles
are the same. Therefore, within this book, business aviation will be used as the predominant
example because it often requires the highest level of organization and standards, therefore
making it the form more inclusive of the factors to be considered in many aspects of ondemand air transportation. Where differences exist, they will be discussed.
Our aircraft has enabled my family to be together more frequently and to more fully
enjoy those times.
—AIRCRAFT OWNER
Business Aviation
In an average year, hundreds of millions of people travel for business purposes worldwide.
This is done in an effort to establish firm connections between businesses, to communicate
ideas, to act on opportunities, and to establish a face-to-face connection. While many interbusiness communications can be made by telephone, e-mail, fax, and mail, the deals are
made, the problems solved, and new frontiers forged by people meeting in person.
Twenty years ago, technology mavens were forecasting a dramatic decrease in business
travel due to the advent of cell phones, the Internet, and teleconferencing. Their theory
stated that face-to-face meetings were no longer necessary due to the superlative new
communications devices; teleconferencing was the next best thing to being there. While
these new communications devices did relieve the more routine travel needs, a strange
thing happened: Both teleconferencing and business travel increased. Productivity gains
provided by communications technology generated the opportunity for more business,
which, in turn, generated more business travel. The two connectivity methods worked
together to help the productivity of such countries as the United States, Germany, and Japan
become the highest in the world.
The need to be face-to-face in the business world never seems to decrease, only
increase. New and important deals are made in person, seldom over the phone or Internet.
Customers are cultivated, pampered, listened to, and helped in-person, and new product
and services are introduced in-person; business travel is a long-term growth industry.
However, there are other means of getting business travelers to their destinations via air.
Most business travel, perhaps two-thirds, is accomplished via the airlines. Every year
the world’s airlines carry an average of 1 billion passengers domestically and 550 million
passengers internationally, with roughly one-third of these people traveling for business
purposes. The airlines serve thousands of airports, providing frequent, safe, and fairly reliable service to the world’s business travelers, yet there are alternatives.
With frequent airline service available to the far corners of the earth, why do we need
other aircraft to transport a few people to many of the same destinations? Isn’t this much
more expensive that the airlines? And how safe is it? These are just a few of the questions
asked by both the curious and the critical when considering business aviation.
As this book is being written in 2002, more than 13,000 operators fly in excess of
21,000 turbine (turbojet and turboprop) aircraft worldwide in support of business (Table
1.1 and Figs. 1.2 and 1.3). Three-quarters of the operators and aircraft are located in
North America. In the United States, each of the approximately 14,000 turbine aircraft
flew an average of 450 hours, transporting an estimated 18 million business travelers in
2001.1 Interestingly, four-fifths of U.S. business flight operations have just one aircraft
(Fig. 1.4).
1.5
SETTING THE SCENE
TABLE 1.1 Business Aircraft
by Country, 2001
United States
Brazil
Canada
Mexico
France
Germany
Venezuela
United Kingdom
South Africa
Argentina
Australia
14,079
667
656
540
431
378
288
283
247
216
213
Source: International Business
Aviation Council (IBAC).
16,000
14,000
12,000
10,000
8,000
6,000
4,000
2,000
0
North America
FIGURE 1.2
Europe
South America
Aircraft
Operators
Other
Turbine-powered business aircraft distribution. (NBAA.)
Of the Fortune 500 companies, only 29 percent choose not to operate at least one corporate aircraft. The productivity, net income, and sales of companies operating corporate
aircraft dramatically exceed those of comparable nonaircraft operators. These companies
use their aircraft as productivity tools, as a means of controlling their busy travel schedules,
and as a convenience for their executives who need to pack every ounce of productive work
into each day. In essence, the aircraft becomes a time machine, a modern magic carpet to
safely and rapidly transport executives to the next business opportunity.
On-demand air transportation has become a part of corporate culture and promises to be
a fixture in the business world for the foreseeable future. It did not take long for companies
to discover that having an aircraft of one’s own created advantages that the competition did
1.6
CHAPTER ONE
25,000
Aircraft
20,000
15,000
10,000
5,000
0
1980
2001
USA
FIGURE 1.3
International
Total
Business aviation turbine-powered aircraft. (NBAA.)
Three
5%
Four +
5%
Two
13%
One
77%
FIGURE 1.4
Average aircraft per company. (NBAA.)
not have. The time savings, flexibility, efficiency, privacy, and security that corporate aviation offered were convincing enough to justify aircraft devoted to a company’s exclusive
use. However, softer, more intangible benefits accrued to its use too. Increased time at
home, the ability to reach even the most remote locations directly, comfort, and fewer airport hassles became sufficient reasons for most to gravitate toward this type of transportation.
