1. Quality Human Resources as a main Contribution to Safety and Efficiency of Shipping
International Forum on Seafarer's Education, Training and Crewing, Odessa
24 – 25 April 2013
Chief Marine Technical Officer Aron Sørensen

2. Established in Denmark in 1905
BIMCO history
23/04/2017
Established in Denmark in 1905
A large international shipping Association for Owners, Brokers, Agents, Clubs and Associates
Approximately members in 123 countries
The owner-members of BIMCO control about 65% of the world's merchant fleet. 

3. Advocacy - promulgating shipping interests Documentation
What does BIMCO do?
23/04/2017
Education
Advocacy - promulgating shipping interests
Documentation
Information and advice to members

4. Todays presentation Quality what are we talking about?
Manpower issues and its impact on quality in shipping
Suggsted solutions to ensure quality shipping also in the future
The subject of my presentation today is: Quality Human Resources as a main Contribution to Safety and Efficiency of Shipping
The shipping industry consists of shipowners and operators, equipment manufacturers, ports and service companies. Also connected to the industry you will find authorities, cargo owners, and institutes of research and education.
The shipping industry is an essential part of the global supply chain and it is evident that we need the right people to ensure goods are transported from manufacturer to consumer in a safe and efficient manner. The responsibility for this not only lies with the shipping industry but also with seafarers supplying nations and other authorizes around the world.
With this introduction I have tried to indicate that quality and efficiency in shipping is a complex issue. With regard to ships this may be intensified because the ship owner or ship operator may newer meet the employee on board the ships.
To get around the subject I will:
• Set the scene by discussing quality and put it into a shipping human resources perspective
• Base my case on the results of the 2010 BIMCO/ISF Manpower Study
• Suggest solutions to ensure quality human resources also in the future

5. Definition
Quality in business, engineering and manufacturing is non-inferiority or superiority of something or fitness for purpose
A quality human resource has the ability to perform satisfactorily on board and provide the service suitable for the intended purpose
Let me start by saying that in this presentation I will use the word Company a lot. Company will stand for the owner of the ship or the manager or the bareboat charterer. It will be the person who has assumed the responsibility for operation of the ship.
Quality in business, engineering and manufacturing has a pragmatic interpretation as the non-inferiority or superiority of something; it may also be defined as fitness for purpose.
Quality is a somewhat subjective attribute and may be understood differently by different people. Consumers may focus on the specification quality of a product/service, or how it compares to competitors in the marketplace.
For shipping you could say that a quality human resource is a person with the ability to perform satisfactorily on board and provide the service suitable for getting the cargo safe to the destination in the most economical possible way.

6. Aspects of quality in a business context
Producing - providing something
Checking - confirming that something has been done correctly
Quality Control - controlling a process to ensure that the outcomes are predictable
Quality Management – directing an organisation so that it optimises its performance through analysis and improvement
Quality Assurance – obtaining confidence that a product or service will be satisfactory
From a theoretical point of view there are five aspects of quality in a business context:
Producing - providing something.
Checking - confirming that something has been done correctly.
Quality Control - controlling a process to ensure that the outcomes are predictable.
Quality Management – directing an organisation so that it optimises its performance through analysis and improvement.
Quality Assurance – obtaining confidence that a product or service will be satisfactory. (Normally performed by a buyer (charterer) but in the case of shipping also by port state control)

7. Aspects of human element quality in a shipping context
23/04/2017
Supply states
(Producing and Checking)
Crew manger
(Quality Control)
Company (Quality Management, Quality Control)
Vetting and Port State Control
(Quality Assurance)
From a quality perspective, ‘production and checking’ represents: Provision of educated and trained seafarers. This responsibility lies with the supply countries; however the Company will in many cases take part in training the apprentices. The company does so by offering scholarships and by directly engaging itself in a training institution. This can for example be done by direct financial support or by donation of full mission simulators.
When it comes to quality control, which is controlling the process, this would in the shipping industry be to ensure that the crew, ship and cargo are safe and that the voyage happens is done with low fuel consumption and emissions; and without polluting the marine environment.
If the company uses a crew manager, the crew manager may be tasked with the job of preparing the seafarer for the job on board and ensure familiarisation with the safety management system of the company. If the company employs its own seafarers the responsibility will of course lie here. The company will have to ensure that the seafarer lives up to the standards that the company requires of its employees.
Quality management definitely encompasses the responsibility of optimizing safety and efficiency both in the land base part of the company but also on board. Efficiency will in the supply chain be very dependent on other operators such as port workers and custom authorities etc.
Quality insurance lies with the charters. Especially in the tanker and supply industry, the oil majors have set a number of quality demands for companies. They are using vetting as a means for quality insurance. But also the bulk trade is together with other parts of the industry beginning to feel the quality and efficacy demand from charters.
Port state control have over the last decade been intensified and increased. Even though shipping is very safe the coastal states are moving towards a zero tolerance for accidents.

