Ari Marjamaa, Director DNV Maritime Advisory Nordic November 18th, 2009 Outsourcing – the green answer? Performance critical outsourcing for the maritime industry
Jan 18, 2015
Ari Marjamaa, Director
DNV Maritime Advisory Nordic
November 18th, 2009
Outsourcing – the green answer?Performance critical outsourcing for the maritime industry
© Det Norske Veritas AS. All rights reserved.
Outsourcing – the green answer?
18 November 2009
2
Framing the issues
Can outsourcing
- Play a role in helping ship owners conform to new regulations?
- Contribute to a company’s green profile?
Is the growth of outsourcing a threat or an opportunity for class?
© Det Norske Veritas AS. All rights reserved.
Outsourcing – the green answer?
18 November 2009
3
Change in regulations? What changes?
© Det Norske Veritas AS. All rights reserved.
Outsourcing – the green answer?
18 November 2009
4
BALLAST WATER
RECYCLING
NOx, SOx & “PM”
SCRUBBERS
VOC
+++
EEOI
EEDI
SEEMP
FUEL LEVY
ETS
Environmental regulations are here to stay
BEYOND CO2PENHAGEN FUTURE REGULATIONS
But also: Increased stakeholder awareness
CO2
© Det Norske Veritas AS. All rights reserved.
Outsourcing – the green answer?
18 November 2009
5
Compliance depends on your capabilities
TECHNOLOGY
PROCESSES & ACTIVITIES
PEOPLE & COMPETENCE
© Det Norske Veritas AS. All rights reserved.
Outsourcing – the green answer?
18 November 2009
6Slide 611 November 2009
Most companies face the capability gap
CAPABILITY
TIME
Company required capabilities
Company capability outlook
NEW TECHNOLOGYINCREASING FLEET & COMPLEXITYINCREASING COMPETITIONCHANGING REGULATIONNEW MARKETS
LOWER EMPLOYEE RETENTIONFINANCIAL PRESSURESCOST CUTTING
Status quo
© Det Norske Veritas AS. All rights reserved.
Outsourcing – the green answer?
18 November 2009
7
Your capabilities determine your green performanceTechnology vs capability – what matters the most?
NOx
Alien Species
Arctic spills
Waste
Mammal
CO2
0
1
2
3
4
5
0 1 2 3 4 5Environmental impact
(Measured as environmental significance, impact on brand, cost and compliance)
Technology vs capability – what matters the most?
NOx
Alien Species
Arctic spills
Waste
Mammal
CO2
0
1
2
3
4
5
0 1 2 3 4 5Environmental impact
(Measured as environmental significance, impact on brand, cost and compliance)
ENVIRONMENTAL IMPACT
CAPABILITYVS
TECHNOLOGY
World class capability
Technology
© Det Norske Veritas AS. All rights reserved.
Outsourcing – the green answer?
18 November 2009
8
Access to capabilities increasingly drive outsourcing
CAPABILITIES AS DRIVER
CO
STA
S D
RIV
ER
1970s
1990s
2000+
EXAMPLE: SHIP MANAGEMENT
DILEMMA TODAY:
ACCESS TO LOWER COST & CAPABILITIES AT THE SAME TIME
© Det Norske Veritas AS. All rights reserved.
Outsourcing – the green answer?
18 November 2009
9
The same discussion…in 1998
http://www.marinelog.com/DOCS/sman.html
Vessel owners with smaller number of vessels would benefit by having 3rd party managers to
deal with the ever demanding maritime legislation worldwide.
It's a sad thing that people who have known about the imposition of ISM becoming mandatory for the past four years are now, some of them, still rushing to gain certification.
RAMESH BHATJardine Ship Management
BRUCE W.B. LUCASAtlantic Marine
© Det Norske Veritas AS. All rights reserved.
Outsourcing – the green answer?
18 November 2009
10
So, can outsourcing help ship owners conform to new regulations?
And does it contribute to a company’s green profile?
© Det Norske Veritas AS. All rights reserved.
Outsourcing – the green answer?
18 November 2009
11
YES…
© Det Norske Veritas AS. All rights reserved.
Outsourcing – the green answer?
18 November 2009
12
…but it all depends on what you can outsource
Strategically important
Not strategically
importantNot needed Critical
Outsourced
In-house
IMPORTANCE TO PRIME PURPOSE
CORE COMPETENCE TO ACHIEVE PURPOSE
© Det Norske Veritas AS. All rights reserved.
Outsourcing – the green answer?
18 November 2009
13
Managing uncertainty and risk through outsourcing
If you do not have the technology……outsourcing might give you cost efficient access to it
If you do not have the right people & competence……outsourcing might let you get access to them quickly, without developing from scratch
If you do not have the right processes & activities……outsourcing might let you leverage on something that already exists
But will you need the capabilities in the future?
© Det Norske Veritas AS. All rights reserved.
Outsourcing – the green answer?
18 November 2009
14
Outsourcing places demands on the company
Fundamental competence available in-
house to select, monitor and
control 3rd party services
3rd party support to
select, monitor and control 3rd party services
OR
© Det Norske Veritas AS. All rights reserved.
Outsourcing – the green answer?
18 November 2009
15
Partnerships contribute to company image and brand
Green Ship of the Future
Sustainable shipping
Clean Cargo
SEAaT
BUT ONLY REAL CAPABILITIES CAN BUILD A REAL GREEN PROFILE
© Det Norske Veritas AS. All rights reserved.
Outsourcing – the green answer?
18 November 2009
16
All in all, outsourcing can be good for you
Good for the company- Quicker- Cheaper- Less hassle
Good for the industry- Quicker ramp up to meet requirements
- Knowledge diffusion- Drive innovation
The 3rd party supplier needs to offer significant advantage
You still need to be in control
You will not be a green champion solely through outsourcing
SOME ADVANTAGES… …AND SOME BUTs
© Det Norske Veritas AS. All rights reserved.
Outsourcing – the green answer?
18 November 2009
17
Is the growth of outsourcing a threat or an
opportunity for class?
© Det Norske Veritas AS. All rights reserved.
Outsourcing – the green answer?
18 November 2009
18
The survey is still a complex process…
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Outsourcing – the green answer?
18 November 2009
19
…with some critical success factorsEfficient organization of work
Decision makingTIME
TRANSACTION COST
COMPETENCE
Number of parties involved
Effective organization of work
Competent counterparties
© Det Norske Veritas AS. All rights reserved.
Outsourcing – the green answer?
18 November 2009
20
Opportunities – and some challenges too
Conflict of interestLack of clear mandateInteraction with too many parties
Drive developmentNeed for verificationCompetent counterparties
© Det Norske Veritas AS. All rights reserved.
Outsourcing – the green answer?
18 November 2009
21
Peanuts does not always get you monkeys
Monkeys, or elephants, are not always what you need
Some times, all you need is a cost efficient expert
© Det Norske Veritas AS. All rights reserved.
Outsourcing – the green answer?
18 November 2009
22
Safeguarding life, property and the environment
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