November 7, 2017
When the founders of Facebook coined the motto ‘move fast and break things’ they probably didn’t have the shipping industry in mind. As those that work in it know, few people have the shipping industry in mind unless there is an oil spill or they take a ferry.
So it is strange that an industry that has largely contented itself by keeping its head down and profitably supporting global trade since the second world war should find itself drawing so much attention from purveyors of digital disruption.
Could it be that the new generation of tech giants have reached the edges of the digital frontier and sitting around a virtual boardroom table said, ‘OK it’s time to take on shipping’? Doubtful.
The problem with this strategy, should it actually exist, is that shipping is in many ways quite happy being inefficient. Money is made from the opacity of information flows, from relationships that are not subject to much competition and very often, on the basis that while quality is the goal, price will be the final determinant.
Yet things are changing. The unpredictable impact of goal-based, aspirational regulations as well as the uncertain dynamics of the oil price are making operators realise that doing things the same in the future will not pay as well as it did in the past.
Even so, however much the trends in consumer technology find their way into our business lives, many shipowners and operators are struggling to get to grips with how technology can really benefit their operations.
The reasons for this are pretty obvious. Like the gap between consumer tech and systems engineering, the opportunity for digital disruption to take hold across a shipping company from CEO to seafarer might be vast but fails to take into account that the maritime environment is nothing like an office suite in Silicon Valley or the top deck of a bus.
This has not stopped a handful of visionaries pointing out all the things that are wrong with shipping companies and why start-ups will eat them alive because they can deploy the tools that the industry does not or will not wield. This may, ultimately, prove to be correct but for the most part it bears much closer examination.
It is said that the reason the dotcom boom failed to have a lasting impact on shipping was due more to a lack of bandwidth than a dearth of innovation. This is broadly true, though the majority of innovations of the early 2000s were also business-focussed rather than operational, which suggests that the very few to survive had a good idea rather than a desire to use technology for its own sake.
In what are told is an era of abundant satellite bandwidth there should be an opportunity to digitalise vessel operations and presumably to make quantum improvements in efficiency and safety while simultaneously lowering costs.
This overlooks the fact that shipping technology, that is the hardware rather than the software, shows a stubborn resistance to change except by increments. At a presentation about the future of shipping some years ago, the audience was treated to slides on hydrophobic coatings, buckypaper lightweight steel replacements and ingestible human monitors; none of which have been seen again since.
The far bigger problem is the lack of alternatives to the diesel engine for its ability to move ship, commodities and consumer goods reliably around the world in pretty much all weather conditions. Yes there are options but of these, LNG is a transition fuel, methanol has energy challenges and hydrogen is years away from commercially acceptable application. As for wind, well, let’s see.
On the bridge things are little better. The current spate of malware attacks has shown how much shipboard IT infrastructure is either outdated or unprotected with negative consequences for operations, safety and compliance.
Where new technology exists, in the ECDIS or Integrated Bridge System, it is too often seen as the brains of the ship when it should be part of an integrated system of apps and data. So much is made of the need for better, smarter and faster data that it seems incredible to think that operators are still being told that daily replication of information is the best they can hope for.
In this sense, the game has moved on and will continue to move and fast. Arguing about whether satellite bandwidth will ever be cheap enough fails to address the issue that it can deliver value if used on the right applications.
Operators are starting to realise that as the cost of cloud computing falls and the power of ship management systems continues to increase that there are dozens of shipboard procedures and activities that can benefit from closer co-operation between ship and shore or greater automation to generate more reliable data.
Using an ecosystem of applications that can manage enough tasks to release seafarers to spend more time on the voyage itself is an argument it is hard to counter. Yes, these systems and applications need to be reliable enough to function in the maritime environment but identifying the need is not a barrier to adoption.
Shipping’s problem with technology still largely reflects the inability to separate the glitter ball of consumer tech from the grimy reality of industrial shipping. But owners don’t have to believe the proposition that everything they know is wrong any more than they should think that platform-based hyper-collaboration is right for them. The answer, as always lies somewhere in between, which also puts it within reach.