Shipping, people, technology (in that order)

October 24, 2017

Shipping tech

How important are people to the future of shipping? To judge by the slick graphics and big promises of the technology companies, we will soon be at a point where they are, if still needed, then only in very reduced numbers. In reality, most people realise that humans will be more, not less important to shipping’s digital future because the skills needed will be higher and the tasks different to what went before.

It was with this in mind that class society ABS convened a panel during London International Shipping Week to discuss the changes taking place both at corporate and academic levels. In setting the tone for much of what followed, it attempted to address a fundamental question – do we recognise this technology wave and if so, how must we prepare?

For the shipowners, John Michael Radziwill, Chairman & CEO, GoodBulk, Chairman & CEO C-Transport Maritime was joined by Mark Cameron, EVP and COO, Ardmore Shipping. Academia was represented by Professor Marianne W Lewis, Dean of Cass Business School, City University London, and Julie Lithgow, Director, Institute of Chartered Shipbrokers, with Kirsi Tikka, EVP, Global Marine, ABS acting as moderator.

So did the owners perceive a radical change taking place in the workforce, what were the biggest changes they identified? For Radziwill, an owner is still going to still need “the nuts and bolts guys, but they are going to have to understand data processing because we are living in a whole new world. They will have to understand how a ship works and how to process the data. What that means is less people in the workplace but much more efficient data processing.”

Commercially he said, the change has already begun to take effect, with new realtime platforms emerging for commodity shipping and a feeling that brokers must bring a lot more value than in the past. “It can’t just bring bid or offer, whether put together on screen or not you need to leverage relationships.”

Mark Cameron’s concern was that technology change risks dumbing down the seafarer’s job and not allowing the use of human intelligence to drive decision-making. “Our captains spend a huge amount of time sending crew lists, vaccination certificates every piece of paper you can think of to a port agent, that are nothing to do with intelligence but are required to trade. We are thinking on one level and operating on another,” he said.

The challenges for those coming ashore is that strategic thinking is not a concept that is easily applied because many crew are used to a ‘look it up in the manual’ approach. “When you are ashore it’s about hypotheticals and situations not previously encountered and that’s where critical thinking skills are lacking,” he added.

In terms of how a digital industry impacts business education, Prof Lewis accepted the argument, that the smarter the individual, the smarter the business. “We are encouraging much stronger critical, creative thinking, how do we help people operate in periods of greater uncertainty and ever more information,” she said.

This might mean fewer people but also a clear view on “the information sources they are applying, from macro trends to micro operational and human challenges operating complex systems. As educators we have to be learning faster than the technology changes are happening, with more interaction across groups to help leaders”.

Shipbrokers are the industry group commonly voted most likely to lose out as new technology makes the role of intermediaries less and less relevant but the Chamber’s Julie Lithgow disagreed.

“I don’t think brokers are at risk, I think we might be the last one standing. We’re nothing if not evolutionary. Part of what brokers need is to be generalists, to understand how an El Nino year might affect freight next year and not just to stay in one sector all their career. This new generation is thinking more like that.”

The risk the industry faces, she said, was to make sure that technology is used to empower people and how they work , promote decision-making and remove “the day to day boring stuff so the master or manager can focus on the unexpected and skills can come to the fore”.

Cameron added that the industry has been ‘protectionist’ about bringing seafarers through corporate structures but that is beginning to change. “We need to look at different ways [to recruit] that makes this a sexy industry competing against other industries, we need more pull to be visible.” Not being in the everyday psyche is a challenge and there is “a fair degree of grind. There are a lot of millennials looking for gratification and praise and we’re not geared up for reward. Maybe that needs to change.”

For Radziwill the desirability or otherwise of the industry is also a function of the market; under the radar in the bad times, a good choice in the upturn. Between 2002 and 2004 a lot more people were asking him how they could get into the business but that went away in 2009. “We still have intelligent people and they like the global business and interpersonal parts. You need friends in the industry to do business and it’s coming back, I just wrote a recommendation for a candidate to move from money broker to shipbroker.”

This exceptionalism under which shipping has long laboured has tended to logjam the debate and the opportunity to attract better people but Prof Lewis confessed herself frustrated. “We have to move beyond the idea that shipping is different, we need to think instead how to blend best practice that sets long term stories against the current trends. It’s a combination of realtime knowledge and living case studies where we bring people in to help our students build skills for critical thinking and apply theory and practice.”

But is technology really transforming the industry and if so, are we getting what we need from the process? Julie Lithgow, who admitted she joined shipping ‘to be part of an industry that runs the world’ is doubtful that the old order will be completely washed away.

“I don’t buy into the Chrono centric idea that societal change has never moved faster, that technology has never been more interesting or dangerous than now, because when the telegraph was invented, people thought it would be the end of nation states because you could communicate without governments. We have only had 70 years of containers, so we’re nothing if not adaptable.”

The caution should be around how as an industry, we use the opportunity of new technology and how humans thrive and survive in this context. For Lithgow, it is not enough to say that shipping shares some technology only with NASA and sell on those benefits. “Shipping is already very good and cherry-picking the bits that work for us. Perhaps we should be thinking what technology works for shipping and who are the people best placed to use that, not other way around.”