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Maersk CEO Paints Digital UPS-FedEx Style Future

Maersk CEO Paints Digital UPS-FedEx Style Future

The CEO of Maersk, Søren Skou, has clarified the container transport company’s direction as a global integrator of container logistics by comparing its service development to that of FedEx or UPS.

In his presentation at Capital Markets Day 2018, Skou revealed further details about the company's strategy to become the only point of contact for its global shipping customers.

It plans to continue being the dominant carrier, but also provide inland services, cover customs and brokerage, finance and insurance for goods, and any service that is relevant for its customers.

Skou said: “We want our customers, the people who ship stuff from one end of the world to the other, to be able to do that by just dealing with Maersk.

“When we talk about this, we want to paint the picture of UPS, and FedEx and DHL and the courier, express and package industry.

“That is an industry where you deal with just one party if that’s what you want to do when you ship your goods.

“We’re building this company that is a global integrated container business, a company very similar to UPS and FedEx.

“I hope they will be considered peers of ours when we are done with this journey in three to five years.”

By Maersk keeping these bases covered, it is wading into an industry that is facing competition from many different directions.

Market movement between shipping services heated up this month after a report that Amazon, the largest internet retailer in the world, was launching a new delivery service for businesses called Shipping with Amazon.

Lars Jensen, CEO, SeaIntelligence, recently forecasted the industry’s developments as far into the future as 2025 in his 'Liner Shipping in 2025' technical paper

However, an end-to-end offering of products and services is only the first core principle of Maersk’s 'three-pillar' strategy, as it is also developing its customer engagement and an end-to-end delivery network.

In its mission to connect and simplify customer supply chains, Maersk wants to digitize its interactions with customers “as much as we possibly can”, said Skou.

This approach recently saw further developments for the Maersk-IBM blockchain solution, with Agility announcing that it was the first freight forwarder to become part of  the venture’s distributed ledger system.

Skou compared Maersk's approach to online banking, adding that the digital development of its service would enable customers to self-serve when retrieving price quotes, bookings, uploading and creating documents and paying the bill for shipping.

He stated: “Now, banking is online, 24/7 on multiple platforms, that’s also where we’re going.”

However, he stressed that when Maersk’s customers did want to speak with people, they would be able to talk to well-qualified customer service employees.

Maersk’s third pillar is to have “a competitive network”, said Skou, who wants to cover the key areas of geographic coverage, transit times, and high levels of reliability with a “great physical product”, but also keep these services cost competitive.

Skou concluded: “We are strong believers that in the long run, in our industry, lowest cost will win.

“The way to build up margin difference and maintain it is to have lower costs than the competition, and we are a scale-based industry, therefore we should be able to do that. We have done it in the past and we will be able to do that in the future.”

Read more: Soren Skou, CEO of Maersk, recently said that autonomous containerships without humans on board are unlikely to operate in his lifetime



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