““CEOs go to their vacation homes just after companies report favorable news, and CEOs return to headquarters right before subsequent news is released. More good news is released when CEOs are back at work, and CEOs appear not to leave headquarters at all if a firm has adverse news to disclose. When CEOs are away from the office, stock prices behave quietly with sharply lower volatility. Volatility increases immediately when CEOs return to work.” —David Yermack, a New York University finance professor, whose recently released study shows a correlation between when CEOs take their private jets on vacation and movements in their companies’ stock price ”
How training pays off
Since the Wright brothers' first flight, major improvements in safety have resulted primarily from technological advances. The reduction in accidents over time has paralleled improved airplane and wing design and engine-propulsion technology, the introduction of traffic collision avoidance systems, terrain warning indicators and other innovative equipment.
But "what comes with technology is the training needed to use and maintain it," said Doug Carr, vice president for safety, security and regulation at the National Business Aviation Association. "Training is the one thing the operator has total control over-who gets trained, how often, in what subjects and how much money is budgeted."
The FAA predicts that by 2012 a billion passengers a year will be flying worldwide on all forms of aviation, Carr noted. "Right now, we're operating at the margin of safety improvements. As an industry, our safety record is excellent. If we're going to maintain our safety record with that type of increase, training has to be a top priority. It's critical because technology is always changing."
The same can be said about FAA regulations and even the airspace. "New airspace gets put in place all the time," Carr said. "Every flight can be affected by a change somewhere along the line. Then consider that flight departments have personnel turnover, too. You must assure everyone is able to meet the standards you've set for your company, and that requires ongoing training."
Carr said the NBAA has asked officials at the National Transportation Safety Board what they believe is the best use of a flight department's limited budget to maximize operational safety. "Debbie Herfman of the NTSB responded by saying training remains one of the best investments in aviation safety," Carr explained. "She stressed that training allows a company to ensure their personnel have up-to-date knowledge on systems, technology, flight environment, rules and all facets of the industry.
"Your employees are only as good as the last training event they experienced," Carr continued. "The investment in training should remain a high priority even during an economic downturn so you are poised to make safety improvements as your activity increases."
Other safety experts agree. "Training allows us to identify hazards before they manifest themselves as errors, accidents or incidents," said Thomas Anthony, director of the University of Southern California Aviation Safety and Security Program. "We buy accident insurance for our house, car and airplane, but what training does is teach us to mitigate things before they happen."
The International Civil Aviation Organization requires international airline operators to establish a Safety Management System, and as a result the FAA now also has similar guidance that will soon become a regulation. "What an SMS does is create a safety gauge for the operator to judge how things are going. An SMS relies on training to implement knowledge," Anthony explained.
John Casker, president of the Professional Aviation Maintenance Association, agreed, while also suggesting another benefit of training. "Training is certainly important for keeping up with technology and developing your employees to be more productive and future leaders, but it also helps with employee retention," he said. "An unfulfilled employee has a tendency to ask if the grass is greener elsewhere, but if you invest time and money in training, your employees feel their talents are being recognized. They feel they're valued. That is money well spent."