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April 24, 2019

Ειδήσεις, Voyager Blogs

No industry for old men

The first step in making a change is acknowledging the need for change and by that marker, the maritime industry should by now be well along with the process of digital transformation. To judge by the attention lavished on digitalisation at Sea-Asia, the topic ranks ahead of regulation and profitability in the minds of owners.

That appears to put the cart before the horse, but rightly or wrongly, technology is being touted as the means to comply with the former and as a key to unlock the latter. The Maritime CEO Forum was uniquely able to give the topic its due place in the pecking order, bringing together a tech accelerator, a leading shipmanager, an autonomous ship platform and the industry’s leading communications provider for a discussion that ranged widely.

Ultimately, digital progress is probably still not fast enough and is hampered by familiar issues; the scale of the challenge, a lack of collaboration and a fragmented vendor-driven approach to name but three. But there is reason to be positive and still plenty of opportunity for the ambitious, if not the brave.

And as an aside, the previous week’s CMA Shipping had seen numerous well-funded technology bucks describe their transition from start-ups to industry players – though the problems they were tackling sounded very familiar.

So how does shipping get from digital dreaming to reality – and is it even necessary for all players? Wallem CEO Frank Coles has run technology-focussed businesses and is no doubt that the problem is not scarcity but abundance.

“The industry does need to change but it starts in the office not on the ship, with leadership. There is not enough culture around modernising and using technology as an enabler,” he said. “What we have is a lot of people talking fragmented and unconnected apps and tools and they are presenting to people who are very confused and very scared because they don’t understand how to use them. None of it is connected and we’re not collaborating.”

Päivi Haikkola is Ecosystem Lead at One Sea, a platform that drives OEM collaboration with the aim of developing autonomous vessel technology and has found that the desire for collaboration requires more than just open APIs. “I have to admit we have found it is not as easy as it sounds, there are so many internal systems and everyone is afraid their IP will disappear if they open them up.”

The feeling that we are still at the start of the digital journey was reinforced by Inmarsat Maritime President Ronald Spithout who was shocked by the company’s research into IoT which found that 51% of respondents had ‘no clue’ how to get real time information off their vessels.

“What we have so far is owners using apps for cost saving; that’s the lowest level of digitalisation of the industry as a whole. Only the most sophisticated shipmanagers are getting to the next level,” he said. “The capacity of most organisations [in the digital sphere] is still not there at all, with enormous fragmentation in standards and platforms.”

Incredibly innovative in cargo transport, it seems shipping’s engagement with digital so far is about saving nickels and dimes rather than having a wider vision. Spithout agreed there are far too many solutions and hopes to see a de facto platform where apps and data can be interchanged in a standardised way.

“The problem is that it’s disruption and not innovation,” added Coles. “We’re looking for change but it’s really hard to get there. Companies are still using 15-20 different applications in an office when we should be driving towards the least amount of paper as possible. We’re talking autonomy and pushing paper; there’s something wrong with the narrative.”

Dhritiman Hui, who brings high level shipping experience to EPS MaritimeTech Accelerator Powered by Techstars, says that part of the problem is sectoral. “For young and tech savvy entrepreneurs, shipping is not something you look at. It hums along in the background and not enough technologists have tried to do anything,” he said. Exceptions include ‘poster boy’ Flexport whose valuation exceeds that of Inmarsat and Hui believes the situation “is going to change exponentially over the next 10 years or so. Owners will have to stay ahead of that curve.”

But is the start-up model the right one since it tends to focus on discrete problems in a model designed for a short term payback rather than a long term solution. Hui pointed out that unlike in fintech or ride sharing, where a young entrepreneur can run a limited experiment with tens of thousands of users, “in shipping you are talking about innovating around a massive vessel with all the risks attached. It’s much harder for an outsider to come in and experiment.” Instead he advocated teaming up with an incumbent as this gave owners and managers the opportunity to get in on the disruption rather than be disrupted.

Haikkola agreed and said the size of the innovation challenge meant that the sums investors could put in and the relative scale start-up companies were far from sufficient. “We realised early on that to back a 10 person start-up on technology that has to last for 20 years is a disaster. When we talk about start-ups what we mean is start-ups like IBM, companies that are not in maritime or autonomy.”

The lack of collaboration also means there is very little of the standardisation that is needed, if the industry is to adopt more than the entry level technology. She admitted that even with big OEMs onboard, the task was ‘overwhelming’ not because they wouldn’t share data and information but because the challenges had to be broken out and addressed piece by piece.

Perhaps the reality is that the industry needs another shakeout of personnel in order to drive transformation – and a round of retirements. Hui disagreed, noting that his peers and colleagues all want technology, innovation, simplification and cost savings but that new opportunities would come only by having more success stories to share.

Having just celebrated a significant birthday himself, Coles agreed that too many companies were staffed by managers thinking in terms of 20 years ago and Spithout advocated for a blend of youth and experience.

For her part, Haikkola pointed out that more creative thinking would result from greater gender diversity, though she noted ‘Elon Musk is a middle aged white man’. So perhaps there’s hope for shipping after all.

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