Priorit-e - AMEM cycle costing, have been dealt with by the Hydrocarbon Processing Industry far...

Maritime Industries Forum, Plenary Session, Naples, 28-29 October 2002.

Third Session: Review of manufacturing related AD HOC WORKING GROUPS

© 2002 by J. R. KuehmayerChairman AHWG e-business

Priorit-efor the European Marine Industry-

A Vision

© 2002 by J. R. Kuehmayer · Chairman AHWG e-business

Priorit-e for the European marine industry 2

The European shipbuilding community comprisesseveral extremely active national associations andclusters in various countries supported in manyways by their governments and non-governmentorganisations.

These admirable activities are masterpieces ofmarketing and export promotion, one only needsto consider the Dutch Maritime Cluster, theNorwegian Export Initiatives, the British MaritimeCluster, or the Danish Export Offensive, to nameonly a few in the Northern hemisphere.

In Southern Europe the community is also activein all respects. France, Spain and Italy have beensupporting their shipbuilding industries whereverpossible.

Germany is clearly spearheading the struggle forsubsidies conversely, there is no other country inEurope less protectionist.

This is only a reflexion of the kaleidoscopicmarket situation, which over hundreds of yearshave been so typical and so fascinating aboutEurope.

Seen from a EU point of view, a much higher levelof integration and solidarity has to be achieved –e-business could contribute a lot to reach this goal!

The European shipbuilding community never wasafraid of adopting e-business, but there were somespecialists around who were fully aware of threefacts that have been overlooked by some boldprotagonists of e-business.

Introduction



First

Shipbuilding and shipping an industry that by it’svery nature never had to go global can not bebenchmarked, nor even compared with theautomotive or aerospace and airline industry.However, the temptation is very strong and some”experts“ still continue to do so.There is only one industry similar to shipbuildingand shipping and this is the HydrocarbonProcessing Industry, – in other words refineriesand petrochemical plants.

Since conception, companies like SHELL orEXXON/ESSO have been facing similar problemsor challenges to the builders and operators ofships.

Common issues such as:

complexity of the plants and equipment

life time of a plant up to 30 years and more

inspection, repair, maintenance

predictive and preventive maintenance

time between overhauls

refurbishing and retrofitting

re-engineering

spare parts handling

supply chain management, and

life cycle costing,

have been dealt with by the HydrocarbonProcessing Industry far ahead of our own, leavingour industry to adapt, rather than invent, newsolutions.

Second

Products and services in shipbuilding can in noway be easily standardised because of the hugediversity of ships being built in Euope. No shiphas an absolutely identical equivalent sistership,not even main propulsion engines arestandardised.A leading engine manufacturer inEurope might have several hundred variationswithin one generic line of models according tothe wishes and specifiations of the owners.Thisclearly illustrates the difficulties faced in creatingany form of cohesion between enterprises.

Third

There never was a dramatically urgent need for achange in the procurement philosophy of thehigh class, – high tech shipbuilding community inEurope. Europeans have clearly demonstrated –versus the USA and Japan, – that they are capableof handling the most complex logistical tasks,when they build cruise liners across the spread ofEurope’s geographic and ethnic regions.

Bearing that in mind the MIF-Ad Hoc WorkingGroup on e-business developed a vision for theentire industry, entitled:

”Priorit-e for the European marine industry“.



In order to preserve and secure Priorit-efor the European marine industry shipowners,shipbuilders, marine equipment suppliers andallied associations will jointly provide a ”plainlevel playing field“ for the entire Europeanshipbuilding community.

This initiative will contribute to a double figureshare in worldwide shipbuilding – a prerequisitefor successfully defending Europe’s leadership intechnology, expertise and skills. It will maintainthe close relationship between shipyards andmarine equipment suppliers, and it will guaranteethe scope for improvement through feedback onequipment performance.

The SMM Exhibition in Hamburg clearlydemonstrates that Europe leads the worldwideshipbuilding league in terms of innovation andquality.But if Europe continues to give economic aid tothe rest of the world for free – with no appropriateprotection of the intellectual property, the industrywill no longer be able to finance R & D and remainattractive for rising generations.

This Working Group has a vision, Europeanentrepreneurs and managers have the knowledge,expertise and skill to lead the shipbuildingindustry into a challenging future.

All that this industry needs is a secureenvironment for fair business.

The members of the MIF, the European Parliamentand the Commission are invited to support thisvision!

The network can be compared to that of asporting event being played on a „level playingfield“ where players, or participating companies,are regulated by the rules of the league.Infringement of the rules can result in theoffending player being cautioned, or in extremecases, sent off for a predetermined period.

rugby

soccer

plain level playing field



This industry needs a plain level playing field, auniform set of rules, or legal framework, and areferee.