SETTING THE SCENE
1.7
The real clincher, the reason that keeps the board of directors and stockholders happy,
is the ability of corporate on-demand air transportation to increase productivity for its executives. The corporate aircraft becomes a time multiplier, offering convenient access to as
many as 5000 airports in the United States (compared with just 500 that airlines serve) with
turbojet speed and an ease not possible on the airlines. It makes little sense to consume 2
days in getting star corporate performers to and from a remote location when the corporate
aircraft can get them there, provide a half-day on site for business, and have them home for
dinner, all in the same day. It is this measurable productivity multiplier effect that keeps
selling corporate aviation every day.
Even the accounting department realizes that business flying makes sense. Studies show
that companies using their own aircraft have better sales growth, earnings per share, longterm return to investors, and productivity (sales per employee) than companies that do not
use business aircraft. The evidence is compelling: Business aircraft are good for the bottom
line. The airlines continue to drive executives to corporate aviation in increasing numbers.
As scheduled air transportation is forced to restrict and segment its schedules and routes to
be more competitive, as airlines overbook and bump passengers in increasing numbers, and
as airline terminals become more unmanageable, corporate aviation can only increase in
importance; the airlines may be the best reason for using corporate aircraft.
As the global village increasingly becomes a nation’s marketplace, the use of corporate
aircraft will facilitate this transition. Intercontinental corporate aviation has been a reality
for some years and increasingly will serve our interests abroad. Corporate turbojets having nonstop New York to Tokyo and Los
Angeles to Paris range are a reality and the
hottest-selling aircraft in the business fleet.
The Honeywell Corporation, a leading
Yet corporate aviation is not immune
supplier of turbojet engines and avionto the business cycle. The health and
ics to corporate aviation, predicts that
well-being of the company flight depart7600 new business aircraft, valued at
ment may be directly tied to the state of
$121 billion, will be delivered between
the economy, with boom times signaling
2003 and 2013.
increased aviation activity and recessions
creating not only less activity but also
fewer aircraft, hours, and people as well.
There will continue to be good times and bad as the economy pursues its mood swings.
Despite the bad times, corporate aviation will persist and become stronger as the concept of
on-demand air transportation becomes more deeply entrenched in many corporate cultures.
The Beginnings
Personal aviation began with the Wright brothers in 1903. Their objective was to provide a
new form of transportation that would enable people to get from point A to point B as
rapidly as possible. Their initial 129-ft trip signaled the beginning of personal air transportation. Before the end of the first decade of the twentieth century, individuals were using
the airplane as a legitimate, although limited, form of transportation. It was the initial desire
for individuals to travel by air rather than groups in larger public aircraft that drove early
aviation forward. While interrupted by World War I, personal aviation continued to grow
and grow steadily until Lindbergh’s transatlantic crossing in 1927, a watershed event for
all aviation.
Business aviation began shortly after World War I. Plentiful war-surplus open-cockpit,
two-seat biplanes were used to promote various companies’ wares via barnstorming trips
and advertising courtesy of product logos painted on the fuselage. Hearty entrepreneurs
flew or rode in these aircraft to sales opportunities around the country. Yet the rigors of
1.8
CHAPTER ONE
open-cockpit flying and less-than-reliable engines kept these risky trips to a minimum
through the 1920s. The world’s oil companies, Standard Oil, Texaco, Continental, and
Royal Dutch Shell, became the pioneers of true business and corporate flying in the 1920s,
using the first multiengine, usually trimotor transports to service their far-flung drill sites.
Standard Oil’s chairman, Robert W. Steward, concluded that the advantages of airplane
versus train travel “…more than compensate for the expense and make the airplane an economical method of travel…as safe and comfortable as transcontinental train.”2 Despite this
glowing endorsement, relatively few companies took advantage of business aviation until
the late 1920s. It was the simultaneous availability of closed-cabin monoplanes (with more
reliable engines) and Charles Lindbergh’s solo transatlantic flight in 1927 that served as the
basis for corporate aviation as we know it today.
The Lindbergh flight, combined with national authorities regulating civil aviation, gave
travelers new confidence in this fledgling form of transportation. Airlines suddenly
sprouted, proving to the world that air travel was safe, efficient, and mostly reliable.
Business executives and entrepreneurs, ever seeking a competitive advantage, immediately
saw company operated aircraft as a means to facilitate their business activities. The 1930s
saw the availability of aircraft specifically designed for business applications, including
small single-engine and medium-sized multiengine aircraft. Oil companies again took the
lead, using fleets of aircraft, including airliners, to service their international business activities. The growth of business aviation during the 1930s is remarkable in that the great
depression curtailed much other business expansion.
