Maersk hires more IT staff to automate processes, digitise asset utilisation

AP Moller-Maersk plans to hire more IT staff to position technology at the core of its operations in order to realise its 'vision to become the global integrator of container logistics'

28 August 2019 - 19:00

AP Moller-Maersk plans to hire more IT staff to position technology at the core of its operations in order to realise its 'vision to become the global integrator of container logistics'.

The company's technology strategy focuses on the following three areas: 'Digitising customer transactions, enabling to become our key transaction platform for all products and services,' it said.

The carrier also intends to improve operations and increase utilisation of ships, containers and terminals through digitisation and by automating 'core processes' in the company. It also aims to generate new revenue streams from digital products such as the electronic shipping platform TradeLens, reported American Shipper.

Chief financial officer Carolina Dybeck Happe said in a call with investment analysts that the company has in total 6,000 people working in information technology, half of whom are contractors. The company is looking at raising the share of IT staff working directly for Maersk 'in the more strategic areas, and the important areas, and then keep a healthy balance of contractors for the rest,' she said.

Chief technology officer (CTO) Adam Banks told the Danish newspaper Borsen in July that the company was hiring 26 new employees a week and that in a year and a half it planned to have 4,500-5,000 IT employees. He said two-and-a-half years ago the company had an 800-person IT staff.

This year the company introduced 'Maersk Spot', a product that offers shippers carriage of their cargo at a fixed price as well as guaranteed equipment and space in exchange for a penalty if they don't show up with the promised cargo.

Maersk Spot is available on all trade lanes except in and out of the US, and at the end of the second quarter it was moving 8,000 FEU, equivalent to eight per cent of spot volumes. A company spokesman said the company plans to launch Maersk Spot in the US in the fourth quarter, subject to regulatory approval.

Maersk said it has 'achieved improved fuel efficiency for our vessels through technology', allowing it to prevent an increase in bunker costs even while moving more cargo. Although the average price for bunker fuel in the second quarter was $436 per tonne, 8.5 per cent more than in the second quarter of 2018, the company was able to keep fuel costs at $1.2 billion for the quarter by reducing bunker fuel consumption by 7.5 per cent.

The company said it reduced fuel consumption 'mainly due to efficiency initiatives, the more efficient newbuild vessels delivered in the past year as well as from a stable network in the second quarter that also impacted schedule reliability positively.'

The use of automation is also helping the shipping giant to improve service delivery. Since the first quarter of 2018 it has improved vessel schedule reliability from 70.4 per cent to 85.5 per cent in the second quarter of 2019, citing figures from the consulting company SeaIntelligence.

Speaking about TradeLens, a 'blockchain-enabled' digital shipping platform jointly developed by AP Moller-Maersk and IBM, CEO Soren Skou said Maersk is 'building towards TradeLens becoming a business in its own right as if you will, an internet of trade.' It is hoped that the new platform will help shippers manage their supply chain, make it more efficient and improve visibility.

In addition to Maersk, carriers such MSC, CMA CGM, Hapag-Lloyd and Zim are joining TradeLens, as well as terminals and logistics companies.

'It was a very important step to get commitments from some of the largest carriers in the world to join the platform because without the data from the carriers, the platform will not be interesting for the customer,' said Mr Skou.

'The rest of this year we'll do the work to actually get these carriers on board,' he said. 'We will have around 60 per cent of global capacity on the network then on the platform. At the same time building the platform with the landside participants - container terminals, container truckers, railroads and so on, so that we get as much of a network covering as many participants as possible.'


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