The future of shipbuilding?
Global trade networks and supply chains are being rewired – suddenly and urgently. There are many factors behind this tectonic shift – too many to mention here, and although we have been through this drama before, this time, more of the changes will be permanent structural moves that will result in capability and capacity development across the world.
Individuals, corporations, and governments have made bold claims about “re-shoring manufacturing” and exponentially increasing shipbuilding over a period of a few years. For the sake of this FutureofTheOcean article, the focus will be on shipbuilding, but many of the same principles will apply to other forms of manufacturing and capacity development across industries and geographies.
The Same as The Past, Only Much Better!
The question is how to ramp up from current capacity to achieve such scale?
The USA wants to go from five to fifty ships per year within five years1and is spending $400M per year through 2035 to fund shipyard modernization, capital upgrades, workforce development, and to develop regional incubators to explore best practices in design and construction methods. In Russia, the government plans to spend $6.2B to build 1600 ships by 2036, revising upward their previous plan.
The question is how to ramp up from current capacity to achieve such scale?
Experts, pundits, consultants, and industry groups all have a point of view that supports their particular agenda. People that have been in the shipbuilding ecosystem certainly have a point of view on “how things are done.” “It’s done the way it’s done, because that’s the way we do it!”
Most of the published articles and video debates on the matter focus on the many constraints that will prevent achieving the goal. “We no longer have a skilled workforce,” “There aren’t enough shipyards,” “Capital investment is required,” “There aren’t enough materials due to tariffs” All of these arguments may be true, but all assume one thing – that the existing processes will be the go-forward processes. It’s a look in the rear-view mirror.
Will we need to invest in a skilled workforce? Yes. Will it be the same professions and job titles that contributed to shipbuilding fifty years ago? 20 years ago? Last year? Probably not.
Will countries and industry engage in building additional shipyards? Perhaps. Increase capacity at existing shipyards? Likely. Dramatically increase efficiency and throughput? Absolutely.
If we don’t address the constraints and solve for them using existing methods, how will we achieve scale? Is it a simple math problem? For example, if it takes 100 workers to build one ship per year, do we just multiply that number by the number of ships we wish to build, so 50 ships would require 5000 workers? No. (forgive the simple example)
To create a dramatically different outcome, we change the game. We don’t look behind us, we look forward.
Future Shipbuilding must be reimagined. The entire ecosystem needs to be recalibrated to meet new and emerging needs. This does not mean that durability, seaworthiness, quality, safety, and performance are sacrificed – it means innovative designs, construction methods, networks, inputs, technologies must be introduced, embraced, aligned, and implemented by stakeholders. A phased-in approach is likely, but to meet an audacious goal on a short timeline, and aggressive cycle-time from ideation-to-execution must be designed. That may mean a 40-60% reduction from the current cycle time.
Still, how?
Modular design – Shipbuilding of the past (like most great things) were a combination of art and science. Everybody loves art, but people don’t think of real artistry as efficient. It takes time and there is usually a different result of each commission. In the auto industry, modular design has been a remarkably successful attribute of mass production of various models sitting on the same frame, and sometimes the same engine3. Design in future shipbuilding may include modular,
interchangeable design to increase efficiency, speed of production, and enable rapid customization working from a standard core configuration that can be modified per use-case.
Standardization – of design specifications, engineering drawings, Bills of Material, and other core documents throughout the ecosystem – the design chain through the supply chain. Standardization will add acceleration throughout the process by eliminating custom engineering and parts requirements and non-value-added tasks.
Introduction of new-age materials – if existing materials are in short supply due to tariffs or any other supply chain disruption, locally produced new-age materials may be planned and incorporated as they have been in the aerospace and auto industries. Lightweight and stronger, these materials may be applicable to shipbuilding as well.
Robotics and automation – The use of new technology throughout the shipbuilding supply chain will reduce costs, allow greater throughput, eliminate non-value-added work, and improve quality. Robots will replace the repetitive, hazardous production practices of the past. Humans will still be required to program them, operate them, and inspect work. Automation will be at work throughout the supply base, unloading containers of raw material, storing products on racks in the warehouse, picking items off the shelf, delivering them to a staging area, and loading them on a truck. Humans will still be required in the supply chain, but in value-added roles. The use of artificial intelligence (AI) will be used in many forms from design through mass production to serve up known and available information to a worker using a verbal command, a keystroke, or a click. In the past, workers had to access a system, pull up a file, validate the information, and then use the information to make a decision or complete a task. That cycle time will be eliminated, allowing improved productivity. Finally, the use of 3D printing has greatly mitigated the need to store inventory at multiple tiers of the supply chain. A well-placed 3D printer close to the point of need can eliminate the cost of warehouse space, labor, cost of capital, and more. There are many technologies in use today and available tomorrow to change the game of shipbuilding - only a few are mentioned here.
Here’s to bold goals!
The future of shipbuilding is upon us suddenly and urgently. All of the necessary ingredients have fallen in place or are about to – strategy, political will, policy, investment from government and industry, workforce and supply chain industry partners, education – are calibrating and focusing on national and global strategies to significantly change how ships are made, who makes them, and who operates them.
Can such bold plans be accomplished in a short time? Yes.
It will require innovation, transformation, change management, education, and a dramatically different level of collaboration throughout the shipbuilding ecosystem.
Shipyards will still be shipyards and shipbuilders will still be required, but the future of shipbuilding will look vastly different than in the past. The inputs and the value-adds will change significantly, and the outcomes will be more, higher quality vessels with greatly reduced cycle times.
Here’s to bold goals!
About Mike Notarangeli
Mike Notarangeli is an accomplished executive and consulting leader that leverages 30 years of operations, supply chain, logistics experience and innovation to solve problems, identify opportunities, and create competitive advantage. Transformation and culture change management have been an integral part of Mike’s work from day one.
Mike is Principal, Client Solutions at OptiSource Solutions LLC. More info can be found at: www.optisourcesolutions.com or at www.linkedin.com/in/notar
When not working, Mike enjoys being outside and staying active cycling, hiking, running, swimming and generally not sitting at a desk!