If you ever visit Stockholm, I would recommend a trip to the Vasa Museum, which is home to a grand warship that sank little more than a kilometre into its maiden voyage in August 1628. Aside from marvelling at its staggering level of preservation, the Vasa disaster is a vivid and ever-relevant example of why big decisions can go terribly wrong.
The Vasa was commissioned by King Gustav II Adolf to project military strength and royal grandeur. It was 69 metres long, with three masts and ten sails. It also carried 64 bronze cannons across two gun decks and close to 700 sculptures and ornaments. Looking at its scale and all it carried, it seems a wonder that it ever floated at all.
The design of the ship was the responsibility of Dutch master shipwright Henrik Hybertsson, but he died a year before the ship’s first voyage, which augured poorly for what was to follow.
Before departure, a test took place in which 30 men ran from one side of the deck to the other. The roll caused by this activity was so severe that the test had to be abandoned. Although Vice Admiral Klas Fleming witnessed this, he did not report it to the King, who was out of the country. According to testimony at the subsequent inquiry, Fleming exclaimed:
“If only His Majesty were at home!”
The ship set sail in front of expectant crowds on 10 August 1628. The Vasa almost immediately struggled for stability as winds gusted. Water began to enter through the open lower gunports, and the ship sank. It is estimated that around 30 people died.
There are several technical explanations for the Vasa’s sinking: its tall, heavy upper structure, the relatively small hull beneath the waterline and the open gunports. But the choice to sail despite the warning is also a failure of decision making, and one that seems eerily modern.
How does such a decision get made?
Power and incentives
Most decisions reflect the power and incentives at play. Decisions get made by those with power, based on their goals and desires, and the Vasa was no different. The King was the autocratic decision maker and he wanted a glorious and prestigious ship. Those working for him had limited power and were incentivised to please him, or at least not disappoint him.
To this day, the best way to predict what decisions will get made in almost any situation is to understand who holds the power and what they want.
The consequences of dissent
The prospect of disappointing King Gustav II Adolf seems to have carried considerable weight: even the failed test was not reported to him. We cannot know exactly how those involved weighed the consequences of calling out problems or jeopardising the project, but the personal risks of speaking up may have felt more immediate and specific than the general danger of going ahead.
There is little credit for disasters prevented
One of the inescapable challenges of raising concerns or highlighting risks that could halt a project is that, if you are successful in putting a stop to a bad idea, nobody ever sees the catastrophe your intervention prevented. There is limited credit available for stopping disasters that never transpired because you took action. In many situations there is more personal risk to speaking out than averting dire consequences.
Accountability sinks
No person or group was officially blamed for the Vasa’s sinking. The builders said they had followed the approved design, the designer was dead and blaming the King was politically unthinkable. This illustrates a type of accountability sink (no pun intended), where nobody takes responsibility or acts because nobody is clearly accountable – it is all lost in the system of control. Environments without clear accountability or agency are acutely susceptible to this problem and it remains a familiar feature of modern corporate life.
Expertise is not enough
Sweden employed expert (Dutch) shipbuilders and the level of craftsmanship on the Vasa meant that it withstood 300 years underwater largely intact – quality wasn’t not the issue. Rather the problem was one of organisation and decision making. If you place a group of competent people within an ineffective system, then you should expect the system to win.
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Walking around the Vasa is an incredible experience, and its conservation is remarkable. It is also remarkable that many of the decision-making problems that led to the great ship’s demise have also been well-preserved for 400 years.
My first book has been published. The Intelligent Fund Investor explores the beliefs and behaviours that lead investors astray, and shows how we can make better decisions. You can get a copy here (UK) or here (US).
All opinions are my own, not that of my employer or anybody else. I am often wrong, and my future self will disagree with my present self at some point. Not investment advice.
