SMS Pro Aviation Safety Software Blog 4 Airlines & Airports

Why Should We Implement Aviation SMS?

Posted by Christopher Howell on Dec 22, 2018 10:51:00 AM Find me on:

Resistance to Aviation SMS

Cost of Not Implementing Aviation SMS Programs

Considerable numbers of aviation managers in the United States and a few other countries groaned when ICAO (International Civil Aviation Organization) mandated that most aviation service providers implement formal aviation safety management systems (SMS).

Americans, by nature, are rebellious against government involvement in commercial activities. This is why the U.S. is further behind the formal SMS implementations than a few other parts of the world, such as Australia, Canada and now, the European Union. We have rule-making processes to go through before operators are required to implement SMS.

Related Articles on Implementing SMS

Recalcitrant aviation managers, not only in the U.S., but in other parts of world, saw no added value in implementing highly structured safety management programs because they already had the safest flight operations in the world (in their minds anyway).

Furthermore, most commercial operators already possessed elements of a safety program. Additional risk management initiatives seemed to increase costs and add no additional benefit in reducing risk and protecting assets. In this article, we will discuss why you should implement an aviation SMS at your airline or airport. We'll not to repeat the obvious "it's a requirement," as this argument adds little value to demonstrate the true value of aviation SMS.

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Costs of Not Implementing a Structured Aviation SMS

I don't like using the FUD factor. FUD is spreading fear, uncertainty, and doubt to coerce others to your viewpoint. FUD practitioners will inevitably rely upon this argument: "It only takes one accident to put you out of business." This may be true, but I don't like to focus on that "one accident." I prefer to focus on the common events that drastically affect the bottom line!

In Boeing's MEDA investigation process, Boeing claims that:

  • 20 to 30 percent of engine in-flight shutdowns cost $500,000 USD per shutdown.
  • 50 percent of flight delays due to engine problems cost $9,000 USD per hour.
  • 50 percent of flight cancellations due to engine problems cost $66,000 USD per cancellation.

Can the most modern, best-implemented aviation SMS eliminate these costs? To be realistic, one must say no. However, if an airline or airport follows best practices in managing their aviation SMS, they will be more capable of predicting these events and developing risk management strategies that will allow the airline or airport to recover from or avoid these types of events.

Related aviation risk management articles...

Unless your airline or airport has endured a catastrophic event, managers will have a hard time visualizing how an event will affect their operations. How will additional aviation risk management requirements outweigh the costs of implementation?

Direct and Indirect Costs of an Event

Costs associated with not implementing an aviation safety management system

Managers can easily grasp these concrete numbers. They know very well how much it costs to replace an engine, replace a damaged wingtip or repair property damage. However, these numbers appear to be easily digestible because of their required insurance coverage.

What managers don't easily identify with are the indirect costs of an event. These costs may include:

  • Additional insurance premiums;
  • Loss of business and damaged reputation;
  • Loss of income due to out-of-service aircraft; and
  • Fines.

Making the Business Case of an Aviation SMS

In 2008, Transport Canada (Advisory Circular 107-001) demonstrated a very strong business case for implementing an aviation SMS program.

Their business case claims that if your airline or airport's annual yearly costs for safety-related events are $50,000 and your profit margin is a meager 3% then operations will have to generate $1,667,000 in additional sales to cover these additional "safety expenses."

What Is the Cost of Doing Nothing?

We all have alternatives. Simple, readily apparent alternatives include:

  1. Doing nothing and ignoring the requirements;
  2. Merely "checking the box" to barely meet the requirements;
  3. Browbeat or make empty promises to improve when SMS regulatory auditors appear; or
  4. Wholeheartedly and earnestly adopting aviation SMS best practices at your airline or airport.

In practice, I have seen all the options play out. #2 appears to be a satisfactory alternative to the crusty, "set-in-their-ways," old-school managers. They have always believed that losing money to safety or quality related events was just a cost of doing business.

Why should we implement aviation SMS programs at airlines and airports

In the long run, the most profitable airlines and airports will be those recognizing the financial and other benefits of embracing the mandated aviation safety management system. I believe they will also experience:

  • Reduced employee turnover;
  • Less workplace stress; and
  • More employee involvement in improving operations.

Related Aviation SMS Benefits articles...

Final Thoughts on Why Airlines & Airports Need Aviation SMS

Unless you are in the aviation industry, you are blind to most of the close calls, the bird strikes, and the damaged equipment that occurs daily. Aviation passengers are like patients visiting the hospital, completely unaware that doctors "lose" tools, incorrectly connect body parts and other dirty secrets. Pax are mostly unaware of the clear and present dangers existing in our world-wide aviation industry.

In the past several years, we have seen a diminishing rate of aviation accidents in the commercial airline industry. Does this mean we have reached ALARP (as low as reasonably practicable)? Aviation professionals worldwide agree that we can continue to improve operations and increase safety. If you do this correctly, your airline or airport will also enjoy financial benefits and improved operational quality.

One of the first steps in implementing an aviation SMS is to understand what is required. The following SMS implementation plan checklist will illustrate the main activities required in implementing a formal, ICAO compliant SMS.


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Published July 2015. Last updated December 2018.

Topics: 2-Safety Risk Management

Site content provided by Northwest Data Solutions is meant for informational purposes only. Opinions presented here are not provided by any civil aviation authority or standards body.

 

 

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