Digitalisation

DELIVERING RESILIENT SUPPLY CHAINS

As supply chains become more complex, with decentralised production and distribution centres, vessel and cargo owners need two key things: Transparency and clear communication, writes Jason Berman, CCO, S5 Agency World

A fundamental step to achieving this is the digitalisation of port services, which will give individual companies more visibility over their port transactions and operations and increase the resilience of their systems.

As the world recovers from the Covid-19 pandemic, the underlying importance of efficient and resilient port operations has never been so important. However, the shipping industry still lags behind other sectors in its use of digital technology and a resistance in the industry to change. This slow adoption of digitalisation in port services prevents fleet operators from using data and systematic communication to improve efficiency, sustainability and costs on their port call their vessels make.

Historically, port operations have been managed by a multitude of manual processes, such as emails and individual phone calls. In fact, many companies still manage their port calls and monitor vessel progress using desktop spreadsheets. This approach is no longer sustainable in a world demanding more accountability and faster decision making from its supply chains.

The additional data management handling work required of manual processes not only reduces productivity, it leads to a fragmented approach to port services that is no longer suitable in today’s interconnected world. In other words, the increasing complexity of supply chains requires increasing resilient business models, which will also drive the digitalisation of port services.

The Covid-19 pandemic has helped to accelerate this trend. Increasingly, businesses are seeking to spread risk by bring their operations closer to home, using networked manufacturing, or spreading their activities across multiple geopolitical regions. This is the case across a range of key sectors, it means cargo carriers will find themselves calling at more new and unfamiliar ports in the future.

The need for digitalisation is also driven by rising market demands for improved sustainability. While cargo and vessel owners have their own commitments to operating sustainably under the Sea Cargo Charter, it is their customer and their customers’ customers, that will apply the greatest pressure for improved sustainable practices and provide a licence for them to operate. Increasingly, both these stakeholder groups are putting their money where their mouth is and pushing companies to adopt sustainability as a business-critical function.

Delivering sustainability

Across the shipping industry, sustainability and digitalisation go hand in hand as data helps to highlight and subsequently minimise inefficiencies, in particular reducing fuel consumption in last mile of voyages and minimising unnecessary emissions.

Lengthy port waiting times around the world further demonstrate the need for quicker adoption of digitalised port services. Insight and analysis of data collected across

Credit: Pixabay

Credit: Pixabay 8 Digitalisation

can give individual companies more visibility over their port transactions and operations and increase the resilience of their systems

8 Lengthy port

waiting times around the world further demonstrate the need for quicker adoption of digitalised port services

Credit: Port of Rotterdam

thousands of port calls and available through a central, digital hub can be used to help vessel and cargo owners optimise their approach to ports with long waiting times and continue to operate safely and sustainability.

Using a digital hub with standardised operating systems can save time and money for businesses simultaneously managing vessels in several ports around the world. A digital hub allows vessel owners and operators to implement and monitor the application of standard practices across all port call activity and allows them to gather all their data in one place for easier analysis.

Digitalised and integrated as a global hub, port services management systems provide vital data and benchmarking to support real time decision making on a short-term basis and in the longer term, on sustainability measurements. Companies that fail to digitalise will see their competitors pull ahead as they find ways to improve operations, lower costs and meet their sustainability commitments.

Digital collaboration

At present, the potential of digitalisation remains underutilised, with less than half of all seaborne vessel movements currently using digital hub solutions for port services. This means there is huge scope for improvements in resilience, transparency and sustainability across the board.

The shipping industry is still a people business but the move for digitalisation requires a change in mindset to take full advantage of the available digital solutions, which will end the opacity that is eroding efficiency for vessel owners and operators. User-friendly technology offers a route to eliminating a silo-based culture, in which it is difficult for owners to monitor port services activities and coordinate their fleets.

Digitalising port services via a central hub solution improves access to this store of data, provides end-to-end visibility of what needs to be managed during the first and last mile of a voyage, and ultimately delivers more efficient, lower-cost port calls and a safer and more sustainable shipping industry.

8 Ports such as

Rotterdam have embraced digitalisation

System integration

In recent years S5 Agency World has worked with its vessel owning partners to integrate digital systems to improve how they manage port calls for all the vessels in their fleets. Recently S5 has invested in its partnership with Nordic Hamburg, working with the ship-owner to integrate its IT systems as part of an ongoing automation project. Beyond simple digitalisation of local port agency activities, the project supports Nordic Hamburg’s own IT applications and systems.

As a full-service ship-owning company with offices across Europe and Asia the integration helps Nordic Hamburg to manage the flow of financial documents across the business in support of its fleet of bulkers, tankers and container vessels. Automation of the data flows ensures that key documents are available in a timely manner and operators and vessel charterers see no disruption to their activities caused by administrative delays when accessing essential port services.

The work S5 has been doing connects a range of operational and financial activities onboard and onshore to make port call management processes smoother. The S5 integration works with Nordic Hamburg’s own systems for nomination and purchase order creation, as well as funding and the coding of invoices. The integration feeds Nordic Hamburg internal IT systems for port-related activities and agency-related approvals, simplifying the flow of invoices across the organisation

As well as improving approval flows across the business, the integration allows us to save considerable time by freeing up resources that previously were dedicated to the simple administration of finance activity, including reconciliation, accruals, invoicing and payments.

Nordic Hamburg Group provides a commitment to transparently and efficiently managing the flow of information between itself, its co-owners and the operators and charters of its vessels. The integration with S5 systems delivers a live feed of data that supports this important aim and establishes a basis from which further automation of IT systems can proceed as the shipping industry aims to deliver services safely and more sustainably for all parties.