Dynamic Strategic Planning Case Analysis (PLG1) - Aviation Industry

This case study analyzes dynamic strategic planning within the context of airport development, emphasizing the shift from traditional forecasting to more flexible approaches. The analysis explores the reasons for forecasting, despite its inherent inaccuracies, and the associated pros and cons in aviation planning. It examines the role of the Federal Aviation Administration (FAA) in encouraging forecasting, while acknowledging its limitations. The study highlights how dynamic strategic planning addresses uncertainties by accepting a range of future outcomes and incorporating flexible forecasts and adaptable infrastructure. The case study examines how airport planners can base their master plans on forecasting. The conclusion emphasizes the importance of dynamic strategic planning in mitigating uncertainties and fostering appropriate planning for future airport development.

1Running head: DYNAMIC STRATEGIC PLANNING CASE ANALYSIS (PLG1)
Dynamic Strategic Planning Case Analysis (PLG1)
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2DYNAMIC STRATEGIC PLANNING CASE ANALYSIS (PLG1)
Dynamic Strategic Planning Case Analysis (PLG1)
Introduction
Over the years, the competitive landscape has significantly changed for many
industries, thereby forcing managers to emphasize more on strategic plans along with the
process of developing it (Dibrell, Down, & Bull, 2007). Dynamic strategic planning is
considered the key aspect of Airport Master Planning. Thus, in this context, dynamic strategic
planning can be defined as the process of making plans specifically relating to infrastructure,
which can be adjusted eventually to a real situation. This process states that the future cannot
be predicted accurately, thereby leading all the forecast to be wrong. Therefore, a plan needs
to be flexible so that it can deal with the issues in the future (Kwakkel, Walker, & Marchau,
2010). The objective of this essay is to understand the overall concept of dynamic strategic
planning. This essay also focuses on portraying the reasons for carrying out forecasting even
though it is incorrect along with the pros and cons of using it in airports. The essay also
examines the reason for the FAA to encourage forecasting despite its flaws.
Reasons for Carrying out Forecasting
Kwakkel, Walker, and Marchau (2010) stated that even though problems related to
the biases of the forecaster are mitigated, there are uncertainties that can lead it towards
failure. With respect to the aviation sector, demand forecasting has been perceived to be
highly problematic due to uncertainties. However, there is still a high demand for forecasting,
especially while overcoming the uncertainties in Airport Master Planning (AMP). In this
context, AMP has been unable to plan for the future development of the airports. An example
can be cited from Amsterdam Airport Schiphol along with Boston Logan Airport, and Denver
International Airport that some of the airport plans have been unsuccessful to depict future
development (Kwakkel, Walker, & Marchau, 2010).

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Pros and Cons of Forecasting in Aviation Planning
The advantage of using forecasting is that it helps in predicting traffic along with
peak-period parameters, which is considered essential for air navigation systems planners.
This is mainly because it helps in estimating the time and place related to congestion. Hence,
“traffic forecasts are required by ICAO’s regional planning and implementation groups for air
navigation systems planning including the implementation of CNS/ATM systems across the
regions” (International Civil Aviation Organization, 2006, II-1). In addition, another
advantage of using the forecasting technique in airports is that it assists in estimating aircraft
movements, even though it is applicable only for short duration (International Civil Aviation
Organization, 2006).
The disadvantages or cons of foresting in relation to aviation planning are the
challenges associated with uncertainty in AMP. Even though aviation demand forecasts help
in estimating the passengers along with goods, and air transport movement, but the estimation
can be considered a major concern. For instance, the forecast, which was implemented for the
plan in relation to the continuing development of Schiphol in the year 1995, was an
estimation of aviation demand for 2015. This was specifically related to the number of
passengers. Similarly, for identifying the average number of travelers on an airplane it was
found that the forecast was actually done for air transport movements (Kwakkel, Walker, &
Marchau, 2010). This indicates that there are issues that must be mitigated in order to forecast
efficiently in the aviation planning process.
Airport Planners and Forecasting
Sumathi, Balakrishnan, and Venugopal (2018) stated that forecasting helps in
assessing the present along with impending movements of the airports. It also supports an
airport to establish an idea for developing airport activities over the anticipated time. It

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further supports airports in developing the existing and strategic requirements based on
airport activity forecasts. Additionally, forecasts focus on enhancing realistic estimation
(Sumathi, Balakrishnan, & Venugopal, 2018). Hence, it can be suggested that the airport
planners need to base their master plans on forecasting.
Reasons for FAA to Encourage Forecasting
Federal Aviation Administration (FAA) (2007) defined AMP as “the goal of a master
plan is to provide guidelines for future airport development that will cost-effectively satisfy
aviation demand while considering potential environmental and socioeconomic impacts” (2).
The FAA further encourages the airport planners to estimate and consider the prevailing
environmental, as well as socio-economic costs, which are related to other development
concepts. Additionally, they should also consider the possible means to avert and minimize or
mitigate the overall effects on sensitive resources at a suitable level for facilitating the
planning process. The FAA is also engaged in reviewing the core concepts of the master plan
for making sure that appropriate techniques are implemented. Hence, the master plan must
further make certain that the underlying assumptions along with the forecasting approaches
are all appropriate. In this regard, “Paragraph 704.h of this guidance should be used to
determine the consistency of the master plan forecast levels and the Terminal Area Forecast
(TAF)” (Federal Aviation Administration, 2015, 8). Besides, “Inconsistencies between the
master plan forecast and TAF must be resolved, and the forecast approved, before proceeding
with subsequent planning work” (Federal Aviation Administration, 2007, 8).

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Conclusion
Based on the overall understanding, it can be ascertained that dynamic strategic
planning is an important aspect of airports. This is because it can help in mitigating the
uncertainties such as wrong forecasting so that future plans can be made appropriately, which
can lead towards further development.

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References
Dibrell, C., Down, J., & Bull, L. (2007). Dynamic strategic planning: Achieving strategic
flexibility through formalization. Journal of Business and Management, 13( 1), 21-35.
Federal Aviation Administration. (2007). Advisory circular. U.S. Department of
Transportation, 1-136.
Federal Aviation Administration. (2015). Change 2 to airport master plan. U.S. Department
of Transportation, 1-152.
International Civil Aviation Organization. (2006). Manual on air traffic forecasting. ICAO, 1-
III-28.
Kwakkel, J. H., Walker, W. E., & Marchau, V. A. W. J. (2010). Adaptive airport strategic
planning. European Journal of Transport and Infrastructure Research, 10(3), 249-
273.
Sumathi, N., Balakrishnan, A., & Venugopal, A. (2018). A Study on the master planning in
airports. International Journal of Latest Technology in Engineering, Management &
Applied Science, VII(IV), 157-162.