High reliability remains a priority for Maersk Line
A benchmark change from Drewry to SeaIntel signals a continued commitment to industry-leading reliability, says Maersk Line’s Chief Operating Officer Soren Toft.
Maersk Line has decided to change our external benchmark on schedule reliability from Drewry to SeaIntel. With this change, Maersk Line is now measured monthly instead of quarterly, and with coverage of more than 270 ports and close to 10,000 vessel arrivals, the SeaIntel measurement provides both a trade and global performance overview, which is much more relevant for how our customers experience the services.
Even with the expansion of coverage from 10 ports with Drewry to 270 ports with SeaIntel, Maersk Line still aims to deliver consistently high reliability and remain an industry leader.
Here Chief Operating Officer Soren Toft comments on the change, and the future of reliability in Maersk Line.
How is Maersk Line performing on reliability?
“Maersk Line ended the first quarter of 2014 with a reliability of 80% globally. Against an industry average of 70% for the top 20 shipping lines, we are performing in the high end, and with a significant gap to the overall industry performance.
In an industry where overall reliability has decreased the past year, mainly due to rate pressure forcing shipping lines to aggressively cut cost, performing at a level of around 90% comes with higher costs. When facing unexpected events such as adverse weather conditions, port capacity shortage, crane breakdowns or labour strikes, there will be a trade-off between spending bunker for recovering reliability or saving profit margins. With decreasing rates, that is a decision which all carriers must face daily.”
What are you doing to ensure reliability?
“Over the last year, Maersk Line has established pre-planned contingency plans for all trades. This means that we have pre-planned the responses we will take and what they mean for our customers’ cargo.
We also know from our discussions with customers that schedule reliability in itself is not everything. When they plan their supply chains, the important thing is to know when the box will be available; this takes into account feeder and inland services, as well as available space on the vessels. Customer experience should be seen as an end-to-end process, and our service levels are the sum of a number of measures.”
What does industry leader mean?
“Being industry leader means that Maersk Line will continue to deliver consistent reliability to our customers and remain in the top end of the most reliable shipping lines.
Maersk Line will now also look at reliability in the individual trades rather than only on a global average, and thereby increase the relevance for each individual customer that entrusts their cargo with us.
As SeaIntel’s monthly reports are more frequent, we can expect more fluctuations in our overall ranking, but over a period of time, Maersk Line should remain a top performer and keep our relative performance to the peer group high.”
What does this change mean for customers?
“By using SeaIntel and its wide coverage, Maersk Line and our customers will get a more realistic and transparent measurement which is closer to what customers experience, regardless of the ports they use. It will also allow customers to benchmark services more effectively among individual shipping lines.
Maersk Line will still aim for the highest level of consistent reliability for our customers, but in accordance with our cost leadership strategy, we may have to prioritise costs over reliability in some cases. We firmly believe that we can manage this balancing act and remain an industry leader.”
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