If you don’t know what to do, say something

​During the dotcom boom of the early 2000s, it was often said that, faced with a huge tide of technological change, it was arguably better to do something than do nothing and hope for the best.

The creative destruction that followed, with one over-valued venture after another foundering, left many companies wishing they had stayed put rather than gambling on the then still-emerging platform of the internet.

Nearly 20 years later, the same argument is being made, but from much firmer foundations. The new technology revolution – sometimes called business 4.0 – is forcing the shipping industry to consider new ways of working at a pace that is faster, more fundamental more urgent than ever.

With maritime just emerging from a decade of downturn and asset values and earnings on the rise, owners and managers are looking for practical opportunities to embrace the digital economy that can sharpen competitive edge and improve profitability.

Not every new technology will be game-changer for shipping, not every trend is just hype, but being able to choose the tools needed for smarter operations is the challenge that a majority of owners need to address.

The major trends

Despite the emergence of a handful of ‘technology mega-trends’, many owners and managers are only recently adopting the applications that can drive improved productivity and generate the more transparent and accountable operations – and which will put them on the journey to smarter shipping.

Central to these are increased shoreside monitoring and control, whether through machine-to-machine connections of major equipment and systems or with enhanced connectivity to bridge and engine room teams.

Owners are embracing concepts once considered exotic, including CCTV, much higher bandwidth communications and fleet control centres from which they can provide 24-7 support to ships and crews.

Such systems have been available for some years but are beginning to provide the sort of deeper user experience that builds towards smarter operations. Until recently, adoption has been driven primarily by cost saving motivations and have centred on main propulsion and other critical components.

In some cases, fleet managers and superintendents who have sought to embrace big data have found themselves in receipt of more than they can reasonably process and take action on. This has created an opportunity for third party service providers to offer integrated vessel performance solutions – often in partnership with class or OEMs – that can provide optimisation analysis against design and other parameters.

Sailing in new directions

Achieving meaningful vessel performance monitoring relies on three factors; the onboard interaction between vessel and crew, understanding the actual environmental conditions in which the vessel is operating and the customer pressure points on the industry.

The principal pressure point remains access to information for the owner or manager and the ability to share that data in a uniform way with partners and customers, a task that calls for a new approach to data analysis and vessel management.

Shipping companies have practised business intelligence techniques for years but this has tended to be a spreadsheet-driven activity focussed on a handful of key metrics in understanding vessel performance. It is also a process that has tended to come as much out of necessity as design.

When a charterer wants to check whether the owner was in compliance with terms of their charter party based on fuel consumed, or if a shipowner wants to understand whether newbuildings are performing to the contract specification, the data used to be gathered retrospectively if at all.

One reason historically for the lack of a data-driven or real-time monitoring process is the noon report – the standard (though far from standardised) means of providing key data from ship to shore. Often collated manually and produced in different formats for different users, the noon report was ripe for an overhaul and a new life as source of business intelligence.

With shipyards increasingly wiring up newbuildings and equipment manufacturers fitting more and more sensing and monitoring equipment, it has become possible to make the noon report a tool for understanding vessel performance and acting on the data it can provide.

Among the data technologies that are having the greatest impact on shipping are a new generation of weather routing services. Driven by a combination of regulatory and operational demands and pushed along by the growth in satellite bandwidth, operators can now take advantage of high quality, high resolution data on a region by region basis.

For owners and operators, better data and information can feed directly into enhanced fleet and voyage management, whether this is driven by compliance or commercial reasons. Leveraging the cloud to share that data and optimise vessel performance can create the roadmap which leads to smarter shipping.

As a result, there is a tangible growth in interest in use of metocean data for voyage optimisation, from both bigger players with large fleets and smaller ones interested in improving vessel performance.

Another major trend is the increased use of management systems that can combine layers of information to display a complete fleet operation on one dashboard. A superintendent who manages 20-30 vessels can easily integrate weather, tides and currents with other voyage data.

The ability to manage large numbers of ships or even multiple fleets used to be a case of employing as many experienced former mariners as you could find. A decade of cost cutting has done for this strategy, with fewer people running more ships.

For owners embracing fleet management, there are a growing number of platforms that can be used to enhance visibility not just of fleet positions but also regulatory and performance data. Providers have been able to integrate publicly-available position data with information on vessel voyage plan, speed, fuel consumption together with risk and regulated areas on a single screen.

The boom in such systems has depended as much on the ability to use APIs to connect data sources to management platforms as on the ability to collect the data itself. With this standard now a commonplace, operators and managers can take the feeds they need for navigation data, weather, position, security and piracy and regulatory geofencing and see this in real time alongside their vessels’ progress against schedule with key performance indicators.

Adopting fleet management not only allows for a single window into corporate operations but also a means to share data and information with other stakeholders, be that charterer, customer, class, flag or insurer and in real time instead of after the fact.

Communications the enabler

For decades, while shipping was a connected industry, it was a case of think before you dial or click send. Until recently the costs of real time communications have been too high to enable the sort of smart shipping that we hear so much about.

Today, the critical element to all the above technologies and many more beside is not the data, or even the software but the communications platform that enables it. Owners and managers might continue to complain that relative costs are too high, but it should be remembered that in real terms the cost per megabyte of data has never been lower.

Part of the reason for this is the huge addition of capacity to what has traditionally been an undersupplied market. New constellations of high throughput satellite capacity are coming onstream rapidly across the bandwidth spectrum and designed to address the market more accurately than ever before.

It is no longer a case of everyone being obliged to buy the same system from which some will get better value than others. The network operators are finally addressing merchant, cruise, passenger, offshore, fishing and yachting as the distinct markets they have always been.

Communications also works harder than ever before. Hardware solutions from the service providers do not just compress data, they offer built-in services such as email, pre-pay, cyber intrusion prevention, segregated, prioritised networks and much better reporting for fleet managers.

Old, expensive voice lines have been supplanted by voice over IP data channels and the flexibility of data options available from providers reflect the fact that they too are competing hard for the owners’ dollar.

In 2018, shipping finds itself at a confluence of positive trends. An improving supply/demand picture for the most part is mirrored by the availability of new technology that makes it easier to comply with regulation and operate in a more efficient and optimised way.

Certainly challenges remain and some observers continue to believe that shipping will have to contend with large scale disruption to its business and operational models. Whether this proves to be true, there is no reason why operators and managers cannot take steps to make their businesses more efficient and connected.

While to adopt such a strategy requires outlay in terms of time and resources, the alternative business-as-usual scenario creates much bigger risks. Loss of competitive edge cannot always be fixed by cutting costs; retaining it means recognising that customers are looking for greater value from their service providers – shipping included.

By Rashid Baba
a/Chief Commercial Officer

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