The Billion-Dollar Risk Nobody Really Expected.

The MV Dali in the aftermath of the accident

On the evening of 25 March 2024, the crew of the container ship MV Dali were dealing with an electrical problem.

The vessel was alongside in Baltimore when a circuit breaker unexpectedly tripped, causing a blackout. The crew investigated the issue, restored power and carried on preparing the ship for departure. At the time, I doubt anybody gave the incident much thought. That might sound slightly odd given what happened next, but ships are incredibly complex machines. Electrical systems fail and circuit breakers trip. Other components break. Crews routinely troubleshoot faults and continue operating. If every technical issue resulted in operations stopping indefinitely, very little would move anywhere in the world.

The following day, cargo operations were completed, a harbour pilot boarded and the ship prepared to leave Baltimore. Tugs assisted the vessel away from the berth before releasing it in accordance with normal local procedures. The ship entered the channel and continued towards the Francis Scott Key Bridge.

Everything appeared routine. Then, shortly after 1:24am on the morning of 26 March, the lights went out again. Power returned briefly before failing once more. The pilot immediately recognised the seriousness of the situation. Anchors were ordered away, a mayday was transmitted and efforts were made to stop traffic crossing the bridge. Five minutes later, the 95,000-tonne vessel struck one of the bridge’s main support piers and a large section of the structure collapsed into the Patapsco River.

Six road workers lost their lives as the vehicles they were in, static on the bridge, fell into the river below.

More than 2 years later, legal proceedings continue and several members of the crew remain caught up in the aftermath of an accident they almost certainly never imagined they would become part of. It has been estimated that the 'final bill' could be in the order of USD4 billion. That is a lot of zeros.

The eventual NTSB investigation traced the likely initiating technical failure to something remarkably small. A loose signal wire inside an electrical control cabinet had not been fully seated in its terminal block. A plastic identification label had prevented the ferrule from being inserted correctly and, over time, the connection worked loose. When the failure occurred, a cascade of electrical problems followed.\

As mentioned, that’s the technical explanation. But this isn’t the part of the story I find most interesting. What interests me is how organisations decide which risks deserve attention and which ones don’t.

The Risk Wasn’t Unknown.

An easy conclusion to reach after an accident like this is that nobody could reasonably have anticipated it being even remotely likely. A ship loses power at exactly the wrong moment, strikes a bridge and causes a catastrophic collapse. It feels like an extraordinary sequence of events.

Hold my beer....

In 1980, another vessel struck one of the Francis Scott Key Bridge piers. The ship was considerably smaller and the damage relatively minor, but the event demonstrated something important. Ships can hit bridges. That might sound painfully obvious. The difficult part is deciding what to do with information like that.

The World Association for Waterborne Transport Infrastructure actually noted in 2018 that ships frequently collide with bridge structures, although only a small number of those collisions result in collapse. Across the United States, thousands of vessels have struck bridges over the years. Most incidents result in repairs, insurance claims and inconvenience. A tiny number become catastrophes.

This creates a dilemma which should feel familiar to anyone responsible for managing risk.

If something has happened once, how seriously should we take it?

If it has happened once in forty years, does it justify major investment?

If the likelihood is low but the consequences are enormous, how much protection is enough?

These aren’t engineering questions, they’re leadership questions. Note that they may well need engineering expertise to answer though.

Aviation faces a similar challenge. Mid-air collisions are thankfully rare, but they are almost always preceded by years of near misses, loss of separation events and opportunities to learn. The collision appears obvious once it happens and our hindsight bias kicks in. However the signals leading up to it are much harder to interpret. Which ones represent a genuine warning? Which ones are simply part of operating in a complex environment? How many systems have been and gone with multiple near misses that never resulted in a catastrophe?

The Francis Scott Key Bridge had already been struck by a ship. So the difficult questions aren’t to do with whether a collision was possible. The difficult questions relate to deciding whether the bridge collision risk justified additional controls.

When One Failure Becomes Catastrophic

A lot of the discussion following the accident focused on the electrical fault. This is understandable (but arguably naive). A ship lost power and then hit a bridge. Problem solved.

Or perhaps not.

While attending the Australasian Marine Pilots Institute conference last week, I had conversations with a number of pilots and maritime professionals. Somewhat interestingly, electrical failures and power interruptions are not particularly unusual. As mentioned in the opening paragraph, crews troubleshoot issues and continue operating.

The goal is not to eliminate every fault. That would be impossible. It is more useful to explore which faults can create catastrophic consequences if they occur at the wrong place AND the wrong time.

The NTSB identified the loose wire. But this ship would have had thousands of connections within its electrical system. What is more interesting is what happened after the blackout.

Once the vessel lost propulsion and steering, what controls remained between the ship and the bridge? Sadly there weren't many. The anchors were deployed. A mayday was transmitted. Traffic on the bridge was stopped. None of those controls could physically prevent the impact. At that point, the system had effectively run out of meaningful options.

