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Evaluating and Understanding the Organization 45 section of the worksheet are particularly significant as they will be critical inputs to the strate- gic planning process. If relatively few individuals on the planning team have worked at the organization for an extensive length of time, consider inviting long-term/tenured staff or former employees (former airport managers, and so forth) to participate in the historical review process. If a common strategic plan is being developed for a multi-airport system, Worksheet 4.01 should be completed for each airport that the organization oversees. To conduct a historical review of an organization, complete Worksheet 4.01, "Documenting Key Past Events and Historical Trends." 4.2 Reviewing Historical Performance Statistics Members of the planning team should supplement the historical events analysis with a review of historical performance statistics. The results of the online survey indicated that many airport operators (46 percent of survey respondents) currently sort, review, and analyze historical perfor- mance data. Of these, 88 percent use past performance data to project future trends. Historical trend analysis was also cited by survey respondents as their top tool (out of eight options) for assess- ing future risks/uncertainties. While any pertinent statistic can be reviewed using the framework set forth in Worksheet 4.02, "Analyzing Historical Performance Statistics," the most commonly reviewed statistics relate to four general categories: operational, financial, market share/market presence, and other. The main sample statistics as well as "additional" sample statistics are listed for each category below: · Operational sample statistics include, but are not limited to, the following: Aircraft movements for different types of traffic (domestic, international, general aviation, military, and so forth) Enplaned passengers for airports with commercial service, categorized as domestic, inter- national, and total, as well as connecting versus origin and departure passengers Cargo volume (in tons or pounds) Based aircraft Jet fuel and Avgas sales (in gallons) · Additional operational sample statistics are the following: Landed weight for different types of traffic (passenger airline, all-cargo airline) Enplaned passengers per departure Enplaned passengers per gate U.S. Customs and Border Protection arrival clearances · Financial sample statistics include, but are not limited to, the following: Cash flow from operating activities Operating revenue/operating expense ratio Operating margin Total operating revenue per enplaned passenger
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46 Strategic Planning in the Airport Industry Operating expense per enplaned passenger Airline cost per enplaned passenger Non-aeronautical revenue as a percentage of operating revenue Debt service coverage ratio Bond ratings · Additional financial sample statistics are the following: Debt capacity Airline revenue per enplaned passenger Cargo revenue per cargo operation Concession, parking, and rental car revenue per enplaned passenger and by facility/unit. Total general aviation/FBO revenue (for airports that are not general aviation) Landing fee (per 1,000 pound units of landed weight) for signatory and nonsignatory pas- senger airlines and signatory all-cargo airlines Capital contributions such as passenger facility charge [PFC] revenue, government grants, and so forth (reviewing government grant statistics is particularly important for general avi- ation airports as they are typically dependent on government grants to fund most of their capital improvements) Operating cost per square foot of terminal space · Market share/market presence sample statistics include, but are not limited to, the following: Airline market shares based on enplaned passengers Airline market shares based on cargo weight FBO market share Number of nonstop cities served by airlines and service frequencies on key routes Number of outbound airline seats available (international and domestic) · Additional market share/market presence sample statistics are the following: Number of origin and destination passengers in most important markets Average airfare(s) (could separate into short-haul, 0 to 600 miles; medium-haul, 601 to 1,800 miles; and long-haul, over 1,800 miles) · Other sample statistics include, but are not limited to, the following: Passenger satisfaction survey results Operating revenue per employee/operating expense per employee Percentage of employees satisfied with their jobs Number of safety and security incidents Number of noise complaints Economic impact on the surrounding communities · Additional other sample statistics are the following: Total employees per enplaned passenger and per square foot of terminal space Employee turnover rate Security screening wait times By completing Worksheet 4.02, "Analyzing Historical Performance Statistics," the planning team will be able to do the following: · Compare actual performance versus targeted performance (if available) for the relevant sta- tistics selected. · Assess whether there is a relationship between the performance reflected and a particular key event internal or external to the organization. · Review the historical statistical data analyzed and determine whether any discernible trends have the potential to affect the organization's future performance. These trends should then be ranked in order of importance. Similar to Worksheet 4.01, "Documenting Key Past Events and Historical Trends," the answers to Worksheet 4.02 are particularly important, as they will be inputs to the strategic planning process.
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Evaluating and Understanding the Organization 47 CASE STUDY Historical Performance Statistics of Particular Relevance to General Aviation Airports-- Centennial Airport (Denver, Colorado) Centennial Airport (the Airport) in Denver, Colorado, is the second busiest general aviation airport in the United States. The Airport is currently home to over 700 based aircraft, consisting of a mix of single-engine, multi-engine, and jet aircraft and helicopters. Five fixed base operators provide a full variety of services for both locally based and transient pilots. According to Robert Olislagers, Executive Director of Centennial Airport, the airport operator, Arapahoe County Public Airport Authority, has tracked the following fuel and operational statistics on a monthly basis for many years and reports them as part of monthly Board of Commissioners meetings (actual example below for December 2008): · Year-to-date (YTD) Operations: Down 4.8% from 2007 at 319,593 operations. · YTD Fuel Totals: Down 10.2% from 2007 at 11,654,719 gallons. · YTD Jet Fuel Totals: Down 10% from 2007 at 11,031,378 gallons. · YTD AvGas Totals: Down 13.8% at 623,341 gallons. · YTD Market Share [listed by FBO] for AvGas and Jet Fuel Combined: 59.2% for Denver Jet Center; 22.9% for TAC Air; 15.8% for Signature; 1.9% for Xjet Club; and 0.1% for the Heliplex. · Monthly Operations: Down 6.5% at 19,461 operations. · Monthly Jet Fuel Sales: Down 21.5% at 815,473 gallons. · Monthly AvGas Sales: Down 8.2% at 35,375 gallons. · Monthly Market Share [listed by FBO] for AvGas and Jet Fuel Combined: 53.7% for Denver Jet Center; 21.2% for TAC Air; 21.2% for Signature; 3.9% for Xjet Club; and 0% for The Heliplex. The Arapahoe County Public Airport Authority also tracks various financial and noise statistics as part of the monthly Board reports. Financial statistics tracked for the Airport consist of operating revenues, operating expenses, and capital expenses and any deviation from the budget for each statistic. Noise complaints are tracked on a YTD and monthly basis (according to the total number of noise complaints and number of households reporting) and are further sorted by region and distance from the Airport. Informally, the Executive Director regularly checks with numerous vendors that use or are based at the Airport regarding their level of business activity. These checks include updates on flight school activity (including hours flown and aircraft rented) and the activity of various aircraft detailing companies, aircraft charter operators, and caterers. The two most useful statistics for gauging Airport performance are jet fuel sales and operational activity and, in particular, the relationship between the two statistics. For example, Mr. Olislagers noted that, "during the summer [of 2008] when fuel prices escalated, our operational levels continued at the same pace, but fuel sales dropped. Following conversations with our FBOs, we discovered more customers [filled up their tanks] at their home [airport] or wanted to enter into contract fuel deals. We adjusted our prices and volume went up along with ancillary service purchases." If a common strategic plan is being developed for a multi-airport system, Worksheet 4.02 should be completed for each airport that the organization oversees. To review an organization's historical performance, complete Worksheet 4.02, "Analyzing Historical Performance Statistics."