Q&A With ARINC Chairman & CEO John Belcher

By Mark R. Smith, EDITOR-IN-CHIEF

John Belcher, whose illustrious career has straddled the international border between the U.S. and his native Canada, has made an indelible mark in that country as well as domestically.
Belcher, who has more than 30 years of experience in the aviation, information technology and defense industries, joined ARINC in 1997 as president and COO and by 2002 had been appointed CEO as well; in 2004, he added the title of chairman.
In 2005 he was selected as one of Maryland's top business executives, receiving the annual Maryland International Business Leadership Award, and was named the 2005 Business Leader of the Year for Annapolis and Anne Arundel County. Previous honors included the Canadian National Transportation Award.
Since 1997, he has been the driving force behind ARINC's diversification and global expansion that resulted in the company's sales growing from about $200 million in revenues to more than $1.2 billion by 2008. During that span, the company expanded to 124 offices worldwide. It now serves customers in 106 countries.
All told, Belcher is a member of (or has served on) boards too numerous to mention in the U.S. and Canada. The Leadership Maryland grad is presently chairman for development for the Annapolis History Center and serves on the boards of the Historic Annapolis Foundation, the Anne Arundel Medical Center Foundation and the Greater Baltimore Committee.
Prior to coming to ARINC, Belcher held the titles of president and CEO of Hughes Aircraft of Canada, vice president of Hughes Aircraft Co. and president and CEO of Thompson-Hickling Aviation, among other endeavors. He holds a B.S. in applied science from the University of Ottawa and a postgraduate diploma in communications systems engineering from Queen's University.

How has the financial clout of The Carlyle Group (wbich owns ARINC) impacted what you are able to do?
From the year of our founding in 1927, the major domestic airline carriers (that have evolved into today's "Big Six": Delta, United, USAirways, American, Northwest and Continental) owned the company. But in 2007, it sold the company to The Carlyle Group and we were fortunate enough that, in October of that year, Carlyle bought all of the shares and brought their management in.
When I came here 10 years ago, we were doing $200 million a year in business; that's the base Carlyle brought us from. They helped us attain financial stability and grow faster than we had, as well as giving us the opportunity to go for acquisitions more aggressively. Before, we relied on retained earnings to build the company, with no new investments by the airlines.

You said in your recent address to the BWI Business Partnership that "most citizens globally have used ARINC's services in some way." How?
If you examine our seven divisions, we basically offer communications between the air and ground for the airlines. In fact, we handle about 70% of the global air/ground communications businesses.
We build information systems for airports that can be used for check-in, kiosks, information display and baggage systems in 165 airports worldwide. So in that way, most people have been touched by our services.
On the rail transport side, we have about 60% of the operational rail control centers in the U.S., so in effect the passenger information systems at train stations and the management of the trains along the tracks are all handled by the operation control centers we have installed. Therefore, anyone who travels has used our services one way or another.

Why has ARINC traditionally flown so low under the radar?
When I came here, ARINC was almost like a stealth company. But now we are more widely recognized as a top technology and engineering company because I felt that we had to extend our business across various platforms. In fact, I had a mandate to build the company.
I think the key was that I realized that we had top engineering talent and I feel like I provided the leadership capability to lead it.

What led to your desire to expand ARINC's service offerings into so many different sectors during the past several years? Might that be spreading the company's mission too thin?
No. As an engineering company, we provide three major services: systems engineering, information technology and communications solutions. During our expansion, all we have really done is expand those core capabilities across the transportation and aerospace fields.
As noted, a customer might need the same technology at a rail station that is needed at an airport. We're really not stretching our abilities in too many directions, so much as transferring the technologies to appropriate uses.

ARINC's strength is in technologies that concern security, airports, airplanes, defense, etc. How do you continue growing at (or above) the growth level that has been achieved under your stewardship?
It's in those areas that we will keep to applying our applications while gaining market share.

How were ARINC's services expanded into the cruise ship market?
We applied our kiosk technology for off-site check-in (like a guest at a hotel would use before heading to the airport) to check the traveler in and offer passes and bag tags.
Travelers getting on and off a cruise ship have a similar experience to those in an airport - except that the travelers place their luggage outside their doors the night before they return home - but they have to find it among hundreds of pieces of before they leave the wharf the following day. So, we just put the kiosks on a ship in this case. Again, we handle the transport, so all the traveler has to do is grab a shuttle to the airport and fly home.

Where do you see ARINC heading in the next five to 10 years?
At this point, we intend to continue gaining market share in our present services, and as we go forward, we'll consider acquisitions to help us gain more market share, such as a company that manufacturers baggage reconciliation systems. We don't build those and would need to buy a company that is set up for that type of business.

ARINC employs 3,500 workers worldwide and 1,200 locally. Can you estimate the economic impact of ARINC's Annapolis headquarters on the local economy?
We are one of the biggest employers in the county, but figuring out our economic impact depends on valuations of the state and Anne Arundel County. That's hard to guesstimate, but it has to be at least a couple of hundred million dollars.

How will ARINC's just-introduced airport check-in system significantly reduce the cost of common-use passenger processing in airports?
Outside the U.S., most countries use what are called common-user check-in systems. They allow the user to go to a kiosk and check in any airline at that airport from that kiosk.
Domestically, those systems are very limited. So without common-user systems, each airline has to have its own check-in system. From the airport authority's point of view, that takes up more space to check-in if you're not using a common-user system, and our new system alleviates that problem.

What do you consider your greatest personal triumph?
I would say having the opportunity to become a U.S. citizen, since it gave me the opportunity, as an entrepreneur, to be able to build a large, successful company.

And what is ARINC's greatest triumph since you've been there?
The double-digit growth of the company every year.

What's the biggest challenge that you've had to overcome in your career?
In building any company, there are always many challenges. I have been very fortunate to be able to overcome them by having a top management team working with me to ensure the success of the company.

What has been your biggest personal challenge?
I've always enjoyed the challenge of taking a small company and building it into a large operation.

What's the biggest challenge that ARINC is facing now?
The present overall economic market is shifting and it's difficult, at times, to determine where those shifts are going to take place. We're fortunate to be a global company. For instance, while our airport business is flat domestically, it may be growing in Asia or Europe. That's how we overcome such issues.