FAQ: SO YOU WANT A HISTORIC SHIPThis article was written by Dr. Norman M. Cary, Jr, formerly Head of the Curator Branch at the (U.S.) Naval Historical Center (Naval History and Heritage Command) and currently Chair of the Historic Naval Ships Association Curatorial Committee. Dr. Cary is now retired and he may be contacted via email at [email protected]
This FAQ has been prepared in response to a question received quite often by the members of the Historic Naval Ships Association - "My friends and I are following a dream. We want to put a historic ship in our community. What do we need to do to make this a reality?" The essay below is an attempt to provide information to help you answer that question. While much of the advice in this document is applicable and relevant to acquisition of historic ships outside of the United States, the majority of queries received by members of the Historic Naval Ships Association are from organizations in the United States. Therefore, this document is oriented to those who want to establish a historic ship in the United States. It does not deal with the day-to-day operation of a ship unless planning for it is a necessary part of the effort to get a ship in the first place. It is a work in progress, and should be considered in no way definitive or the last word. It is also not a "sole source" or "single authority" document. It is guidance based on the extensive experience of a variety of people associated with the historic ship community. These people have been kind enough to provide their informed insights and comments. You may not agree with everything that is said, but you should pay close attention to it. In the long run, it normally works out better (and usually much less expensive) to learn from the experience of others than from your own. Ultimately, however, it is your time, effort, reputation, peace of mind, and money on the line.
You've visited a number of historic ships, or you are really interested in naval history and you are thinking to yourself "Gee, running a historic ship would be neat. This would be fun. We could do this. We want to do this. Why don't we get a historic ship and operate it? How hard could it be?"
The answer to the last question is "Very!!" First and foremost, successfully operating a historic ship - or, indeed, any form of public historical venue - is extremely difficult work. There are many things that have to be done in order to have a successful historic ship operation. In the final analysis, what you are getting into is the difficult process of obtaining, promoting, and operating a public attraction. It may eventually be successful, profitable, well-attended, spiritual, and even fun. But at first it will be horrific, expensive, dreary, complicated, and about as far from a feel-good experience as you can imagine. Good corporate sense makes for a good display ship operation; bad corporate sense... - you know the rest. You don't have to be a money-grubbing jerk, but you can't run a historic ship like a backyard party and have it work. If you or your associates can't handle or are unwilling to run a business - and running a historic ship operation is a business, make no mistake - you had better go do something else. Obtaining and operating a historic ship is not for you. And ask yourself why you want to do it. Be honest with yourself. Your true answer will to a great extent determine whether you succeed or not, regardless of how you may try to disguise it. Decide now if you are in it for the long haul. Year after year, day after day. Realize you will be working on it continuously. The grind never stops.
If, after reading the preceding paragraphs, you are still determined to obtain and operate a historic ship, here are some factors you need to consider:
I. START WITH THE BASIC RESEARCHFirst on your agenda, you should go to the web site for the Ship Donation Office of the Naval Sea Systems Command at http://www.navsea.navy.mil/teamships/Inactiveships/default.aspx and carefully peruse the site, especially the portion discussing how to acquire a ship through the Navy. You do not have to acquire your historic ship from the United States Navy. There are other sources, domestic and foreign. Increasingly, US organizations are going overseas and acquiring display ships from foreign governments. Some potential display ship organizations appear to think that the Navy's standards and requirements are excessive. There are reasons for these requirements, however. The most obvious one is Navy self-interest. In the final analysis, even though nearly all of the display ships donated by the US Navy are run by non-federal organizations, the Navy is ultimately responsible for them and has a problem if a display ship is not properly operated. Care in selection of an appropriate custodian for a display ship is a reasonable basic precaution on the Navy's part to prevent problems in the long term. Comparison of ship submissions against specific standards also helps the Navy in determining which organization is best qualified to run a specific ship should there be more than one request for it. Beyond this, the Navy's standards outline reasonable steps which any potential display ship organization should take in order to ensure the proper operation of a display ship. Those who ignore or try to bypass these standards do so at their own peril and can cause serious problems for others as well. The misadventures of ex-USS CABOT (outside of the US Navy's jurisdiction) in the late 1990's is a most illustrative cautionary tale of the value of these standards and what can happen if they are not followed. If your organization is not willing to follow the standards which the Navy has set forward for the display ships it provides, you had best seriously reconsider your desire to obtain a historic ship.
