Embracing trust and collaboration

REMI ERIKSEN

Welcome to Trust and transformations - leaders navigating change, a DNV podcast. I'm Remi Eriksen, DNV’s group president and CEO.

In this series, myself and our business area CEOs sit down with other global leaders to talk about how they tackle transformations, build trust in their business and people, and what they think is coming next for their industry. Right now, they are experiencing a series of historically significant transformations, making trust more important than ever.

This episode is hosted by Knut Ørbeck-Nilssen, CEO of Maritime at DNV.

KNUT ØRBECK-NILSSEN

Hello and welcome to Trust and transformations - leaders navigating change. I'm very delighted to be joined by Thomas Wilhelmsen, Group Chief Executive Officer at Wilh. Wilhelmsen Holding ASA today. Hello Thomas!

THOMAS WILHELMSEN

Hello, good morning.

KNUT ØRBECK-NILSSEN  

Good morning. Wilhelmsen provides essential products and services to the merchant fleet, along with supplying crew and technical management to the largest and most complex vessels ever to sail. The group company legacy spans over 160 years and its enduring success can be attributed to its ability to navigating evolving landscapes, embracing new technologies, adapting to regulatory standards and meeting customer demands.

Let's first touch on the topic of leadership, Thomas. And if I could ask you the first question, could you tell our listeners what a typical working day looks like for you? What might your diary hold, please?

THOMAS WILHELMSEN

I think that's a very funny question because I'm not sure if I have a typical day. I'm extremely lucky. We have a very varied business with different companies, representation in 60 different countries, a lot of different people, 20 employees. So it's a typical day for me would be very different each and every day. It would be board meetings, management meetings, strategy sessions, meeting with investors, meeting with banks, all types of stakeholders. And probably say what I like the most is to be out in our operations, seeing people doing the actual work at the coal face. So I think I'm extremely lucky having a very, very varied day.

KNUT ØRBECK-NILSSEN  

Sounds fascinating. What leadership qualities do you believe are essential for success in the maritime sector? And how do you foster these qualities within your organization, Thomas?

THOMAS WILHELMSEN

Yeah, leadership qualities, of course, there's a large array of qualities, but I think trust, which funnily enough, I think is one of your starting points for this podcast is extremely important, especially when you run a international business like the shipping and maritime industries. I believe it's important to have the drive - drive to move forward, drive to fulfilment, and also curiosity as an important trait. Within our organization, we're very much a values-based organization. We don't really have those three leadership traits as explained values within the organization, but I think you'll find them in what we try to foster.

And as I said, trust is important because we're a large group of people. We need to have trust within the organization and we need to have trust outside the organization with all the stakeholders that we are exposed to and of course, especially towards our customers. But we can't stand still and - as with DNV, you're now celebrating your 160 years anniversary, so congratulations - you need drive, you need to move forward, you need to challenge the status quo. And in order to also have that drive, I think you need some curiosity So I think I will, yeah, that's at least three as an example that we use in, or that I use in our organization to make the company and the organization excel.

KNUT ØRBECK-NILSSEN  

Very important indeed. And I guess when we touch on the next topic on decarbonization, which is arguably the greatest challenge facing our industry, I guess, drive and curiosity is important. So in your view, how successful has the maritime sectors response to the decarbonization challenge been so far? And what has Wilhelmsen's approach been in meeting this challenge, please?

THOMAS WILHELMSEN

It's a very large question and talking first on behalf of the industry and not wanting to be negative. I actually think the industry has taken this extremely seriously, but we have to take into consideration and especially if you then look at the shipping side of the industry. We're talking about large capital items in the vessels which are built to last 25 to 30 years. With the backdrop of, call it both a supply uncertainty and technological challenges. I think that technologies are there, but there are certain challenges and the same with the supply of new energy sources. So it's no surprise that we have an industry where this is, say, where we are to a certain extent, it takes time before we get into the real implementation phase. And that's probably also one of the reasons why you see the tight supply demand situation as we have today, because it's very big decisions for an owner to make, especially in an early phase when there is no firm view on, call it the preferred technology and energy source.

But there's been quite a lot has been done. There's a big order book out there with different technologies. And I think we will get there, but it's probably going to be a little bit of a hard push towards the end.

