This is a summary of a report
which reviews Team New Zealand's 2003 America's Cup
Defence and which sets out to answer the fundamental
question, why did Team New Zealand lose the America's
Cup 0-5?
Overview
Ultimately, the loss of the America's Cup 0-5 can be
attributed to a host of specific things not going in
the Team's favour. These, however, need to be viewed
as the end effects, not the cause.
Our management structure, which consisted of three individuals
with specific, self contained areas of responsibility
reporting to a four-person board, did not deliver a
winning combination of boat and crew to the start line
for race one of America's Cup 2003.
It will always remain speculation as to whether a different
management structure would have seen Team New Zealand
successfully defend the Cup. It may have, but what is
clear now, but was not clear at the time, was that the
management structure adopted did not pull together sufficiently
well the areas of sailing (including sail development)
boat design and administration.
A second, significant contributing factor was the structural
failure NZL81 experienced in mid December 2002. The
impact this catastrophe had on the Team cannot be under
stated.
The failure of NZL81 led to downstream decisions being
made which severely handicapped and disadvantaged the
crew and the preparation of NZL82.
In preparation for mounting a challenge in 2007, Team
New Zealand has already addressed the issue of management
structure.
- Grant Dalton has been
appointed Managing Director of the Team, and the
separate functions of sailing, boat design and administration
will report to him.
- It has been determined
that the Team will be sailor led, with the sailors
briefing the designers as to what they want in a
boat
- The design team's focus
will be on delivering to the sailors' specifications,
while utilising the innovative approach that has
been a feature of Team New Zealand's previous campaigns.
- With that resolved, the
Team's director structure will now be examined and
any appropriate changes made.
Management
Structure
The Team's management structure was developed to hold
and best utilise the talents of its two remaining leaders,
skipper Dean Barker and head of design, Tom Schnackenberg,
following the departure of many of the 2000 defending
combination.
The circumstances Team New Zealand found itself in in
May 2000 need to be restated, as they were fundamental
to the adoption of the Team's management structure.
As it turned out, the Directors took on responsibility
for the Team only 12 hours before it was announced by
Russell Coutts and Brad Butterworth that they were leaving
the Team. The Directors (assisted by Dean and Tom) told
the 2000 Team of this only 60 minutes before it was
publicly announced that the leadership was departing.
The Team faced a major crisis, and holding together
the remnants of Team New Zealand required immediate
and decisive decision making.
The departure of Russell and Brad triggered an exodus
of knowledge and experience across every area of capability
- management, design, sailing, sails and rigging. Through
the loss of institutional and intellectual knowledge,
the Team was badly wounded.
The management structure adopted by a recovering Team
New Zealand was absolutely the right one at the time.
Tom and Dean together began recruiting team members
with Dean in charge of sailing and Tom in charge of
boat design. The Directors believe explicitly that without
those appointments, there was a very real chance that
what remained of Team New Zealand after the walkout
would have collapsed.
Ross Blackman was brought in some months later to be
responsible for administration and sponsorship.
This initial management structure remained in place
through to the 2003 defence because team activities
and internal reporting indicated it was working. Management
was responsible for the defence of the America's Cup,
the America's cup event itself and all the activities
in the American Express Viaduct Harbour.
Funding for all these activities was estimated during
the early days of Team rebuilding to be $60 million
but this was revised to close to $90 million. This funding
requirement put enormous demands on senior management
right up to the commencement of racing and was a feature
of board discussions.
It is only in retrospect, and in the last months of
the campaign when it was too late to make changes, that
the fundamental weaknesses of the structure emerged.
The most critical weakness was that no one individual
had a total overview of where the Team was at, and final
responsibility for and authority over decision making.
Note: The departure of the Team's leadership in 2000
is not put forward as the reason Team New Zealand failed
to defend the Cup. It sets the scene for the decisions
made about management structure.
NZL81's Problems
NZL81 suffered crippling hull and deck structural damage
in early December 2002.
At the time of the failure, the boat had not completed
its testing programme. The cause of the failure has
not been finally determined at the time of writing this
report. However, it was not the result of a manufacturing
fault.
The hull and deck on NZL81 failed again just prior to
the start of the first race in the America's Cup.
These failures did not occur in NZL82 but it was a concern
that never left the minds of all members of the Team.