Also go to the Historic Naval Ships Association (HNSA) website at http://www.hnsa.org and find out about how to join this organization. Membership in HNSA is absolutely critical for anyone or any organization thinking of acquiring a display ship. As a result of years of experience, the collective membership of this organization between them know, in great and excruciating detail, all the ins and outs of the business. There is no better resource for the information you must have if you are considering acquiring and operating a display ship.
II. WAIT BEFORE YOU LEAPYou have gone to see historic ships; you have seen, but have you observed and analyzed, and for how long? Have you worked on one of them in any capacity? Before you obtain a historic ship, it is advisable to wait a year or two or three and spend the time and money to visit as many historic ships and HNSA annual conferences as possible--not for fun (although it is), but to observe and learn how things are done, or should not be not done, as the case might be. Concentrate on visiting target historic ships you feel fit the parameters of what you plan to do. Don't be afraid to ask hard questions. It might later make the difference between success and failure. It is also recommended that you and your partners talk to people who have worked at historic ships - a ship manager, a curator, maintenance personnel, volunteers - to get a good idea of what is involved. Educate yourself and be prepared to perform every function aboard a historic ship yourself; from start to finish and in any capacity. Delegating to your staff is common sense and necessary. But if you don't understand a function, you won't know if it is being done properly or how to teach someone else to take on the task. Before you become management, it is well to know what it is like on the other side of the fence.
III. CHECK YOUR DEMOGRAPHICSBefore you develop your vision, before your business plan, before you apply for a ship, you must make sure that "if you build it, they will come". You have to know with a reasonable degree of certainty that you will have enough customers to (literally) keep your ship afloat. Also, knowing the number of customers you can reasonably expect to attract, and the amount of money they may reasonably be expected to bring to your operation, makes a huge difference when you are deciding what kind of ship you can afford to operate. Be certain that the local demographics will support your historic ship. Most states, regions of states and large municipalities have a department which has demographic information available as part of its goal of enticing new business and tourists into the locality. If the demographics aren't there, neither will your ship be before too long.
Where and when are potential competitors? While there is a dedicated core group of patrons who regularly make as many trips as they can to historic ships, it is a relatively small number. Most people are either first timers or visit no more than once or twice a year. Starting a new historic ship too close to a viable historic ship is generally a fatal mistake. If you do it, you had better confirm that the local demographics will support it.
Part of the demographics issue is the site. In the historic ship community, as in real estate, it is all about "location, location, location". Your site needs to be readily accessible to the public, or they will not come, no matter what the demographic studies on the community say.
IV. VISIONWhat is your vision for your historic ship - one, five, ten years down the road? Where are you going to start? In what direction do you want to go? If you don't have a clear vision of where you are headed, your chances of obtaining and having a viable historic ship are significantly reduced. Some factors to consider.
What is the actual scope of the historic ship going to be? Is it going to be limited to the actual history of the particular ship or are you going to deal as well with other historical subject matter? What time period of the ship's history can you and will you restore it to? Are you going to have a museum operation associated with it? If you fail to make a decision, it will muddy the waters and make it difficult in the short run to acquire the ship and in the long run to operate it effectively.
What size operation do you want to have? How do you plan to get there? In this arena, the critical factor is to determine what size ship you can handle with the resources available to you. There is no one good answer. It depends on your situation and how much risk you are willing to take. However, you have to be realistic in developing this vision. A bigger operation/larger ship requires more money to start and operate. If you can't realistically expect this level of funding, best to scale down your vision before you start the campaign to acquire the ship. Punctured expectations do not a happy community make, and a community which is not happy can make your display ship experience unpleasant and/or impossible.
