Etihad, one of two flag carriers and the UAE’s second-largest airline, was joined by Jim Kaitz, president and CEO of AFP, Larysa Melnychuk, managing director of the FP&A Club, AFP, and finance professionals from Nestle, IBM, Mars, 3W Networks, Mubadala, Abu Dhabi National Insurance Company, Agthia Group PJSC, Ipsos UAE, Miagen, AMMROC (Advance Military Maintenance Repair Overhaul Centre) and Abu Dhabi Capital Group LLC.
Etihad’s Shariq Daudi, head of long-term planning and budgeting, and Danysh Framroze, head of financial control – operations, network, fleet, led a discussion on the development of the airline’s FP&A department (known as financial planning and control, or FP&C, at Etihad). Founded in 2003, the airline has experienced rapid growth in recent years, both organically and through acquisitions. This growth had to be managed from a financial point of view, which is why Etihad set up its FP&A department.
Leaders of Tomorrow
Over the past decade, Etihad’s FP&A function has become one of the best in the world. Last year, Etihad won the Financial Planning and Analysis Award at the gtnews Forum and Awards for Global Corporate Treasury and Finance in London.
Part of the reason why Etihad’s FP&A department has been so successful is a strong commitment to its people. The airline says its goal for FP&A is to “create the business leaders of tomorrow, with sound commercial knowledge.” The airline does this by:
- On-boarding smart, young, financially sound leaders.
- Providing an intelligent resource pool to tap into.
- Protecting business unit leaders by ensuring governance is followed.
- Identifying, quantifying and managing cost reduction projects across business units.
- Supporting business units with successful implementation of approved initiatives.
“Etihad is very careful about the development of its people,” Melnychuk said. “They have the resources to hire the best in the world. The team is very international; there are representatives from many different countries there. They utilise best possible education in the marketplace.”
Culture and Structure
Etihad employs a continuous cost improvement cycle strategy that has helped to ingrain the culture of cost awareness within its operating business units and drive behaviours. The result has been positive financial outcomes for the company, as detailed in Figure 1 below.
Figure 1: FP&A’s Contribution to Etihad’s Financial Performance
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