Analysis of Allen Aircraft Radio Corporation

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Introduction

 

Allen Aircraft Radio (AAR) Corp. was founded in 1951 to supply aviation products and provides maintenance services to the aviation industry and its related spheres (Fundinguniverse, 1999). The company has remained steadfast in ensuring it keeps pace with the changing market trends within the aviation sector. Some of the areas that have proved vital to revamp are its safety programs, human resources, financial management system, and the operational governance structure (AAR, 2017). These factors have a bearing in elucidating the sustainability of the corporation amidst the intensifying competition. Notably, the target market for Allen Aircraft Radio Corp. has blossomed from the aviation agencies within the United States to the international aviation arena. Therefore, the corporation has found it imperative to modify their values, vision, mission, and agenda to have an international outlook.

Safety forms the epicenter of the activities in the aviation world. AAR Corp. is committed to offering security to its clients (AAR, 2017). As an MRO company based in the United States, it offers a world class mode of services and systems for aircraft thus has achieved an undisputable track record of safety. One of the measures to ascertain safety employed by the corporation is the engagement of qualified and experienced staff with FAA certifications (Fundinguniverse, 1999). The staff at AAR Corp. has accumulated several flight hours in the various facets of aviation and is endowed with engineering skills imperative in modern aircraft maintenance and repair. The prowess of the team is manifested in the plethora of services they offer such as aircraft maintenance, landing gear services, engineering services, and component repair. Each employee practices as per the privileges of the support licenses they possess.

Moreover, the corporation enjoys the right of a certification that is sync with the regulatory precepts of the worldwide aviation industry according to ICAO. AAR has an intricate safety management system that is designed to vet the veracity of the different mechanisms used to offer services to the company (Erkoc & Ertogral, 2016). The institution of customized policies and procedures that define safety measures act as a template for reference for the employees as they go about their duty of serving clients. Owing to the diversity of the aviation needs across the world, AAR Corp. finds it crucial to engage a safety personnel vested with the mandate to follow-up adherence to the outlined safety policies (AAR, 2017). Additionally, the security personnel is charged with review of data from past incidences to postulate the possible measures for improvement. The training of the professionals within the AAR Corp. is also customized to meet the pressing needs of the immediate environment of deployment, and they are assisted by a panel of quality assurance and safety professionals based at the company’s headquarters in Florida.

Considering the magnitude of the work supposed to be done and the company’s scope, AAR Corp. brings a significant number of employees on board. The company has several departments for which it employs professionals, and these include the safety programs department, the aircraft maintenance department, the engineering domain, and the executive staff (AAR, 2017). Recruitment is done from across the borders considering that that company is international and requires employees who will adequately and relevantly meet the needs of their clients. Today, the company has established its branches in 100 countries across the world with more than 5000 employees in at least 20 countries. With consideration to the nature of services the company offers, it has taken a leading role in solving the mechanical hiccups in the defense aviation platform.

AAR Corp. is cognizant of the value of employee empowerment and as such undertakes training for staff to prepare for the tasks; they ought to perform in line with the company’s core values. Through the human resource department, customized employee training is rolled out to ensure each employee displays the anticipated peculiarity in their working environment (AAR, 2017). The accorded training meets the standards stipulated by FL Technical employee training scheme. Since the work of maintenance, repairs and overhaul duties entails a chain of activities, teamwork proves an essential component to guarantee the success of the processes (Palma-Mendoza & Neailey, 2015). One of the values that underpin the exercise of duty within the company is working as one and being inclusive implying the necessity of teamwork in the enterprise. Through the branches spread throughout the world, the company coordinates and provides support from the headquarters. Inferentially, the company’s endeavor ‘to do right’ is a move that drives the scope of the activities endorsed to boost the welfare of the employees, customers, and stakeholders.

AAR Corp. brags of an untainted reputation since 1955 in offering MRO services to defense and commercial aviation companies. The revenues collected by the corporation at present amount to about $ 1.7 billion (AAR, 2017). That seems to be good news for the shareholders who remain optimistic that the dividends will rise as time ensues. The finance management team is in charge of the finances that are accumulated from the customers who are urged to make their payments online when feasible. Due to the existence of a plethora of segments within the company, the financial team bears the mandate of amalgamating the available resources in a bid to elucidate the company’s stand regarding gain in the spare parts and repairs industry (Erkoc & Ertogral, 2016). Furthermore, the financial team which is carefully selected based on the prowess of handling financial accounting and interpretation trends. Through these qualities, the team is capable of offering relevant and focused advice on the management on the products and services that need to be incorporated and the necessary improvements that should be adopted so as to maintain a sustainable competitive edge against competitors.

According to the financial report released in 2016, the company registered an increase in sales of 4.3% compared to the previous year. The aviation services segment was the most outstanding constituting more than 80% of the consolidated revenue (AAR, 2017). From the posted results, it is evident that the company invests in projects that are promising in returns. The goal of AAR Corp. as it outlines its investment plans is to offer cost-effective programs for the aviation companies it serves. Among the values cherished by the corporation is the proper utilization of finances and offering the customers the value worth their money. Innovation is an avenue that is exploited by AAR Corp. Apart from providing the services of maintenance, repairs, and overhauling; the company also buys and leases some of the aircraft from the customers to sell them out when in good condition (AAR, 2017). The move is an advantage to the clients who engage in transactions with the company. Deductively, AAR Corp. understands the essence of an intricate financial management system since it lies at the foundation of the success the company has accumulated so far.

AAR Corp. has a hierarchal model of governance which permits counter communication. The corporation has a president who also acts as the chief executive officer (Fundinguniverse, 1999). He is in charge of overseeing all the activities of the company across the world and chairs the board of directors meetings to deliberate on the future of the enterprise. The corporate officers are appointed to cater for the various departments and regions that define the engagement of the corporation in the course of duty. From the board of directors, the board committees that address pertinent issues within the company are established (AAR, 2017). Through a customized approach, AAR Corp. reaches its customers in the commercial and defense realms. The Corporation leads in value added supply chain remedies to its clients. Their aim is to augment the clients’ benefits wherever they may be.

The programs at work in AAR Corp. are promising and could point to its stability over an extended period. However, the market trends keep on changing calling for a restructuring of the general approach employed in business transactions. The certifications from FAA and ICAO are just but a stepping stone to the limbo of active business. With the aim of doing it right every time, the scope of their services ought to be transformed (Palma-Mendoza & Neailey, 2015). The general aviation domain harbors several aircraft that need MRO services. To achieve the objective of worldwide safety, the corporation must intensify its assistance muscles towards reaching the general aviation aircraft. Moreover, the occupation of 150 countries does not imply conquering the world. There still lies a robust opportunity for exploitation by AAR.

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