Tuesday, August 23, 2011
The Value Of Corporate Time
It has to do with misinformation, not politics
Keep in mind, virtually all of that executive’s time will be unproductive on the airline, even in first class. He won’t be able to use his cell phone during the trip, and he probably won’t have an Internet connection. (In fairness, some airlines do now provide WiFi.)
Conversely, if the same executive travels by corporate jet, he’ll fly on his own schedule from and to the most convenient airport, he won’t need to change planes in Atlanta or Dallas, and he’ll usually have all the accommodations of his office available in the airplane.
His check-in time will be nonexistent, as the airplane won’t leave without him even if he’s late or if he needs to reschedule; he can keep his shoes on (or off) for the entire trip; he can take along several advisors for the same price; and he’s guaranteed to have his baggage arrive on the same airplane. A company airplane can sometimes fly home after the meeting, as well, thereby avoiding an overnight.
By corporate jet, the trip would charter for about $8,000 one way. Figure the combined ground and flight time at four hours. Bottom line—the busy executive’s company would spend roughly $56,000 for corporate time and another $16,000 for travel expense on the corporate jet, a total of $72,000.
The company is already way ahead if traveling by private aircraft, but remember, executives rarely fly alone, just as the president nearly always travels with a large retinue of assistants and advisors.
Remember that the president, any president, America’s ultimate CEO, travels on perhaps the ultimate business airplane (operating cost—roughly $180,000 an hour), as he should. There’s no question whatsoever the president needs the security and facilities of Air Force One. No one argues that the president isn’t entitled to optimize his time and maximize his security on a corporate aircraft, in this case, a Boeing 747-200.
Would it be illogical to assert that the security of a $20 million/year CEO is pressing to a major company? No one is suggesting the president should fly first class on Delta, but is it any more reasonable to assert that corporate executives do exactly that? Perhaps now you understand exactly how the business aviation community felt about the president’s comments on business jets.
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