An Enduring Example of Money Management vs. Risk Management
Roy Brander, P.Eng.
I've put off starting this essay for days, because today is so appropriate. As I sit down to write, it is 11:40 PM, April 14th, 1995. Ignoring the time zone difference, it was 83 years ago this minute that the RMS Titanic, on her maiden voyage in 1912, struck an iceberg. The collision was not head-on. The berg bumped and ground along the starboard side and then was gone into the calm, moonless night. At first, few thought the damage serious. It was difficult to coax passengers into the lifeboats. Yet three hours later, the Titanic slammed into the ocean floor almost 4000 metres below, torn in two. Over 1500 of her passengers and crew were dead. And the design and operation of sea vessels changed dramatically and permanently.
Most of the discussion of the accident revolves around specific problems. There was the lack of sufficient lifeboats (enough for at most 1200 on a ship carrying 2200). There was the steaming ahead at full-speed despite various warnings about the ice-field. There was the lack of binoculars for the lookout. There were the poor procedures with the new invention, the wireless (not all warnings sent to the ship reached the bridge, and a nearby ship, the operator abed, missed Titanic's SOS). Very recently, from recovered wreckage, "Popular Science" claimed the hull was particularly brittle even for the metallurgy of the time. (A claim now debunked.) Each has at one time or another been put forward as "THE reason the Titanic sank".
What gets far less comment is that most of the problems all came from a larger, systemic problem: the owners and operators of steamships had for five decades taken larger and larger risks to save money - risks to which they had methodically blinded themselves. The Titanic disaster suddenly ripped away the blindfolds and changed dozens of attitudes, practices, and standards almost literally overnight.
The perception persists that the Titanic was, if obviously not "unsinkable" (though the White Star line actually never used that word in advertising), then very safe, as safe as the art could build her. That, despite various errors, the accident was mostly enormous bad luck. Nothing could be further from the truth. It was amazing good luck that there had been no similar accidents years earlier. For over 50 years, safety standards had been steadily deteriorating in various ways - almost always because of pressures to be "competitive".
Walter Lord, author of the classic "A Night to Remember", describes the process vividly in his 1986 sequel, "The Night Lives On". He compares the ships of Titanic's day to the first great liner, the "Great Eastern", built in 1858. She was designed by I.K. Brunel, England's most celebrated engineer, who got every feature he wanted. The Great Eastern was not the most profitable ship, but she was a triumph of safety. She had an entire inner hull two feet inside the outer. Inside that, the ship was divided by 15 transverse bulkheads, and one lengthwise into 32 compartments. Watertight lower decks further divided those.
The decades passed, and dozens, then hundreds of liners were built. Competitive pressures between some 11 lines were fierce. As Walter Lord relates:
"But the engineers did not have the last word for very long...the perfect ship was no longer the vessel that best expressed the art of the shipbuilder. It was the ship that made the most money."
"Passengers demanded attention; stewards could serve them more easily if doors were cut in the watertight bulkheads. A grand staircase required a spacious opening at every level, making a watertight deck impossible. ... Stokers could work more efficiently if longitudinal bulkheads were omitted... A double hull ate up valuable passenger & cargo space; a double bottom would be enough."
"One by one the safety precautions that marked the Great Eastern were chipped away in the interests of a more competitive ship. ... When the "unsinkable" Titanic was completed in 1912, she matched the Great Eastern in only one respect: she, too, had 15 transverse bulkheads."
"But even this was misleading. The Great Eastern's bulkheads were carried 30 feet above the waterline; the Titanic's, only 10 feet."
-"The Night Lives On", pg. 21
The Titanic's designers thought her quite safe enough, because she could float with any two of her 16 compartments flooded, and only the worst possible accident, a collision right at a bulkhead, could even flood two. Indeed, at the bow where the ship was narrowest and the compartments much smaller, she could float with the first four flooded, and collisions were most likely at the bow.
As the Titanic nudged and shouldered her way past the huge iceberg, we can now estimate that a gash was torn in her almost 100 metres long. It was probably more an irregular series of holes and rips, but the cumulative area along that great length was square metres. The ship's builder, Thomas Andrews, was aboard and inspected the damage with the Captain. They found that the first five compartments were flooding rapidly, and the sixth leaking.
Andrews quickly visualized the awful, inevitable mathematics. As the front compartments filled, and the bow sank, the transverse hull between the fifth and sixth compartments would drop over 10 feet - below the waterline. The water would spill over into the next compartment. So the ship would sink further, and water would spill into the next, and the next - and the pumps could only slightly delay it. The accident that nobody could imagine had occurred just that simply. Andrews underestimated her remaining time at only an hour. She lasted two.
By contrast, 50 years earlier on August 27, 1862, the Great Eastern had scraped on an uncharted rock off the coast of Long Island. It ripped a gash in her skin some 9 feet wide and 83 long, worse in some ways than the breach in the Titanic. However, the Great Eastern's inner hull was unbroken and the engine room remained dry. She not only floated, but limped into New York the next day under her own steam. Not a soul was hurt.
