Fathom World

Mapping the transformation of shipping and the oceans

Operations & ManagementUncategorised

The need for shipowners to better integrate into supply chains

Shipowners and operators need to move beyond using vessel specific digital solutions and grasp the transformational benefits of cross-transport chain collaboration

EXPERTS are warning that shipping is likely to become more integrated into supply chains, and the old fashioned models of looking at shipping as asset plays, where they are chartered out for hopeful profit but sold ahead of their asset values depreciating too much, may be a more risky strategy in the future.

Digitalisation has changed how value is created and those involved in the industry need to look at their business models to see where this value is, especially as new players, such as Flexport,  make a difference without knowing anything about a ship.

Talking at a Swedish Shipowners Association’s annual gathering this week, Christopher Rex, Head of Innovation and Research at Danish Ship Finance reiterated his thoughts on the likely continued transformation of shipping. His warning is that  ship operators need to find value beyond their current operating model, and to do that there needs to be able to look beyond the direct customer.

Rex says digitalisation in the maritime sector is still focused heavily on individual ships, such as performance measurement to reduce a single vessel’s power consumption and CO2 emissions. The next step is the need to think more holistically and optimise the use of the vessel, namely how it fits into a total supply or transport chain and can lead to increased competitive edge. Using performance measurement, something nearly every company does, is no longer enough to give a competitive edge, he said.

Christopher Rex, Danish Ship Finance: “Shipping needs to unlock the value in data”

He pointed to port to port optimisation and while this is being done already, the need is to move value across the whole supply chain.

One organisation is pushing the industry to move a step further in the right direction; the recently formed International Port CDM Council.

It is ramping up efforts to get ports, terminals, vessels and traffic managers to share more up-to-date information with each other and increase supply chain efficiencies.

From STM onwards – the future of collective decision making

As the long running EU Sea Traffic Management validation project comes to a close, one of its elements – known as Port Collaborative Decision Making – is moving into a more industrial phase.

STM Validation allowed researchers to begin the journey to emulate the Airport CDM model where airports and airlines were able to share notifications of delays instantly and thus make more efficient decisions.

Following the close of the STM Validation project, the International Port CDM Council is now picking up the efforts to get terminals and ports to invest in collaborative data sharing to improve operations.

IPCDMC has developed a staged approach to data sharing and it is inline with how other experts see the future total supply chain evolving, with shipping being much more integrated. But to do this a common language, notably for time stamps of ship movements and terminal events has had to be developed.

The International PortCDM Council aims to promote the use of common messaging to seas port-to-port and intra-port operations

This standard was allocated to IALA to do under what this known as S-211 and has now been finalised. Having a standard time interface stamp is a key step in raising supply chain efficiency 

Previously as part of its support of the STM Validation project Fathom World has been publishing a series of Concept Notes. This arrangement now continues with a new series of Implementation notes being published by the International PortCDM Council as it encourages the maritime sector to integrate common standards for messaging across the supply chain.

The first Implementation from IPCDMC can be found here

About Author

Craig Eason Stockholm
Craig Eason is the owner and editorial director of Fathom.World. He has a background in the shipping industry having started his career as a cadet on oil tankers and gas carriers before becoming a navigating officer on a range of vessel types. A change in career, with ensuing university studies, and he has now gained 20 years experience in written and broadcast journalism. He now is in demand as a knowledgeable and competent editor and event host and moderator, both for in-house events and ones for the public.