Rationale
The logic of the design was simple. If the ship was hit in vital areas (the ammunition and propellant magazines; the propulsion plant; the fire-control and command sections), her survival was in jeopardy. On the other hand, if the ship were hit in non-vital areas (non-explosive stores, crew berthing and rest areas, offices and administrative areas), it would most likely not result in the ship's destruction.
The "all-or-nothing" philosophy of armor design required the rethinking of the ship’s design, her armor system and the integration of the ship’s design architecture with the armor protection system. With this rethinking of design, naval architects had to examine every system and function of a warship, and determine which functions and systems were critical (and in what priority) to the survival and mission accomplishment of the warship. This analysis led to designs in which all vital systems and functions were located in a single area within the hull of the vessel, the armored citadel; within and beneath which the propulsion plant, communications systems, weapons, ammunition stores, and command & control of the ship resided. Everything else resided outside of this armored citadel. When battle stations were called, the whole crew retreated into this area behind armored bulkheads and armored watertight doors, which were sealed so that each compartment within, and the armored citadel as a whole, were virtually immune to enemy action by any but concentrated and direct attack.
The all or nothing system was intended to ensure that battleships could survive against the heaviest armor-piercing shells currently in use, while at the same time being able to carry a powerful armament and retain a useful speed and endurance. This was made possible by dispensing with the large areas of relatively light armor which had been used in previous battleship designs; the weight saved was used to strengthen the armor protecting the "vitals" of the ship. In effect, the scheme accepted vulnerability to medium-caliber and high-explosive shells striking the unarmored sections of the hull, in order to improve resistance against armor-piercing shells without increasing the overall weight of armor. The unarmored parts of the ship would not offer enough resistance to armor-piercing shells to trigger their firing mechanisms (designed to explode after penetrating armor) so the shells would pass through without exploding, while the vital parts could have armor thick enough to resist the heaviest shells.
In the ideal form of the system, all of a battleship's armor would be concentrated to form an armored "citadel" around the ship's magazine spaces: an armored box of uniform thickness designed to defend against the largest enemy guns. Save for the turrets, the ammunition hoists, conning tower and part of its steering gear, nothing in the way of armor protected the remainder of the ship. By stripping away the armor from all other parts of the ship the armor of the citadel could be made thicker.
The armored citadel can be visualized as an open-bottomed rectangular armored raft with sloped sides sitting within the hull of the ship. From this box, shafts known as barbettes would lead upwards to the ship's main gun turrets and conning tower. Through compartmentalization and the redundancy of key systems, any damage done to the ship outside of this armored box would be survivable, and as long as those systems within the box remain intact, the ship could continue to fight. To maximize the thickness of armor available for a given weight it was desirable that the citadel be as small as possible, this being achieved with, for example, triple turrets as well as double and quadruple (quad) gun mounts, the turrets having an all-forward layout.
Read more about this topic: All Or Nothing (armor)