As the federal government slowly makes headway on its new fleet of Arctic patrol vessels and support ships, as well as its surface combatant, Captain Gordan Evans Van Hook, USN (Ret’d) describes what government maritime services – navies and coast guards in particular – can learn from commercial operators.
Rising procurement, manpower, operations and maintenance costs are forcing the world’s maritime services to re-examine traditional fleet management to minimize total ownership costs. There are immediate savings that can be quickly realized, particularly in energy efficient technological solutions, but government maritime services could find greater long-term benefit in a more holistic energy management approach. Such approaches can be found in many large commercial maritime fleets, where energy efficiency is crucial to competitive advantage.
Holistic energy management
Energy management has long been central to the business operations of successful commercial maritime companies. It has typically taken the form of cost-cutting measures in response to cyclical economic downturns and oil price increases. In a less competitive company, these conservation initiatives recede when the economy improves or oil prices drop again. Transforming energy conservation from a cyclic, short-lived response into a long-term, sustainable path to achieve strategic goals is the hallmark of the world’s top maritime competitors.
Holistic energy management includes not only technological improvements, but incorporates processes, people and competencies to maximize and sustain savings and efficiency. Holistic energy management has four major components: marine engineering, innovation, regulatory affairs and vessel performance management.
Marine engineering
Superior marine engineering is the heart of the energy efficiency, environmental awareness, safety and operational reliability that keep a top commercial maritime company cost competitive. It includes technical support, naval architecture and engineering, risk management, and actual vessel modifications. Most nations supporting robust maritime services have an indigenous marine engineering organization that can focus on the same technological solutions as a leading commercial operator would.
While marine engineering solutions can yield “quick wins” that produce immediate cost savings, these solutions cannot be taken in isolation from the processes, people and competencies of a corporate culture. Excessive focus on marine engineering solutions can be exacerbated by a nation’s defence industrial base and technology-based companies in their marketing to governmental maritime services. Such solutions can be seductive in their relative ease of implementation, but changing the processes, people and competencies can be far more challenging.
Innovation
Innovation within successful organizations includes soliciting ideas, evaluating opportunities, conducting business case analyses, performing demonstrations, validating results and making final determinations of value. Innovation within a commercial maritime fleet’s technical organization focuses internal research and development toward energy efficiency, often coordinated with original equipment managers (OEM). This screening of ideas must employ its own innovative approach to enhance the generation and development of ideas from all organizational levels, incorporating expertise across many fields within the company, the OEM or other commercial partners. The process ultimately culminates in a strategic development plan for introduction of the idea into fleet operations.
For a government maritime service there will almost certainly be limitations in the freedom to team with certain partners based upon a nation’s acquisition regulations. Although a potential partner may be the recognized technological leader, policy may require a competitive bid and evaluation process. Despite such limitations, a successful innovation process in a government maritime service can still allow an active generation and comprehensive screening of ideas, and further concept development and maturation. This must be an internally transparent and easily understood process that encourages idea generation in the future.
Regulatory affairs
Regulatory affairs for a commercial fleet do not simply involve observing safety and environmental rules and regulations, but also participating in their development with relevant industry stakeholders and fellow ship owners to drive regulatory initiatives. The commercial maritime industry is constantly evaluating the business impact of proposed regulations and preparing for the future regulatory environment. Although this commercial approach may seem limited in the government context, it remains relevant. Often government agencies and services can appear to operate in isolation from the activities of regulatory agencies. There are examples of military services that have run afoul of their own national or provincial environmental regulations, or broader international standards adopted by host nations while deployed. Maritime services could benefit from the commercial perspective in keeping a “weather eye” toward the onset of such regulations by early participation in policy development.
Vessel performance management
Addressing the people, processes and competencies directly through the operating fleet and its shore support is necessary to incorporate energy-efficient and environmentally-conscious operations as fundamental business values, rather than simple mandates. Monitoring and managing vessel performance is inextricably interconnected with marine engineering, innovation and regulatory affairs.
A successful commercial ship and shore support framework empowers leadership to make decisions that increase the fleet’s operating efficiency and reduce energy expenses and carbon emissions. Performance monitoring systems can provide immediate access to the current and historical operating data and conditions, such as hull, propeller and engine performance; power and fuel consumption; monthly lubrication and cylinder oil consumption; main engine and electrical load profiles; and daily warning reports. Vessel performance management uses specific fuel efficiency targets to drive immediate proactive corrections before poor performance becomes a trend.
A set of operational Key Performance Indicators (KPIs) are used to create a matrix to identify, class-by-class, the potential for using specific modules to optimize vessel performance. The matrix identifies which modules, singularly or in combination, are compatible with existing propulsion systems; and identifies potential costs and benefits. Various performance initiatives can then be applied to existing vessels and new designs.
Data, collected automatically from traditional reports and regular tests, are compared to baseline and sea trial models to support future decisions on operations, maintenance and modifications for the specific vessel, class and fleet. This provides early identification of technical issues that require further analysis and correction; more important, it stimulates self-motivation, teamwork, competition and ideas that in turn feed the innovation process. Different ships or fleets within a large commercial company may be scored against each other and results could be published to further stimulate cooperation and competition afloat and ashore.
Sustainability as the goal
Energy is the largest non-manpower expense in any successful commercial maritime enterprise, and any efficiency improvement, even in tenths of a percent, significantly improves competitive advantage. Commercial maritime leaders know that energy-efficient and environmentally conscious operations must be a fundamental business value within the corporate culture. There may be specific differences in some commercial and governmental approaches, but the goal of sustainability for both requires robust innovation coupled with engineering expertise to turn creative ideas into reality.
Regulatory insight and proactive engagement promotes understanding of issues, but also guides the future business environment for both industry and government. For both, vessel performance provides essential access to data to support important and costly investment decisions in the operation and technical management of a fleet. The sharpest competitive edge demands a continuous, innovative and structured holistic approach to energy management, whether in government or private industry.
Capt Gordan Evans Van Hook is senior director for Innovation and Concept Development at Maersk Line Limited, focused upon ways that U.S. maritime services can leverage commercial best practices and innovation in energy efficiency, sustainment, sea-basing, sealift, modularity and commercial ship conversions. He served 29 years in the USN, commanding destroyers and frigates.