V. BUSINESS, FINANCE AND OPERATIONSBefore you even consider starting the process to obtain a display ship, you need to have a business plan and look into all the factors that go into developing this plan. To acquire a display ship and keep it going, it all comes down to money and management. How much money do you need to start the display ship operation, and where is it going to come from? Can you bring in enough money to keep the display ship solvent? How are you going to manage the ship so that you can do so? If the operation doesn't pay for itself in a reasonable amount of time or if it ceases to become a moneymaker and starts to lose money consistently, it will go away, sooner or later. Someone on your founding group (preferably, several someones) should have a firm grounding in professional business practices and personnel management. All of you should at least be acquainted with the basics. You can find out how to get acquainted simply by contacting a local college or university with a good business school and ask for advice. There are a number of major considerations you have to look at and consider in detail before you go after a display ship. They include, but are not limited, to the following:
A. Maintenance. You must carefully and thoroughly examine the maintenance issue. In the long run, maintenance is one of your biggest expenses and one of the most necessary things that must be done to ensure your ship's long-term survival. You have to plan for regular maintenance and care of the ship, to include periodic drydocking. Indeed, the maintenance issue should be one of the major determining factors in the type and size of ship you want to acquire. First, of course, there is the amount of money needed for maintenance. Maintenance costs money - BIG money. And, remember, the larger the ship, the more maintenance money needed. What can your organization afford? But there is also another maintenance consideration you must look at - your site. You need to consider your site carefully so that your ship can periodically be removed for drydocking. Looking at this from another angle, your available site may be a major determining factor as to what size ship you can have; conversely, the size of the ship you have may be a major determining factor as to what site you choose.
B. Staffing. You can't have a historic ship without staff to run it, staff to do the work. You should do much of this planning ahead of time, if for no other reason than to allow you to develop a reasonable estimate of your potential expenses. Some of the major issues include:
Management: What is your on-site and daily management team going to look like? What kind of efficient "mix" do you need to ensure that both the historic and business angles are all taken care of? Who has what authority and what responsibility?--CRITICAL--you HAVE to define this clearly or you risk serious and frequent management problems. How do you handle conflicts between members of the management team? Yes, it will happen, even in the best of operations. Remember four basic rules that your management must follow:
Volunteers vs. Paid Staff: This is an issue you and your management team have to face early and head-on. Experience in various profit-making and non-profit venues suggests that you cannot operate successfully over the long term solely with volunteers. Most historic ships have a mix of both. The degree to which you used volunteer and paid staff depends on a number of factors, to include:
Volunteers: All historic ships have some volunteers. Once you have determined where you are going to use them, you have to manage them intelligently. You should have a volunteer coordinator to manage your volunteer program. How do you manage volunteers? To find out more about this, it is recommended that you contact nearby large museums/other historic ships/other large non-profits to find out how they do it. There is also considerable literature on this subject, some of which can be obtained from the American Association of Museums, 1575 Eye Street, NW, Suite 400, Washington, DC 20005, E-Mail: [email protected] One thing you have to remember: Volunteers are NOT free, contrary to popular opinion. It takes time and resources to manage them effectively and to retain them.
Paid Staff. You must some paid staff. Handling this issue properly is one of your most critical management tasks, because, if for no other reason, at most historic ships this is a major expense. How many paid staff do you need; how many do you need to pay directly, how many do you get on contract? One difficult issue is determining what type of person is the most cost-efficient choice to perform a particular function. As an example, some public venues have found it more efficient to hire fewer, older, better-paid people to work the grounds (i.e., garbage and janitorial staff) than hiring twice the number of younger, less expensive workers. There are no hard and fast rules about hiring paid staff; it depends on your circumstances. Just remember, this is not a simple process.
Staff Training. How are you going to train your staff? Long-term? Short-Term? How are you going to ensure that your staff knows what to do, how to do it, and when to do it?