KNUT ØRBECK-NILSSEN

Fascinating. When we say, for instance, talk about the global maritime forums getting to zero coalition, they aim to have commercially viable zero emission vessels operating along deep-sea routes by 2030. How close in your view is the industry to meeting this target?

THOMAS WILHELMSEN

Well, it depends on that there will be zero emission, call it services or trades by 2030. There should be, I'm sure there will be. But there's a long way from a few trades or a few services. So, but again, you need to start somewhere and it's not too different from the targets that we've set within our overall group. So, Wallenius Wilhelmsen, as an example, has a net zero target by 2040 and also wanting to have a net zero trade way before then. So I think we are definitely on the way. And when it comes to the services part of our organization, we have, say, tight goals as well. So I think the industry in general will definitely move in a constructive manner towards the targets that are set, especially of course 2050, but that's way down the line. So in order to force this and to have a catalyst for acceleration, I think we just need to set somewhat more ambitious targets so that we actually get on the way earlier rather than wait towards the end of it.

KNUT ØRBECK-NILSSEN

So setting ambitious targets is part of it. And you mentioned earlier that these vessels, they have a long lifespan, maybe more than 20 years. Are there any interim solutions that we can use?

THOMAS WILHELMSEN

Yeah, there's a lot of interim solutions and technology is moving fast. And I think we've, and I do actually believe that the most responsible owners, they work on continuously on projects in terms of what they can do to at least reduce consumption significantly within this period of time or also looking at different forms of abatement technologies. So, just the use of data in terms of optimization has a significant impact on emissions and also, of course, then as a result of reduced bunker usage.

KNUT ØRBECK-NILSSEN

Do you, Thomas, believe that decarbonizing the shipping industry can be a catalyst for a much broader transition to clean energy in the hard to electrify industrial sectors?

THOMAS WILHELMSEN

Well, I believe most measures will have a, hopefully will have a, positive effect on other industries. It's a very, very big question as to where should you start and what are the best industries to say to implement such measures. And no doubt the maritime industry is a complex industry to target, but I think that's the world we live in. We just need to adapt. We need to make sure that this industry is also in line with the expectations for the rest of the world and other industries. We from this industry may argue, of course, that it's even tougher and even harder, but then we just have to work tougher and we have to work harder. That will force solutions.

KNUT ØRBECK-NILSSEN  

So there is quite a bit of talk these days around price on carbon and what challenges and opportunities would the introduction of a global maritime carbon levy pose to companies both within and outside of the shipping sector, please?

THOMAS WILHELMSEN

Another very interesting question. I think we are there that in the industry, if there is no price of carbon, then it's going to be very hard to implement the changes. Personally, I'm not a very big fan of carbon levies, but I do think it's definitely a tool. The reason why I'm not necessarily a big fan is the question of what do you use the proceeds for? Who's in charge? How do you distribute this? Is it just ending up in an endlessly big bureaucracy? Or is the funds actually being set to use where they should be used? But price on carbon will drive changes, so that's a positive side of the equation. The other side on the more challenges is in terms of measurement and enforcement. And then you come back to technology and the importance of really being able to have the right tools, the right data to measure this. And luckily there's huge advancements within that field. And that technology may also then be used in, say, for additional purposes, which can drive efficiency even further. But the lack of data quality when you have called a penalty system as a levy, that's a challenge, of course.

KNUT ØRBECK-NILSSEN  

And this leads us say quite nicely into the next topic, which you also mentioned briefly on the decarb question, what we can do in the meantime, but digitalization is another key transformational challenge and embracing technology has become an imperative for the shipping industry. And how is Wilhelmsen onboarding processes that use automation, machine learning and cloud-based systems?

THOMAS WILHELMSEN

Yeah, as we said, the Wilhelmsen Group, as we touched upon, is of course a very diverse group of companies, although we have a lot within the marine industry. So first I would say, well, one, we embrace the technology shift and we also embrace digitization and we believe that this are say important tools and trends that will be paramount for us to actually be on that wagon going forward. But since we are so many different both businesses and companies, then there's not one particular solution.

