The Futurenauts: Warwick Norman

spread_futurenaut_warwickAs part of our mission to chart shipping and maritime’s technology-enabled future, we’re profiling some of the people shaping that future.

Warwick Norman has been CEO of RightShip since its inception in 2001. Under his stewardship, the company has become a global authority on maritime safety, helping shippers, terminals and ports, ship owners and managers and maritime finance organisations to minimise their maritime and environmental risk.

Prior to joining RightShip, Warwick was the Marine Standards Manager at BHP Billiton where he was responsible for ensuring the company adhered to national and international standards for Quality Assurance, International Safety Management and Safety and Environmental Protection.

Warwick began his seagoing career with ASP Ship Management, sailing from cadet to the rank of Master, and advancing to become Ship Manager and Marine Superintendent for the fleet of tankers managed by Shell, BP, Mobil and Esso.

He is currently Chairman of both AUSMEPA and INTERMEPA, and has been a member of Lloyd’s Register Asia Advisory Committee since 2007.

Warwick was named an ‘Australian Export Hero’ in 2014 for his outstanding contribution to Australia on the international stage.

K D Adamson posed him a set of characteristically impertinent questions, and fortunately he was gracious enough to answer them. Here’s what he told us.

Futurenautics: You were CEO of RightShip from day one ‐ what drove its creation then and how has its core mission developed since?

Warwick Norman: In 1992 the Parliament of Australia’s House of Representatives Inquiry into Ship Safety, ‘Ships of Shame’, drove BHP Billiton & Rio Tinto (later joined by Cargill) to establish RightShip; and in so doing improve the safety standards of the vessels and crew they were using to transport their cargo.

RightShip’s focus has always been on delivering insight into vessel selection. Since establishment in 2001 we have continually developed the vetting system as new data has become available.

In 2011 we added environmental sustainability to our core agenda with introduction of the Greenhouse Gas (GHG) Emissions Rating; and in 2016 we are launching RightShip Qi, which brings big data & predictive analytics into the mainstream for ship vetting.

Having said that, these developments are still true to our initial core mission of providing transparency and insight into vessel selection to minimise the risk faced by our customers.

Futurenautics: RightShip met with well‐publicised hostility in some shipping quarters, as did another innovator, freight‐rate benchmarking company Xeneta. Is the success of RightShip and Xeneta evidence that engaging shipping isn’t the answer, but engaging shipping’s customers is?

Warwick Norman: We’re pretty clear that we need to engage with not just these groups that you mention, but the entire maritime supply chain.
Ship owners are responsible for improving the standards on vessels, and so it has been vital to engage them in the process. We have an inclusive culture at all levels of the business, and working hard to engage all stakeholders has been key to our success.

Futurenautics: SmartShips have become the focus for discussions around data and analytics, we’ve argued that where ‘ship efficiency’—efficient ships—focussed on cost reduction, ‘smart ships’ offer new opportunities to create value. What’s your view?

Warwick Norman: I agree. One of the reasons we created the GHG Rating was to allow owners and customers to have better insight into ship efficiency, creating value for themselves and their own customers. Use of this tool has provided transparency and insight. It not only contributes to a reduction in fuel spend, but enables customers to satisfy their stakeholders’ demands for supply chain transparency and a reduced carbon footprint.

We’ve also been working with some of our terminal customers around vessel data collection, improving insight into vessel fit and enabling greater efficiencies in terminal throughput. The impact on the efficiency of their logistics chain can be significant.

Futurenautics: We’re talking about the development of intelligent transport systems and what we’re calling Blue Logistics as part of the new Industry 4.0. Autonomy is a part of that, but what else does the industry need in order to play its proper role in the new Industry 4.0 supply and value chains?

Warwick Norman: An intelligent transport system will require a greater investment in communications: mainly satellite communication to allow autonomous monitoring of vessels.
However industry regulators need to reassess current regulations before this happens; and it will also need individuals or organisations who are willing to take risks on autonomous vessels to create a model that allows others to see results, and see how they fit in. Transparency in the tracking of vessels is another area that needs industry attention – the establishment of something akin to air traffic control systems.

spread_futurenaut_warwick_01

Futurenautics: Everyone’s talking about Big Data, but most of the attention is paid to technical/engineering data, and not the combination of different datasets. RightShip are at the cutting edge of analytics in the industry—can you give an idea of what you’re doing and how that’s reflected in products like RightShip Qi?

