Page 16 - Risk Management Bulletin February 2024

RMAI BULLETIN FEBRUARY 2024

contributed to the accident. The flawed design of the ciency. The catastrophe highlighted the need for
shuttle's solid rocket boosters (SRBs) was one of the NASA and other space agencies to prioritise safety
key technical setbacks. The SRBs' O-ring seals were not and take the necessary procedures to avoid trag-
meant to withstand the low temperatures on launch edies such as the Challenger.
day, allowing hot gases to escape and ignite the main
Y The accident underlined the significance of open
fuel tank. Despite engineers' warnings regarding the and honest communication among engineers, sci-
likely failure of the O-ring seals, NASA authorities ne- entists, and officials, as well as the importance of
glected to handle the matter sufficiently, and the listening to and taking warnings seriously.
launch was permitted.
Y The significance of continuous learning and im-
provement: Following the Challenger accident,
Another element that contributed was the pressure to
NASA conducted a thorough evaluation of its
meet deadlines. There was tremendous political and
public pressure to launch the shuttle on time, as well safety protocols and organisational culture, result-
ing in significant adjustments and improvements
as a determination to stay competitive in the space
to the space agency's operations.
race. This pressure may have prompted NASA execu-
tives to downplay the risks and disregard engineer
cautions. Remedies:
Following the Challenger disaster, NASA made several
The Challenger accident had far-reaching conse- changes and improvements to its safety procedures
quences for NASA and the world of space exploration. and organisational culture in order to avoid future trag-
Following the catastrophe, NASA conducted a thor- edies, including
ough evaluation of its safety protocols and Y The implementation of a more rigorous and trans-
organisational culture, resulting in significant adjust- parent safety review process and the establish-
ments and improvements to the space agency's opera- ment of an independent safety office.
tions. Y New safety rules and procedures, including greater
testing and inspection of crucial components, are
Causes: being developed.
Y The shuttle's solid rocket boosters (SRBs) were Y The establishment of a new organisational culture
designed incorrectly. The SRBs' O-ring seals were that placed a premium on safety, communication,
not meant to withstand the low temperatures on and transparency.
launch day, allowing hot gases to escape and ig-
Y Adoption of innovative technologies and materi-
nite the main fuel tank.
als to improve space shuttle and other spacecraft
Y Inadequate testing and communication: Despite safety and reliability.
engineer warnings about the potential failure of
the O-ring seals, NASA authorities did not address Case Study 2: The 2008 financial crisis:
the matter sufficiently, and the launch was al-
The US housing market expanded rapidly in the years
lowed.
preceding the crisis, powered by easy credit and low
Y Pressure to fulfill deadlines: Due to political and interest rates. Lenders, such as banks and mortgage
public pressure, as well as the desire to keep up
companies, lowered lending requirements and made
with the competitors in the space race, there was
loans to borrowers who were unable to repay them.
enormous pressure to launch the shuttle on time. These subprime mortgages were then packaged with
other mortgages into securities and marketed to inves-
Lessons learned:
tors all over the world.
Y NASA and the rest of the world learned several
critical lessons from the Challenger catastrophe,
As property values rose, mortgage-backed securities
including:
were viewed as secure investments, and demand for
Safety is more important than speed and effi- them surged dramatically. The underlying mortgages,

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