E-trading and e-freight are recurring technological themes for all shipping sectors
With technology a popular and pertinent topic in today’s shipping industry, it was no surprise that there was substantial discussion about this theme at Multimodal 2018, held in Birmingham last week. While the event is more focused on containerised traffic, many of the topics discussed remain relevant to the dry trades.
During a seminar at the event, Chris Lewis, DP World’s UK managing director and chief executive of DP World London Gateway, described the word “digitisation” as “the buzzword … at the moment across the whole industry”. Another technology promoter was Sue Terpilowski, managing director of Image Line Communications and chairman of The Chartered Institute of Logistics and Transport’s (CILT) Ports, Maritime & Waterways Forum, who argued that technology will play a crucial role in logistics in the future.
“Going forward, digitalisation could be something that we really need to think about, not just for Brexit but actually for global trade … E-trading, e-freight — whatever you want to call it — is going to be the way forward,” Ms Terpilowski said. “It’s also going to solve frictionless borders across the globe. So we really are now at the start as an industry to really think about how we can re-look at our processes.”
The CILT forum chair’s belief in the importance of technology for logistics is a view that’s shared by Søren Skou, Maersk’s chief executive. Recalling the crippling NotPetya cyber attack that hit his organisation last year, Mr Skou pointed to the scale of the damage when he spoke at Singapore Maritime Week 2018, held last month: “We had no systems in 120 countries for 80,000 people for two weeks.”
One area in shipping that could really benefit from technological change is workforce management
The Maersk leader also made reference to the lack of assistance currently in place when it comes to the cyber world during his speech. “If your house is on fire, you call the fire brigade,” he noted. “If you are being burgled, you call the police. If you get cyber attacked, there’s no one to call.” However, Mr Skou was positive about the use of technology in shipping during his speech, also noting benefits for both his organisation and the broader shipping sector.
Asked at Multimodal as to whether recent technological developments will have a transformative effect on shipping, James Hookham, deputy chief executive of the Freight Transport Association and a director of the Global Shippers Forum, said: “I think, like most technology, it will have a transformative effect or could have a transformative effect on the costs of operations, which is why you’ll do it, which is why you might have autonomous vessels, because you wouldn’t need a crew. We’re certainly seeing the first emergence of fully-robotic container handling terminals. From the perspective of the shipper, which is where I’m talking from, it’s all just stuff. I suspect for some of the engineering exporters, the automotive sector, they’re probably sitting there saying: ‘Oh great, look at that. Automation’s caught up with the shipping industry at last. We’ve been there for twenty years, so what’s the big deal?’
“But what this is going to do is to keep the costs down, hopefully reduce the costs — the debate, no doubt, will be how much of that the shipper will actually see — but then, it’s not purely a price thing, is it? It is the service level, and if that can be translated into more reliable and shorter handling times in terminals, it can be translated into lower rates — as if they could get much lower — but if shipping lines are investing in that kind of technology and the risks associated with it, there would be some expectation of sharing of those savings.”
However, he pointed to the risks involved in jumping on the bandwagon of untested technology, questioning how the insurance industry will view some of the offerings out there. “So it might be that we want to be careful about any differential insurance arrangements or other pricing arrangements for what would still be seen as novel and possibly even experimental technology. It’s whether you want to be on the leading edge or the bleeding edge, as it’s often described, and I would imagine that that will probably be the view of the shipper: ‘I’m excited, great, but just make sure my goods are going to arrive when you say they are.’”
Hammering it home
One area of shipping that could really benefit from technological change is workforce management. Speaking at Multimodal, Andreas Sjölund, global sales director at workforce management company Quinyx, argued that right now that a revolution of sorts is at play, driven by mobile, big data and automation (as well as millennials and Generation Z in the workplace). Andy McBain, head of product management at technology organisation Zebra Technologies, added that a “connectivity world” is becoming more prevalent, referring to a statistic from research firm Gartner forecasting that 20.4bn connected things will be in use globally by 2020. Mr McBain pointed out that this increasing “connectivity world” prevalence is partly driven by the millennial generation.
“They’re the ones that are influencing and perhaps have always had an exposure to the Internet, have always had a level of connectivity,” he said.
However, it is arguably not the future that one needs to look at, but the present when it comes to technology breaks in shipping. During Mr Sjölund and Mr McBain’s presentation, Mr Sjölund told the audience that today a person picks up their mobile phone 280 times on average in a single day. Those who want to remain competitive in dry bulk shipping will need to get onboard with the latest technological changes pronto.