The impact of maritime digital transformations


The impact of maritime digital transformations

Three options to respond to the challenges of digital disruption

Digital transformation is inevitable and a necessity. How do we prepare for the impact and reap the benefits?

Indra Vonck - 8 August 2017

The impact of maritime digital transformations

Digital evolution – hot topic

The digital transformation in the maritime industry is a hot topic these days. That shipping, and the wider maritime sector, including logistics and ports, are going through a digital transformation is apparent from the multiple ongoing digital projects in the sector. These projects offer an abundance of benefits like increased efficiencies, cost savings, increased visibility, lower emissions, etc. but we must remain vigilant for the impact of these evolutions on the wider market.

The Netherlands: in the frontline of disruptive transformations

The Netherlands has a long standing maritime history. As dominant European Sea Power in the 16th century, it became home to the VOC fleet and eventually evolved into the current European maritime hub with a strong dredging, E&R, maritime transport and Blue Growth footprint. In 2015, Approximately 3.5% of the Dutch GDP originated from the maritime cluster and it employed around 265,000 people overall. This entails that the Netherlands is also on the frontline for the impact of disruptive transformations such as automation and digital integration. Transformations that could render traditional activities and jobs redundant.

Evolving the supporting structure

Digital transformation is inevitable and a necessity, but it must be managed correctly. As Deloitte, we offer a myriad of services which guide companies once they embark on this path. Services such as the installation of ERM systems, HR transformations, companywide strategies, etc. But we must be aware that the supporting (policy) structure must evolve as well. We need to change the focus of our educational system and manage the outflow of lower trained personnel.

Jobs at risk in the Dutch maritime cluster

We have estimated the impact of digital disruption on the employment in the Dutch maritime cluster. According to the Deloitte Digital Disruption map, in combination with the number of active employees, the largest sub-sectors at risk are ports, maritime suppliers and inland navigation. Next to the fact that the amount of jobs at risk is quite high, the type of jobs at risk are lower educated functions, making relocation quite challenging. Various programs in the past have tried to increase education levels of seafarers (e.g. Know-Me), but industry wide programs have yet to be developed.

A resilient industry

When faced with other disruptions in the past, the maritime industry in the Netherlands has always shown itself resilient. When shipbuilding declined in Europe, the successful companies moved to the (Super) Yacht and coaster niche. Now that offshore is declining, the Pioneering Spirit was created with one job in mind: decommissioning oil platforms. Our national dredging companies are successfully diversifying into renewable energy investments, etc.

Three options

The maritime sub-sectors currently most at risk of digital disruption (Maritime suppliers, Maritime services, Ports, Inland navigation and Shipping) will face similar challenges. In order to respond successfully, three options exist :
1. recalibrate costs, 2. replenish revenues, 3. reshape corporate strategy. Once an organisation arrives at a better understanding of the extent to which digital disruption will change its operations and outlook, it can begin to prepare for the future.

Work together for sustainable growth

The preparation for the digital evolution up ahead is something that must be done on all levels of the maritime cluster. It is not only the responsibility of the private companies but of all stakeholders involved. Government must provide policies and facilitate through transitional programs, knowledge institutions must adapt their curricula to prepare for the new technical requirements and the private sector must invest responsibly and transition its assets in a sustainable manner. We all have to work together, not only to create a resilient and competitive cluster, but to make sure that the cluster growth is sustainable in the longer term.

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