NZL81's failure undermined the Team's confidence in
the structural soundness of NZL82. This led to compromises
being made when testing the limits of NZL82's capabilities,
and eventually to pushing the boat during racing.
Collectively the sailors expressed confidence in NZL82.
However, privately they harbored the belief that NZL82
might be fragile, and they treated it too protectively.
There was a genuine concern that if they pushed NZL82
too hard, it too might fail and they would not have
a boat with which to defend the America's Cup.
Consequently, NZL82 was never made to stretch in more
than 25 knots and the issues this created showed up
dramatically in the defence series, when the boat was
pushed to its limits for the first time.
The water issue experienced on race day one had never
been encountered previously, and the loads applied to
boom and rigging in testing and practice were not at
the extreme end of the range experienced during the
eventual regatta.
Greater faith in NZL82 and more time to test, fine tune
and understand the boat would have led to the defects
being detected, and fixed, in advance.
The difficulties the Team faced with NZL81 and NZL82
could not be made public at the time as such knowledge
would have materially assisted the syndicate challenging
for the America's Cup.
State Of Readiness
When Team New Zealand lined up on the start line for
race one of the defence we had in NZL82 a boat with
the potential to defend the Cup. We also had in the
crew, under skipper Dean Barker, the sailors with the
skills capable of defending the Cup.
However, these two elements were still some weeks away
from jelling together into an optimal combination.
Team New Zealand was not as prepared as it should have
been and had planned to be.
As invariably happens in such situations, unseasonal
weather and sea conditions further exposed and compounded
the poor state of readiness.
Team New Zealand found itself on the wrong side of the
fine line that determines success or failure, and all
our shortcomings were exposed in the white heat of the
final.
The question must be asked whether it was ever possible
for Team New Zealand to get to the point where it had
a reasonable chance of successfully defending the Cup.
The obvious comparison is that the Alinghi syndicate
was able to build a cup winning team from scratch in
the same time period as Team New Zealand had to reconstruct
itself.
A key difference is that Alinghi had the former decision
makers, other than Tom, and formal and informal leaders,
from Team New Zealand. The Alinghi funding base was
secure from the outset and this freed them from the
pressure of raising finance.
While Team New Zealand can be rightly criticised for
its performance, in more seasonal sailing conditions
there existed the very real chance that we may have
succeeded. That we were able to get ourselves to this
position is a tribute to the outstanding talent and
total commitment of Team members. Special mention must
be made of those Team members who turned down very large
financial offers and stayed. Many of these took on double
responsibilities at great personal cost in terms of
income, time and effort.
Also noteworthy was the growth of individuals who moved
from understudies to lead players, and the stubborn
determination of a group of very talented New Zealanders
who simply refused to give in.
Design
Team New Zealand became a design led campaign.
The process of becoming design led was gradual and design
was able to dominate through the lack of an overall
Team leader with the responsibility for balancing the
demands of boat development and sailing needs.
Tom and his design team determined that to be competitive
in 2003 they had to take a major step forward in terms
of boat design. They worked on a number of revolutionary
concepts, of which the hula was only one.
Developing revolutionary concepts eats into time and
financial resource.
The testing programme for NZL81 and NZL82 was based
on that followed for the Team's 2000 boats, NZL57 and
NZL60.
NZL57 and NZL60 were conventional boats with few problems,
and the testing time allowed proved adequate. NZL81
and NZL82 were radical boats and problems were experienced
during testing. Late delivery and structural problems
substantially reduced the time for trialing and NZL82
started racing without adequate preparation.
Sailing Issues
The sailing team under Dean Barker faced three major
challenges.
Composition
The preferred sailing combination was composed of some
of the world's most talented yachtsmen. Undoubtedly
they have the ability to compete successfully against
the best.
However, it was a relatively inexperienced after guard
in America's Cup terms.
Being the defenders, with new crew members, they had
no real Team experience of the pressure cooker atmosphere
of the America's Cup. They also went in at the deep
end, with no chance to hone their skills through a challenge
series or ease into the regatta with relatively unimportant
early races.
Testing
The sailors were given their boats behind schedule and
with limited time to get to understand and tune radical
boats. This was compounded by structural failure in
NZL81 and the subsequent time required to effect repairs.
They were still coming to grips with their boat's potential
on race day.
Confidence
The structural failure of NZL81, and concerns about
NZL82, bred caution into the crew during testing. Confidence
was dented even further when gear failed during race
one of the Cup defence.