8. (Producing and checking)
Regulatory basis
(Producing and checking)
STCW
(Quality control)
ISM Code
(Quality assurance)
MLC
The basis
A number of international conventions form a basis for ensuring quality human resources in shipping.
STCW
Education and training are very important as shipping is becoming increasingly specialized and technically sophisticated. STCW reflects at any given time the technological state at the time of adoption of amendments.
As the STCW in only updated every 10 to 15 years it is evident that education to a level that is higher than STCW must be provided by the company in order to keep up with the changes coming from technology developments. Continued in-service training is a must to maintain the ability to compete in the shipping industry.
International Safety Management (ISM) Code establishes an international standard for the safe management. Proper implementation of a safety management system (SMS) will helps company to self-regulate safety issues. In reality this forms a quality management system.
The International Maritime Labour Convention sets out seafarers' of work on a wide range of subjects. It gives a number of fundamental rights and principles of seafarers along with seafarer’s employment and social rights. It has therefore rightfully known as one of the pillars of the international regulatory regime for quality shipping.
BIMCO believes that the two mentioned internationally agreed conventions represent a comprehensive and realistic framework for ensuring basic safety, standards of qualifications and training, security, decent working conditions, fair treatment and minimum safe manning. Moreover, BIMCO believes that the ISM Code establishes an international standard for safe management for the industry. Proper implementation of a Safety Management System (SMS) will help companies to self-regulate manning levels taking into account safety issues.

9. 2010 Global supply and demand
Area
2010
Supply
Officers %
Ratings
OECD Countries
184
29.4
143
19.2
Eastern Europe
127
20.3
109
14.6
Africa / Latin America 50
8.0
112
15.0
Far East
29.5
275
36.7
Indian Sub-Continent 80
12.8
108
14.5
All National Groups
624
100.0
747
The supplying nations ensure access to well qualified and properly trained manpower base. From a quality perspective it is extremely important that base is solid.
To give you an overview over where the seafarers are coming from I will use numbers from the latest BIMCO ISF Manpower study. The
Manpower Study has been made for the every five years since We basically ask flag countries in the world of how many valid certificates they have. We also ask shipping companies all over the world how many seafarers they employ. The numbers are fed into a statistical model and the result is an estimation of the global supply and demand.
Demand and supply of officers were more or less in balance in And on the surface everything looks fine.
Mention overall numbers, Far East and Eastern Europe.
Worldwide demand in 2010 was
637,000 officers.

10. Manpower Study 2010 other results
Wastage rates are high (avarage app. 6%)
Faster carreer patchs a challenge
Leave periods expected to increase
Specialisation will continue
The rigth human resources needs to be supplied in sufficient numbers
It is important to point out that a balance between support and demand may not be the best starting point for ensuring the best quality. A supply surplus would make it possible for a company to be selective for example if having an urgent need for new officers. A balanced situation may force a company to take what is available on the market even if the qualifications of the person are not living up to the expected standard.
What you cannot see from the numbers mentioned at the last slide; is that there was a shortage in specialise sectors such as tankers and off shore vessels. This was mainly driven though quality demands made by charterers.
If you add the wastage rate per year (in this case 5,7 percent of officers) you will have officers key employees who will have to be replaced every year. This is a very high number. Every new officer will have to be educated for a long time, trained so the wastage number represents a great loss of knowledge and experience and impact huge investments in new education and training for supply countries and companies.
Furthermore the BIMCO Manpower Study indicated that for some nationalities the relative wealth of seafarers compared to other professions in their country of residence, enabled officers to go for early retirement. There is also some evidence that shore-side prosperity, and good domestic salaries, also attract seafarers ashore.
Finally the leave periods for e.g. Indian officers were getting closer to the traditionally longer leave periods of officers from the OECD countries. Longer leave periods means more crews per ship.
BIMCO believes that increasing specialization of all crew and ship types will continue to be a significant feature. It is becoming more unusual for officers to change ship type. This, together with rapid technological changes, is feeding an increasing concern of a consequential war for talent and skills, with associated wage rises. Shortages of officers were most evident in areas such as the tanker sector, the offshore industry and on ships using Dynamic Positioning and was countered by the present crisis. However when the market picks up again we believe we may end up in a situation where companies will have to increase back-up rates. If you can only replace a DP officer with another DP officer you definitely will have to increase your quality management.
So even though the supply and demand was balanced in 2010 a surplus supply of qualified officers is needed in order to live up to the quality that the costumer and authorities demands.
On the positive side it should be mentioned that the 2010 Manpower Study showed significant increases in the supply from many countries due to improved training and recruitment. BIMCO’s message is that supply levels on officers need to be maintained to ensure efficient world trade especially when growth starts to pick up.

