Best Practices for Aircraft Management Part 1: The Magus

“Balancing a flight department, an FBO, or maybe just a maintenance shop coupled with a charter company and demanding jet owners is best left to magicians, like a Magus.” — David Anderson

I met David in April of 2006 when I was selling consulting and online tools for jet owners and charter operators in the US, Canada and some of Europe. David was a Captain on the G-IV’s based out of Millville, NJ, but like many small firms – he was also the marketing guy. The most interesting thing about hanging out and chatting with David was that he brought this word to me and I quickly saw that the character it defined was key to the fabric of the private jet and jet owner world.

It was about these guys – the jet owner’s manager. And this special person, this Magus, was clearly present at many jet management firms. The Magus, as a species, was fascinating, since the more you got to know them, the more you realized this business wasn’t about flying the airplane more, or figuring out how to scale and grow.

It was more about their passion and dreams that were tied to airplanes: The Magus is a captivating individual who has built a lifestyle around what they do – flying private and business aircraft for the well heeled. Doing it well, doing it with style and swagger, and doing it in their Magus Universe where all major decisions and actions flow through them.

To Google a Magus is: “A member of a priestly caste of ancient Persia. A sorcerer.” While this may sound extreme, it is a fair characterization of what at least the outward appearance might be of the small business owner that is deeply into their jet owner management religion.

They Must Exist

The nature of the industry requires a relationship manager for the jet owner. And the aircraft manager, the Magus, cannot survive without the jet owner. Jet owners also know that their aircraft don’t fly enough to offset their large fixed costs, so being able provide great aircraft to your local Magus (air charter operator / management Co.) sets up a natural symbiotic relationship: They get to operate an airplane that you they could not afford otherwise and the jet owner gets all the trappings their lawyers and accountants seek:

  • Eliminate or minimize operational control liability.
  • The tax benefit and structure that comes with a commercial operation.
  • Some subsidy effect of 3rd party income on the aircraft.

But as with any endeavor, the most complex part of any business relationship is managing people. How the owner of a multimillion dollar jet interfaces with an individual who is the most expensive baby sitter known to mankind is the key to the success of the relationship. A close friend who owned a local trucking company once commented to me on what he had learned, in years of managing people: When it came to people problems, I asked him – “How do you manage problems with pilots, personnel… you know… people problems?” The answer was simple:

“Are there any other problems?”

The key to finding and retaining a good aircraft manager lies in the simple statement:

Manage Your Magus

If your jet isn’t with a larger charter management such as TAG or Jet Aviation, then you are invariably going to meet some form of Magus – some key person that knows so many facets of their business that you are astounded by their encyclopedic command of aircraft, systems, models, serial numbers, safety data, baggage capacity, etc that you feel compelled to give this person your airplane immediately.

The Magus lives as a pilot, aircraft salesperson, a buyer’s representative, or even a corporate flight department head. They add real value, but to the layperson the Magus is odd in that there is just so much airplane talk all the time. You could say that they were born in an airplane, or at the very least raised in one.

For all their strengths, the Magus is typically plagued with weaknesses that directly affect aircraft and jet owners. Here are three key ways to help you manage your Magus:

Setting Goals and Planning

While well meaning and intentioned, typically the Magus will hide their core focus – the next transactions that immediately affect their banking, cash flow and next meal. Virtually all are pilots – and charismatic ones at that. While some are modest and shrewd business people, the vast majority have an ego that is tightly wound around their identity as a “getting things done” person that can figure just about anything out.

These guys (and a few gals) know aircraft. And while they are brilliant sales people in the moment, they are less successful at building and finding more repeating customers or knowing how to make your flight department operate in their absence, illness or death. In fact, any sustained repetitive behavior that is required for building a business is difficult for the Magus, and this is why much of private aviation appears insane to the outside world.

Savings vs. Value

The deepest flaw in the Magus, however, is one that you need to know as their future business partner. While not malicious, they define value inversely to how you would and you don’t want to avoid this dynamic until it is too late.

Examples:

  • Being cheaper on fixed costs is seen by them as giving value to you, even if this means attracting sub-optimal crew, or skimping on training requirements. This is not a priority for you, the jet owner, and you want them to know that you’d like to pay for the appropriate level of training and best practices – always.
  • Your aircraft goes out on charters that are close to the cost of the trip, or worse, even below the actual costs due to their need to ensure that they can put income hours on the airplane, but in fact you just end up subsidizing some luckier person’s charter. You want the hours, but you want better marketing and branding, not more bottom feeding clients.

The best relationships start this way: Put your arm around the Magus and calmly explain that you’ve selected them for practical, personal and geographical reasons. You are already in the most expensive form of air travel, you know that things are just going to cost a lot. Calmly explain:

“I just want to pay the appropriate price for the safest, most efficient, most comfortable ride through the sky. Can you help me do that?”

By being forthright (and repetitive) with the Magus on these issues you can disarm many of the natural tendencies to show value to through price, non-scalable behavior and other mom and pop business detriments that make them so endearing, but also so hamstrung for growth.

And since you’ve asked for transparency on cost versus profit on elements of the arrangement – be sure you are getting it. If you don’t have or want complete transparency, that’s fine too – just be sure the aircraft management company is ok with both financial and safety auditing on a regular basis by the jet owner’s team or designee.

Building the Relationship

In the end we want to create, foster and improve relationships. Despite whatever difficult dysfunction lurks in business and private aviation, it is entirely manageable if we focus on key principles that yield the best behavior from the jet owner’s most important vendor:

Money – explain to them you that you know they have to make it, just don’t be ashamed, hide or try to minimize where it is made: On the pilots, the parts, the charter? Emphasize that a management fee is fine, so long as you get something for it beyond the legal requirements they must meet.

Oversight – explain that you have a considerable amount of money invested in their operations, accordingly you’ll be hiring experts, either occasionally or on an ongoing basis to help you see what isn’t obvious in the operation.

Alignment – be sure they know that you are interests are both aligned for them to be better, whether this means more safety audits, aiming for higher standards, or simply being better risk managers, not pilots.

Best Practices – being legal is great, emphasize that you want them to be not just compliant, but studying the root causes of why accidents happen, how cultures, bosses, instructions, all form a culture that is better. When discussing alignment, show them that them being rockstars as risk managers, leads to more referrals from you, your friends and their charter customers.

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