This is where Andrew Baker’s presentation at the AMPI conference really resonated with me. His phrase, “blind spots born of skill”, captures something many organisations struggle with. We become very good at managing the risks we see regularly. We become comfortable with the failures we encounter frequently. Over time, our attention naturally shifts away from asking what happens when those failures combine in ways we hadn’t fully considered.

We won't stop every blackout. With that in mind, we need to therefore ask is:

“What happens if the blackout occurs here?”

Safety Is Never The Number One Priority

Almost every organisation claims safety is its number one priority. I don’t believe them and, for good reason, I don’t think they should believe it either.

If safety genuinely sat above every other consideration, nobody would fly, drive, dive, operate ships, construct buildings or manufacture products. Organisations would spend themselves into bankruptcy attempting to eliminate every conceivable hazard. In context, that means stopping doing everything that exposes people (or maybe 'things') to serious risk.

Companies exist to create value. Part of leadership is deciding which risks are acceptable and which require additional protection and there is always tension.

In hindsight, it is easy to ask why escort tugs were not attached to vessels until they travelled further down the channel. It is easy to ask whether additional protection structures should have been installed around the bridge piers. It is easy to ask why more wasn’t done.

We need to consider that every additional control carries a cost. Some costs are financial. Others affect efficiency, schedules, capability and operational flexibility. Every organisation makes trade-offs, whether they admit it or not. If every trade off were made to ensure 'total' safety and zero risk, those organisations go bankrupt. That is why safety cannot be the number one priority, it is merely a part of the puzzle. An important part but just a part nonetheless.

It is important to consider that the cost of prevention is visible immediately. The cost of catastrophe remains hypothetical until the day it arrives.

Viewed through the lens of a bridge collapse, six fatalities and what is likely to be billions of dollars in losses, many preventative measures suddenly appear remarkably affordable. Viewed the day before the accident, the calculation may have looked very different.

I'm not making an argument against additional controls. I'm trying to help us understand how those decisions are made.

What assumptions were being made about likelihood?

What scenarios had been considered?

What events were considered too unlikely to justify further investment?

What would have happened if someone had deliberately challenged those assumptions/scenarios/likelihoods?

The Danger of Looking For Certainty

The power failures on the Dali are a good example of how quickly hindsight can pull us towards certainty. Looking back, it is easy to conclude that the ship should never have sailed after experiencing electrical problems the previous day. There may be some truth in that argument. But there is also a danger in oversimplifying the discussion.

As mentioned, issues such as power failures are not uncommon on ships. That isn't likely to change any time soon. Treat every anomaly as a precursor to catastrophe and you’ll quickly overwhelm the organisation. Ignore every anomaly because “these things happen” and you’ll eventually miss something important. Neither approach works particularly well so the answer sits somewhere in the middle.

This is where techniques such as Red Teaming can be incredibly valuable. Instead of trying to predict every possible failure, focus attention on the areas where a single failure could create disproportionate consequences.

What happens if the vessel loses power here?

What happens if the backup systems don’t recover?

What happens if a bridge pier is struck?

What happens if two independent failures occur at the same time?

Those conversations won’t completely eliminate the risk but they do help organisations identify where limited resources will have the greatest effect.

What Does This Mean For Leaders?

The easiest lesson from the Dali is to focus on the loose wire. That would be a mistake.

The loose wire was merely the trigger. The more interesting thread to pull on is why a single, relatively simple electrical failure had the potential to create such enormous consequences.

Most organisations have equivalent vulnerabilities. They are often hidden inside systems which appear reliable, efficient and well understood. The challenge is that these vulnerabilities rarely reveal themselves during normal operations. They usually emerge when several things go wrong at once.

This is where I think leaders can take something practical away from the Dali accident.

Spend less time trying to predict every possible failure and more time identifying the failures you simply cannot afford to have. Every organisation has critical points of failure where a relatively small problem could create disproportionate consequences.

Challenge assumptions regularly. The bridge had been struck before. Power failures on ships were not unheard of. Neither fact predicted the accident, but both provided clues about where vulnerabilities might exist.

Deliberately explore uncomfortable scenarios. Red Teaming works because it forces people to consider outcomes which feel unlikely, inconvenient or commercially unattractive. Most of those scenarios never occur. Occasionally one of them becomes tomorrow’s incident report.

Recognise that every risk control exists within a broader trade-off. Additional barriers cost money, time and capability. The question is rarely whether you can eliminate risk. The question is whether you’ve consciously decided which risks you’re prepared to live with.

The Dali accident is easy to understand in hindsight. A ship lost power and hit a bridge.

The challenge for leaders is identifying the next billion-dollar risk before it becomes obvious.

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Mike Mason and Sam Gladman are the co-founders of On Target, a leadership and team development company that brings elite fighter pilot expertise into the corporate world. With decades of combined experience in high-performance aviation, they specialise in translating critical skills such as communication, decision-making, and teamwork into practical tools for business. Through immersive training and cutting-edge simulation, Mike and Sam help teams build trust, improve performance, and thrive under pressure—just like the best flight crews in the world.

If you'd like to learn more about how On Target can help your team, contact Mike and Sam at info@ontargetteaming.com.