In April 1970, Nasa’s mission control centre in Houston had a problem: Apollo XIII was running out of batteries, out of oxygen and out of time. An explosion in the spacecraft had ripped out critical systems, but the mission was already half way to its objective, the moon. Gene Kranz was the leader of the “White Team” of mission controllers – renamed the “Tiger Team” after the crisis broke – which had to assess the situation, address the problem of how to bring the crew back home and execute whatever plan they could devise. Not surprisingly, Kranz has made something of a name for himself as a crisis manager since then. Last month he was the guest speaker at the Risk 98 forum in Guernsey, where Financial Director obtained exclusive access to the man and his risk management teachings. In fact, as we found out, Apollo XIII was just one in a long series of risk management propositions for the men who staffed Nasa during those early years of the space programme. “When we went to launch the Redstone rocket (in the early 1960s), only the upper half of the rocket fired,” recalls Krantz. “The lower half remained on the launchpad and the rocket engineers in mission control all started speaking German. We did not know what to do. But we were fortunate: our nation understood that there is no achievement without risk.” Motivated by the inspirational vision of John F Kennedy – “We choose to go to the moon and do these other things not because they are easy, but because they are hard,” he famously said in 1961 – Nasa mission control rapidly gained an understanding of the need to control the risk factor, especially when men started to ride the rockets they were sending into orbit. This concern for risk was crystallised in 1967 when a fire raged within the Apollo I command module during a simulation, killing the three astronauts on board. “We listened to their cries, the horror and the chaos, for 16 seconds as our crew died,” says Krantz. “And when the communication loops became silent, we became angry, angry at ourselves because we were responsible for America’s first spaceflight disaster.” This harshest of lessons brought new words into the vocabulary of mission control: toughness to shoulder their responsibilities; and competence to be perfect. Risk minimisation is, in fact, the credo of the flight control teams. For Krantz, the importance of training – preparation should the worst happen – is critical. “The training process is so intense that you learn to separate out anything except your risk, your gain, your objective, your team,” explains Krantz. With an average age of 26, the flight controllers on Apollo XIII had to rely on training to keep them cool as the mission turned bad. After the explosion, for example, there was a moment of – well, not panic, but uncertainty. “For 60 seconds mission control bordered on chaos,” Krantz remembers. “Then the training kicked in. The controllers’ voices became cool, crisp – on top of the job.” The training had instilled a sense of confidence. “Everything that is normal is almost done in the back of your mind, so that you’re all ready for those things that are abnormal,” he explains. In fact, the exceptional training the young people in Nasa had gone through was simply a part of an overall ethos which existed to minimise the risks to the crew and the mission. Krantz warms to this theme: “The tools we use in mission control are leadership, values, trust, teamwork and training,” he says. “Leadership provides the vision and the focus for our teams. Trust allows us to exploit any opportunities that arise during the mission. Values create a heart to overcome any adversity that we face. Training builds the confidence for our young teams to step into the breach. And our teamwork assures ultimate victory. Mission control succeeds because we know as a team that we will not fail.” Then that quotation: “Failure is not an option.” There was some confusion after the Apollo XIII blast – after all, many of the systems had gone off-line, and the controllers were in the dark about the problem. But Krantz took charge in a way most business executives can only dream about. “This is a very stark, lonely feeling that you get when the only thing on your mind is survival,” says the ex-fighter pilot. “It’s my job to lead, I was the flight director, it’s time to take charge. So I say to my flight controllers, ‘Settle down. Quit your guessing and let’s start working the problems.'” In Jim Lovell’s book of the mission, Krantz is reported to have said to his controllers, “What I want from every one of you is simple: options, and plenty of them.” Krantz understood that while he had the most experience, and the ultimate responsibility, for making the final decisions, he needed every choice available to make the right call and get the crew back home. The first option he was presented with was whether to fire the service module’s main engines and bring the crew directly home; or slingshot round the moon, saving the engines but adding at least three days to the return journey. “Something, some gut feeling, says ‘Don’t use that main engine,’ and I can’t explain it,” Krantz says. “So on nothing more than gut feeling, I make the decision to swing this mission around the moon.” That decision looked crazy – the electrical power on the seemingly doomed craft would last two days on their calculations at that time. But when, towards the end of the mission, the crew jettisoned the holed service module, the astronauts themselves realised what a good call it had been. “(The crew) start reporting, and it’s preceded by a gasp as (commander Jim) Lovell sees the damage for the first time,” recalls Krantz. “Then he says, ‘The whole side of the spacecraft is missing.’ (Lunar module pilot Fred) Haise chops in and says, ‘Yeah, it looks like it got the engine too, there’s nothing but a dark brown streak.’ And when he says those words, I think of the decision I made four days earlier to go against the odds, to go round the moon.” Had the crew attempted to fire the engines, they would have perished. Krantz himself puts that decision down to divine guidance. Whilst the hand of God often seems to play a role in risk management situations, there are also ways to give yourself the edge. For example, Nasa tries to calculate risks ahead of time and produce potential solutions for when the worst happens. “The Mission Rules is our risk management strategy,” says Krantz. “This defines how far we’re going to move out on a risk plateau to gain our objective.” Every conceivable problem is analysed and a solution written into the rules. The hard part is deciding how long to stay on that risk plateau for the anticipated gain. Whilst these rules can help guide the managers as risk situations develop, sometimes greater skills have to be brought to bear. “If you’ve got three, four, five, six elements contributing to a problem, you have to innovate through this process,” Krantz explains. “The flight directors are always selected from the ranks of the controllers because you’re after their ability to manage the risks.” Readers familiar with the film Apollo XIII will recall that the flight team had to do exactly that with the air filtration process. A new filter was designed and constructed by mission control using only materials they knew were in the capsule; and the crew managed to replicate this and prevent themselves choking to death. By taking on board every option available, the team could also analyse potential outcomes and come up with risk-weighted scenarios. After rounding the moon, for example, the Tiger Team had to decide whether to speed up the craft – and risk a splashdown out of reach of the Navy and possibly damage the re-entry heat shield – or maintain speed, keeping the astronauts in space for an extra day, but better control the risks towards the end of the mission. The slow route wasn’t the obvious choice; only careful analysis proved it was the right choice. Few managers will ever encounter the high risks or severe penalties for failure that Krantz and the Nasa crews faced. But some of Krantz’s observations are right on the mark. Take knowledge management: “The flight director is the most experienced risk manager in the business,” he says. “It’s really an accumulation of experience. If you’re going to underwrite risk, it’s basically cumulative knowledge. We can’t devolve the skills that we need without experience.” In other words, older, wiser heads will always be needed in tandem with the energy and innovation of youth. Krantz’s words are occasionally reminiscent of management consultancy double-speak. But when he says them, it’s easy to understand how and why they should be at the forefront of everyone’s mind, regardless of the situation. Risk management, in Krantz’s world, really is about responsibility, leadership and trust. And whilst business leaders may never face the extremes of Apollo XIII, they can certainly minimise their own risks by applying a fraction of the preparation, ability, drive and commitment that Krantz and his fellow mission controllers did back in April 1970.