Extraordinary Executive: Paul Archambeault, CFO/COO, Airlines For America

What are the challenges nonprofit CFOs face today? How are you/A4A meeting that challenge?

Each nonprofit, whether a 501(c) 3, 4, 6, etc., has a unique set of challenges based on the makeup of its mission, constituents and available resources. Most nonprofits, by the nature of the business, work with somewhat limited resources. A central challenge facing nonprofit CFOs today is managing the balance between uses of those resources while doing everything possible to achieve its mission.

A4A, like most nonprofits, meets that challenge through a rigorous budget cycle process. In that process we have the ability to reallocate funds based on pending or perceived resource requirements for given projects/ issues. Once the budget is set and we obtain board approval, departments are responsible for managing to that budget. If a new project/issue arises that could impact previously allocated funding, we immediately review current activities. We look to see where we can reduce, postpone or stop spending in other areas and make a concerted effort to re-allocate those resources internally without the need for a special assessment.

During 2015, we took on new government affairs campaigns and communications-related activities in support of those campaigns, and we were able to respond without impacting our current funding. We focus on the fact that our members have internal budgets to manage as well.

What do you believe may become a challenge in the near future in association finances? How would you meet that challenge?

Revenue diversification – Every nonprofit has a different path to total revenue. Total revenue can include: dues, contributions and grants, program service revenue, unrelated business income and more. Each component has its own set of restrictions, rules and regulations. A nonprofit (association in my case) must mitigate increase requests from year to year and mature revenue streams and rising expenses do not provide much help to offset increases.

We continually look for new revenue opportunities that will help not only our direct members, but those in the industry as a whole. We launched the Known Crew Member program (KCM). KCM provides an alternative screening location for approved pilots and flight attendants, thereby removing them from the passenger security checkpoints. This helps increase the facilitation of the traveling public through the security checkpoints. To date, that program includes 55 airline participants (both A4A and nonmembers), is in 65 airports and has removed 50,713,630 approved crew members from passenger security checkpoints.

As a CFO and a COO, where do you strike a balance between the two? How are the 2 roles intertwined/distinct?

For me, the roles are mostly intertwined, providing synergies that benefit A4A. The balance for me comes from being involved with both financial and operational aspects of the association. We strive to let the business needs of our members drive our funding requests versus allowing limited resources to drive our business needs. That’s not to say that every “business need” gets approved. On the surface, anyone can suggest, recommend, or even justify a business need. Having the ability to work closely with senior leadership on the operational side allows me to better assess requests, evaluate how they fit within our overall strategic plan, and ensure they are truly worth investment.

What technology would you like to see developed to help association CFOs?

I would love to see an app that could correctly predict the market 100 percent of the time. In all seriousness, I think technology that allows you to consolidate data and metrics from multiple platforms into a dashboard format would benefit nonprofits. With the increase in consumption-focused devices (phones, tablets, apps) nonprofits are reporting more data elements both internally and externally. The need is there to strike a balance between what needs to be reported and what is reported.

These systems are currently available, and as with any technology-related idea, the balance between off-the-shelf and customized is always an issue. Most technology platforms might get you to between 75 percent and 90 percent of exactly what you need, with the remainder being customized based on a nonprofit’s specific need(s).

What is your advice to a director who is looking to move into the C-suite in nonprofit finances?

Strive to be make yourself that “go-to” person and obtain as much other knowledge and experience outside of finance as possible. During my tenure as Director Financial Systems, I viewed each department as a customer and made sure I understood the business needs of each. I became a resource to the department heads and business units. I was able to obtain knowledge and experience outside of finance by moving up within A4A from auditing fuel service providers at U.S. airports, to assisting airlines with net settlements of revenue, to working in aviation security and managing the Y2K effort for the association. That breadth of experience helped me become a well-rounded resource for other association operations and issues and made the transition into the CFO/COO role rather smooth.

Earning a credential in finance – worth it for a nonprofit financial professional?

Yes – I feel that any type of professional credential, along with a continuing education requirement can only help you as you move throughout and up in your career. I hold my CPA designation and earned my MBA in managerial finance. I believe that you should never stop learning and what better way to do that than obtain professional certifications that includes a continuing education requirement. I am not saying that it is a requirement or absolutely necessary, but from a resume and future opportunity perspective it can only be a positive.