The Flight Department Business Unit
Flight departments have historically reported to various business units in their companies, and are often bounced around from one unit to another because many companies have a hard time finding where they fit best. The truth is flight departments often manage one of the biggest budgets (including facilities, payroll, aircraft and operations) and often with some of the most valuable individual assets the company owns. Working within the business aviation industry requires a different set of operating procedures than most other standard business processes. And the flight department supports some of the most important travel for the most senior executives in the organization. Consequently, flight departments should be a separate business unit tasked with managing the aviation assets the company owns and supporting the overall growth plan of the organization.
We have long helped clients think about their aircraft as aviation assets and flight department leaders as aviation asset managers. In 1997 my parents (we are a family business) created the Aviation Asset Manager Portfolio. This was an aircraft valuation and planning tool helping owners better evaluate whether to transition aircraft or invest in their existing aircraft and how to maximize their return on investment and residual value. Since then, we have helped several flight departments create long-term strategic growth plans and evaluate their current lift against the corporate business plans to see how the flight department can best support the companies’ needs. Lately, I have heard a lot of aviation directors start to talk about needing to prepare these same kinds of plans and this is exciting personally. I recently applied to become part of the NBAA’s Corporate Aviation Management Committee (CAMC) and was subsequently invited to join. I now need to choose a sub-committee to participate in and the director asked me to think about what is exciting to me about management in our industry. I immediately knew the answer and it is this very evolution of the flight department into a true distinct business unit that doesn’t just support an organization’s travel needs, but rather helps affect the organization’s bottom line and is accountable for doing so.
Because the flight department has long been looked at as a division of another business unit, they have not often had the same corporate visibility or top-down support to be integrated into the business development plans. When, however, the flight departments are thought of as their own business units and create long-term strategic plans in conjunction with their company’s business plans something often unexpected and very exciting starts to occur. This kind of planning and work to meet the goals established mean that the flights departments can better support their company’s long-term growth goals, maximize the residual values of their assets, minimize their costs and most positively impact their company’s bottom lines. The good news is that more and more aviation directors are starting to recognize the enormous potential that this kind of long-term strategic planning can provide. As they start to talk differently, internally, as true aviation asset managers, and demonstrate how this kind of thinking and work can really positively affect their companies, this will lead to a shift in the organizational structures of companies that have flight departments. This paradigm shift will benefit the companies that utilize business aviation and in turn, strengthen our industry.