So we have a lot of different, say, new ways of working, new systems, new ways of gathering data. Some purely for internal efficiency and improvements perspectives. Other are a combination of our own internal improvement, but also in terms of being able to say capitalize and having a commercial, externally commercial approach. And one of our companies, Raa Labs, which is a data gathering company is say down that alley where we see the importance and the value of gathering data from ships, take them ashore, analyze them, put them into the right models, the right algorithms, and through that be able to improve efficiency measures. I might not be absolutely correct on the numbers, but Wallenius Williamson has through this call a tool or technology, they believe they will save between five to 10 % on bunker consumption just through the efficiencies that they can implement by analyzing this data in a proper way. So first being able to collect the data, then analyze it and use it correctly. And this has given significant savings, both from an environmental perspective but also from a cost side of it.

KNUT ØRBECK-NILSSEN  

That's very impressive and certainly speaks loudly about digital transformation. If I could turn to autonomous technology, are you seeing any advances in the shipping industry with respect to autonomy?

THOMAS WILHELMSEN  

Well, we are doubling our feet a little bit there as well. With Kongsberg, we have a joint venture called Massterly, which the ENV is very aware of. And I think it's a long way from having fully autonomous vessels, at least deep sea. In more regional or short sea, yes, we are much closer. But I think the interesting part of it is not necessarily aiming for fully autonomous vessels on the deep sea, but its elements of autonomy and being able to both improve then on health and safety and efficiency, and of course on the cost side. So what we've all at least, personally, what I find most exciting with this company called Massterly is really how can we take some of the measures that have been implemented through Massterly and apply them to the wider group. I'm sure there are significant savings down the track that we can tap into.

If you look at the number of seafarers on board a typical PCTC today, of course it's less than what it used to be. And I'm sure that going down say a decade or so, there has been significant changes in that regard because of autonomous solutions.

KNUT ØRBECK-NILSSEN  

We talked a few minutes ago about the cost of carbon and the necessity for having access to the right data at the right time. And what impact does the quality of data bring or being exchanged between all parties in the supply chain have on these areas?

THOMAS WILHELMSEN

The quality of data is of course extremely important. And there are different approaches within any industry. Some players are very focused on keeping their data and seeing the value of trapping the data for themselves. While there are other philosophies which are more, say, open source based.

I believe we will advance to a much greater extent as an industry if we have a more open-source approach. Whether the data quality is very good, that's another question, but at least then you are able to extract the data. And if you're able to extract the data, then you can start working on the data quality afterwards. But if you're not even able to extract it, then there's no way to really work with the data.

But that comes back to what we spoke initially about trust and also a little bit about drive. Because if we as an industry are going to make significant leaps forward, we need to work together to a greater extent. And probably where the world has seen, say, the greatest advancements in later history was during the period of COVID. One in the way how we were able to work remotely, but from a technological point of view, when you look at the time it took to make the vaccines, that has never ever been done before. And that needed a cooperation, not just between the pharma companies, but also between the pharma companies and the regulators. And that's probably the brink of where we stand a little bit from a solution basis here. If we are going to meet our, say, the latest 2050 targets, hopefully before, then we need to be more open to cooperate, have that mutual trust, and also get the regulators, say, on stream and hopefully have a fast track solution rather than the slowness that we are witnessing today.

KNUT ØRBECK-NILSSEN  

Yeah, so having speed is very essential in all of this. And you know, at DNV, we are quite keen on standardization. And in your view, is lack of standardized data on shipping operations holding the industry back from making progress in areas such as digitalization and decarbonization?

THOMAS WILHELMSEN

Well, standardization sometimes is very good. At least it makes it easier. So, whether it's holding it back or can we really hope and expect for everything to be standardized? I'm not so sure. We, again, have a very, very international exposure with different processes. So, I think we need to accept that there are different standards.

We can hope for increased standardization, but in general, I think we just have to accept that there are different standards in many ways and forms. But again, I think if we're able to at least get access to it, then we're able to massage it in the right way. And down the line, at some point, there will be probably more standardization.

But I would say it's impossible to create a standard at this point in time and it will be at the risk of speed actually.

KNUT ØRBECK-NILSSEN  

That's a very interesting viewpoint and certainly something that we will try to work with. You mentioned the need for mutual trust in order to advance technology development in the shipping industry. Could you say something about the importance of global collaboration and how we can make that work even better?

