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DECEMBER2011TheConferenceCircuitSmartShippingSingaporelISSREPORTERwww.iss-shipping.com9x18SmartcorporateDNAx19requiredtoreapfullrewardsTHECURRENTECONOMICclimatemeansthatsmartshippingpracticeswillcontinuetothrivebutcorporateinertiaisthebiggestobstacletothesuccessofanyinitiativeinthecomingmonthstheinauguralSmartShippingconferenceinSingaporewastoldrecently.Theeventco-hostedbyShipServandNHSTEventsTradewindssawover170delegateslistentoastellarcastofvisionariesfromtheshippingindustryincludingISSEVPCorporateStrategyTerryGidlowonhowthesectorcanbecomemoreefficientreducecostsimproveperformanceandstaycompliant.Thespeakersandpanellistswerequicktoagreethatsmartshippingisnotasinglerevolutionaryideaorconceptthatisgoingtotransformtheindustryx13butisacombinationofinnovativethinkingtechnologiesandprocessescombinedwithagreaterunderstandingofthehumanelement.Butthebiggeststumblingblocktoanyimplementationistheinternalcultureofshippingcompaniesandtheirsuppliers.RajaishBajpaeeCEOofBernhardSchulteShipmanagementsaidx1cSmartShippingisaboutdrivinginnovationandcreatingvalueforcustomers.Technologyprocessespeopleareenablersbuttherealdriveristhemindsetofcreatingvalueforcustomersanddrivinginnovation.x1dx1cToomanycompaniesgodownjustthebasiccompliancetoregulationsroutebuttheseonlymeetminimumstandardsanddonotprovidetherequiredvalueforcustomers.Corporateleadershipmustdriveacorporatex18SmartDNAx19toaddvaluex1dheadded.Evidenceofsmartinitiativesinpracticeweregivenbyavarietyofspeakersinthex18DriversofSmartShippingx19sessionincludinghowcontainergiantSeaspanhaschangeditsvesseldesignthroughitsSAVERprogrammeandhowshipbuilderOshimaShipyardhasdevelopeditsECO-shipstrategy.PeterJacksonHeadofNewbuildingandTechnologyatSeaspanShipManagementsaidx1cThedevelopmentofaninternalcapacitytothinkinaninnovativewayismoreimportantthantheproductitselfanditisvitalthatyoubuildagoodteamtofosterthis.x1dSingaporex19sMaritimeandPortAuthorityprovidedasubsidytotheMasterbulkfuelefficiencyprojectunderitsGreenTechnologyprogramandisworkinghardtofosteraninnovativeculture.CheongKengSoonDirectoroftheMPAx19smaritimedivisionsaidx1cItisinnovationthatdrivesimprovementsinshippinganditisthecatalystforSmartShipping.TheMPAstronglybelievesthatinnovationiscrucialforthecontinuedgrowthofthemaritimeindustry.x1dx1cBeingx18smartx19isalreadypartofthelanguageoftelecomsITandsourcingandwefeltitwastimetoaskx18intodayx19sbusinessclimatewhatissmartshippingx19Whatwasclearfromtheconferencewasthatawidecrosssectionofownersandoperatorsarenowseriousaboutsmartshippingx13puttingrealmoneyandresourcesbehindenergyefficiencysmartercrewsandtechnicalinnovationx1dsaidconferencedirectorBanuKannuofNHSTEvents.ThoughtleaderISSExecutiveVPGroupStrategyTerryGidlowparticipatedinapaneldiscussionattheSmartShippingconference.Hereisthekeymessageheputacrossx1cThestatisticsshowthatthefundamentaldemanddriversaremovingintherightdirection.WehavewitnessedagrowthinseabornetradewearewitnessingagrowthindemandforenergyweseeUS8trillionofinfrastructureprojectsearmarkedforAsiainthenext10yearsofwhichUS4.3trillionaccordingtheAsianDevelopmentBankwillbespentinChinaaloneandChinahasthemoneyandthepoliticalmightandmotivationtoseethisthrough.x1cThistellsusthatthedemandorneedtoshipgoodsisnottheproblem.Theproblemistheovercapacityonthesupplyside.Themarketwentthroughaboomperiodinthemiddleofthedecadewherefreightandcharterrateswentthroughtheroof.Thisresultedinaflurryofnewbuildingordersthatwerefinancedbyoverzealousbanks.Whatweareseeingtodayistheresultoftheflurryofordershittingthemarket.Itwillprobablytakethemarkettwotothreeyearstorectifyitselfbyremovingtonnageandconsolidatingfleets.x1cThismeanstousasserviceprovidersthatthedemandforourserviceswonx19tvanishtheywillhoweverchangeshape.Peoplehavebeenforcedoutoftheircomfortzonesandforcedintolookingatnewoperatingmodels.ThisiswhereSmartShippingbecomesanecessitytosurvivenotaluxuryoroptionthatwecanaffordtoshrugoff.x1cSmartShippingrevolvesaroundacombinationofinvestmentinInnovativeThinkinginTechnologyinProcessesinHardwareinSoftwareandinPeople.Combinedsuchinvestmentwillenablecompaniestoidentifywhatdifferentiatesthemfromtheircompetitorswhilesimultaneouslyreducingcostbasesandstayingattheleadingedgeofcomplianceintodayx19sdemandingregulatoryenvironment.x1dTerryGidlowsecondfromleftinthepaneldiscussion