The rules that will govern the initiating,conducting, providing and monitoring of adefined European e-business park will be basedon a regulatory framework under private lawbetween the European shipbuilding communityand a specified number of accredited operators ofelectronic “building sites”.

The plain level playing field will be given a legalframework and thus will be transformed into an e-business park where operators and providers ofelectronic market places/vertical portals, databases and other electronic information systemsand services will be given a permission for theerection of their construction sites.They will have

to apply for a building license and an ID in orderto secure user confidence, observation of therules, protection of intellectual property and theexclusiveness of European products and services.The vision of the Ad Hoc Working Group onmaritime e-business is of the creation within fiveyears of a commercial network that will allowEuropean companies to exclusively conductcommercial transactions and informationexchanges in such a way to preserve the integrityof their products, protect their financial interests,and increase the European competitive edge overthe outside world.

The picture below illustrates the diversity ofvertical portals (arches) and data-bases(bookshelves) deployed in the e-business-park.

Participants in the game will see a cost advantageover their external competitors through shortenedtime to market. They will also benefit from a self-regulating quality regime.

e-business park

legal framework

data base added



Of course, the vision of a game is only a simile,but the image is enduring.The European footballleague’s players have to abide by the rules of theEuropean cup competition, but they are not ban-ned from individually competing in other arenas.The outside world will act as spectators, and evenmake bids for the services of players, but notcompete in the event itself.This is the way theplaying field should act.

It is envisioned that a steering group to thegoverning body will draft an authorisedmembership list. Nominations in the first instancewill come from CESA, EMEC and AWES.Companies that are not members of suchassociations or are from future partners in the ECwould be invited to join on a case-by-case basisonce the governing body is established.

Accreditation of constructors, issuing of IDs andmonitoring of events in the “playing field” will be transferred to a“referee” -committee composed of representatives from the Europeanmarine industry, their legal advisors and observersfrom the European classification societies.

The resources required will be as follows:

a project manager to oversee the design andconstruction of the maritime e-businessnetwork.

a temporary steering group to give strategicinputs, monitor the construction of the

network and, to recommend themembership of the network.

A governing body, seconded from the marineindustry to make rulings on the conduct ofparticipants in the “game”.

The maritime network would be based in the E.C.The Ad Hoc Working Group proposes a businessnetwork that is open to European companieswithin the marine supply chain wishing toconduct business in Europe.

It is proposed that a product catalogue based onthe marine e-business standards of EMSA willform the basis of all product descriptions,technical data exchanges and transactions ofinformation.

Following the principles of a free marketeconomy, portals and data bases will beestablished, operated for a while, refurbished andrenovated and if necessary demolished thusproviding space for new ideas, new solutions.

It is not the function of this Ad-hoc WorkingGroup to specify the method, only the vision.Thetransaction method will be subject to agreedcommon law, and will probably be based aroundexisting standards and will not require substantialreworking of existing solutions.

accreditation and monitoringplatform

demolishedportal



Access to the e-business park should be given to allEU accredited organisations and their members plus

Norway and its maritime organisations,Switzerland and its maritime organisations, if any,EU candidates and Croatia,European Classification Societies and ABS.

Taking ABS American Bureau of Shipping on boardwill consequently result in allowing the U.S. CoastGuard and the U.S. Navy to enter the playing fieldin the spirit of an Atlantic Alliance.

The U.S. COAST GUARD Deepwater SystemProgram has not only the potential to extend overup to 30 years, with an approximate value of 17 billion USD, it has also a potential for marineequipment supplies from Europe, as U.S. shipyardsdraw heavily on these supplies and marineconcepts and services.The CANADIAN COASTGUARD will face a very similar situation.

The current deepwater assets are aging andtechnologically obsolete, the new fleet of CoastGuard vessels will feature state of the art commonsystems and technologies.

European technologies – not only military butalso commercial expertise – will be desperatelyneeded also from a time frame point of view.

The U.S. Navy is in a process of inventing itself. Itfaces a similar problem that confronted the navalpowers at the turn of the last century –Dreadnoughts at that time, aircraft carriers today.The rebuild program of the U.S. Navy will focusamong others on a new ship design concept thatwill revolutionise the Navy builds and fights shipsin littoral waters.This again will involve technologies whereEuropean marine equipment suppliers canprovide tailor made solutions.

l shipowners:

ECSA

l shipbuilders:

CESA

AWES

l equipment suppliers:

EMEC

l classification societies:

IACS / EURACS

ABS

U.S. COAST GUARD

CANADIAN COAST GUARD

U.S. NAVY



Access to the e-business park

All EU accredited maritime organisations and their members, maritime organisations of Norway andSwitzerland and the EU-candidates

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