At the Container xChange maritime summit, Hariesh Manaadiar of the Shipping and Freight Resource spoke on the several pitfalls of hasty adoption of digitalization in the maritime landscape but also detailed best practices that help avoid deadlocks within shipping processes.
“Communication in the space has changed very drastically and quickly over the years, as can be seen from the evolution of containerized shipping over the last 50 years. But when you look at global trade and the other ships that are around, container ships are still only 13% of that, with Maersk having the biggest pie,” said Manaadiar.
Digital transformation in the business is vital as it helps enhance shipping processes and service offerings, which is evident from the variety of digital solutions mushrooming in the space — like real-time freight rates, paperless bills of lading, blockchain-based bills of lading and the use of data to draw relevant insights into improving operational efficiency.
“Another example of digitalization is the fully automated container terminals where nothing is manual. There are no people around and everything is operated digitally,” said Manaadiar. “Technology has helped streamline and hasten documentation processes as businesses don’t need to physically send out documents anymore, as it can all be sent with a click of a button.”
However, beneath the veneer of digitalization, there are concerns that need to be addressed. Manaadiar contended that companies should not be swayed by the technology jargon thrown around within the industry and should have a concrete understanding of concepts before they advent into digitizing operations.
“People need to understand that digitalization is not the objective or the business itself, but is just a means for enabling the business. The business is having cargo shipped from point A to point B and digitalization is the process through which that can be helped,” said Manaadiar.
That said, the absence of global standards for digitalization could stifle its adoption, as different companies look to develop solutions that are tangential and lack common ground. Digitalization also is furthered with the help of technology startups that are run by people who have limited experience within the maritime ecosystem and thus might not be accustomed to the shipping processes on ground zero.
“The lack of practical experience could be a problem, as some of them are not clear on the shipping side of things or the freight processes involved. If you don’t have the background, it might be difficult to connect shipping with technology,” said Manaadiar. “As a customer, you need to know who is creating this technology and who is behind it.”
Manaadiar pointed out that not acting as a “conveyor belt” of digitalization is the first step to avoiding technology pitfalls. Though technology alleviates manual processes, it is vital to keep an eye on its workings, as digitalization cannot be an excuse to stop scrutinizing shipping operations.
For instance, incorrect use of terms or mistaken digital entry into a software could have unwanted repercussions. A crate of fish transported in a reefer container would require its temperature to be at around -25 degrees Fahrenheit, and if the shipper erroneously enters it as 25 degrees Fahrenheit (forgetting the minus), it will cause the crate to be spoiled by the time it reaches its destination. Such human errors occur, making it vital for stakeholders across the value chain to be vigilant and check for mistakes even when the process is completely digital.
“People must understand the limits of digitalization. It is a staged and gradual process, and it is important for businesses to not adopt new technology because they are dazzled by the buzzwords floating in the industry,” said Manaadiar. “You need a good mix of industry knowledge and technical information within the company, and most importantly, the entire company needs to be behind this evolution — as without that, digitalization will never be a success.”