Innovation/Global Risk 

Titanic’s Lesson for the World 

By Shlomo Maital  

 

   The RMS Titanic sank almost a century ago.  Since then she has served as a sad lesson for innovators, on the consequences of arrogance.  Built to carry 3,500 people, Titanic had 2,223 people on board during its maiden voyage, and sank at 2:20 a.m., on April 14, 1912, with 1,517 people perishing in the frigid Atlantic waters.  The reason: There were lifeboats only for 1,178 people, because the Titanic was “unsinkable”. 

   But I believe there is another key lesson the Titanic conveys:  Strategic agility. Nations need to constantly evaluate where their competitive advantage lies, and adapt and reinvent it when technology and markets change and shift.

    Titanic was built in the shipyards of Harland and Wolff for the Cunard Lines, in Belfast,  Ireland.   It was the only shipyard in the world capable of building the advanced vessel, which weighed 45,000 tons (a modern aircraft carrier weighs over twice that, but recall that it has a large steel deck for launching and landing planes).  It was built by a highly skilled workforce of 15,000 workers, all men (no women were allowed to do the hard physical work).  But women also had good jobs created by Titanic – they wove the textiles needed for the 45,000 napkins and 12,000 sheets, and thousands of tablecloths used on Titanic.   One of the key skills in building Titanic was riveting. It took a riveter five years to learn the craft, driving white-hot rivets into steel plates, so that they could contract when they cooled and tighten the joints.  Many millions of such rivets went into the Titanic.  Riveters were paid according to the number of rivets they drove. 

    At the time, Ireland had a global competitive advantage in shipbuilding.  As the world changed, and as shipbuilding evolved and moved to places like Korea, Ireland lost jobs, income and exports.  In part, Ireland was preoccupied with its struggle for independence from Britain (in the end, Belfast remained in what became Northern Ireland, a part of the United Kingdom).  It took Ireland some 75 years, until a few clever officials from the Irish Industrial Development Agency figured out how to attract American companies to Ireland, to generate quality jobs like those the Titanic once supplied.  During those 75 years, many Irish emigrated abroad, because they found no work at home.  Ireland itself became not unlike the Titanic – it sank, becoming one of the poorest countries in Europe. 

    Ireland again finds itself in trouble. After a hasty government bailout of its troubled banks, the Irish people drown in debt, and the new Irish budget announced today (actually, the budget is so tough, the government will reveal it over a two-day period, to soften the blow) is severely austere.  The Prime Minister’s tough address to the nation backfired, as the Irish people seek solutions, not statements of the problem.  Unlike the Titanic, Ireland seems to be sinking ever so slowly – but surely.  The people of Ireland deserve better.   

   Today nations are sinking, in Europe and elsewhere, like Titanic.  They are unable to adapt to changing geopolitical realities.  As we mark a century since Titanic’s launch and tragic sinking, let us recall what Titanic teaches. 

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