Digital revolution

"We need to adopt a more ‘Silicon Valley’ way of thinking and acting, in order to eliminate efficiencies that are stunting the industry’s growth," Martin Wallgren, GAC
"Ports do need to be looking outside their own industry and ‘allowing’ people in to maximise digitalisation," Karen Waltham, Spinnaker
Reach out: port CIOs should be IT experts with limited or no port experience, not the other way around
Reach out: port CIOs should be IT experts with limited or no port experience, not the other way around
Supply chain: it is important for ports to have sufficient digital intelligence at their fingertips
Supply chain: it is important for ports to have sufficient digital intelligence at their fingertips
New horizon: shipping now presents interesting career growth opportunities for IT practitioners
New horizon: shipping now presents interesting career growth opportunities for IT practitioners

Who do ports need on the team to be able to embrace digitalisation, Felicity Landon asks

Digital is the new norm and it is here to stay, Christopher Wiernicki, chief executive of classification society ABS, stated unequivocally in his recent World Maritime University lecture. And, he further emphasised, we need new mindsets, new skill sets and new leadership roles to drive the changes ahead.

What does that mean for the ports sector? In short, says human resources specialist Karen Waltham, it’s a case of "wake up or get left behind".

“We describe digitalisation as the third industrial revolution,” says Ms Waltham, managing director, HR consulting, at Spinnaker Global. “There is definitely change in the air, similar to the 1999-2000 dotcom revolution. It is a true transition. Business and other industries have gone through that transition – I don’t think that maritime and shipping, ports included, have really done so. But change is coming and ports really must keep up.”

It is vital that chief executives and top management recognise the pace of change and understand how important it is to have sufficient digital intelligence at their fingertips, she says – and that means a lot more than simply gathering piles of data or expecting your IT department to stretch a bit.

“It is also important, when you appoint into a CIO (Chief Information Officer) or similar role, that the company and the person really understand, appreciate and embrace the language, too – so that they can interpret the information and put it into commercial terms. It is all very well doing this and collecting that, but once you have all that information, what do you do with it?”

'Change blindness'

Ports should also beware of ‘change blindness’, she says: “You don’t know what you don’t know. And the transformation is big enough that ports really will be left behind by the competition and could go out of business if they don’t wake up.”

We all love to hear a story about the humble school leaver who started on the warehouse floor and rose to become top bod at the port – but Ms Waltham warns that rather traditional picture is changing: “Roles are changing and it becomes less old-school. You can’t just grow sophisticated IT people inside; you can’t rebadge people and make them CIOs. You need people who really understand the digital world and you really need people from outside the maritime world.”

In this context, she says, it’s time to flip things the other way – rather than seeking someone with maritime industry knowledge and a smattering of IT, we need IT experts with a smattering of (or even no) maritime experience.

“Ports do need to be looking outside their own industry and ‘allowing’ people in to maximise digitalisation. So often we hear ‘they wouldn’t know anything about it, they have never been to sea’. But ports need to be responsive to what is going on in the bigger, wider world. It would be good to cast the net wider.”

Another common mistake is sweeping anything even remotely linked to IT into one basket. “There used to be ‘the IT person’ but there are so many parts to this,” she says. “For example, technicians handling the kit that makes it all happen; the software specialists; the data collectors and analysts; and the CIO or others who ensure that something commercial is actually done with all the data.”

Eliminating inefficiencies

Martin Wallgren, group CIO at marine and logistics group GAC, says: “Everyone talks about the digital world and so do we at GAC. There is a lot of planning and activity going on and there is much more to come. With new technology, we cannot spend years and years before anything gets done, as so many companies have done in the past. We need to adopt a more ‘Silicon Valley’ way of thinking and acting, in order to eliminate efficiencies that are stunting the industry’s growth.”

This primarily involves tighter collaboration within players in the maritime industry, he says. “Some of the obstacles we’ve seen so far are the industry’s resistance to change, a short-term cost-cutting focus and aging IT systems that have not kept up with the times.”

Digital disruption is changing the whole business landscape and reshaping investment strategies; technology is transforming business models, changing consumer preferences and blurring sector boundaries, adds Mr Wallgren, and this rapid digital transformation is creating major opportunities for businesses.

“Executives are now focusing on digital-related investments to manage costs and secure innovation, competitive advantage and market share for the foreseeable future," he says.

GAC’s digital platform is built on five core drivers: making decisions based on facts; easy to connect to its customers; sharing data with peers in the ecosystem; collecting and analysing sensor data; and well-maintained IT systems.

Changing roles

It has traditionally been challenging to attract IT talent to the maritime sector, he says – but he believes that has changed. “The maritime sector now presents interesting career growth opportunities for IT practitioners, and many are drawn to the prospect of making a real difference in elevating the role and impact of IT in the industry.”

The advance of digitalisation will bring different jobs – “and that means we need to know how to retrain people and people will need to be open to retraining", says Dennis Dortland, innovation consultant at Portbase, the Dutch port community system. “There are people who say every company today is an IT company,” he says. “Certainly, some jobs will be taken over by robots. Jobs will change into working with robots. But that can remove repetitive work and make a job more exciting.”

Mike Dempsey, vice president of container and port solutions at ORBCOMM, adds that a significant challenge is not generating or gathering the data but how to handle that data and what to do with it.

The Internet of Things will ensure that firms have to deal with a continuous data flow, 24/7, in significant amounts. “For a firm to absorb that data is challenging. First of all, they have to change their mindset to exception management. In other words, if it is working fine, don’t worry about it. They have to move to analytics and apply prescriptive analytics to the Big Data. All these things together create the requirement for a new type of personnel inside the company; to allow them to manage large amounts of data effectively, they need to use analytical tools allowing them to process the information and make fast, smart decisions on very large amounts of data.

“You can call it traditional IT but it is a whole new world of technology and how to apply that technology. You have to understand the port and also understand the technology, and also it is a visionary job. Whether it is a port authority, Customs or terminal, it will require a new type of individual who can look at and manage these large amounts of data being sent to them.”



CRITICAL BUSINESS IMPERATIVES

We are past the point where digital innovation is ‘nice to have’ – now it is a critical business imperative, says futurist KD Adamson, chief executive of the Futurenautics Group.

She says there is an accepted narrative that the ports/maritime industry is conservative, but counters: “When you get under the skin of these organisations, you very often find there are very forward-thinking people who get this stuff – although not necessarily the senior layer of management – which enables you to push these projects forward.”

However, she adds: “Leaders have an almost impossible balancing act right now because they have to be preparing the business for the future, which is going to radically change, but they still have to reach their quarterly targets.”

Businesses take a different approach to this, she says. Some have the idea that you take innovation out of the organisation and do it separately. Google does it differently – all its employees are allowed to spend 20% of their time on their own project within the organisation. Others have their digital transformation unit sitting underneath each one of their businesses.

“So there is a variety of ways you can slice this. But from the leadership point of view, you have to realise that you can’t do it all by yourself. Digitalisation is incredibly complex. Leaders need to find a way to collaborate to move forward ideas. The idea that one chief executive has to take everything on their shoulders is pretty old-fashioned; you are not on your own going to have the breadth or capacity to do this yourself. Equally, it is unreasonable to expect companies to have an epiphany and suddenly become experts in digitalisation.”

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