As with all industries, the global pandemic has accelerated the digitalization of the maritime sector. With increasing strain on the global logistical network and supply chains, the need to receive real-time updates and data from ships and their cargo is great. Before the pandemic, many international shipping companies had resisted digital transformation beyond the industry requirements. However, the benefits of optimisation and automation have become increasingly clear. The rise of environmental regulations means that maritime transport must streamline systems and processes not just for commercial efficiency, but to meet sustainability strategies in lowering unnecessary carbon emissions.

The industry is known for its relative conservatism and yet digitalization and information technology in the shipping industry goes as far back to the 1980s. Electronic data interchange (EDI) standards were adopted by shipping back then to send electronic documents such as purchase orders and invoices between trading partners. Since 1999, Inmarsat C has been the leading provider of GMDSS-approved satellite communication for vessels alongside Iridium Communications. The Global Maritime Distress and Safety Services (GMDSS), developed by the United Nations’ International Maritime Organization (IMO) signaled the end of Morse code communications and the implementation of automated distress alerting and locating. The combination of satellite and terrestrial radio services has changed international distress communications from being principally ship-to-ship to being ship-to-shore.

Under the Safety of Life at Sea (SOLAS) convention, all cargo ships of 300 gross register tonnage and above, as well as all passenger ships on international voyages, must be equipped with satellite and radio equipment that meets international standards. The automatic identification system (AIS) became mandatory in 2002. This is an automatic tracking system that utilizes transceivers and feeds data to vessel traffic services (VTS).

With tracking and locating, the maritime industry started to see the value of data, especially in terms of maintaining competitiveness and in decision making. Being able to see where the ships of competitors were located meant that ship operators could use this information to their advantage in fixture negotiations with clients. 2018 saw the arrival of ECDIS (Electronic Chart Display and Information System) and e-navigation became the norm, making paper nautical charts redundant.

Smart ships and smart ports

FleetBroadband emerged in 2007 and is a satellite internet connectivity service that also allows phone calls and texting. This is still used as a back-up for many ships but has now been overtaken by Fleet Xpress which offers smart ship operations. Providing high speed broadband, and a suite of cloud-based digital solutions, integrated platforms such as this make it easier for ships to collate and use data effectively.

Other digital platforms such as port community systems facilitate the internet of things (IoT) and increase collaboration between port authorities, cargo owners, and third-party logistics providers. Using such a system helps to align each party’s individual digital roadmaps and updates them in real-time according to data input. Efficiency and safety are just two major benefits of harnessing artificial intelligence (AI) capabilities in ports and terminals.

Digital technology has come a long way in a short space of time and the connectivity that the IoT provides means more joined up systems onboard as well as between stakeholders. Big data, AI, robotics, and machine learning have yet to be truly leveraged for maritime logistics, but they are being adopted by more progressive ship operations.

Some of the world’s biggest ports and shipyards such as Hamburg, Rotterdam, and Singapore use machine learning and data analytics to create predictive models of behavior and to anticipate repairs and maintenance. AI is used at container terminals to decide which container should be placed in which storage space or which automated transport vehicle should move the container from A to B and what route to take. This involves a lot of processing and coordinating of data based on schedules, weather, and a myriad of other inputs which computers can organize more quickly than humans. In the future, smart ports will increasingly use image recognition and robotics for even more automation.

Artificial intelligence

A key project in exploring new technologies is the Mayflower Autonomous Ship (MAS). A project led by marine research organization ProMare and IBM, MAS is a fully working ship with no crew onboard and without a human captain. 

Utilizing AI and powered by solar energy (as well as wind power and diesel propulsion systems), MAS is able to travel further afield with less load, uncovering and recording more information about the ocean’s conditions as she goes. If MAS is successful in navigating the same route that the Mayflower ship took in 1620 using AI alone, autonomous ships could transform ocean-related industries such as shipping, telecommunications, defense, and fishing. Exploring the use of renewable energy and decarbonization is one of shipping’s biggest challenges. Hybrid systems such as the one used on MAS could offer a realistic option for lowering carbon emissions.

Digital twins

The concept of the digital twin has also been a game-changer in container shipping. A digital twin is a digital representation of an object (in this case a ship) or a system that describes its properties as a set of equations which dynamically update. 

A complex process such as shipping involves many changeable factors. By modeling the ship digitally, many decisions can be made more confidently. This is because the digital twin uses the same hardware for acquiring and processing data and the same software used to manipulate the data according to the same conditions as the real ship. Analytics for a digital twin rely on historical data and real-time digital data (from IoT, for example) to model and analyze possible outcomes.

Blockchain and smart contracts

Blockchain is increasingly used in many global trade supply chains, including in shipping, to create smart contracts. A smart contract is a program that automatically runs on the blockchain. It will usually be based on a series of if-then statements. For example, if A happens then X happens, but if B happens then Y happens. The program recognises when an if-then statement completes and automatically updates without further authorisation or approval needed. 

Blockchain provides transparency and security, particularly from cyberattacks. If the program is tampered with all changes are recorded and traceable.

Navigate career options with an MBA with Shipping Management

The pace of change in the maritime industry is picking up as the world’s challenges demand more effective and more sustainable shipping and logistics. With technology facilitating more complex information systems and data management that can optimize and automate, knowledge of digital transformation and the ability to apply it successfully is valuable to the industry. 

Learn more about these exciting developments in shipping and how they can benefit your career progression with a 100% online MBA with Shipping Management from the Alba Graduate Business School, The American College of Greece.