Similarly, personal aviation benefited greatly from Lindbergh’s transatlantic flight,
turning all eyes to the skies. During the 1930s, scores of new aircraft were introduced with
the thought of providing personal transportation for the masses. Despite the constraints of the
poor economic conditions, light aviation flourished and grew. Business aviation and the airlines provided the new developments and the infrastructure that benefited personal flight.
World War II called a temporary halt to civil aviation development, but in a very real
sense, it prepared the world for the aviation boom that followed the cessation of hostilities.
Hundreds of thousands of people learned about and became acclimated to the concept of
air transportation during their wartime service, leading them to transfer their skills and knowledge of aviation to the business environment. Postwar boom times and the availability of
surplus military transports fueled a rapid growth in both personal and business aviation.
Significantly, the rapid advances of wartime aviation technology made civil flying much
safer, more reliable, and even practical. Improved communications and navigation equipment, more reliable engines and aircraft systems, and the beginnings of a real air traffic
control system facilitated the move toward business and personal aviation.
While business and personal (general) aviation grew substantially during the 1950s, it
was introduction of the business jet at the end of the decade that made the industry take off.
In 1957, the Lockheed Jetstar made its first flight and ushered in a new era of speed and
convenience for corporate travelers. Fast, comfortable, and practical, “airborne board
rooms” became a reality with the jet age. Followed shortly by the Sabreliner and
Hawker/deHaviland 125, the jets provided a quantum increase in business travel effectiveness and efficiency. Then, in 1964, the first Learjet brought jet travel within economical
reach of most corporations. The Learjet cost $550,000 and provided speeds of up to 485
mph over distances as great as 1800 mi, accommodating up to seven passengers. Business
aviation had arrived.
Commercial helicopters were available as early as 1946, but it was the advent of the
Sue-Est Alouette turbine-powered helicopter in 1958 that brought a practical rotary-wing
aircraft to business applications. While thousands of business helicopters are used worldwide for business aviation, their numbers remain small relative to the number of fixed-wing
aircraft working for business. Yet their importance for specialized applications make them
valuable and permanent assets in the corporate transportation inventory.
SETTING THE SCENE
1.9
Personal aviation benefited from these developments, taking aerodynamics, radio, and
infrastructure improvements for its own. During the 1960s and 1970s, personal aviation
grew rapidly, attempting to reach the dream of practical and safe flying for all. The late 1970s
and early 1980s saw a peak in the number of pilots and aircraft produced, essentially realizing the dream within the bounds of economic practicality. Finally, small general aviation
aircraft could be used as a practical form of personal transportation through most weather
conditions and at speeds and distances that made sense to the consumer.
Through the mid-1970s, business aviation aircraft growth was modest, with fewer than
100 turbine-powered aircraft being produced for the business community in 1972. Good
economic times in the late 1970s and early 1980s produced a miniature boom in business
turbine aircraft, with more than 400 such aircraft produced at the peak in 1982. During the
same year, more than 2000 piston-powered light general aviation aircraft were produced, a significant number destined for business uses. In 2001, more than 1200 turbine-powered business
aircraft were shipped worldwide, approaching the 1800 piston-powered airplanes produced
in the same year; the emphasis is clearly turning to turbine-powered business aircraft.3
In 1986, some 14,000 turbojets and turboprops flew for business around the world; that
number had grown to more than 21,000 by the end of 2002 (11,000 of these are turbojets),
50 percent growth in just 15 years. Importantly, 13,000 operators worldwide sponsored all
these aircraft. The rate of increase is growing, perhaps as rapidly as 4 percent per year.
Business aviation has earned itself a permanent place in the world’s corporations.4
Personal aviation has taken its place as a practical transportation alternative throughout
the world with an estimated 150,000 aircraft used for safe, reliable, transportation.
Travel Is Important for Business
Corporations of all sizes increasingly focus on their travel expenditures, which often represent the third largest expenditure within many companies. As such, corporate stakeholders
traditionally have viewed business travel from the narrow perspective of costs as opposed to
its relationship to corporate productivity. Understanding the need to better define the corporate perception of travel and the role of travel management, the Institute of Business Travel
Management (IBTM) commissioned an environmental scan to assess the value senior corporate executives place on business travel and travel management in meeting corporate goals
and objectives.