It led to the crew factoring in a safety margin when
setting up the boat and pushing it during racing, which
they would not have done if they had greater confidence
in NZL82.
Specific Race Issues
Race 1
The second major structural failure NZL81 experienced
in pre race manoeuvering was a body blow to the confidence
of those on NZL82 in the ability of the boat to handle
the conditions.
Choppy seas in conditions NZL82 had not been tested
in, combined with the chop from spectator craft and
extra weight from the positioning of some sails and
the weight of the television equipment and umpire, saw
NZL82 take on water during the start.
Lee cloths and extra bailers solved the problem after
race one, but the Team was not prepared for the water
issue as it had never been experienced before.
Testing in conditions above 25 knots would most likely
have revealed the problems that emerged with the boom
and the headsail tack fitting, and the issues resolved
before race day.
Race 2
Racing tactics, particularly on the last leg, and an
incorrect selection of sails lost us this race. The
Team believes they lost rather than Alinghi won race
two.
Race 3
We won this start and chose to go left. The after guard
was advised of the shift to the right but elected to
keep with its earlier preference for the left. As we
were in a position to go either left or right at the
time we made the decision to go left, it proved a race
losing decision. Strategy lost us this race.
Race 4
To save 18 kilos of weight, aluminium tip cups were
used in the rigging. One of these broke while the boat
was on the wind and the rig was lost.
The move to aluminium occurred six weeks earlier, and
while there had been testing of the aluminium cups "to
destruction" in the workshop, limited on water testing
in strong conditions had been undertaken.
Race 5
The Team attempted to banish concerns about the boat
from their minds but confidence in the boat and gear
was low. The Team was determined to finish the race
and tuned and raced the boat conservatively. We failed
to meet our own high standards.
The Positives
This report focuses on the events that led to the 0-5
loss, and therefore does not balance the ledger by looking
at the many positives to have come from the campaign.
The most significant of these is that in Team New Zealand
we have a team that is capable of challenging for and
winning the America's Cup.
While NZL82 was plagued by reliability issues, it was
regarded by some experienced observers as an extremely
fast America's Cup boat. In particular, the tacking
duel and upwind performance in race 2 showed the real
potential of NZL82. More testing time would have enabled
the Team to resolve all reliability issues and to realise
the full speed potential of the boat. The crew demonstrated
superb boat handling skills in all phases of sailing.
Management was faced with an enormous challenge to fund
the campaign, the event and the activities in the American
Express Viaduct Harbour. It is a matter of record that
close to $90 million was raised, that visitor experience
with the event and all activities were positive and
that New Zealand gained major international exposure
in addition to many hundreds of millions of additional
revenue. These positives cannot be overlooked.
Considering the intellectual property owned, we are
confident in our ability to meet the innovation and
technology challenge required to win the America's Cup
again.
Our young sailing team is now a series more mature,
has experienced defeat and has a burning desire to avenge
that defeat. By the time of the 2007 challenge the Team
will have molded itself into a formidable combination
with the ability and experience to rival the great 1995
and 2000 New Zealand teams.
Conclusion
The single, most important cause was the management
structure adopted for the Team following the sudden
and unexpected departure of its former leadership in
May, 2000.
All subsequent downstream events and occurrences can
be traced back to the management structure not delivering.
Therefore, those responsible for the management structure
- Peter Menzies, Ralph Norris, John Risley and Kevin
Roberts (as directors), Dean Barker (sailing) Ross Blackman
(administration) and Tom Schnackenberg (boat design)
- have collectively and individually accepted responsibility
for the Team's performance.
Collectively they developed the structure, and collectively
they failed to challenge its ability to deliver.
The Team has recognized the need to improve its structure
and, with the appointment of Grant Dalton as Managing
Director, has now covered one of the key elements missing
in 2003. What we still lack is committed funding to
mount a European challenge. Finding that funding is
now our priority, and we expect to make a decision no
later than the end of the year as to whether Team New
Zealand will challenge in 2007.
As a Team, we have two deep disappointments.
The first is that of competitors who lost. That is hard,
but competitors learn to live with the highs and lows
of competitive life, and real winners come back the
stronger having lost.
The second is not giving an on water performance worthy
of the tremendous support we received from the New Zealand
public. There is a tangible sense of a debt of gratitude
that needs repaying. As a Team we intend to do that.
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