11. Means to ensure quality shipping
Company
Retain human resources
Attract new seafarers to an attractive career
Manage to ensure that seafarers contribute to safe and efficient shipping
Seafarer supplying countries
The right human resources in sufficient numbers should be supplied
More supply countries please
Lean education systems are called for

12. How does the Company ensure quality shipping
23/04/2017
Career path planning to retain qualified seafarers
Availiablity to direct link to home
Improve industry image
Continuing training for STCW++ competencies, because of
Specialised facilities and ships
Stricter regulation (environmental, operational etc.)
Integrated and sophisticated on board systems
Create a safety culture
Link to home shipping. While we are still waiting for INMARSAT or Intelsat, to carry out the announced plans for the era of High Throughput Satellites (HTS) with data speeds in megabytes rather than kilobits we have to find other means to crews calling for better data access. We need to come with solutions where the seafarer can assess the net and link to home at a reasonable price. The increased need of quality crew members seems to some extent to drive this market. More BIMCO members are now talking of crew access to home as a must for retention and more and more are subsidising the cost to deliver it free or cheap. The new trend is to have seafarers bringing their own i-pad or smart phone on board giving access to Wi-Fi on board.
Improve industry image: Attracting quality human resources are hampered by the general low status of the industry are having to the surrounding society.
Unfortunately the normal press on shipping that reaches the mass media is generally negative focussing on accidents causing pollution and/or deaths of passengers. This vicious circle will have to be broken and the message that a seagoing career within the international shipping industry represents an attractive career opportunity with a broad international perspective.
We need to get the message across that ships are just the place for the right young persons with its widespread use of sophisticated integrated electronic and automated systems on the bridge as well as in the engine room and the cargo departments, operating in a high tech environment.
Career path planning to retain qualified seafarers: I think flexibility is a key word when we are discussing career planning and retainment of officers.
Let us use having small children which we know complicate matters for many officers who want to take part in the upbringing of their children.
To accommodate this, the company could offer shorter periods at sea for example paring the officer with an officer who has chosen to stay out for longer periods at a time. The company could also work with a combination of seagoing and shore based work at one of its offices to provide this kind of flexibility.
Career planning should be open up for dialogue to establish what plans people and needs the officer have. If an officer are interested in working in the organisation ashore the career should be planned in a way that the competence from ship operation can be dragged into the organization ashore.
Continuing training for STCW++ competencies: Many shipowners, primarily the larger ones, have invested substantially in the establishment of internal training facilities or have entered into arrangements with training centres and maritime universities to ensure a steady supply of well-trained officers.
The reason for the need for education is listed on the slide. Let me just say that different types of ships are optimised in order to make them competitive with other ships in similar trades. So the educational profile of an officer that operates will a heavy lift vessel will be different than the one that operates a container vessel or else the company will newer ensure efficiency on board the ship.
Continued training represents a cost and there are companies that try to get around the cost by seizing seafarers who are well trained. This is indeed a problem for the industry. BIMCO however strongly believes that seafarers should at all times be competent and appropriately trained to fulfil the duties for which they were employed. In an industry that becomes more specialized with increasingly faster developments in technology, investments in training beyond STCW level is a prerequisite for being competitive.
Create a safety culture: Professional and competent seafarers advocate a safety culture, which is much more than avoiding or reducing accidents. It is to do the right thing at the right time in response to both normal and emergency situations. Such an attitude is to a large degree inspired by the signals given from the management in the shipping company, backed up by the employment of seafarers with high standards and qualifications. A safety culture should be an embedded part of a well-run shipboard operation – prevention is better than cure, and most of the time considerably less expensive.

13. How does the supply country ensure quality human resources
Shipping industry needs interest from policy makers in supply states
Close co-operation with the industry makes recruitment and retainment easier
Feed of specialied people into shore side part of industry crucial
Active administrations seem to be winning the market. And it is a market. Large supply countries will ensure an inflow of foreign currency. The fact that some flag states are so encouraging ought to serve as an example to others, who need perhaps to be persuaded that their shipping industry does not grow by accident, but by active interest by policy makers.
As supply of human resources companies and the coastal states need to co- operate on recruitment and the content of education. The company would benefit from this by the of a training and education programme including special needs of the company and the training institute would receive funding and input from the needs of the industry.
Finally I would mention that in order to avoid knowledge drain if seafarers decide to stop the on board career, BIMCO supports career paths, which qualify for employment in the land based part of the shipping industry. The global supply chain needs people with direct experience from the sea.

14. Questions?