With participants ranging from chief executive officers (CEOs), senior vice presidents,
vice presidents, and chief financial officers (CFOs) of Fortune 500 companies including
Boeing, EDS Corporation, Johnson & Johnson, Microsoft, and The Limited, Deloitte &
Touche conducted the first research project of the IBTM.5
Key findings included the following:
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Travel is important to meeting company goals and objectives, and travel management
programs contribute significantly to companies. As a result of the combination of an
increasingly global economy and increasing company growth fueled by the economic boom
of the last few years, companies have strategically channeled more funds into the cost of
conducting business. Like other business units, travel is expected to increase the corporation’s return on investment and increase process efficiencies. The findings of this study
clearly indicate that senior executives value the role of travel and effective travel management. Further, the study found that senior executives believe that travel management
programs make significant contributions to the corporation and support the achievement
of corporate missions and goals.
Few companies use sophisticated models to calculate the contribution of travel management to company bottom lines and shareholder value. While senior executives value
1.10
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CHAPTER ONE
the contributions of the travel management programs, the study found that few companies
use sophisticated means to calculate the true value of their travel programs. Although
executives implicitly understand that travel affects other areas of the company such as sales,
marketing, and operations, most travel management programs do not employ measurements
that effectively calculate travel’s bottom-line impact on the corporation. As a result, travel’s
impact on the company is strongly recognized, but a mechanism to quantify its impact
has not been fully developed.
Senior management’s highest travel priority is to optimize time while being very sensitive
to the balance between time and cost. While minimizing costs for any company is critical, the study found that those interviewed also understand that “time is money.” Thus,
in crafting travel policy, entering supplier relationships, and developing performance
measurements, travel managers should develop methods that integrate the time and cost
elements of travel.
The Reasons6
Deciding how to travel—via the airlines, via company or charter aircraft, or even by driving
or taking a train—involves many considerations. While several of the benefits of business aircraft are tangible and measurable, some are challenging to quantify precisely. Progressive
managers routinely consider all the costs and realistically evaluate all the benefits of every
travel option before deciding how to go. According to the NBAA these benefits include
the following:
Saving Employee Time. Efficient employee scheduling and employee time saved are key
advantages of business aircraft use. Because business aircraft have the ability to fly nonstop
between any of the 3500 small, close-in airports—ten times the number of locations served
by scheduled airlines in the United States—highly efficient employee time management
becomes a very real benefit. Additionally, the value of employee time often exceeds its cost
to the company by substantial margins, further increasing the importance of employee time
savings. Simply stated, business aviation helps a company obtain maximum productivity
from its two most important assets—people and time.
Increasing Productivity Enroute. High levels of employee productivity enroute to a
business destination—in a secure office environment that is free from interruptions, distractions, or eavesdropping—can have substantial value to an employer. A Louis Harris &
Associates survey showed that executives felt that they were 20 percent more productive in
the company jet than they were in the office. Conversely, they felt that they were 40 percent
less productive in an airliner due to distractions and lack of privacy.
Group productivity, maximized due to the common availability of club seating and tables,
often is unique to business aircraft. Strategizing before meetings and debriefing afterwards
are common practices facilitated and encouraged by business aircraft cabin configurations
(Figs. 1.5 and 1.6).
Minimizing Nonbusiness Hours away from Home. Family time before and after traditional business hours is critical to most employees. Because a stable, supportive family can
have an acute effect on employee morale and productivity, scheduling that minimizes time
away from home can be a key benefit.
Ensuring Industrial Security. For many companies, the protection of personnel from
uncontrolled public exposure alone is justification for business aircraft use. Avoiding
1.11
SETTING THE SCENE
140
120
Percent Productivity
100
80
60
40
20
0
Company
Jet
FIGURE 1.5
Company
Turboprop
Airline Jet
Commuter
Turboprop
Office
Productivity compared. (NBAA.)
45
40
35
30
25
20
15
10
5
0
Employee
meetings
Customer
meetings
Individual
work
Company aircraft
FIGURE 1.6
Non-work
Airliner
Passenger activity aboard aircraft. (NBAA.)
Rest
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eavesdropping, reducing travel visibility, and eliminating unwanted and unnecessary
conversations and interruptions all support the use of business aircraft to safeguard company
employees and the sensitive information they carry.
Maximizing Personal Safety and Peace of Mind. Turbine-powered aircraft flown by
two-person professional crews have a safety record comparable with or better than that of
scheduled airlines. The peace of mind that results from complete company control over the
aircraft flown, passenger and baggage manifests, pilot quality and training, aircraft maintenance, and operational safety standards is substantial. This benefit also can include the
rescheduling of flights if weather, mechanical, or other considerations suggest that this is
the appropriate course.
