For those of you who don’t know what "BHAG" stands for, it means "Big Hairy Audacious Goal." In the Fall of 2018 the Aeronautical Center (AMC) Senior Leaders set out to accomplish the Center’s very own BHAG. The AMC goal was to achieve a cost savings or cost avoidance of at least $20M by FY 2020. So far, AMC organizations have exceeded the BHAG and as of January 21st there is a reported $33M in cost savings and avoidance across the three major AMC organizations - FAA Academy (AMA), Enterprise Services Center (AMK), and the Facilities Management Office (AMP).

Kevin O’Connor, Deputy Director of the Mike Monroney Aeronautical Center explains, "We are not looking for indiscriminant across-the-board cuts that affect things like employee training, facility projects, or supplies and new equipment - those are all needed for our mission. We want to focus on eliminating and reducing the ’bad’ costs - where we are inefficient and wasteful. All of our operations have some waste and inefficiencies, we just need to step back and take a fresh look through the prism of cost effectiveness. We need to make sure we are producing optimum results for the expenditure of our customer’s funds. While we want to reduce ’bad’ costs... we want to invest in ’good’ costs - any costs that fuel our competitive advantage, capitalize on our strengths, and make technology work for us – improving the efficiency of our operations."

The leadership team wanted to focus on areas where improvements could be made in MMAC processes that would eliminate waste and re-work. These improvements would provide more affordable options for contracting services, implementing technologies to accomplish tasks and deliver services, and develop similar initiatives that make jobs easier or more productive. Each Directorate asked their employees to identify how monies could be saved.

The reported savings or avoidance could be beneficial to our customers, the FAA, or the Federal government in general. In other words, the savings did not have to be tied to the AMC operating budget. Any savings or cost avoidance can be forwarded on to our customers by charging them less, or avoiding an increase in cost of services in the future, or the savings could be used to invest in other areas. Each of the types of savings were sorted into different "buckets," based on how the savings or avoidance was achieved. The categories included: Modernization and Automation; Academy Operational Efficiencies; Utilities, Contracts; Streamlined Operations and Processes; and Federal Shared Services Efficiency.

Here are a few examples of ways in which this $33M accumulated cost savings and avoidance.

• The Office of Facility Management (AMP) researched a more cost effective and efficient way to refurbish an elevator and saved over $400K. The elevator was refurbished earlier than originally projected.


• Effective utilities management in AMP resulted in over $500K in avoidance or savings.


• The FAA Academy (AMA) replaced the traditional desktop computers in some classrooms with a more modern virtual desktop computer. This expansion in the virtual desktop resulted in a savings of $200K because virtual equipment was actually cheaper than standard desktops.


• About $1.3M in savings were identified by moving some training courses from a contract vendor to the FAA Academy. The Academy could deliver the same courses for less than vendor prices.


• The Enterprise Services Center (ESC) reported $12.4M in savings tied to the effective operations of the Information Systems Security (ISS) services. The ISS is a Federal Shared Services operation, which means they provide services to multiple Federal agencies. This - in itself - saves money through the elimination of duplicate staffing and infrastructure at multiple agencies, so the more customers that are supported, the more savings for the Federal government. Bottom line: the Department of Homeland Security calculates the cost avoidance as a result of the Federal Shared Services concept, and in 2019 they reported that the ESC ISS had achieved $12.4M in cost avoidance.


• ESC also reported over $10M in savings or avoidance through more efficient contract management.

While organizations can take glory in reaching (or rather exceeding) this Big, Hairy, Audacious Goal, leadership and employees will continue to look for ways to save or avoid costs as we move forward, and will continue to capture and celebrate the associated dollars. AMC’s ultimate goal is to create a culture where innovation and collaboration are part of our core values and operating principles. Only then will cost effectiveness truly flourish.