In the late 1990s, Flight Standards began to develop a systems approach to oversight of 14 CFR 121 carriers. Regulatory requirements were grouped into a set of system, subsystem, and elements. A set of process quality characteristics were developed which became known as the safety attributes. These attributes are used to judge the design and performance of the carrier's systems. A set of structured tools was developed for evaluating design and performance of each system element. The developed system is referred to as ATOS version 1.0.

At the same time, the Certification Standardization Evaluation Team (CSET) was formed. Among other duties, CSET was tasked with coordinating and standardizing new entrant certification using system safety methods and tools.

At this time, however, only the "top ten" airlines, which accounted for 90% of the industry's annual passenger enplanements as involved in the ATOS program. This implementation is called "phase I" of ATOS. Also, after certification, new entrants were returned to traditional methods of surveillance planning, implementation, and analysis for continuing oversight. Flight Standards sought to expand the use of system safety methods with the eventual goal of implementing ATOS across the Part 121 industry.