So, is Voyage Optimization Working?
By Brian Hatter
Several months ago, I wrote a Blog Post for our website titled “True North Marine 2.0 – Embracing AI to Optimize Voyages and Reduce Carbon Emissions” discussing the changing priorities in our industry (ie digitization, decarbonization) and how we as a company were intending to address these challenges. The post elicited quite a reaction and it was easy to see this was a touch point among our client base with many bullish on this subject and eager to embrace change and others viewing it as simply another fad that in practical terms will not work.
We have now had several months to work with our proprietary AI based software OptiNav, trying all sorts of scenarios with our trusted partner clients and we often get asked; so does it work?
The answer to above is yes and no or perhaps more precisely yes and not quite yet. The technology and the algorithm certainly work and it is actually quite impressive to see how the software can compute a myriad of trade-offs to find the best scenario for our clients needs based on their preferences for a particular voyage. Whether least voyage cost, lowest emission, specific ETA etc. or some hybrid of these, the algorithm is capable of adjusting routing to find optimal path and our early research is showing consistent savings in the 5-10% range on average.
However, it does not work when the human element is not onboard. In order for optimization to fully work, it requires the full cooperation of the Charterers, Owners and Master onboard. For years, Owners and Charterers have had what can often be described as an adversarial relationship. Given the dynamics of the markets it rarely happens that we have an equilibrium where both Owners and Charterers feel they are on equal footing. Speed and Consumption warranties as drafted in Charter Parties naturally lead to disputes, often times quite contentious.
So when you propose doing away with those warranties and really looking at vessel operation in a new light, it can naturally lead to some skepticism and mistrust. This will take time and same is the reason that we strongly feel that a piece of software no matter how sophisticated will not work alone in these first years. We are training our Analysts to be the bridge between the client and optimization, providing a guiding hand and most importantly flagging early on when optimization will not work and traditional weather routing is preferable.
Has your experience been different? Want to chat to us about the TNM approach? Please feel free to contact me at email@example.com