As industry increasingly evolves on the digital transformation path, inevitably the focus turns to the move toward cloud computing. Last month Maritime Reporter & Engineering News spoke with Howard Fireman, SVP and Chief Technology Officer of the American Bureau of Shipping (ABS) for take on how industry innovators – large and small – in the shipbuilding and marine equipment sectors are leveraging inherent advantages of cloud computing to better position themselves for the competitive long-haul.
Please describe your organization’s philosophy on the digitalization transformation as a core business philosophy.
Our industry as a whole is moving toward Digitalization. At ABS, we are leveraging digitalization to be more predictive about operational health and reliability. As a consequence of the drive for greater safety, we expect any improvements in operational reliability to also improve the health of our clients’ businesses. Additionally, the transition to digitization will enable us to develop a comprehensive suite of compliance tools in an era of emerging regulation, which will help to make any inspections or audits conducted by class less-intrusive processes.
What about cloud computing as a part of this digitalization transformation?
It’s about speed and velocity. Our industry is evolving at an accelerated pace so we need to be able to offer products and services that help our clients to manage their businesses in a fast-moving environment. That requires improvements in internal and external operating efficiencies. A cloud infrastructure responds to demands of speed and scale much faster than the traditional “on premise” approaches. The secure, shared environment offered in a cloud environment allows us to collaborate and work more efficiently with our entire business eco-system.
Please put in perspective where your company is on this move toward the cloud?
We have been moving many internal systems to the Cloud in the last several years – including HR systems, training systems, contract management systems, and now even email and office productivity software. Whenever we have a new project, we always ask ourselves “Does the cloud make sense for this solution?”
ABS Nautical Systems, our fleet management ERP offers products on the cloud now. New clients predominantly want cloud implementations, while existing clients are moving there as their natural investment cycle causes them to reevaluate.
What are the main drivers toward a move to the cloud?
Shifting the management of our IT infrastructure from a capital expenditure to an operating expense creates cost efficiencies that enable us to improve the efficiency of service delivery for our clients. Additionally, as a global organization, the reliability of 24/7 access offered with a cloud environment is crucial for supporting our global operations.
What do you see as the main risk of moving your business operations to the cloud, and how are you preparing?
Transitioning legacy products to the cloud that require architecture changes can be risky. Additionally, an increased reliance on third party providers with increasing costs and a loss of control is a risk that can be mitigated through due diligence and contract negotiations.
When you look at the speed of business today in the transport and logistics sectors, and specifically watch as non-maritime entities serve as ‘disruptors’, put in perspective your thoughts on the risk to a company that does not adopt a digital and/or cloud-based future.
Those who do not adopt cloud solutions are likely to miss the opportunity to develop point solutions which can be easily deployed in a cloud environment. These solutions can be very efficient at driving efficiency across the organization. In that scenario, organizations can find themselves investing in basic infrastructure hardware and management while their competitors invest in business intelligence and analytics.
When you look at your customers, give insight on where we are at on the adoption curve of digitalization and cloud computing.
I think it is common knowledge that shipping in general is a traditionally conservative industry that can be resistant to change. But, as there are many examples of other industries benefitting from digitalization, the tide is beginning to turn across the maritime sector. It is the role of class to support companies who wish to do so.