Part 23 Lessons may have Applicability to other FAA Regulations; Harvard Professor Agrees

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ARTICLE: FAA touts safety boost at half the cost


As noted here before, the FAA is forging new regulatory ground in its examination of how it certificates General Aviation aircraft. A recent interview with Earl Lawrence, manager of the Small Airplane Directorate (pictured on top left) is both timely and insightful about how the new regime was developed in a manner approved of by Harvard’s guru on American Competitiveness.

Timely, in that Washington’s current crisis is about whether government has a cost problem or a need for new or more revenue. Lawrence makes the bold statement about the new approach to the certification of this class of aircraft:

“We expect to see an increase in safety and new technology. The way we put it is, ‘half the cost and twice the safety.’”

When the FAA is saying that a 5% decrease in its budget will result in dire consequences, a 50% reduction in the cost of regulating must be tremendous news.

Michael Porter, Bishop William Lawrence University Professor based at Harvard Business School (pictured on bottom center), where he leads the Institute for Strategy and Competitiveness, articulated the following principle as one of the critical paths to restoring American competitiveness in The Economist, The World in 2013:

Simplify and streamline regulation affecting business to focus on outcomes
rather than costly reporting and compliance, delays and frequent litigation…..

Regulation must set high standards but focus on desired outcomes rather than on dictating compliance methods. The burden of reporting and inspection should
fall primarily on companies with track records of problems. Regulation should undergo rigorous cost-benefit analysis and look-backs to ensure it is achieving the desired outcomes efficiently.

Lawrence, seemingly a disciple of the Porter thesis, explains how his industry/multi-governmental group was able to realign how these critical rules are applied:

“The new rule will use consensus standards to enable innovation and the expanded use of new technology. This enables us to embrace change without having to rewrite regulations…

“This is the rule’s first clean look [in decades], “We don’t just want to add another layer; we want to rewrite the whole thing to make it clearer and more straightforward to comply with. With this new approach, changes will be made to the underlying standards, leaving the safety umbrella in the regulations. ‘It is not Part 23 Lite, it is Part 23 Right’.”

The FAA analysis focused on “outcomes” and brought a new perspective that will both enhance safety and improve the regulatory results.

This perspective should be shared with the other regulators in the FAA- Part 25, Part 121 and Part 145 experts, among others—to see how the Porter principle and the Lawrence experience can alter the current FAA focus on costly reporting and compliance. If the remainder of the FAA can do its work better at 25% reduction of the costs, that would be spectacular. There are experts who may be able to assist in such initiatives.

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