‘Disruptive sustainability’ – from buzzword to reality

‘Disruptive sustainability’ – from buzzword to reality

Disruptive sustainability was the theme of the 2017 Nor-Shipping trade fair in Norway. But what does it really mean, and how do we make it more than a catchy phrase and a hollow bandwagon?

Text: Marianne Alfsen Photo: Nadia Frantsen, Nor-shipping

For decades, the term ‘disruptive’ has been used in reference to innovation, especially new technology, products or services that revolutionise the status quo or take down dominant systems.

Disruption has been the way forward since the beginning of time – from the invention of the wheel and gunpowder, to x-rays and penicillin, electricity and nuclear fission, telecommunication and the Internet.

However, innovation that has revolutionised human life has also, in some cases, led to our downfall. Fossil fuels, for instance, has been a major driving force of modern life, but it has also caused havoc to nature.

Thus, during the past decade, the term ‘disruptive’ has gained a new friend: ‘sustainability’. It is not enough that innovations are merely game changers anymore. They must be sustainable, i.e. not thrive at the expense of something else – be it the climate or the environment, human rights or human health. 

‘Disruptive sustainability’ – from buzzword to reality2

   
The shipping industry on board

At the 2017 Nor-Shipping trade fair in Norway, from 30 May to 2 June, the concept of ‘sustainable disruption’ was embraced once and for all by the global shipping industry.

“The industry is in the midst of a paradigm shift, facing a new digital reality, a need for new business models as well as increased focus on clean energy. The shipping industry cannot sit around and wait for these shifts to disrupt the business. We need to change from within, be disruptive ourselves, to develop a financially and environmentally sustainable industry,” says Nor-Shipping Director Birgit Liodden, explaining the choice of main topic.

An entire exhibition hall and a series of talks were dedicated to challenging conventions and embracing innovation. Exhibitors and speakers from a variety of businesses and organisations were invited to showcase their ideas on how they can help the shipping industry disrupt in a sustainable manner. Wärtsilä was one of them.

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The Wärtsilä way

“To disrupt the business is not about predicting the future, but placing a dot on the horizon to indicate where you want to go, and then figuring out how to get there,” says Egil Hystad, General Manager Market Innovation in Wärtsilä Norway.

Some of these ‘dots’ on the horizon are digital fleet management, predictive analytics and zero emission propulsion.

“What we see today are so many trends, so many ways to be disrupted, that it makes it impossible to know what is coming next,” continues Hystad, listing greening of energy, changes in local and international legislation and new technology as major overall trends.

“Constant and fast paced change is the new normal, after almost three decades of relative stability,” he adds.

  

Co-creation, co-innovation and cooperation

His Dutch counterpart, Teus van Beek, General Manager Market Innovation in Wärtsilä Netherlands, adds that the way the industry works with innovation and investments must in it self change.

“We come from an industry that is used to thinking in gradual steps and incremental movement. We need to adopt a more radical innovation model, more like the fast paced ‘Silicon Valley’ approach,” he says, adding that the way forward is also through “co-creation, co-innovation and co-operation.”

Wärtsilä is facing the challenge head-on, by, for instance, establishing Digital Acceleration Centres across the globe – where Wärtsilä can join forces with inventors and customers, to speed up innovation and meet the needs of tomorrow, today.

“Being involved with customers in an early stage and figuring out the next steps is very important. Mutual understanding of the business drivers will help take the next steps. Inevitably new ways and new business models will help discover what the future looks like,” says van Beek.

“Wärtsilä has renewed a video showing six concepts. These concepts should stimulate our contacts and stakeholders to think outside-the-box and find directions for future development. The concepts deal with new ways of working, zero emission, new business models and improved efficiencies. They should not be misinterpreted as predictions of the future, but will help to stimulate innovation for the future,” continues van Beek.

See Wärtsilä’s video: “Visions for the Future of Shipping”

     
Technology vs system

To Dr. Martin Stopford, President of Clarkson Research, and one of the world’s foremost shipping analysts, the term ‘Disruptive Sustainability’ has a slightly sour taste.

“The term disruptive sustainability risks focussing attention on the disruption rather than the real goal, which is reorganising for a sustainable future. Maybe there will be some disruption, but that is not the goal. It is just one of many problems along the way,” Dr Stopford says.

He is also concerned that the industry is jumping on to the bandwagon from the wrong side.

“The industry is obsessed with better ships and new technology,” he says, dismissing the ultimate futuristic vision of autonomous ships as a digression, and emphasising that the focus must shift from hardware and software to a systems level: “What the industry needs, is a new fleet management and business model,” according to Stopford.

He describes an industry still stuck in ancient patterns, where each ship is an autonomous entity, and each captain is a boss in his own little world, while the business model is still quay-to-quay-delivery.

“Everybody is shouting ‘better technology’, but what they really should be shouting is ‘better organisation’,” says Stopford.

He believes there are three things the shipping industry must achieve during the next two or three decades:

First, it must offer a better level of service to global shippers, providing door-to-door delivery and transparency and control through the entire value chain. Secondly, the industry must become greener and move towards zero emission operations. And thirdly, the industry must move away from operating ships as independent business units, and implement smart fleet management in integrated companies.

    
Disruption = delivering a better service

“In the end, it is all about delivering a better service,” Stopford says, adding that some things were actually better before:

“The industry is half as efficient today as it used to be. In 1973, an average tanker delivered 49,000 tonne-miles per dead weight tonnes of oil. Today the number is 23,000.”

Stopford does not believe that ship owners are facing the same collapse as they did the last time shipping was revolutionised. In the 1960s, when multipurpose liners were exchanged for container ships and specialised bulk cargo ships, all but one international shipping company caved in.

“One good thing about technology, as well as better organisation, is that you do not need to invest in an entire new fleet all at once. It can be introduced gradually,” Stopford says, adding that the industry needs to realise that there is another way of conducting their business, before the sea equivalent to Uber comes along and puts them on the side line.

“There is exciting technology that will help the industry solve organisation problems it has struggled with for decades, so that it can catch up with land-based companies who did all this in the 1980s. As a result, QA systems will work and performance will improve,” says Stopford.

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