Standard Bearer

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Collaboration depends upon non-discriminatory, reliable, standardised units of transactions shared by all stakeholders. That’s a Maritime Business Utility, and Jens Lorens-Poulsen has spent the past 15 years building it, and laying the foundations for its digital iteration.

Tramp shipping, across dry bulk, tankers, chemical and project cargo is a notoriously fragmented industry with thousands of players, all working their own, unique business models and processes. The business network that surrounds them—of port agents, brokers, suppliers and cargo customers—also conduct business without any transactional or contractual standards, and each big and small stakeholder carries substantial hidden costs in dealing with all the variations in documents, contracts, settlement, invoices, claims and payments.

At conference after conference, participants, experts and panelists bemoan the industry’s conservatism and unwillingness to change. The industry is not unwilling; it is a very robust and adaptive industry. It is simply not structured right for fast transformation. And nobody can wait for that to change. They ask for collaboration and standards to lower the cost of simply doing business, but the conference ends with no answer to those calls.

The truth is that no single player has either the power or the incentive to carry the cost and burden of developing industry-wide standards. Consultants and software suppliers really want to help, and do help spend the project budgets that one company or another volunteers to spend on progress. But when the budget is spent, these suppliers have to move on to the next project. Just like uttering the word “water” does not make you wet, nor does uttering the word “collaboration” have any magic effect on reality. Collaboration requires a lot of sustained effort by dedicated resources. It also requires that investments are made in different ways and independently of the individual shipping company.

Collaboration means that counterparties and competitors work according to the same, as of yet, unwritten playbook. And that the collaboration is enabled, supported, resourced and policed by a trusted party. Collaboration cannot be disruptive to the way the industry works. The whole notion of offering the industry disruption as a solution to its future is farfetched and probably has far greater appeal to non-shipping investors than to the struggling and capable stakeholders that keep the industry going day-to-day. The industry is working 24/7 and cannot take a disruptive time out to embrace new ways of working together. Whatever the solution, it has to work with the industry on its terms and not against it.

This is where the idea of a Maritime Business Utility comes in. Today big and small firms alike no longer need to run their own furnaces to keep their offices warm and powered, but can safely plug into power grids, communications grids and other utilities. Utilities that do not discriminate or take sides, but just deliver reliable, standardized units of service to anyone who needs them. Metered and paid on usage and with limited or no need to put money down for a powerplant or waterworks. No CAPEX required.

Imagine a Maritime Business Utility offering plug-in services for basic units of transactions that all stakeholders share and that make no difference to the competitive situation. Imagine lowering the cost of simply being in business in the tramp trades by sharing the cost of a large-scale utility with the resources and the mission to streamline transactions and help each stakeholder embrace the internal change required.

The industry is working 24/7 and cannot take a disruptive time out to embrace new ways of working together. Whatever the solution, it has to work with the industry on its terms and not against it.

In fact, this is the real-world story of DA-Desk and The Marcura Group. Since 2001, The Marcura Group and its main utility, DA-Desk, have patiently invested in and evangelized the notion of empowering the knowledge workers of shipping by removing and improving secondary transaction work from their desks. Today, DA-Desk serves more than 300 tramp shipping companies in support of 180,000 port calls handled by 10,000 port agents in every port of the world. 3,000 ship operators and their accountants trust DA-Desk to handle agency vetting, agency nominations, proforma DA control, port call pre-funding and settlement, final DA control and accounting, data integration to any number of Voyage Management Systems and even systematic use of private discount agreements for port services.

Over the years, the strength of the Marcura utility implementation has led to customers requesting the launch of a whole suite of Maritime Utilities based on the same underlying philosophy, like PortsDirect offering pre-negotiated and managed port service procurement with group discounts. It is fair to say that the 300 shipping companies working with DA-Desk have effectively harvested the consolidation synergy that provides the stock argument for an industry consolidation. “Let us share the cost of the internal functions we all need.” However, they’ve been spared the painful consolidation of their identities, hard-won trade strategies and risk profiles and—importantly for their customers too—their brands.

Now, we are facing the age of Big Data, machine intelligence and autonomous ships, representing great opportunities, but also the threat of disruption for those who can’t grasp them. Marcura has pre-empted and pre-invested in the digitalization of our customers’ business processes however, so we’re now ready to offer our customers the advantage of Maritime Digital Utilities. No need for every single company to go through the same, basic work to make sense of external “Big Data” such as the ever present AIS.

But of even more critical importance than access to external Big Data, is the condition of internal ‘local data’ companies hold, and whether it’s fit to make the advanced business intelligence dreams we all share a reality. The synergies realised by our 300 customers as part of the quiet consolidation journey we’ve shared should now mean they are ideally positioned to move ahead of their competitors on their journeys towards digital transformation.

 

 

Images courtesy © Getty Images

This article appeared in the Q3 2017 issue of Futurenautics.

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