Inchcape Shipping Services adapts to shifting industry dynamics In a sector that sees many players struggling to maintain earnings, ISS lays out its new vision and explains deep changes in the way it is organised and does business
Captain Claus Hyldager, Chief Executive of Inchcape Shipping Services (ISS), the global strategic maritime and cargo services provider, says that companies in the sector should “adapt quickly in the face of shifting industry dynamics.”
Based on its 160 year track record, and coverage in every key port worldwide, Hyldager says ISS’ insight into global shipping trends has informed a fundamental change in the organisation’s structure and the way it will engage with its clients.
Since its last management buy-out in January 2006, when Hyldager took over as CEO supported by a key management team, ISS has seen tremendous growth, expanding the company from its traditional port agency base into a number of new industry activities. This launched ISS on a growth trajectory that has exceeded all expectations creating a very strong revenue and profit base.
“The sector has changed dramatically over just the past 10 years, with shipowners and other clients expecting greater value for money at every level of their business. I’d do the same in their position,” says Hyldager. “But when challenges from geopolitical strife, failed macroeconomic interventions and natural disasters are overlaid on this background of squeezed margins, you need a strong stomach and an innovative plan if you’re going to continue to succeed.”
For ISS, which has more than 270 offices in 67 countries, and provides maritime services to shipowners and operators who span all geographies, market segments, vessel and asset types, that plan has been some time in the making.
“Our goal is simple,” said Hyldager. “It is to develop an organisational structure that enables us to deliver against our business strategy, despite market conditions which are at their most challenging.
“Key to that strategy is the need to put a far greater emphasis on the customer through reducing bureaucracy and giving greater accountability and responsibility to our people.
“In a nutshell, we decided to change our focus and whilst we naturally wish to increase our business in the traditional segment, we are at the same time, deepening our relationship with our clients, offering them new services in existing and fresh areas of their business.
“In practice, that has meant a realignment of our senior management to new roles, with fresh talent coming in and being promoted, creating processes and an environment in which we can build long term strategic relationships with clients, delivering tangible benefits from the outsourcing of more and more of their back office activities.”
Customer segments are now being divided between three business streams covering the needs of shipowners, charterers and operators; cargo owners and traders; and supply chain managers including NGOs and national navies.
Hyldager added: “Our integrated information technology solutions, which are focused on maximising efficiencies within clients’ own operations, will allow them more time to focus on their core business, to secure growth and to seize the opportunities presented by an industry in transition. Their success will be our success.”
For ISS, being global means having both a market-leading geographical footprint plus the ability to offer a full range of services in each location. Already in the first two months of 2012, ISS has grown its proprietary network with the opening of five new offices (in Spain, Venezuela, Thailand, Saudi Arabia and Timor-Leste) and at least 20 more will follow during the course of the year. It’s a solid worldwide platform from which ISS can build business with both existing and new clients.
Hyldager summed up: “Through being able to offer a comprehensive range of services, which includes assuming many back office functions on behalf of clients, ISS has become key to their needs.
“In an industry where margins are tight and asset optimization is critical, ISS will further carve out an innovative niche in long term partnering with its clients in a way which delivers mutual benefits.”
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