The Interview with MD of ChartWorld GmbH and SevenCs GmbH, Mr Jochen Rudolph
During SMM in Hamburg we had an interview with Mr. Jochen Rudolph, Managing Director of the companies ChartWorld GmbH and SevenCs GmbH. Before starting the interview we had a little chat about our magazine and presented our SMM Hamburg special issue. Mr. Rudolph said "I have been to Turkey already in order to visit shipping companies and shipyards. I was quite surprised and it is again confirmed in your magazine that there seem to be far more women in top positions in the Turkish shipping industry compared to, for example, Germany. Is my impression true?" We were very surprised to hear that, and were happy and proud because of the successful women in the Turkish shipping industry.
23 December 2015 - 09:52
Jochen Rudolph: SevenCs was established back in 1992. Two professors of the maritime university in Hamburg had the idea to introduce electronic chart navigation to the world, thus laying the foundations of ECDIS. On the one hand they originally developed software to produce and validate electronic chart data and, on the other hand, the Kernel which is software to display such electronic charts on board a ship.)
SeaNews: Are you referring to the S-57 Kernel?
Jochen Rudolph: Well, S-57 is actually a data format - the original IMO approved official format for electronic navigational chart data. The development of the format, standards and associated tools to produce the data has been significantly influenced by SevenCs. S-57, by the way, is soon going to be replaced by a new data format called S-100. But coming back to your previous question, besides developing maritime software, the founders got involved in numerous EU and Government funded research projects, helping the company and its specialists to gain international reputation. But, while a lot of energy had been put into the groundwork for ECDIS implementation, it turned out that the distribution of electronic charts was not very well taken care of. As a consequence in 2002 a daughter company, ChartWorld GmbH, was established. This enterprise was the first of its kind in the world to concentrate all its efforts on the distribution of official digital charts.
In order to finance its growth SevenCs invited investors at some stage and then eventually got sold entirely to the UK Hydrographic Office, UKHO.
Mr. Jochen Rudolph with Mrs. Fulya Tekin Istikbal of SeaNews at SevenCs Headquarters, Hamburg during interview
SeaNews: So ChartWorld has nothing to do with ECDIS?
Jochen Rudolph: On the contrary, ChartWorld deals with electronic charts which are used within an ECDIS and also offers ECDIS-as-a-service. SevenCs on the other hand concentrates on development and offers software components used as elements within an ECDIS. Plus, it is probably worthwhile to mention that ChartWorld has a well-organized chart production of its own. The charts made here are special charts of high accuracy, custom-made for e.g. pilots, harbour authorities, shipyards and the like.
SeaNews: What is the relation between the two companies? Are they independent?
Jochen Rudolph: Yes, they are independent, they have different products, different focus markets and of course different target customers. We consider them to be two independent companies with the same owner, though. This was the case right from the beginning when ChartWorld was established and was even maintained as such while UKHO was the owner. After they had kept the companies for almost five years UKHO eventually decided to resell them, since they apparently did not fit into their business concept as originally expected. At about the same time Oliver Schwarz and I were looking for a company or enterprise to get a concept going which we had developed over the years - an ECDIS business concept. After we had looked closely at some different companies we came across SevenCs and ChartWorld. We met John Humphrey who was the Managing Director of SevenCs and ChartWorld at that time, and also contacted the UKHO showing our interest. It took nearly a year of talks, tender procedures and negotiations until we finally purchased the companies at the end of 2011. For us it was a perfect fit to start our business concept “ECDIS-as-a-Service” which encompasses both software development and chart distribution.
SeaNews: It is quite interesting to hear that you were looking for a company to buy instead of just setting up a new one. Was there a special reason for that?
Jochen Rudolph: Actually, yes, there was. The IMO decision to impose mandatory carriage of ECDIS on board Solas vessels was very important to us. When developing our business concept we already knew the ECDIS carriage requirement was due to come and the time window for the shipping industry to comply with would be rather short. Setting up a new company would have taken too much time. Plus, it was very important that we got immediate access to official charts, especially charts from UKHO. Although Oliver Schwarz and I had some knowhow about ECDIS as well as ECDIS development and distribution, it was easier to just buy a company in order to get a foot on the road much quicker. That was the main reason.
