The cost effectiveness of SMS is not how many fewer accidents there are, but how cost of SMS is managed in a businesslike system. If an SMS system could predict future accidents, or lack of future accidents, operations of airport and airlines affected would have to cease operations during those hours or minutes when SMS had predicted accidents or incidents.
For an enterprise to identify cost savings there must be one or more defined activities attached to that identification. A virtual, or future prediction of non-accidents are fantasy wishes. SMS is only as effective as collected data explains reliability of processes involved. That an airport, or airline with zero accidents and a good safety track record does not equal a prediction that future airport operation, or next flight would not encounter unexpected events and cause an accident. These unexpected events are variables, and becomes effective at the moment there is presence of kinetic energy.
SMS is not a cost saving from accident prevention, but an operational cost to prevent incidents and accidents.
A successful business would not consider to operate without cash flow directives, goals and a budget. However, in SMS for aviation, the accepted concept is that the more cash an airport or airline spend on safety, the more they will save as a cost saving from accident prevention.
When it comes to SMS in aviation, airports and airlines are operating in the blind without a budget applied to cost of safety. When the savings of safety becomes the cost savings from accident preventions there is no strategy business solutions, or businesslike approach of their SMS system.
There is an operational cost to safety that cannot be avoided. This cost becomes a cost factor applied to time spent on accidents or incidents reports, analysis, investigations and corrective actions. An airline crash with multiple fatalities could have a cost of $ 31,536,000.00 while a smaller accident could have a cost of $3,600.00. That an airport or airline do not experience these accidents does equal cost savings from accident prevention, or a savings of millions. In other words, SMS is not a saving in the value of accidents that did not occur.
Cost of safety businesslike approach in a pareto frequency chart.
The question to ask is what the cost of safety is worth for an airport or airline. When applying this businesslike strategy approach to safety it becomes possible to address processes that are not desirable and could cause unexpected events.
The future cannot be predicted since there are millions of variables in a kinetic energy environment. The only time an airport or airline is guaranteed a safe future without accidents, is when there is no movement. When applying cost of safety in a cost factor budget to safety, it becomes possible to manage and reduce cost of safety to a desirable goal. When a cost factor budget is compared to actual operational cost, airports and airlines have established the bar to shoot for when setting cost factor goals for the next operating budget and apply this cost factor to accident and incident management.