Warwick Norman: We’re in the midst of launching RightShip Qi, so your question is a timely one! Our incumbent vetting platform SVIS is an expert opinion model. RightShip Qi is a predictive, online vetting tool that has enabled us to employ far more sophisticated risk modelling.

RightShip Qi takes a ‘golden record’ of data from over 50 different sources (cleansed in-house by RightShip), and uses predictive analytics modelling to identify vessels that may have an incident in the next 12 months, and therefore remove them from our customers’ supply chain: so indirectly we are reducing the likelihood of a vessel having an accident.

We have multiple data feeds, and prior to implementing Qi we were relying on the quality control systems of these data providers rather than managing this in-house. In some cases, if the data had problems we just had to accept them. Now, rather than accepting problematic data we cleanse it before use.

Under SVIS we also loaded our data in batches which made for many changes all at once, and this could sometimes impact the consistency of our ratings. The real-time application of Qi data results in a smoother, dynamic risk rating model.

To summarise, what we are doing is taking data and turning it into valuable information, and the ultimate outcome is enhanced safety as a result of a superior risk management. We now have a more accurate predictive model for vetting vessels, and this enables our customers to make better-informed decisions within the vetting process.

This doesn’t just provide enhanced financial returns for our customers: the value our analytics provides is in limiting risk, saving lives, and reducing environmental damage.

spread_futurenaut_warwick_003

Futurenautics: The ‘adversarial’ relationship between shipping and its customers is often cited. From where you sit is that a fair assessment? In an industry where asset‐based lending feeds countercyclical investments in tonnage rather than value creation based around customer requirements, is that inevitable?

Warwick Norman: The relationship between shipping and its customers does create additional problems for the maritime industry, but that’s no different to any other industry. What is different is that the asset price for movable items is much higher, and so the risk is greater.

A good example of where tension can arise is in vessel efficiency. Ship owners are not always adequately rewarded for efficiency in terms of charter rates, as the charterer does not always want to pay for more efficient or safer vessel. However as the availability and transparency of information is becoming more prevalent, this is gradually changing.

I’d like to add that I don’t believe the current problems in the industry are the result of adversarial relationships: many factors have combined to cause the current oversupply of tonnage.

Futurenautics: The issue of diversity is rising up the agenda and in other industries has emerged as a competitive differentiator. As a CEO is gender diversity, and the wider cognitive diversity it delivers, important to organisations like yours, and to the industry as a whole? How much of a priority should it be in the maritime sector?

Warwick Norman: I’m a firm believer in the benefits of diversity at all levels, including gender diversity. We can see the benefits of this in our own working environment, which has embraced diversity. Our flexible working arrangements are particularly appreciated by parents (of either gender!). We have a number of part-time employees, and enabling staff to work in remote locations has proven to be very popular.

We find it pays off too – there is very little staff turnover at RightShip, and I believe we have a great culture which rewards both the individual and the organisation.
In terms of gender diversity, we have a large female workforce. Three women form part of our management team, and the roles of Financial Controller and Company Secretary are filled by a female. We believe that the inclusion of women into senior roles gives us a competitive advantage, and I would encourage the industry as a whole to take the same path and see the benefits for themselves.

Futurenautics: As more of shipping’s operations become digital the connectivity and platforms we’re leveraging to drive transparency, collaborate, improve safety and create value are also creating new downside risks which have to be managed. Cyber security is essential for the maritime industry to move safely into its future, and a vessel infected with malware may not qualify as seaworthy. Is that another part of the risk profile that RightShip needs to be evaluating?

Warwick Norman: At present it is not taken into account in our risk rating, although that could change in time. Internally at RightShip we take cyber security very seriously. We were the first (and remain the only) maritime company to successfully achieve ISO / IEC 27001 certification. Referred to as ‘information security risks’, this protects not only our information, but also our customers’ information and requirements from other customers and outside bodies.

