Many years ago, our company founder, Al Conklin, sold a new twin-engine business aircraft to a very successful entrepreneur. He had established a bit of a rapport with the individual and, after the sale, asked him straight out, “How can you justify the cost of this airplane?” His reply? “What is the cost of a divorce?”
Business aircraft enable your passengers to manage their time in the most productive manner. They enable face-to-face contact within your company, with prospects and your customers. How to you measure the success of your aircraft in accomplishing this role for your company? Here are some places to start.
Key Employee Travel Time Saved. If the aircraft saves travel time, then how much time? Increased time spent traveling is decreased productive time or decreased rest/recuperation time. You should have some data and a good feel for when the time saved is worth the use of the business aircraft. How do you measure the worth of the time saved?
Time has value. If using the business aircraft saved three senior executives eight hours’ apiece, then the total time saved was 24 person-hours. If those hours were spent with a major customer, what is the value of that customer? At a minimum, what is the value of the executive’s time to the corporation? The executives' time is worth well over their salary and benefits, but this is a minimum value. Calculating the time saved should not be a big project for the flight department. It can be just another blank in the travel documentation. It can be estimated, tracked and reported on a regular basis.
Customer Travel. One study at UCLA indicated that up to 93 percent of communication effectiveness is determined by nonverbal cues. These cues can mean the success or failure of a contract negotiation or new business venture. Who are the company’s largest customers? How often do they receive visits from senior executives? How often does the company bring them to the corporate headquarters for meetings? Do you track this?
Getting new customers typically takes more effort than retaining the ones you have. Show up for the big presentation with a team of two or a team of seven? Is the business aircraft used to facilitate these meetings? Again, it should be easy to track what the business purpose is for the aircraft: new client visit, sales visit, engineering support, etc.
Travel Between Corporate Locations. Many companies have operating locations in hard to reach areas. One company that I’ve done a study for has four major operating locations is four non-airline-hub locations. The business aircraft keeps the senior executives at each of these locations connected in person with the headquarters. It also enables short-notice travel for a vital meeting. This company tracks the number of overnights executives spend away from their home office (or how many overnights were saved by the business aircraft). Another client uses a helicopter to visit multiple job-sites that cannot be done in a day via ground transport.
Non-tangible Rewards. Many of the rewards we value are non-monetary. The buyer at the beginning of this article had not really estimated the cost of getting a divorce in dollars, but in the loss of a valued relationship with his wife and family. Turnover in key positions means a loss of continuity, a loss of the team’s effectiveness and time spend searching for the new executive that cannot be spent elsewhere. The business aircraft saves on the wear and tear of travel and yes, enables the spouse to make it home for the child’s soccer game on Friday afternoon. Zappos founder, Tony Hsieh is well known for his rise to the top. He’s well known for his corporate culture of happiness. Tony Hsieh also uses business aircraft.
There are many uses for the business aircraft. They all center around making the most effective use of the time available. There needs to be some measures of how the business aircraft is contributing to the success of your company’s mission. What to measures are depend on your use of the business aircraft.