Q&A: How to Navigate the Impending ‘Digital Divide’

 11 Apr 2017     Automation and Optimisation , Automated Decision Making, Digitalisation, Process Automation, Robotisation, TOS and Gate Control Systems, Cargo Volumes and Throughput, Global Economy/Trade, Going Places, Mega Ship Ready, Port & Maritime Training, Port Planning, Ports, Shipping

In light of the recent technical paper released by INTTRA, PTI has spoken to INTTRA President & COO Inna Kuznetsova regarding how companies in the port and maritime sector can better collaborate and gain an upper-hand in future business operations.

As President & COO, Inna runs INTTRA’s product management, software development, IT infrastructure, service delivery, sales, strategic alliances and marketing functions. She is focused on helping customers – ocean carriers, freight forwarders and direct shippers - to create business value through IT-driven innovation.

 

Technical Paper: How Technology Transforms Ocean Container Shipping

 

Hi Inna, firstly, could you explain how you perceive the contemporary maritime market?

After the prolonged period of low prices caused by overcapacity and substantial losses the maritime industry is at a pivotal moment of exploring new business models, adopting new processes and leveraging IT technology.

However, low margins and inconsistencies between players diminish the appetite for traditional two to three year projects with high overheads and uncertain returns. The industry clearly prefers small players offering targeted inexpensive targeted solutions with short-term ROI.

 

Why did you term your recent PTI paper ‘Blueprint 2032’? What is significant about that date?

In December, 2016 when we started working on the paper INTTRA celebrated its fifteenth birthday. INTTRA started in 2001 as the first platform provider in the electronic processing of bookings in a completely manual industry.

Today, 15 years later, INTTRA has grown into a company processing over a quarter of all containers in global trade. However, we still make a point of retaining the very same start-up passion for innovation which drove the company to develop new technology and continue the evolution from manual to digital in ocean shipping.

So, as we were brainstorming and finalizing the paper in early 2017, we were asking ourselves: how will IT shape the industry over the next 15 years? That brings us to 2032.

 

In your recent technical paper it was stated that ‘digitalization is now a competitive necessity’. Can you explain why that is?

We see the industry reaching a tipping point in digitization since the demand for technological innovation from companies’ trading partners has reached critical mass.

A carrier customer told me a year ago that they used to consider e-commerce a nice addition until they realized that freight forwarders expected it as a standard. Today a lack of digital booking is perceived as a gap in service and unless it is offset by a considerable advantage, it may cause a potential loss of business.

 

 

Collaboration along the supply-chain is a long talked about method of expediting trade, but how do you actually see that happening?

With the industry as it is today,  companies lose weeks on obtaining letters of credit through parcel services or exchanging invoices with a backlog up to several weeks, especially when the errors in rates are difficult to amend. Software-based services can reduce these gaps in minutes and help to eliminate waste.

In addition, any manual process can increase the likelihood of errors and require considerable time for corrective actions, while well-integrated systems let the data flow in an automated fashion from one step in the process to another.

 

How can companies involved in port and maritime operations gain an upper-hand in 2017?

It has been our observation, that companies with stronger, better integrated IT emerge as winners from the wave of consolidation and attract more new business.

While each company has its own unique strategy in the market, exploring operational excellence and eliminating unnecessary spending are the best areas to begin with in order to improve profitability.

For freight forwarders, some immediate opportunities include eliminating charges for manual documents handling through digitizing, and investing in data analytics to address dwell times.

For carriers and terminals, it may be gaining a competitive edge by improving the quality of track and trace signals, leveraging new models for empty container repositioning, or deploying a system for booking drayage.

 

Big data and data-sharing are oft talked about terms in the industry, however how can companies have the security that sharing their data across the supply chain will be safe and ultimately beneficial?

There various technologies today offering protection – from high levels of security on Amazon cloud to blockchain technology that is gaining popularity.

Blockchain, for example, allows visibility into every piece of information only to those who are authorized to see it. In the past, the main focus of security centred around firewalls – today we cannot afford to be sloppy even behind a firewall but instead need to apply high security standards to every part of the system.

Obviously, working with reputable providers and avoiding accumulating a technology debt are important. However it is equally important to remember that a vast majority of cyber security incidents occur through insider support.

Improving employee relationships, open culture, and integration of best practices with control and risk monitoring are more important now than ever.

 

How will integration of new technology with machine learning impact the landscape of human to artificial intelligence operators?

There is a huge potential to automate a variety of tasks from customer service to global trade compliance in order to reduce costs. It may also improve job satisfaction since employees will be able to focus on more interesting and challenging tasks, leaving the most frequent and boring questions to the bot to answer.

 

Does the industry see this as threat or competitive advantage?

I think that going forward we will see a digital divide widening between companies that embrace IT and use it as a differentiator in customer service, products and operational excellence versus those who fail to invest in time to do it properly.

The latter group will find it exceedingly difficult to compete and will certainly see all new IT trends as a threat, while the former group will ride the wave of innovation and reinvent their business models, thereby improving their standing.

Inna Kuznetsova will be a keynote speaker at the upcoming Port Technology Container Termninal Automation Conference.

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