Man the Ships!

(This article was originally was published in the 2017 July/August edition)

There are many words for a seafarer, some good, some not. But there can be no doubt that seafarers are society’s first truly international community. Regardless of a vessel’s working language, multiculturalism is second nature to those who work at sea, and there are few endeavors in life that broaden one’s myopic view of the world as much as seafaring.

And just as teamwork is essential to a company’s success, so is proper crew management essential for success on a ship. In the maritime realm – where the penalty for failure is extreme – a strong crew often determines whether or not a vessel returns home. In an ever-complex and evolving industry, how do ship management companies ensure they are providing quality seafarers?

Seafarer Shortage

In May, the Baltic and International Maritime Council (BIMCO) and the International Chamber of Shipping (ICS) jointly published the “2016 Manpower Report,” based on data from 2005-2015. The Report projected that by 2025 there would be a shortage of 150,000 officers. For reference, it cited a current shortage of 16,500 officers and an oversupply of 119,000 ratings, who serve an estimated 68,700 merchant vessels.

“Without continuing efforts to promote careers at sea and improve levels of recruitment and retention,” stated ICS Secretary General Peter Hinchliffe, “it cannot be guaranteed that there will be an abundant supply of seafarers in the future.”

In the U.S. job market, working for the oil and gas industry (a key parallel to maritime) is becoming less and less attractive to younger workers. According to a U.S. Oil & Gas Perception poll conducted in June by Ernst & Young, more than half of adults (51 percent) would be happy if their child chose a career in oil and gas, but only 26 percent of Generation Z and 45 percent of Millennials find industry jobs appealing. A majority of the younger generation also perceive oil and gas jobs as blue-collar, dangerous and physically demanding.

Given the increasing number of options at “high-speed, low- drag” technology companies like Amazon, Virgin Galactic and SpaceX, the industry’s talent pool is threatened. It used to be that going out to sea was the closest you could get to playing Captain Kirk and taking the “conn.” Nowadays, thanks to the likes of Jeff Bezos, Sir Richard Branson and Elon Musk, we make cars that look and feel like spaceships as well as actual spaceships prepping for Mars.

A Closer Look

So what are poor ship management companies to do when their primary function is to crew ships and the pool of available and interested workers is shrinking? To find out, we spoke with Europe’s Danica Maritime Services and Asia’s Thome Group.

Headquartered in Singapore since 1976, Thome Group was founded more than 50 years ago in Scandinavia and offers a complete range of products and services for the maritime and oil & gas sectors including project management, consultancy and other ancillary services. One of its managed vessels, the MT Nord Nightingale, made the news recently when she rescued two German sailors off the coast of Florida in July.

Located in the heart of the Asian maritime scene, Thome has access to the largest talent pool in the world. Should fallout from Brexit push markets east, the Group is well positioned to respond.

A major concern for Thome and other ship management companies is cybersecurity, especially in light of the recent hacking of Maersk, and in 2015 Thome implemented a proactive cyber program to include more positive control of navigational equipment, USB port tagging and mandatory cyber awareness training for crew and staff.

Thome is currently evaluating use of a so-called “sheep dip” – a dedicated, standalone computer system to test files on removable media devices (e.g., USB flash drives) for viruses before they are allowed to interact with other computers in the network. The term is derived from the method of eliminating parasites from sheep by literally dipping them into pesticides.

Hamburg-based Danica Maritime Services established its first office in Odessa, Ukraine in 2008 and has since expanded to Lithuania, four locations in Russia and affiliated partner offices in the Philippines, Bulgaria, Romania, Estonia and Denmark. Danica currently provides 1,300 highly skilled crew members to about 25 first-class shipowners.

Captain Henrik Jensen, Founder of the Danica Maritime Group and Managing Director of Danica Maritime Services GmbH, says there are sufficient numbers of licensed and documented mariners to fill existing jobs, but finding and retaining a seafarer with the right attitude, experience and qualifications is becoming increasingly difficult for a number of reasons.

First are the obvious issues related to the complexity of ship operations and the enormous lingering budget constraints. Next is the fact that, despite shipowners understanding the importance of having “top people” onboard, even senior officers are treated as easily replaceable blue-collar employees. Jensen notes how long it takes for a mariner to reach Chief Engineer. Yet in today’s politically correct and legalistic workplace, obsessed with limiting any potential liability, it doesn’t take much to get fired. Jensen says such realities discourage loyalty or commitment from crews and thus tend to boost a company’s long list of vacancies because seafarers share their experiences.

Hands-On Approach

To help get around these obstacles, Jensen employs the “Danica Hands-On” approach to personalized service for shipowners and seafarers. Putting its more than 40 years of combined experience in the industry to work, Danica is helping disrupt the game – in part by adding transparency and technology to enhance the user experience.

Let’s say you’re a seafarer looking for work. How long does it take to physically go around and visit recruitment agencies until you land a contract? That job can now be done with computers and automation and with minimal interruption to the limited days ashore performing “honey-dos” or playing “Call of Duty.” Danica claims it now has access to more than 25,000 applicants across East- ern Europe – about 25 percent of the total seafarers in the region.

The company relies on a 12-step screening process, which normally requires a full day for each new applicant, to pinpoint the best candidates. Criteria are based on background, qualifications, personality and leadership skills. As part of the 12-step process, applicants must complete a battery of tests (personality, language proficiency, leadership skills and safety awareness) along with direct interviews from senior captains and/or chief engineers. Finally, Jensen himself will conduct an interview before determining the seafarer’s overall fitness for duty. Quite hands-on, indeed.

Danica has also pioneered the use of direct deposit to prepaid credit cards to streamline remittances and payments to seafarers. This is especially beneficial for mariners from nations with immature financial markets. Jensen notes that, in order to open an account at a typical financial institution, mariners have to produce a recent utility bill (less than two months old) to prove residency. Unfortunately, many have been out to sea for six months.

There may even come a day when remittances are made through blockchain/crypto-currencies due to their ease of movement, significantly lower transactional fees and protection against currency devaluation. Just ask the Chinese and Venezuelans.

Jensen is not worried about Brexit and suggests it might even be a positive for them in the future. Many British officers work offshore on windfarm construction vessels and ferries deployed in E.U. waters. As a result of Brexit, they may lose their entitlements to work in E.U. countries and thus need to be replaced by E.U. citizens. Jensen says shipowners are already considering the impact of this potential development on their recruitment and crewing strategies.

New World Order?

Jensen concluded with some astute observations on the state of the industry. The younger generation of seafarers has disrupted and challenged the traditional status quo of vessel hierarchy. Attitudes have shifted from unquestioning obedience to having to explain the reasons behind any decision. It wasn’t so long ago that this would have been considered blasphemous or even mutinous.

Contrarily, Jensen believes this is actually having a positive effect on shipboard operations as younger mariners are much better informed than previous generations and a consensus-led environment may well produce more intelligent decision-making and make for smoother operations.

Perhaps it’s a new world after all.  MarEx