|The Future Shipping Company: Autonomous Shipping Fleet Operators|
|You may have heard of tech industry buzz words like software-as-a-service (SaaS) or car-as-a-service (CaaS). In the SaaS scheme, the user does not need to install and sacrifice a portion of storage for software. Instead, software can be operated through a cloud connection and with much higher computing capacity. Difficult calculations and simulations can be run on very high capacity computers in a cloud space. CaaS is a more technical version of the term “uberization.” Instead of having your own car, other car owners provide you with mobility, much like hailing a taxi but at much lower cost and with more convenience.|
The idea of the as-a-service concept has a long history in the shipping business. I call it Ship-as-a-service (SHIP-as-a-service). Traditional time charters are a typical example of SHIPaaS. With the rise of independent ship owners, many big exporters and importers charter a fleet of ships dedicated to their cargo movements. Today you can even find non-asset ship operators which simply time charter-in a number of ships and spot charter-out for end customers. It is also an investment question whether to own or charter ships. During the industry’s corporatization period, many shipping firms have evolved into SHIPaaS providers, even though we do not use this terminology.
On the other hand, automation is transforming so many things. Vehicles are automated and office work is also increasingly automated. So we have two facets of the automation in general: In the shipping industry, autonomous ships will transform the ship itself while workplace automation transforms the shipping company. In the infographic above, I label the evolution of the ship as SHIP x.0 beginning from the 1700s through roughly 2050s. Considering major changes like the use of iron and steel or steam and diesel power, SHIP 4.0 represents the current technology. From SHIP 4.0 to 7.0, I perceive three major transformations: 1) Implementation of hybrid navigational and engine room automation with on-site monitoring, 2) shifting the majority of seafarers to off-site monitoring and governance (i.e. remote control) and 3) self-sufficient automation which does not need human intervention in any operations. As a side note, technology for the above-mentioned developments is almost there. We just experience these changes with the institutional adaptation and economy of implementation, not due to the lack of technology.
In the business consulting space, one of the leading concepts is the self-driving enterprise or workplace automation. By extensive use of technologies such as robotic process automation and by transforming commercial operations, the need for office space will probably decline dramatically. According to some recent reports by various consulting firms, more than 30 percent of existing office work can be automated by currently available technologies. A much higher level of automation means getting much closer to the self-driving enterprise in which most office work is shifted to intelligent systems and “bots.” Then, key decision makers will focus on things that are difficult to automate. As I recently introduced in an industry event, the algorithmic trading concept can also be implemented in investment management. So, even some financial decisions may be automated too.