Exercising Management Control over Efficient, Reliable Scheduling. The near-total
scheduling flexibility inherent in business aircraft—even changing itineraries enroute—
can be a powerful asset. Since aircraft can arrive and depart on the passenger’s schedule,
typically waiting for them in the ordinary course of business, meetings can be moved up,
back, or extended without penalty, risk, or unnecessary scheduling pressures. Overnight
trips also can be avoided. If managed proactively, this benefit can improve business results.
Projecting a Positive Corporate Image. For customers in particular and often for vendors,
the arrival and departure of company employees via business aircraft are the sign of a wellrun company, signaling the progressive nature of an organization with a keen interest in
efficient time management and high levels of productivity. If used for charitable purposes,
significant public service contributions, as well as possible public relations benefits, also
can be realized.
Attracting and Retaining Key People (Customers Included). The right person in the right
place at the right time can change everything. Finding and keeping such people can hinge on
many factors, including the ability to maintain reasonable travel schedules, maximizing personal productivity and ensuring family time. Holding on to valuable employees also can
prevent companies from spending time and resources on training replacement employees.
Reducing Posttrip Fatigue and Increasing Posttrip Productivity. Schedules that require
late-night travel or longer-than-necessary trips often result in posttrip fatigue, damaging
productivity in the day(s) after the trip. Because they can facilitate more efficient scheduling,
business aircraft can minimize this loss.
Optimizing Payroll. Under “rightsizing” initiatives, many organizations have rediscovered
the need to maximize the productivity of the same or fewer employees to accomplish equal
or greater amounts of work and ensure their competitive position and long-term success.
As business aircraft improve employee time management and efficiency, they can help
eliminate the need for additional personnel, reducing payroll costs, and help to maximize a
company’s competitive market advantage.
Truncating Cycle Times. The compound effect of increased productivity and saved
travel time is that more can be accomplished in less time. Consequently, many companies
attribute reductions in cycle times—when facilities are brought online sooner and projects
finished faster—to business aircraft use. Although it is challenging to quantify or attribute
entirely to business aircraft use, this benefit often can be substantial.
Charging the Entrepreneurial Spirit. By minimizing or eliminating many of the barriers
to travel, business aircraft allow business opportunities to be considered and acted on
SETTING THE SCENE
1.13
more readily. Business cultures and their strategies change as markets, facilities, and
customers in rural areas of the country—once practically unreachable and unconsidered—
are newly accessible.
How Companies Use Aircraft 7
There are a nearly infinite variety of ways to use business aircraft. From the obvious, getting the executives out and back rapidly, to transporting teams of specialists, to going out
and getting customers to witness your excellent manufacturing or service organization,
companies have learned that these and other applications make sense.
The NBAA has studied how companies use their aircraft. Here are just a few ways that
organizations have discovered to use their aircraft (Table 1.2):
Key Employee Travel. This is by far the most frequent use of business aircraft. Getting
to essential meetings, conducting site visits, and keeping customers happy are all reasons
for the right people to get to the right place in a timely manner. The timeliness of these trips
means choosing the right time for the trip and then getting out and back as quickly as possible. We all know intuitively that the business adage “time is money” is true, so we try to
maximize our time where it counts most. Spending time waiting at airports in security lines
does not meet this criterion.
Key employees can be anyone of any rank who is indispensable to a task, not just the
CEO. Financial experts, attorneys, technicians, and quality control specialists are all candidates for using the company aircraft when hours count. Not surprisingly, an NBAA study
revealed that top-level executives were not the most frequent flyers in company aircraft;
middle managers were.
TABLE 1.2 Business Aircraft Utilization Strategies (NBAA)
Key employee travel. Getting the right person in the right place at the right time.
Customer visits. Visit customers on their turf.
Customer trips. Bring customers to you.
Scheduled customer service. Routine trips to service customer accounts.
Emergency customer service. Rapid response trips to fix what’s broken and “put out fires.”
Humanitarian and charitable flights. Being a good corporate citizen; helping employees.
Sales and marketing blitzes. Multiday/multicity sales trips covering a region or sales area.
Charter revenue flights. Offering your aircraft for use by a charter operator.
International flying. Regularly outside the United States.
Helicopters. Used to go directly to specific destinations; not just between airports.
Management teams. Transporting management teams to organization sites.
Engineering teams. Transporting production or engineering teams to critical work sites.
Corporate shuttles. Regularly scheduled flights between organization facilities or customer sites.
Make airline connections. Making airline connections, particularly international flights.
Carry priority cargo, parts, or mail.
Special projects. Such as advertising shoots.
For goodwill/lobbying. Transporting elected officials or candidates; going to lawmakers.
Utilitarian purposes. Mapping, aerial surveys or inspections, etc.
Market expansion. Evaluating new markets/sites.
