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Shipping efficiency has three complementary elements, briefing concludes

New technology, regulation, and manpower are often treated as disparate maritime elements. They present unique concerns that need to be solved case by case. It’s not often argued that there are areas of overlap, and rarely that these three elements should be regarded as mutually beneficial.

“It is absolutely unfair to describe regulation as a hindrance to technology”
Rosita Lau, Ince & Co

But that was the approach taken by speakers at a Lloyd’s List Business Briefing held in Singapore earlier this year. “The best time to adopt technology is when industry is under pressure,” observed Ravi Jeeva, Vice President of Technology and Innovation at event-sponsor Lloyd’s Register. “Technology boosts productivity and efficiency, thereby reducing costs, and this improves the bottom line. At a time when revenue is under pressure, this helps to grow the business.”

In response, Rosita Lau, a Hong Kong partner at law firm Ince & Co, argued that the international nature of shipping demanded over-arching global maritime regulations to avoid confusion. She believes it’s “absolutely unfair to describe regulation as a hindrance to technology.” She said it is human nature to dislike regulation, but in an industry of varied cultures, visions, and agendas there has to be some consistency.

However, finding the right balance is hard to achieve. Reji Joseph, Marine Human Resources manager at Wallem Ship Management, acknowledged that while the industry knows why regulation is in place, “our feedback is that there are too many regulations. Paperwork has increased, although some are using technology to help reduce it. In certain circumstances,” he said, “regulation impacts on the human element.”

“There’s a lot more technology available today, often as plug-and-play solutions”
Ravi Jeeva, Lloyd’s Register

Shipping has traditionally been slow to adopt new technology. However, advances in satellite communications have expanded the links between ship and shore, at a time when there have been significant increases in data gathering and analytical capability and reductions in the cost of processing. “So the expense involved in bringing in new technology can’t be the main cause of slow adoption,” suggested Mr Jeeva. “There’s a lot more technology available today, often as plug-and-play solutions.”

This has not gone unnoticed by shipping. “The industry is listening, although there’s often a reluctance to adopt new technology if there might be a danger to life,” he added. That view changes when it is explained that safety of the ship and its crew will never be compromised. “There’s definitely an educational process as part of this.”

Ms Lau agreed. “You should be worried about regulation if you are minded to ensure your business is operating in a safe and secure way.” Nevertheless, the introduction of new technology will have an impact on regulation that shouldn’t be underestimated. 

“We know about cyber risk, digitalisation, and optimised shipping. Yet we still don’t have any IMO regulation on cyber risk, only guidelines.” She said that from the point of view of a maritime lawyer, there were issues that needed addressing. “Digital certification is easier to tamper with than paper documentation. Lawyers don’t want to be obstructive, but documents remain the best proof in court. There is no IMO regulation today on digitalisation, nor is there any IMO regulation on autonomous shipping: only guidelines.”

Nor should the manpower capability be overlooked, Reji Joseph commented. “Technology won’t progress without the human element. Whether we are talking about technology or regulations, we need to have buy-in from everyone involved, all those who will use the technology or be responsible for complying with the regulation. Human element is one of the drivers of efficiency, besides regulation and technology.”

He believed seafarers should receive training whenever a new piece of technology or a new regulation is brought in. His company regards training as a long-term investment that helps to ensure the safe and efficient operation of the ships, Mr Joseph said. “Seafarers can themselves drive efficient operations when there is a pool of trained and experienced crew, and effective management of that resource.”

And while all three speakers understood the fears about a move towards smaller and differently-skilled crews, and recognised the need for regulation to be aligned with this development, Mr Jeeva cautioned against holding back. If bank chief executives had stopped short of adopting what has become known as Fintech, traditional banking would have been swept aside. 

“Artificial intelligence will undoubtedly lead to job losses but it will increase efficiency overall… Technology is pushing us hard,” he warned. “We need to learn and to adopt. If you start using the new technology, the fears will go.”

That might be the case in developed countries, where compliance with regulations and guidelines is relatively straightforward, suggested Rosita Lau. “For developing countries, it’s a matter of cost, mindset, attitude, and reality because compliance with maritime regulations is not at the top of the agenda.

“Not all developing countries are moving at the same pace,” she said. “China is still a developing country but it is very advanced at adopting regulations compared with some Southeast Asian countries, which are still struggling to build their economies.” 

Complying with the 2020 global sulphur cap and with ballast water treatment is very expensive, Ms Lau warned, and not everyone will be able to achieve the target.

New technology is starting to reduce the burden of routine tasks imposed on seafarers by regulators – paperwork can now be done by an app; it’s very fast, and reduces time, complexity and compliance risk, Ravi Jeeva reminded delegates. 

Reji Joseph agreed that satcoms had made the sharing of information, advice, and documents from ship to shore much easier. “Better software helps to get the best from the technology: it should be seen as another member of the bridge team, storing and retrieving information and reports on performance. 

“If the time spent on paperwork is reduced, there’s more time for the bridge team to devote to safe operation of the ship”
Reji Joseph, Wallem Ship Management

“If the time spent on administration and paperwork is reduced, there’s more time for the bridge team to devote to safe operation of the ship. Using technology to reduce paperwork increases efficiency,” he said.

However, there can be unintended consequences, Mr Joseph cautioned. Wallem’s proactive approach to technology has encouraged the use of wifi on board. Seafarers are more efficient when they are in regular contact with their families. But since wifi was installed, few seafarers gather in the officers’ mess or crew mess room to spend time together. Technology has reduced the level of interaction between seafarers.

“We must work on that. The human element involves interaction with one another, not only between ship and shore, and not only interaction between seafarers and systems. Our managers meet often with the seafarers, listen to them, make sure their voice is heard. We think it’s important to look after the human element, the people running our ships.”  

All three speakers saw the benefits of new technology for shipping, and all recognised that the pace of transformation would catch some ship owners, operators, and managers off-guard. They understood the need for compliance with regulations and were aware that regulators were themselves playing catch-up with technological change. And all three conceded that the human element was under pressure to work alongside technology and regulation while trying to balance safety and operational efficiency. 

The three elements are in fact different sides of the same dilemma, they concluded.

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