SeaNews: Now we would like to ask you about yourself, what is your background? Are you the first person to receive a type approval for ECDIS?
Jochen Rudolph: Actually, my background is business administration. I studied Business Administration in Hamburg, and then I worked for a trading company in South Korea. After having worked for 4 years in Asia I had the choice to either stay in Korea or come back to Germany working together with Oliver Schwarz. I had met Oliver at university and we became friends. When his father had died he asked me if I were interested to come back and join him, which I gladly agreed to. At about that time we also got into contact with Transas and then started distributing Transas products. We managed to be rather successful and got the permission to establish a company with the name Transas GmbH, remaining in our ownership. We started off with just 4 people. In the end we had some 70 employees working for us, taking care of distribution of Transas products and complementary products all over Central Europe. In the beginning our main focus was selling simple electronic chart systems called ECS. Back in 1994 or 1995 nobody was thinking of electronic charts, especially since shipping companies usually do not buy anything unless they are forced to. It was difficult to go and see a shipping company and say “look this is a good idea to buy" We had to create demand first. Eventually some captains and shipowners reported about the great experience they had with our system in fog, bad weather and difficult manoeuvring situations. That helped us a lot to conquer the German market. However, I believe the key to success was actually my friend Oliver who has not only fantastic contacts in the industry, but is the best businessman I have ever met.
SeaNews: Did these multi-layer electronic charts already exist at that time?
Jochen Rudolph: Yes, indeed. Transas was actually one of the forerunners to produce and develop electronic vector charts in a proprietary format. The chart coverage was quite good and helped us to successfully sell electronic chart systems to German shipowners. German government authorities became aware of the increasing number of chart system installations and how crews made use of it. So they eventually claimed that "If you want to install such a navigational aid on a ship, you must have a type approval in one way or the other" That was the bottom line. A German only standard for ECS as a navigational aid was introduced rather quickly. A type approval procedure for ECDIS, though, did not exist. Setting up corresponding test procedures was a big task. ECDIS replaces paper charts - a major change to navigation and shipping in general. Matthias Jonas, today head of the German Hydrographic Office, was in charge of type approval at that time and he managed to publish the very first ECDIS test procedures. I admire his enthusiasm and ambition to get great things done. It was in October 1999 when we got the first type approval for ECDIS worldwide. Obviously a special achievement, as it attracted a lot of print and even TV coverage at that time. Coming back to your question: No, I was not the first person receiving the first ECDIS type approval, but I am proud that I was part of the team of developers, engineers and product managers who made that happen. Besides getting type approval we also set up the supply chain management, component production and ECDIS assembly in our Hamburg facilities, supplying ECDIS systems not only to our own markets but for the entire Transas group. Setting up a production of such scale was not easy, as the demand for quality equipment is so much higher compared with computers and monitors used in an office environment.
SeaNews: Maybe it was the tower computers?
Jochen Rudolph: At the beginning we had used ruggedized industrial computers manufactured in Taiwan. Some sort of half size tower computers. Later the hardware was custom-made to our design in a Swedish company specialized in maritime equipment.
SeaNews: Back to the company issue again, what is your main area of activity? How many people are employed in your company? What is your personal area of activity?
Jochen Rudolph: ChartWorld is a group of companies with offices in Hamburg, Cyprus and Singapore. The company ChartWorld itself is focusing on selling electronic charts and publications as well as providing “ECDIS-as-a-service”. In fact we are not selling ECDIS but rather provide equipment, charts, service, maintenance, crew training and consultancy to shipping companies at a small monthly fee. The daughter company SevenCs is still and will remain a mere software development company. SevenCs develops software tools for electronic chart production mainly used in hydrographic offices. It also produces a so called Kernel which is a software development kit allowing for the display of electronic charts. Many well-known ECDIS manufacturers are using the SevenCs Kernel. The company also develops dedicated navigation software for OEM partners as well as custom-made pilot navigation systems called PPUs, portable pilot units. Altogether, we are employing some 75 people in the group.
SeaNews: Could you please tell us about your products in general and the PPUs in particular?