Engineers today, who work in such safety-conscious designs as nuclear plants, use the military term "defense in depth". Behind the first safety system lies another, and behind that, still another...each with its own backups. The Great Eastern had defense in depth against hull breach. By the era of the Titanic, liners had contented themselves with but a single "layer", the all-too-short transverse bulkheads. Soon after the disaster, the sister ship Olympic, and many other liners with comparable designs, were being expensively retrofitted with an inner, second hull. Suddenly the "impossible costs" of such "extravagances" seemed affordable after all.
Various other corners ceased to be cut in safety standards, as well. Since all lines did the same, competitive positions remained relatively the same. (Of course, the White Star line never recovered from the loss of the Titanic and the settlements for cargo and loss of life; it was absorbed by Cunard lines some years later. So much for competitive advantage from trimming standards.)
The most dumbfounding cut in retrospect was the lack of lifeboats. It was not just the price of the lifeboats themselves that bothered the businessmen, it was the deck space they ate up...one of the most precious commodities aboard. The committee of the British Board of Trade that made the regulations on life-boats was dominated by shipbuilders. They proved very able to convince themselves that boats for every person were not necessary. Thus the regulations of the time required only that a ship of Titanic's size carry boats sufficient for 962, though she could potentially carry over 3500 passengers and crew.
White Star's General Manager Harold Sanderson pointed out that the North Atlantic was so stormy that boats could not be lowered safely 95% of the time, and even once down, the passengers would be subject to additional dangers on the tossing sea. "They could avoid all this by drowning at once" joked the magazine "Fairplay", when he continued with this view even after the accident.
Needless to say, following the disaster, complicated formulas requiring so many cubic feet of lifeboat space per thousand tons of ship were replaced with a simpler one: enough seats for everyone aboard. Again, a supposedly high cost was suddenly affordable, and has never been questioned since.
The lifeboat problem was exacerbated by poor procedure. Only at the last did lifeboats leave full; at first, many left partly empty because passengers were not queued up to them. Second Officer Herbert Lightoller took the instruction "Women and Children First" so literally that he let lifeboats leave with empty spaces rather than let men or boys as young as thirteen aboard...and was never so much as reprimanded for this part in seeing just over 700 saved when 1200 could have been.
Those of us who design and operate public services, and bear the title of "civil servant", may be much sobered by this transcript from the inquiry. Captain Maurice Henry Clarke, the inspector who cleared the Titanic for sailing, was being examined on the reasons for Titanic's only "lifeboat drill" having been conducted at the dock, consisting of only two boats, manned by hand-picked crew. Having conceded that he had since tightened requirements, he was asked:
"Did you think your system was satisfactory before the Titanic disaster?"
"Then why did you do it?"
"Because it was the custom."
"Do you follow a custom because it is bad?"
"Well, I am a civil servant sir, and custom guides us a good bit."
Custom still does, and not just for civil servants. A few decades ago, seat belts in cars were thought a little-needed luxury; today vastly more expensive airbags are becoming a standard feature. Those who make and sell vehicles fought the transition step-by-step as the added cost naturally reduces the number that can be afforded by the buying public. The public itself has either resigned itself to the cost, or embraced it with enthusiasm, once the statistics of death and crippling were considered. The first hockey players to use helmets were jeered by other athletes until it became the new "custom". Now most parents willingly accept the cost of helmets simply for their children to ride bicycles.
All risks need rational consideration, and some must be accepted. Sooner or later, it will be pointed out that a few head injuries occur to pedestrians, but I hope that it will never be made mandatory to wear a helmet to take a walk. Even today however, it is still often the case that money management wins out over risk management.
What this lead to with the Titanic was that a lesson was only learned because the tuition was paid in blood. Has much changed? This week's news was full of the story that tractor-trailers are now being carefully examined for defects in their wheels and many pulled off the road, which costs money. This, after two people were killed by runaway wheels broken loose, both in the same week. There had been other such cases...but then two, close together, stimulated realization of a need for systemic change, not just a focus on the specific trucks involved.
I've been typing for hours, and my watch says it is 2:10. This is another time I recall from my Titanic reading. The ship went down about 2:20, and 2:10 was when her builder, Thomas Andrews, was last seen. After helping to organize the confused lifeboat loading, and personally assisting many to the last boats, he remained aboard. A survivor recalled seeing him at this time, alone in the Gentlemen's First Class Smoking Lounge, staring into space. The steward called to him to come try to swim for it, but he did not answer.
This room was one of the most remarkable on the ship, paneled in rich mahogany inlaid with mother-of-pearl, lit through stained glass, and even possessing a working fireplace. (No expense was spared here!) Andrews had done much of the architecture and interior design, as well as the structural and mechanical work.
I sometimes like to think that in his reverie, he realized the basic mistakes that he and a half-century of his predecessors had made. I hope it comforted him that this disaster was going to be so traumatic as to bring about tremendous changes despite all their costs, changes that would save more lives in the long run. Were it not for the Titanic, the safety standards might have continued for a long time, causing a long string of smaller disasters - each too small in its own right to bring about basic changes to the whole industry.
As the sinking bow lifted the stern a hundred feet in the air, Titanic's own weight broke her back and ripped her in two. The enormous screaming of tons of metal tearing was a sound that haunted the survivors all their lives. I hope Andrew's thoughts had given him some sense of consolation when the hungry North Atlantic stalked into the lavish Georgian drawing room to take away his sorrow and his shame.