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Creating a Flight Department (Part 2)

Writing a business plan for your proposed Flight Department

Fred Haap   |   22nd July 2015
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Fred Haap Fred Haap

Fred Haap is an IS-BAO accredited auditor and past Chairman of NBAA. During his distinguished...
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Regardless of size, a flight department should be structured as a business unit. Thus a business plan is a must, note Fred Haap and Jack Olcott. Here's where to start...

Most organizations considering the formation of an in-house flight department are relatively small enterprises, often led by a dynamic entrepreneur. Thus it’s understandable why far too many efforts to add a business aircraft to the organization's list of available tools lack sufficient planning. As long as the boss wants an aircraft, little else is required, so goes the near-sighted reasoning.

Relying solely (or even mostly) on the desires of the CEO/Boss to use a business aircraft is building your flight department on a weak premise and an unstable foundation. The obvious fallacy of such reasoning is the high risk that the aircraft will be sold if there is a change of top management, owners or if shareholders seek quick solutions to disappointing quarterly financial results for a public corporation.

More significantly, however, failure to integrate the use of a company aircraft into the overall purpose of the organization significantly diminishes the value that Business Aviation can provide stakeholders.

A flight department should be aligned to the organization's objectives just as other business units are so structured. Its role is to serve the organization's transportation needs while maximizing productivity of personnel and time. Thinking of the entity aircraft as existing only to make travel more comfortable for the CEO, Boss or his favored colleagues is truly limiting the scope of what Business Aviation can do to facilitate organizational success.

The Business Plan

Management 101 calls for a Business Plan preceding the launch of any enterprise. The same reasoning applies to the enterprise’s components, such as the Flight Department. Your objective is to present a compelling argument to the enterprise's decision makers that they should authorize the acquisition of a business aircraft as well as formation and on-going support of a Flight Department.

Each dimension of that decision needs to be explored and resolved. Not unlike any investment in equipment and personnel, the case for a Flight Department requires rational thought and articulate presentation.

A Flight Department Business Plan (FDBP) clearly presents the reasons for operating business aircraft and specifies why the enterprise should invest in, and use Business Aviation. It stipulates the FD’s integration into the enterprise and describes how departmental outputs align with organizational objectives. As with other business units, metrics are established to track the FD’s output against anticipated results.

While the content of a FDBP may differ from that of a plan for the organization's finance department, for example, the general format is consistent with a classic Business Plan. Basic paragraph headings are as follows:

• Table of Contents;

• Executive Summary;

• General Description of the Department;

• Departmental Organization, Assets & Personnel;

• Department Deliverables & their Value;

• Measurement of Deliverables & their Value;

• Users of Aircraft (executives, employees, customers, guests);

• Communications with Users;

• Operational Plan & Use of Established Industry Standards (i.e., NBAA Management Guide, IS-BAO);

• Management Plan (including reporting format and frequency to superiors within the organization as well as with regulatory authorities);

• Safety & Security Discipline (including Risk Management);

• Financials Plan (including startup costs, operating costs and tax considerations);

• Launch Plan & Periodic Performance Audits of the Flight Department;

• Appendices & Supporting Documentation.

A successful Business Plan for a Flight Department leaves no doubt in the reader’s mind that the activity is well conceived and will be well implemented.

Writing the Plan

Executive Summary: As tempting as it might be to generate the Executive Summary first, that element of the FDBP should be the last to be completed since it is a concise summary of the basic purpose of the Flight Department and why that purpose benefits stakeholders. As the name implies, the section summarizes the points you make in the FDBP, and does so in two pages or less. If you feel more than two pages are necessary for the Executive Summary, you need to refine the arguments you make in the subsequent sections.

The Executive Summary is the place to unabashedly assert that Business Aviation can support the overall purpose of the company, and that the Flight Department should be included within the organization's matrix of business units.

General Description: The case for forming a Flight Department is made in the section labeled General Description of the Department, which immediately follows the Executive Summary. Lead this section with a concise Vision Statement—namely what you and your associates believe will be the overall achievement of the Flight Department when it is fully functional. Perhaps your department’s Vision is “To provide transportation by organization aircraft that minimizes travel time and maximizes productivity of personnel interfacing with clients and business partners.”

Most likely your Department’s Vision Statement will read differently since each department has its unique idea of how it can best serve the organization as it matures. One size does not fit all.

Vision Statement: Pay particular attention to crafting a Vision Statement that is embraced by all departmental and enterprise personnel. When there is genuine buy-in by all participants, everyone is looking in the same direction and visualizing what is possible. Much hassle and misunderstanding will be avoided when all parties have a common Vision for the Flight Department. Such buy-in requires that all relevant parties participate in the creation of the Vision Statement.

Mission Statement: The General Description of the Department should also include a Mission Statement, which is more focused and less conceptual that a Vision Statement, but nevertheless is directive. An example of a Mission Statement might be…”Using the organization's aircraft, provide safe transportation that meets the specific needs of organization personnel, clients and business partners”. Like Vision, it should be constructed by those who implement the Department’s activities.

Governing Principles: A declaration of Departmental Values or Governing Principles rounds out the key concepts that form the Flight Department’s foundation. For example, a department might believe safe operations, effective use of time, responsiveness to passenger needs, versatile use of aviation assets, and efficiency are governing principles. Instilling such Values or Governing Principles within the description of the Flight Department adds context to what is being presented.

Like statements of Vision, statements of Mission and Governing Principles (or Values) each should be expressed concisely in a declarative sentence of as few words as possible. Departmental personnel should be able to recall these governing concepts easily and apply them to their daily activities as Flight Department Staff.

General Description: A general description of who the Flight Department will serve, why the use of the organization aircraft should be available to all personnel with a compelling business purpose, and how the department will be structured within the framework of the overall organization rounds out this section. Specifics such as departmental organization and personnel, destinations to be served, measures of value delivered by the Flight Department, how the benefits of Business Aviation will be communicated to potential passengers, and how the department will be managed are addressed in subsequent sections of the FDBP.

A well-crafted General Description of the Department is a powerful component within the FDBP for selling management on why your organization should form and maintain a Flight Department. And it sets the stage for subsequent sections within the Business Plan.

Next month, we address Departmental Organization, Assets and Personnel; Department Deliverables and their Value; and how best to measure the department’s contributions to the corporation.

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Read more about: Flight Department | Management | Business Plan

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