C. Other Considerations
Food Services: Who prepares it? Are you going to contract out all the food operations? If so, to whom? If you are going to establish your own kitchens, will that be a separate company or simply part of your primary corporation/partnership? Insurance? Or, are you going to have food service at all?
Publicity. What are you going to do to publicize your historic ship? Do you pay a professional ad agency or hire local college students majoring in marketing to design your ad campaign? Television, print, radio, Web site, billboards? Who and where is your target market? Again, do you know the demographics? The best return on advertising investment is achieved through what sort of marketing strategy? Make sure you have someone truly competent to monitor this function. If people don't know about the ship, they won't come.
Security. Is Security contracted out or hired in-house? If contracted, does your insurance cover claims against the contract personnel? If you hire your own, what are your standards, who does the training, and how many do you need? How are they attired? Give careful consideration to this last, because when Security is needed, they are needed NOW!!!. They must be clearly visible to even the most unobservant patron.
Medical. You have to have personnel readily available to handle medical emergencies. Local paramedics on volunteer duty for a free admission? Paid staff? Contracted? What about major medical emergencies that require IMMEDIATE intervention and rapid removal of the victim to the hospital? Do you have the means to land a medical evacuation helicopter in the immediate area? Can you quickly and easily get an ambulance into the grounds to a victim? What about medical insurance and training for your staff to ensure that they know what to do in case of a medical emergency?
Curatorial functions. Historical interpretation of your ship will require that your organization acquire and manage artifacts, memorabilia and art to be used in this process. Additionally, once you are set up and running, your visitors and your community will want to donate historical materials to you. To avoid serious potential problems, you have to know how you want to professionally handle this material before the ship operation opens. This is extremely important. It is one of the factors evaluated during the ship acquisition process, and management of artifacts, memorabilia and art must be satisfactorily addressed in your application if your organization is to acquire a ship from the US Navy. Once the ship is acquired, submission of a collections management plan to the (US) Naval History and Heritage Command is required if your ship organization wishes to borrow artifacts from the US Navy.
D. Business Plan Development:Once you have looked at all the factors listed above and after you have developed your vision of what the display ship should be and how it should develop, but before you take any action to actually get it on its way, have your business plan in place. Some considerations:
Is this a partnership or corporation? What type?
What are the managerial and/or fiduciary responsibilities of the "founding fathers" with regard to your historic ship?
Do you have people on your management team capable of properly running a business of the size you envision? Do you have a good lawyer available to you? A good accountant? A good office manager? Adequate clerical help? If not, get them soonest.
What is your financial plan? Can you document clearly and accurately the premises on which the plan is based?
Have you thoroughly researched local, state, and federal ordinances and laws that might affect how you set up and run your operation? You had better have a clear plan for complying with these rules and a very educated estimate of what it will cost to do so.
Don't forget insurance. This is something that financial backers look at very closely when deciding to support a corporate event; without it, you are dead meat.
Once you have set up a coherent entity and have a solid business plan, you can start to talk to property owners, governmental institutions, and lending agencies and take the steps necessary to start work to acquire your historic ship. Most of these organizations won't work with you if you don't have a cohesive, established entity with a clear business plan.
After the historic ship is a going concern, you have to continue to pay careful attention to how well it is run and how it is doing financially. It can't be left to run itself. Scrimping on business management expenses is a sure way to destroy a historic ship. You have to continue to revise your business and financial plans on a frequent basis. Make sure you have contingency plans, and contingency people in case something happens to key management/financial people. This is another case where you need to have someone on your management team who understands basic business practices and, in particular, how to plan for business success. Plan for this need when drawing up your business plan.
VI. CONCLUSIONObtaining a historic ship involves a major investment of time and effort on the part of you and your organization. It is neither simple nor painless. It can and has been done successfully, but it requires a huge amount of work to implement it. Only careful planning and attention to detail will ensure your success, the attainment of your dream.