Airline Planning

Planning can be very complex and can take a long time. Results from the planned Profit and Loss Statement are not always acceptable to shareholders, so you have to repeat the planning process. In the end the plan, especially the targets and the budgets, must be approved by the Board of Directors. And, of course, approval must be ready in time, so that the new period can start with a new budget.

• 

  The situation

  Every year again, planning starts in August. Every year again the start of the planning period is slow and the paces are short. Every year again the development of strategic ideas goes hardly beyond new plane requirements and new route operations as marketing proposes it. And every year, the financial plan and the financial statements for the plan and the Board of Directors papers are not ready in time.

  Even worse: When the plan is presented to the Board of Directors, the Board is requiring better profits and rejects plans that result in losses without a strategic outlook for future improvements. Then the entire plan must be worked over, time of December that is hardly available. And since time is short, details are not worked out appropriately, the Board of Director wants to see the financial statements only, anyway.

  But this neglects one important thing, and neither the Controlling department nor the Executive management is happy about it. The approved plan is a sort of work order for steering the company through the coming year. This requires an everyday control of figures, of assumptions, of behavior, of market, or customer reaction, and more. But how can this be done if the details are not planned? How can this be done if only global figures are available such like Seat load factors on a route for an entire period, revenues on the route for a whole period only? How can a controller find out whether the weekday season on a route may be the origin of problems for the global figures on a route? How can a route profitability report be analyzed for problems to be act upon?

  Go back
• 

  The option

  We know about airline detailed functionalities and processes. We know how to split down the planning scenarios to the basic drivers and influence factors. We can do this in view of what the actual figures from the implemented systems can provide you for comparison between plan and actual. We know how a planning process as a whole must be set up, so that deadlines are met and so that the plan efforts are manageable. We know that a plan normally is not ready after one routine run, and that non-acceptable results must be worked over, and how to do this. We know how to prepare presentations for the Board of Directors that are convincing and answer all the questions that the investors may have about it. We know about the complex interdependencies between corporate strategies, commercial plans (both for products as for sales distribution channels), and the financial side of cost, staff and capital investment.

  There are certain parts of the plan which are performed top down, such like strategic plans. Others are made bottom-up, such like an investment plan or such like administrational cost. And thirdly, again others may be made partly top down and partly bottom up, such like operational cost. We know how to manage the complexity and interdependencies in the plan, so that it can work in the end after approval.

  We are experts in airline processes, operational processes as well as auxiliary processes like MRO and all airline administrational problems, and how to plan the business. Try us.

  Go back