The airborne office. Working/conferring enroute.
Personal travel. Employees and their families.
Attract and retain key people. A tool to facilitate work or get people home more nights.
Maximize employee safety and industrial security. Better than the airlines.
1.14
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Saving Time and More
A control-valve manufacturer in Milwaukee was in the final stages of signing a
major contract with a potential customer located in Asheville, North Carolina. A
major sticking point arose over a number of issues, including final design, production rate, and costs. The situation was deemed “critical” by the company executive
vice president. Clearly, a meeting of the minds was in order. A visit to the Asheville
customer was planned.
As is often the case, finding a 3-day window for the meeting for all concerned (at
both locations) was difficult. Why 3 days for a meeting that should require at most
6 hours? Airline service from Milwaukee to Asheville was such that the five travelers
had to depart the day before and return the day after the meeting. Therefore, the executive vice president chose the only day available to all and scheduled the company
aircraft for the trip.
The team rose early on the day of the trip, went to a conveniently located general
aviation airport in suburban Milwaukee, boarded the aircraft on arrival (no waiting
or processing necessary), and 1.5 hours later arrived in Asheville. Exactly 7 hours
later (a little longer than they expected), they reboarded their aircraft and arrived
back in Milwaukee in time for a stylishly late dinner.
Not only did team members save an aggregate 60 productive hours, they also
saved more than 120 hours of their personal time in the process. Moreover, the 3-hour
roundtrip was used profitably in strategy and implementation meetings in the company
aircraft. The best part: The cost of the company aircraft was 20 percent less than the
combined fares would have been on an airline.
Business aircraft are used commonly by key employees to
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Extend management control and bring operational areas to a manageable size
Facilitate company, supplier, and/or customer meetings in multiple cities per day
Take practical and routine daily on-site supervision of facilities in different cities
Reduce, sometimes dramatically, travel times to multiple locations versus public transportation
Facilitate emergency meetings, including those involving the board, partners, and customers
Efficiently reach remote locations
Strengthen relationships with customers through shared private time enroute to a destination
Facilitate rapid action on mergers and acquisitions, particularly for companies in remote
locations
Customer Visits. Most businesses place customer contact at the top of their priority list. An
integral part of such contacts involves face-to-face visits—visits to introduce new products,
discuss existing product lines, explore new customer needs, and in general, be nice to the
people who ultimately pay the bills. However, getting to customer locations, which frequently are poorly served by the airlines, can be a several-day chore. Since business aircraft
have access to many more airports than do the airlines, a number of customer visits can be
made in one day with the company “magic carpet.”
SETTING THE SCENE
1.15
Visits via business aircraft can be used to
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Attend customer-sponsored events, such as a grand opening.
Service more than one destination in a day.
Efficiently increase face-to-face contact with the customer, relationship building, interaction between people. “They think more highly of us when they see more of us.”
Facilitate a lean senior staff. “We have a lean management, so it has to cover a wide area
quickly.” Consequently, business aircraft can facilitate senior management participation
in selling.
Enable a team approach rather than a one-person attempt. “If there is a new business
opportunity that requires a team visit, we dispatch them out on that call.”
Demonstrate capability; establish or reinforce an image
Support a customer in trouble. “Being there sometimes helps.”
Market Expansion. The attractiveness and potential of new geographic markets may be
limited by a lack of physical access to those markets. Business aircraft can open potential
new markets, including international ones, and provide dramatically improved access especially to rural areas. Market expansion is facilitated as much by attitude as by access. Business
aircraft, because they can facilitate access, can lessen or remove perceived barriers to the
management of new markets.
Prospecting within new markets is the first step, often for potential local business partners.
Business aircraft sometimes are used to facilitate meetings that take place at a halfway point
into these new markets. A new class of business aircraft with nonstop ranges in excess of
7000 miles is making access to global markets practical and common. Almost every flight
on business aircraft has an element of market expansion to it.
Management Team Travel. Management team travel is the most common use of business
aircraft. These teams provide a critical mass of expertise, talent, and experience that can be
applied to problems and challenges not found at the home base. Getting these individuals
out to the problem area and back expeditiously makes good business sense.
Management teams have a substantial aggregate hourly value to their employers. The
combined costs of air services, employee travel time (door to door), and other trip expenses
(such as hotel, meals, rental cars, etc.) often compare favorably to airline travel between
second-tier cities or rural locations. When the value of employee time is considered along
with the value of productive time enroute and nonbusiness hours away from home (family
time), the comparison of business aircraft travel versus public transportation often becomes
problematic.
