Business lessons from the Titanic

Business lessons from the Titanic

The Titanic disaster is one of the most familiar stories there is; it has been called the greatest news story of modern times. One hundred years later, historians are still arguing about what could have or should have been done to prevent the sinking of the “unsinkable” ship and the drowning of more than fifteen hundred passengers and crew. The investigations that followed the event resulted in a host of new laws and safety improvements to ships and radio communications laws. But while all these strategic, technical, and legal improvements undoubtedly saved lives in the years to come, they didn’t address the catastrophe’s fundamental cause – a failure in leadership.

On the Main Deck of the Titanic

By around 1:00 a.m., the Titanic was in a state of utter confusion. Not only were there insufficient lifeboats for everyone, the crew had no clue as to the procedures for getting more than 2,000 people into lifejackets and off the ship. When the ocean liner first hit the iceberg, most of the passengers barely noticed, and no one was particularly perturbed. Then the news got around, and a number of people went out on their respective decks in hopes of a little excitement. It was freezing outside, however, and the ship seemed perfectly stable, so most of them quickly returned to their cabins and lounges.

Later, when the call went out for all women and children to board the lifeboats, many people still didn’t believe the ship was really sinking, so they paid no attention. In fact, by the time Steward John Hart got around to escorting some small groups up to the lifeboats, he didn’t have much luck—as soon as he got some of those passengers into the lifeboats, they would get out and go back inside where it was warm.

On the Main Deck of the Californian

A little later, on the Californian—a mere ten miles away—a similar sense of complacency was evident. The Titanic had been firing rockets for hours, but since they were white, not red, the Californian’s captain and officers thought they were part of some sort of celebration. As the ship sank, Second Officer Herbert Stone remarked to a crew member on the odd way it was floating in the water, but he received only a shrug in response. When the ship disappeared, the two men assumed it was steaming away. It never occurred to them to wonder if it were sinking. When dawn came, First Officer Frederick Stewart arrived on deck to relieve Stone who informed him about the ship that had fired eight rockets. At 4:30 Stewart woke the captain and repeated the information Stone had conveyed; the captain said, “I know. He’s been telling me.”

Stewart dropped the whole thing until 5:40 a.m., when Wireless Operator Evans woke up. Stewart told him there had been a ship firing rockets, and asked him to find out if anything was wrong. Evans put on the headphones and tuned in. Two minutes later, Stewart tore up to the bridge with the news: “The Titanic has hit a berg and sunk!” Upon the Californian’s arrival, the Carpathia had already been on the scene for two hours.

Aboard the Carpathia

Upon receiving the Titanic’s distress call, The Carpathia, a steamship about one-eighth the size of the Titanic, responded immediately and beat all speed records arriving at about 4:00 a.m. (sooner than any other ship, but still too late to save any but those in the lifeboats). The Carpathia’s Captain Arthur Rostron had been awakened a little after midnight by Harold Cottam, the ship’s wireless operator who had received the CQD call. Upon learning of the Titanic’s message, Rostron instantly ordered the chief engineer to reverse course and make all speed for the sinking ocean liner. Every crewmember raced to lend a hand; every stoker found a shovel and heaped coal into the boilers. Rostron ordered the heat and hot water cut off so that every ounce of steam would power the ship. He tripled the number of lookouts to ensure that icebergs could be spotted early. Rostron then marshalled the leaders of the crew and had them organize the ship for rescue operations.

Earlier, Rostron had done something else: a small thing, often ignored in books about the tragedy. When he heard the terrible news from the radio operator, he ordered Carpathia’s new course immediately—before checking the wireless message to ascertain that the report was true and before calculating the two ships’ relative positions. Right away he turned the ship around and ordered all off-duty firemen to the boiler room to get up steam; and then, he verified the report, calculated the Titanic’s position and adjusted the Carpathia’s course as she was racing forward.

In other words, Rostron didn’t wait at a standstill until all facts could be known and all positions pinpointed, nor did he charge blindly forward without making course corrections. He moved, then evaluated, then adjusted course—and kept on moving. Rostron’s ship arrived on the scene at daybreak, picking up the first lifeboat at 4:10 a.m. From that point on, the rescue operation was fast and flawless.

What conclusions should business leaders draw from this tale of three ships?

The answer is leaders’ attention to people factors, or lack thereof. As in an organisation that operates on dry land, it was the ships’ leaders’ ability or inability to drive clarity, unity, and agility that made the difference to speed and performance over the course of the crisis. On two of the liners, a complete lack of clarity, unity, and agility led to slow and chaotic execution that resulted in disaster. In one of them, the Carpathia, there was a leader who focused intuitively on those people factors and as a result achieved rapid, fluid, and effective execution that ended up saving 700 lives.

A well-designed ship is helpful, as are inspired strategies, sound processes, and supportive technologies; but every day, those factors are trumped by the behaviours of your “crew members”. On the Titanic, poor leadership trumped impressive design and sank an unsinkable ship.

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