CASO Carnival Cruise Lines

Topics: Carnival Cruise Lines, Holland America Line, Cruise lines Pages: 14 (4317 words) Published: December 5, 2014

Carnival Cruise Lines:
Wreck of the Costa Concordia
“The boat started shaking. The noise – there was panic, like in a film, dishes crashing to the floor, people running, people falling down the stairs.”
– survivor Fulvio Rocci 1
The Crisis
At 4:00 p.m. on the evening of January 13, 2012, the Costa Concordia set sail from Rome, Italy for a seven-day cruise as it did every week. The ship was due to arrive in Savona, Italy the next day. Around 9:15 p.m., the ship took a five mile detour to pass closer to the picturesque Tuscan Island of Giglio (see Exhibit 1).2 Captain Schettino appears to have misjudged the maneuver, and at 9:30 p.m., the ship collided with a rocky reef known as Le Scole. The collision ripped a 160-foot- long gash in the hull of the ship, and the Concordia lost power. The captain is said to have performed the sail-by as a spectacle for head waiter Antonello Tievoli who was a native of Giglio, and as a salute to former Costa captain Mario Palombo, who retired in 2006. Tievoli had been invited to join the captain in the bridge as the vessel was steered by the island. Palombo is reported to have not even been on the island to see the spectacle on the night of the incident.3 In response to the incident, Palombo is reported to have said:

“I cannot understand what could have happened, what passed through my colleague’s head. The captain sets the course – on board the ship, he’s king. But I don’t want to be dragged into this argument, for any reason.”4

This case was prepared by Research Assistants Jeremy Foster, Mary Jo Sorrentino and Charles Florance under the direction of James S. O’Rourke, Teaching Professor of Management, as the basis for class discussion rather than to illustrate either effective or ineffective handling of an administrative situation. Information was gathered from corporate as well as public sources. Copyright ©2012. Eugene D. Fanning Center for Business Communication. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, used in a spreadsheet, or transmitted in any form by any means – electronic, mechanical, photocopying, recording, or otherwise – without permission.

Within 15 minutes of the collision, the ship started to take on water and began to list. At this point, Captain Francesco Schettino likely realized his ship was in trouble and turned the ship back towards shore in what appeared to be an effort to make it easier to evacuate.5 Shortly following the collision, at 10:30 p.m., according to one of the ship’s cooks, Captain Schettino ordered dinner for himself and a woman.6

At 10:35 p.m., the crew directed the passengers to report to their muster stations, saying that the issue was an electrical problem, and technicians were working on it. At 10:58 p.m., Captain Francesco Schettino ordered abandon ship (see Exhibit 2). What followed can only be described as chaos. Many passengers did not know the emergency procedure, or where their muster station was, as there had been no lifeboat drill yet for the 600 passengers who boarded the ship on January 13th.7 Background

Carnival Cruise Lines
In 1972, entrepreneur Ted Arison formed Carnival Cruise Lines with one secondhand ship, and only enough fuel to sail from Miami to San Juan. Through determination and hard work, Mr. Arison built Carnival into a popular and profitable cruise line. In 1987, Carnival made an initial public offering, which provided capital to allow the company to begin expanding through acquisitions. Over the next few decades, Carnival acquired several well-known cruise companies throughout the world, including Costa Cruises in 1997 (see Exhibit 3).8 In 2003, Carnival Corporation merged with P&O Princess Cruises plc to create one of the largest leisure travel companies in the world. This merger added such cruise brands as P&O Cruises, P&O Cruises Austrailia, AIDA Cruises, Ocean Village, and Swan Hellenic, resulting in a global cruise company operating twelve...

References: Agar, Michael & Blenkinsop, Andrew. “Concordia: How the disaster unfolded,” The Telegraph. 16 Jan. 2012.
“Cruise ship’s cook says captain ordered dinner after crash,” CNN Europe. 20 Jan. 2012.
Beyette, Beverly. “Costa Concordia capsizing spotlights cruise ship safety,” Los Angeles Times. 19 Jan. 2012.
Dake, Shawn. “A Short History of the Costa Concordia,” Maritime Matters. 22 Jan. 2012.
“Cruise Ship Damages Quay,” Shipwreck Log, May 21, 2011
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