Some progressive companies have or are installing conference facilities in corporate
hangars to facilitate off-site meetings. Corporate hangars also are being equipped with transient manager offices that can be used for private conversations, study, or sending and
receiving e-mail.
Transporting Customers. A corollary to customer trips is the practice of bringing customers
to your facilities to witness your excellence and to impress them with your knowledge and
insight. Moreover, fetching customers in the company airplane makes a substantial impression
on them; this means that they are very important people to you.
The practice of transporting customers can
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Be used to pick them up, bring them to company facilities, meetings, cultural, entertainment, or sporting events, and then return them home as quickly as is practical, often on
the same day
1.16
CHAPTER ONE
●
Letting Them See Your
Excellence
A major office furniture manufacturer
provides its products to a worldwide
audience; however, most of its sales
occur in the United States. Early in its
life it saw the need for bringing customers to its Midwest headquarters,
first by car and train and then by
company aircraft. The investment in
customer transportation has paid off,
making the company a member of the
Fortune 500 and a world-class provider of office furniture.
“We can show them what we make
in catalogs and showrooms,” says a
member of the company’s marketing
team, “but getting them on our turf
and showing them how all the pieces
fit together and how dedicated we
are to quality is a powerful marketing tool. We couldn’t do this without
the company airplanes.”
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Provide an opportunity to build relationships and ease communications
Help those in need to restore service by
moving their personnel and equipment
Improve customer access in both directions
Be used as a courtesy to correct for
company-induced delays
Engender goodwill
Facilitate approvals for the delivery of
products or services
Facilitate customer contract signing
International Trips. The allure of emerging markets—both as potential suppliers
and as customers—in China, India, and
Russia is of increasing interest. Hundreds
of business aircraft fly every day between
North America and Europe, Asia, Africa, or
South America. A surprising number of the
aircraft used for this purpose are small to
midsized jets.
Many companies transport management teams internationally for multicity
visits, some covering dozens of cities over
multiple weeks. Given the limited airline
service in some regions, this can be a
highly efficient practice. Importantly, as the teams travel, they have an increased opportunity to confer and plan during lengthy enroute legs because of the uniquely private and
communicative environment provided by the business aircraft cabin.
Canada, Mexico, Central America, and the Caribbean are the most frequent destinations
for U.S. companies; many of these markets become closer via business aircraft than crosscountry U.S. markets. As major markets and producers move offshore, the need to get to
those sources becomes increasingly important; business aviation provides ready access to
these areas at greatly reduced cycle times.
Specialty Teams. Teams of engineering, troubleshooting, survey, and financial employees
are commonly dispatched to rural or remote areas to
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Rapidly restore service at “down” facilities or sites
Monitor, inspect, and review construction progress
Install, modify, or dismantle equipment
Deliver and install emergency parts
Evaluate potential construction sites
Attend or facilitate critical meetings
Visit suppliers
Not only do the teams get there faster, using a business aircraft sends a message to the
passengers and customers alike: This is an important job that deserves attention.
SETTING THE SCENE
1.17
Team Efficiency
A major U.S. catalog clothing retailer regularly ensures the quality of its products
by sending quality control teams to its contractors’ manufacturing plants to inspect
the operation. When the manufacturing took place within the United States, normally
in the southeastern part of the country, these visits were relatively simple and quick,
involving a week on the road, via airline, at most to cover four to six plants using
a team of five to seven inspectors. However, when most of the manufacturing
activity went offshore, primarily to Central America and the Caribbean, the inspection teams began to spend more than 3 weeks to accomplish their task.
A chance meeting between the company flight department manager and head of
quality control spawned a scheme to make the company more efficient and to get the
inspection team home more rapidly. By using the company Learjet, up to seven team
members could be taken to the offshore plants, sometimes two per day, in about
half the time required by international airline travel. This scenario is now played
out several times a year, allowing the company to visit its suppliers more frequently
while reducing wear and tear on its inspectors. Importantly, using the company jet
saves tens of thousands of dollars on travel and trip expenses.
Sales/Marketing Campaigns. Sales and marketing blitzes can be of nearly any scope and
duration, depending on the stamina of the participants and their families. Such blitzes can
be highly efficient and concentrated direct selling opportunities. Because they are timeefficient, participants are able to spend more time in the office and less time in airports.
In some companies, business aviation is the prevailing method used to get senior officers
into a specific marketing territory to visit customers and vendors. Because time is so limited,
multiday trips facilitate maximum exposure in a limited time.
Sales and marketing blitzes can intensify seasonally, during new product introduction
cycles, for initial public offerings (IPOs) or investment/investor swings, during downturns
in the economy, or following a restructuring. Potential customers and distributors also can
be the target of multiday trips.