THOMAS WILHELMSEN

I'm not sure if I have the solution for it, but as we've been touching upon several times here, if we are going to advance at the greatest speed than what we've been doing to date, then we need to be open for collaboration. It's easy to say, but it's much more difficult to enforce it. There's a lot of good efforts out there both by regulating bodies and by companies like DNV and others trying to say create the arenas for cooperation and actually just first of all say establishing that basic trust base.

So I'm not sure if I have, unfortunately I don't have a magic wand or a magic recipe for how this should be done.

KNUT ØRBECK-NILSSEN  

I don't think any of us have, but it's important that we try to drive that forward as well.

We've touched upon a lot of the good things around digitalization and trust and exchange and collaboration. But naturally, we will also need to talk about the importance of cyber resilience and cybersecurity. And what type of cybersecurity measures have you had to implement to ensure that you can safely take advantage of the many opportunities of digitalization?

THOMAS WILHELMSEN

Cybersecurity is no doubt an increasing issue and any large and small operation of course are probably seeing an increased number of attacks and so are we. We have a lot of different measures. One of probably the most important things when it comes to cyber securities in general, all employees. So where do you open up the weakness? Well, you can buy the technological solutions, which we do. I'm probably not the best one to explain which solutions we do have, but we have a lot of different solutions in place. But where we probably spend more time is in terms of educating each and every individual within the organization, creating a culture of awareness and security. So most cyber-attacks come through the weakness of call it an operator, as in an individual using a computer or some form of access platform and that's where we see at least the need to work with the organization, which we are doing all the time. We have wellness, we have of course the different penetration tests, etc, but even more so, we have online courses, we have different types of other tests, meetings, gatherings, etc. etc. Just to build that culture and awareness.

KNUT ØRBECK-NILSSEN

Awareness is a key thing for sure.

I would like to close with a question that's more on how we as an industry can attract talent and develop our professionals. So what advice would you give to individuals aspiring to leadership roles within the maritime sector, Thomas?

THOMAS WILHELMSEN

It's always very dangerous giving advice, but there are a few things with this industry which I think newcomers should know. And, you know, it has, in my view, very high attractiveness in the terms of the international exposure that the industry has, meaning that when you get up in the morning, whatever you read in a newspaper has an impact on this industry, which makes it exciting. It's also exciting, especially, I would say, for younger people in leadership roles, and even in roles that are not on the leadership level in the terms that we, in this industry, we very often give a high level of responsibility at an early stage. Because we are dealing with high-value assets which are movable all the time. So even if you are a person coming out into your first job, as an example, you're a boarding clerk. You have the responsibility of a high-value asset during the time of the vessel import. And of course that should be, in my view, very attractive as a young person entering into a new industry. It's not many places where you in some way or form get responsibility maybe for a hundred, hundred and fifty million dollar asset for 24 or 48 hours. So you need to make sure that you find the solutions within a short period of time. Otherwise, you know the costs are exploding. So you get that responsibility.

And I think on some of the topics that we have been touching on, quite a few people look at the maritime industry as being, say, old fashioned and slow. I would actually in many ways argue in another direction because, yes, there are certain processes which are hampered by the fact that we are again dealing on an international basis with different countries where there are more red tape, more paperwork, etc. But then again, that means we have to adapt and find the best possible solutions available for the job at hand. And when you look at the journey that this industry has to make within quality energy transition from an emission point of view and also the technological and digital transition that we have to go through going forward, I believe this should be a very, very exciting industry for younger people to be in. In our company, we recruit people where I often ask myself, how on earth do we get these talents to not just apply, but really, really want to come and work here. And one of the answers I get is that they believe they will be able to look back within a pretty short period of time that they've actually made an impact and set the mark.

So a lot of exciting reasons why young people should seek this industry.

KNUT ØRBECK-NILSSEN

Very inspiring, Thomas. And Thomas, thank you so much for joining our podcast, Trust and transformations, and sharing your reflections and insights. Thanks a lot.

THOMAS WILHELMSEN

Thank you very much Knut and good luck going forward and again congratulations with 160 years.

KNUT ØRBECK-NILSSEN

Thank you.

  REMI ERIKSEN

You've been listening to Trust and transformations - leaders navigating change, a DNV podcast. Head to DNV.com to hear more episodes of Trust and transformations or subscribe on your favorite podcast platform so you'll never miss an episode. Thanks for listening.