In relation to RightShip Qi, that’s allowed us to significantly increase security around, and access to, information contained on the vetting platform.

Futurenautics: RightShip has been instrumental in highlighting and tackling shipping’s CO2 emissions via the GHG Emissions Rating. What’s your view of the results of COP21 and what should happen now?

Warwick Norman: We welcome the COP21 agreement to keep global warming to less than 2 degrees of pre-industrial levels, and agree that the IMO is best positioned to drive CO2 reductions across the maritime industry. To achieve this the IMO needs to show leadership and set aggressive targets; to date it has been industry leading the charge.

Options that could be considered include floating a bunker fuel levy in line with the European ETS – or, better still, having shipping develop their own (capped) ETS, which would also necessitate a mandatory MRV system. Whilst some targets were agreed to at the recent MEPC70, we believe that pressures should be greater given the long lead times currently proposed.

Futurenautics: Which do you think are the most potentially disruptive digital businesses in maritime at the moment; what will be the next major technology disruption in shipping, and who will it most affect?

Warwick Norman: Some of the online broking systems and online chartering platforms have the potential to be disruptive. Other areas with ‘disruption’ potential include marine insurance platforms, run on a model similar to current car and house insurance practises. These changes would mostly affect brokers / middle men.

spread_futurenaut_warwick_002

Futurenautics: The future is being shaped by data and algorithms—which often operate with minimal human oversight. As the algorithms get smarter will human experience and particularly domain expertise be that important in the future? As someone who’s both a Master mariner and the boss of a technology company what’s your view and how does your fairly unique perspective influence it?

Warwick Norman: That’s an interesting question. We’ve seen the use of IBM’s Watson and the general use of artificial intelligence moving ahead in leaps and bounds, so it’s not difficult to see a future where those learning algorithms will make more and more decisions around supply chains without the necessary domain expertise to oversee every decision that’s been made.

So yes, there is certainly a shift as the machine algorithm is getting smarter; and one that we are obviously a part of as we move from an expert opinion model to predictive analytics. However at the moment we still believe that human oversight is necessary, particularly in high risk areas: an algorithm is only as smart as the data that’s fed into it.

Futurenautics: DNV GL’s The Future of Shipping report outlines a scenario where IMO is obsolete by mid‐century, driven by what I call the Bureaucratic Singularity ‐ where the exponential growth of technology outpaces bureaucracy’s ability to regulate it. Is there an opportunity to use the same technology to develop new smart regulatory ecosystems? Does RightShip have a role in that? Would you like it to?

Warwick Norman: Because vetting is not compulsory it’s not covered by legislation. Our customers have already developed a smart ecosystem that combines safety andd efficiency into the one platform. What we see is that industry is moving to more singular platforms rather than working on multiple platforms. We see a future of more data collation, and the creation of singular platforms that encompass industry rules and criteria.

It’s clear that the adoption of open registries is putting pressure on the current IMO model. As with any organisation, the IMO can’t stand rooted to its original constitution; it must continually review its relevance, particularly when industry and regulatory support is undergoing such massive change.

Futurenautics: What would your advice be to anyone with a killer business idea for the maritime industry?

Warwick Norman: Go for it! Seek like-minded and suitably-skilled partners: don’t try and do it by yourself. Test thoroughly before releasing it on to the market. Be passionate about your idea, and believe in yourself.

Futurenautics: What was the last piece of technology—consumer, industrial or professional—which made you say “Wow!”?

Warwick Norman: I recently had the privilege – wearing both my RightShip CEO and AUSMEPA Chairman hats – to present the concept of a shipping emissions portal at the 2016 Australian Google Impact Challenge. We were one of 10 finalists to be awarded AUD $250K to our project, the entry criteria being “using technology to make the world better, faster”.

Within the finalist presentations I saw some killer ideas and technology developments from start-ups to established NFPs, and each one of them made me say “wow!” I was also encouraged to see that of the 10 finalists, three represented the maritime industry.

 

Warwick Norman is CEO of RightShip. Visit them at www.rightship.com

Images courtesy © Getty Images/RightShip

This article appeared in the October 2016 issue of Futurenautics.

ipad_issue13

free of charge as a PDF

 

Author: admin

Share This Post On