Jochen Rudolph: The PPU software has been developed in co-operation with the German pilots. It is actually an ongoing project in which we try to continuously cater for the changing demands of pilots. This is rather typical for SevenCs. Our strength is the customization of software; on one hand precisely considering the requirements of our customers while on the other hand bringing in our extraordinary know-how. This is not only true for the navigation software but just as much for the suite of software tools for ENC production and for the Kernel software development kit.
SeaNews: Is your software open source?
Jochen Rudolph: No, it is not. We are applying a license system to most of our software packages. There is plenty of software we are making available for free download and evaluation, but an open source approach does not really suit the small market we are in. On the ChartWorld side we have to pay royalties to hydrographic offices for each chart we sell. This is not only true for the charts we are distributors for, but also for those we are producing ourselves at ChartWorld. Besides official ENCs we also distribute quite a number of non-official charts for leisure boats, coastal navigation, fishing and other special applications.
SeaNews: But how is the reliability of those private charts guaranteed? Are they endorsed by the National Hydrographic Offices?
Jochen Rudolph: They are not really endorsing the charts, but basically they are the data producers. Almost all data used for private charts are originally taken from official charts. The method is either vectorising paper charts or just converting official ENCs into a private format. The appearance and the data is more or less the same. The main difference is the frequency of chart corrections. While official charts are corrected on a weekly basis, private charts are corrected only monthly or quarterly, depending on what the customers want. Some chart formats even are corrected only once per year.
SeaNews: Presently you are developing a product that shall be used on ships for navigation with touchscreen operation. How is the situation so far?
Jochen Rudolph: If you look at the ECDIS systems out there in the market they are all, without exception, full with fantastic functions and features, but they are rather difficult to use. If you ask a superintendent, though, “what is important for you?" the answer in most cases is: "Make it easy. I want our mariners to get used to it quickly and without time-consuming and expensive training”. We have tried to gather all our experience and ECDIS knowledge as well as plenty of user input in order to develop something entirely new, which the market has not seen yet. User friendliness is the main focus and a touchscreen is part of this. I remember well when the first touchscreen phones appeared on the market. I was reluctant and insisted on separate hard keys at that time. Today touchscreen phones are the standard and even the most traditional mariner, skeptical towards new technologies, carries a touchscreen phone in his pocket. When developing the new ECDIS we have made sure the user interface is 100% suitable for touchscreen operation. That makes us rather unique. At the SMM Hamburg you could see some other manufacturers showing touchscreen ECDIS, but none of them was really made for it, hence very difficult to operate.
SeaNews: What are the technological advantages of your products?
Jochen Rudolph: We try to take a different approach. The term “made by mariners for mariners” is pretty much used by everybody. Besides offering advanced technology, we put a lot of focus on the shipping companies’ demand. What are they looking for? What are their concerns when dealing with ECDIS? Our concept “ECDIS-as-a-service” was created to make it really simple for a shipping company to transfer the vessels to paperless navigation. On top of that we have developed a unique approach, which helps shipping companies to finance the ECDIS re-fit, in most cases with a positive cash flow effect. Another main area of focus is a hardware concept which should be very easy for maintenance. ECDIS is important for navigation; if ECDIS does not work, the ship cannot go, it is as simple as that. This burden has to be taken off our customer’s shoulder. So we had to find a technology allowing us to not repair but just exchange equipment very rapidly. Eventually we developed an "easy to replace hardware" with swappable hard disks and a RAID system. This is a real technological advantage. Once a system breaks down, we just replace it. Some 4 screws have to be released and 5 plugs to be removed. Then exchange one of the hard disks, put it into the replacement hardware, tighten the 4 screws again and put back the plugs. Ready! It is that simple that basically everybody can do it. Certainly an expensive engineer is not required. We have also looked into the chart correction process which, to my taste, is still very complicated in most other ECDIS systems. With ChartWorld the complete process is fully automatic. Ordering new charts for a planned route or correcting existing charts has never been this easy.
SeaNews: What kinds of ship require your products most? Who are your clientele?