Attract and Retain Key People.
Attraction:
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Companies commonly use business aircraft as recruiting tools to facilitate the interview and
negotiation process for key prospective employees or business partners and their families.
The greater the distance and the more rural the recruiting base, the greater is the apparent
benefit of a company aircraft.
Anything that helps motivate key employee recruitment is critical.
The value of the first impression left on a prospective employee is very important.
The use of business aircraft rapidly establishes credibility.
Companies make regular flights to universities to recruit graduating students.
Retention:
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Companies can keep personnel longer by making their days shorter.
The use of business aircraft for commuting or other personal travel can be negotiated as
part of a personal services contract.
1.18
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CHAPTER ONE
Extra “no cost” passengers can fill empty seats as a reward to high-performance employees
and their families on certain trips scheduled for business reasons, although this type of
travel may be taxable as personal income to those passengers.
A company philosophy that stresses family-friendly scheduling—reducing nonbusiness
hours away from home through the use of business aircraft for efficient day trips—can
be very attractive.
A surprising number of goodwill flights seem to be flown, typically very quietly, to facilitate employee medical treatments.
Corporate Shuttles. Some companies with multiple operating bases have found it
advantageous to institute a scheduled flight operation between those bases to save both
time and money relative to airline service. Airline schedules frequently do not fit the daily
commute nature of many work requirements, driving companies to establish what amounts
to their own private airline. Time savings in airport processing delays with the airlines
greatly reduces an employee’s availability to accomplish work productively; a private shuttle
may reduce this wasted time by as much as 80 percent. Moreover, with just a modest number
of travelers, significant cost savings may be realized with a shuttle.
Shuttles are most appropriate for larger companies with decentralized operations and
facilities or for companies with repetitive tasks, such as safety checks, management reviews,
ongoing employee training, or a need to make airline connections from rural locations.
Shuttles are not always permanent, often operating for short periods for specific projects or
startups. High-priority personnel can be transported regularly via helicopter to several company locations in a major metropolitan area, saving many hours of tedious ground travel.
Priority Cargo, Parts, or Mail. This subject has immense potential. Many companies use
aircraft to carry high-value cargo, replacement or spare parts, or interoffice mail. This practice
is common and often unquantified but of substantial commercial value in displaced overnight
delivery charges. Any material that cannot be moved practically by conventional shippers
due to size, weight, susceptibility to damage, or other physical limitations, and particularly
those which need to be delivered within hours, often are best transported via business aircraft.
Projects. Usually business aircraft are used for infrequent or “one shot” projects, such as
multilocation advertising photography “shoots” involving a multidisciplined team of experts.
The combination of both personnel and an unusually large amount of project-specific
equipment can trigger business aircraft use as the most efficient and cost-effective travel
alternative, specifically for transporting delicate equipment of extreme value to the project.
It’s just essential for us to get out in the field.…Aviation is the most time-efficient
way for us to do that.
—MARKETING MANAGER
Utilitarian. Business aircraft are used commonly as a convertible platform for mapping;
aerial surveys, inspections, and photography; cattle ranching and herding; flying laboratories
for airborne experiments or other research and development; educational laboratories; surveillance; and power-line and pipeline patrols, in addition to other uses.
Public, Press, and Investor Relations. Progressive companies often manage opportunities
to project a positive corporate image using business aircraft either as a symbol of efficiency
or as simple transportation to facilities or events to further this purpose. Publicity generated
by the use of aircraft for noble purposes, such as the rapid delivery of relief supplies after
a natural disaster, can be of substantial public relations benefit.
SETTING THE SCENE
1.19
Personal Travel. Just because the aircraft is operated by a company does not preclude its
use for personal transportation. However, the company must define personal-use policies
and provide methods for employees to pay for these services.
Emergency Evacuation/Response. Business aircraft also are used to remove company
employees from harm’s way, usually as a result of a medical emergency, natural disaster,
civil strife, or other security threat, particularly in areas of limited or uncertain scheduled airline service. Similarly, the ability to place key personnel at the scene of an oil spill, manufacturing plant fire, or tornado-damaged office site rapidly makes good business sense. Getting
to the scene early with the right people may save additional damage and costly downtime.
Goodwill. Business aircraft also are used for personal customer or employee needs, such as
travel associated with family emergencies, or as a favor. There is not always an immediate,
tangible business benefit from the use of business aircraft for customers or employees with
special needs or for public officials. A longer view, however, may suggest that the company’s
strategic interests can be best served by this practice depending on individual circumstances.
Lobbying. Business aircraft can be used to transport elected or appointed officials. The use
of business aircraft for the carriag...
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