Stacking the Deck

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Onboarding the digital future whilst maintaining a firm grip on today’s business is one of the great challenges for every company, but the right partner can make the balance less of a gamble, says Jens Lorens-Poulsen.

As Lao Tzu said, the journey of a thousand miles begins with one step. The digital future of shipping will not be something an individual shipping company can simply buy, like a scrubber or a ballast treatment plant. Nor is it something the company can build and expect the entire industry to embrace.
Given the noise about digitalization, companies understandably feel it might be risky to sit on the fence and wait to see what everybody else is buying. And it does not help that there are plenty of vendors with new platforms and well-meaning consultants at the door.

Bizarrely, most projects reach their “pinnacle” at the delivery stage when the seller or consultant gets paid. Not when the project begins to deliver real value – i.e., when it is in production.
Feeding an organization with new digital tools is a production exercise as much as it is a project. Thus, it needs to happen alongside—and be meshed together with—the day-to-day business of charterers, brokers, vessel operators, masters and port agents.

At Marcura, we have the privilege of processing close to 180,000 port calls annually for our customers in the tramp sector. Typically, however, the transactions exchanged between 10,000 port agencies and 300 shipping companies are—no surprise—not standardized and therefore not ready to feed to a scientific team for “Big Data treatment”. The transactions are produced manually or by a wild mix of systems. There are no agreed standards for coding, contract terms or tariffs.

To make matters worse, the ship owner on the one side and the agent on the other side each have their home-grown data universes, and no time, incentive or method to align them.

As a result we realised more than five years ago that we could not wait for these stakeholders to adopt a uniform, digital approach to do business. We also foresaw that our customers would begin to expect benchmarks, advanced management information, and even inclusion of AIS and other “Big Data promises” in our services.

We were then faced with a tough choice that mirrors the situation in every shipping company today. Either we had to get our 600-plus good people to totally change how they work and move from being brilliant controllers and accountants to become digital experts and start capturing a lot more data than necessary for the job at hand. Or, we would have to invest in building digital capabilities and processes in a separate organization.

It was clear that starting on a digital journey would be a steep learning curve. This meant making mistakes and making a lot of them. But there was no way we would expose our highly efficient delivery system and our customers to frequent failures. That would break confidence internally and externally.

So we had to bite the bullet and invest time and resources in building a credible “digital twin” to the voyage management universe we were running in our current services.

Thus began the process of building a team of analysts, data engineers, automation experts and even natural language experts. We tasked them to develop a universal Maritime Master Data set of reference databases. And we tasked them to design systems and processes that allow a dedicated team of analysts to convert any incoming analog transaction to digital form, at high quality and with proper, detailed and universal coding.

In this way, we could begin to develop cost and time benchmarks at a level of granularity that is only possible if you have a lot of transactions.

The notion of a benchmark is key to just about anything you want to do. Knowing the benchmark for a port call’s detailed cost or times will feed you the needed gap analysis to your own performance.

If it is not detailed, it will not provide actionable information to the practical people in chartering and operations who are dealing with real vessels and real terminals.

A typical tramp company with 50 vessels may have 1,500 port calls a year. 80 per cent of these calls will be in their top 20 ports. Hence they may have reasonable statistics for themselves in 20 ports, but for the remaining, say, 100 ports, there is no way to report anything statistically. And forget about benchmarks to compare how the “industry” is performing in the same combination of vessel, terminal and commodity because that takes much larger volumes.

We had to bite the bullet and invest time and resources in building a credible ‘digital twin’ to the voyage management universe we were running in our current services.

This is where the Marcura Maritime Tramp Benchmarks come into play. By running our conventional operation in parallel to our Master Data driven digital operation, we are now at a point where we are transforming our operations into a much more efficient and detailed set of processes. And we can provide our 300 customers with highly enriched and detailed decision support.

More importantly, due to our operational roots, we understand what it takes for a busy charterer or operator to include a new platform or a new tool in their work day. It is not easy. It is a lot easier to carry on the same way you did yesterday.

We could not have survived and grown as a platform-enabled service provider without strong user on-boarding and continuous user support and attention. This experience now benefits our customers as we journey alongside them into a digital universe.

Fortunately for our customers, we are now ready with software tools and detailed data that have been co-created with a good number of our customers. We know the tools make sense in the hands of the average tramp charterer and vessel operator. We have already made and learnt from many of the boring and costly mistakes.

The key for our customers is now to take that next step into a more digital future. With us by their side, this step can be a lot safer and will likely deliver tangible results that are so essential to any change project.

We are inspired and driven by Dr Kotter’s 8-step change model. Many of the companies we see begin with step 8: Experts are hired; systems and data are purchased; a “laboratory” or “Digital Team” is announced. This is akin to buying the future in a box.

However, these initiatives do risk running out of steam when the money runs out and the consultants and software suppliers have delivered. And more often than not, the operation stays very much the same, with underutilised tools and old habits still ruling.

One question I like to ask Management is ‘If you can’t make your entire organization use just ONE new piece of information than it is used to, how are you ever going to get to Big Data?’

Another is, ‘Has Management decided and communicated that they will now be measured on one, new KPI that depends on proper use of digital tools?’

We have seen early adopters of our digital services focusing on very simple, but new KPIs such as “Time for Gangway Down”. Or insisting on chartering desks using readily available information about port and terminal times in their voyage estimates. Surprisingly, many chartering desks have not had the privilege of getting real, trustworthy turnaround data, so they have resorted to default time estimates, even if every voyage result analysis shows that they are off by some 50 per cent or more.

Getting these busy frontline workers in the industry onboarded to a digital future takes top-to-bottom commitment to do at least one meaningful and digital thing together. And, I will add, have a partner that has invested in creating solid and actionable information services and application tools that make practical sense to the frontline—a partner that has the resources and decade-long experience in onboarding your employees into the digital future.

Did I forget to use the word “disruption”? Did I forget to bemoan how traditional and conservative the industry is? Well, that is because we don’t need disruption. We need time, resources and patience to take those initial steps so we can learn that they are meaningful, and get a healthy appetite for more steps.

And then, one fine day we will find ourselves in Big Data’s ‘Promised Land’, and will think nothing of it.

 

Images courtesy © Getty Images

This article appeared in the Q4 2017 issue of Futurenautics.

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