Jochen Rudolph: Our eGlobe ECDIS is mainly made for the retrofit market but it can be installed on newly built ships just as well. In the end it does not matter what kind of ship it is used on. We have equipped modern very large container vessels, super tankers but also smaller coastal feeders or offshore supply vessels.
SeaNews: How old is your pilotage product?
Jochen Rudolph: SevenCs is supplying the German pilots with pilot software for, I think, for more than 5 years now. However, when taking over the company in 2011 we found the product being pretty outdated. Pilots, quite rightly, started to complain. So I contacted the head of the German Pilot Association and suggested a joint development of entirely new software. A good fit, as the pilots have the expertise and we the software development skills. A similar approach has been used in a project with Australian pilots. Other pilots associations just choose our off-the-shelf product which we have developed in parallel.
SeaNews: Is your pilot software compatible with a ship database?
Jochen Rudolph: The compatibility with a ship database and a permanent connection to servers ashore is very important for pilot systems. We are not developing database software but an interface to. The Australian customers are using a database solution which is called Voyage Bank, whereas the Germans partner with the Trenz AG which has developed a very nice custom-made solution. Interfacing those to our pilot software has been an essential part of the development. The portable pilot unit we supply is getting all its navigational data from the so-called pilot plug onboard, but we also connect to shore via GSM, which allows us to work with different database applications. On top of that we make sure that chart data, special pilot information and software version can be updated fully automatically. Interaction of the pilot, who is busy with other duties anyway, is not required.
SeaNews: How many of your customers are from Germany, and how many from abroad? What is your market share?
Jochen Rudolph: At SevenCs our product range addresses quite different markets. The ENC tools are mainly sold to hydrographic offices, port and costal authorities, offshore companies and simulator users. We sell the Kernel to ECS and ECDIS manufacturers as well as to solution providers who like to display electronic charts in their applications. The navigation products are made for OEM partners and clients requesting custom-made solutions. In all, about 90% of the SevenCs customers are coming from abroad. At ChartWorld, mainly addressing shipping companies, the split is 30% German and 70% from abroad. The number of international customers is constantly growing, so that I believe the ChartWorld split will also be 10% to 90% in two years’ time. Giving you a short answer on SevenCs’ market share is difficult as our product range and the target markets are very broad. The ECDIS market is very volatile right now. There are about 35 companies offering ECDIS equipment. Now, when you ask about their business model, they all claim to have some 10% market share. You do not need to be a mathematician to understand this being slightly off the truth. Some will certainly disappear as the market is too small for such a number of competitors. I believe there will be only a few key players left, those which are really dedicated to their respective product and understand market and demand very well. The market situation for electronic charts is also quite interesting. The total number of ships is not growing and consequently the demand for charts, whether paper or electronic, will remain the same, too. The number of distributors on the other hand has dramatically increased. All those traditional paper chart dealers are now pushing into distribution of electronic charts. Then we have the established distributors of electronic charts such as Transas, ChartCo and, of course, ChartWorld. Additionally some clever people attracted money from professional investors and venture capital companies and also appear in this market. I am just wondering what their business plans look like. We can already see now some desperate price wars which will be appreciated by customers in the short run. In the long term, however, this will not benefit anybody and a considerable number of traditional and new ventures will disappear from the market. It is a pity that all the money is wasted here. We at ChartWorld are among the top 5 chart distributors and we are confident to remain on that level. 15 years of experience in distribution of electronic charts, the understanding of technology and market demand as well as unique innovative solutions give us the competitive edge.
SeaNews: What are your publications?
Jochen Rudolph: Besides charts we supply all sorts of publications required on board ships. Each ship has large shelves with books and publications which need to be maintained, updated or replaced quite frequently. Apart from the space issue there is also a lot of work involved for the crew. Luckily, those paperback books are gradually replaced by electronic versions which can be loaded and maintained on the ship’s computer. We are offering not only those e-publications but also automatic updating and replacement solutions, substantially reducing the workload of navigators.
SeaNews: The crisis in the maritime market, to which extent have you been affected?
