Far from getting any easier, management of tankers is certain to get more complex, said Bob Bishop, Chief Operating Officer of V.Ships Shipmanagement, speaking at the Tanker Operator Conference in London this week.
With increased regulation and burgeoning media scrutiny on behalf of a cynical public, risks will be greater and risk management will be ever more crucial he said.
While Bishop anticipated a gradual increase in third party management outsourcing from the current 15 percent of the world’s tanker fleet, he emphasized that Managers will need to do more to demonstrate control, performance and value to clients in order to win new business .
“Winning managers will need to have robust management systems in place which in turn will allow them to provide adaptable and bespoke solutions, such as providing superintendents in clients’ own offices, hybrid j.v. type relationships and franchise ‘virtual’ office solutions, together with key performance indicators covering all the vital areas of management,” he said.
Bishop noted that all the industry research among owners that he had seen pointed clearly to the fact that crucial shipmanagement decisions would be based on trust and integrity, established upon a platform of technical ability and responsiveness.
“Without reputation, there is no business to be conducted in today’s media scrutinised environment,” he said.
Bishop reflected that price did not appear to be the most critical criteria in evaluating shipmanagement, as a manager’s fee represented such a small fraction of a vessel’s running cost. He did comment, however, that generally shipmanagers had, over the years, found it very difficult to get the risk reward ratio to tip in their favor rather than that of the owner.
Commenting upon the challenges facing both tanker owners and managers, Bob Bishop suggested that loss of reputation was perhaps the biggest single risk facing both groups. “Start collecting a string of Port State Control Detentions and watch the approvals slip off the page,” he said.
Commenting that poor inspection reports on public databases such as Equasis were probably bigger areas for concern for quality owners and managers than flag state inspections, Bob Bishop said there was still much work to be done in establishing correct criteria for detentions.
“A concern for all is a tendency in PSC inspections to relate a detention for equipment failure to failure of the ISM Code Management System and hence to question the Company’s Document of Compliance,” he said.
On a positive note, Bishop said that while market volatility has provided the backdrop to the tanker owner-operating environment over the past decade, then in addition, the environment will be the issue of this decade. On this front he noted that tanker safety, including protection of the environment had improved dramatically over the past 20 years.