Jochen Rudolph: It is difficult to say, as we bought the company at the peak of the crisis, at the end of 2011. I believe the crisis has affected our business volume in a way that things were developing a little bit slower than we had expected. The ECDIS-as-a-service approach is actually helpful for shipping companies to fulfil the ECDIS carriage requirements at financially favourable terms. Perfectly suited in times when cash flow is an issue. However, decision making has been put on hold somehow and even good decisions are delayed. Let me tell you a story which underlines this. Just recently, we have made a presentation to a shipping company and proved that signing up for ECDIS-as-a service will not only save money from day one, but also improve the cash flow in the very first year of operation. The customer actually said "This is fantastic and exactly what we need in these bad times. We will equip our fleet with the ChartWorld ECDIS. Please come back in a years’ time!!" It seems the ECDIS carriage requirement is too small a problem and is postponed even if financially not sensible. Some customers obviously have to deal with much bigger and substantial problems right now.
SeaNews: What are the future goals of your company?
Jochen Rudolph: Our main target is to establish “ECDIS-as-a-service” and to become one of the main suppliers for data and charts. Additionally we have a couple of nice ideas up our sleeve both for ChartWorld and SevenCs. But I like to take one step at a time.
SeaNews: How was the SMM Hamburg fair for your companies? What did you do? How were your impressions about SMM 2014 Hamburg?
Jochen Rudolph: SMM is by far the most important event in shipping and this is how we handle it. We are lucky this exhibition is taking place basically on our doorstep. We had a stand at the show presenting our products, but we also organized some other events in parallel, knowing that customers from all around the world are in town. I consider the SMM to be only a platform and it is entirely up to us what we make from it. I was very happy about the results and had a very good overall impression this year.
SeaNews: Are you already involved in the Turkish market? If so, what is your situation in the Turkish market? Do you see a big potential in Turkey?
Jochen Rudolph: I personally visited Turkey back in 2010 for business. I was in Istanbul; visiting shipyards, nautical colleges and shipping companies. I was very impressed to see the level of technology and the level of professionalism in the Turkish shipping industry. That is something which is, apparently, not very well known internationally yet. I think there is a good future in the Turkish shipping market and Turkey is definitely one of the key markets for us. Our sales team is regularly visiting Turkey and we even recently participated in a delegation to Turkey with high ranking politicians and business managers. The trip was organized by the Hamburg senator of economics and gave us access to high ranking decision makers in Turkey. For the future we also intend to create a Turkish PPU version as we understand that Turkish customers appreciate software operated in their own language. We are presently looking for or a mariner or captain being capable to translate the user interface in a sensible way.
SeaNews: How does the ECDIS-as-a-service concept work? Would you like anything to add?
Jochen Rudolph: As I said earlier, we do not sell equipment in the traditional way but rather provide a service. An ECDIS is not just equipment such as a GPS or radar which you sell, install and then forget about it. It is about taking a ship into a new era of navigation; it is about taking the shipping company into paperless navigation. The concept we offer includes the most modern ECDIS equipment which always will meet IMO requirements, now and in the future. That means we make sure hardware and software will be updated and replaced whenever necessary, automatically and without any extra cost. It also includes a lifetime warranty and annual performance tests. It includes consulting the shipping company on how to go paperless including all the required ISM documentation. Furthermore, the concept includes continuous training and certifying of the crew, as all ECDIS operators have to present up-to-date type specific and general ECDIS certificates. An automatic chart correction service and tools to conveniently select charts for the intended route is also included. All these services and the equipment will be provided for a small monthly fee. There are some similarities to a mobile phone contract. The main difference is we do not require a minimum contract period. In case of phones that is usually 2 years. With us customers can quit the contract at any time. There is no risk for the shipping company, which is useful especially in case a ship is sold to new owners or just put off service.
SeaNews: What do you think of our magazine?
Jochen Rudolph: I have seen quite a number of shipping magazines, and I must admit I quite like yours. It is very convenient to read and has a lot of information about the Turkish market - information which is not only interesting but really useful to us. I also think SeaNews is a good forum for us to present our products to the Turkish market. In general I appreciate your magazine as it contains a good mixture of subjects, pictures and texts. It is certainly not the most modern design, but it is anyway the content that really counts. SeaNews is not too big, not too small; just right.
SeaNews: Thank you very much, Mr. Jochen.
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