The relationship between design and economic performance of ships

Albert W. Veenstra and Marcel W. Ludema

Maritime Policy & Management, 2006, vol. 33, issue 2, 159-171

Abstract: Success in the shipping industry depends to large extent on the quality of the main asset: the ship. The owner or operator will ask herself: do I have the right ship for a certain job, and what performance can I achieve with a given ship. The relationship between the specifications of the ship, which are fixed in the design stage, and the economic performance of the ship has received some attention, but most of the previous work lacks in the extent to which economic performance is measured or expressed. This paper describes an attempt to operationalize the concept of design for service in the maritime industry. The paper presents a lengthy review of previous work, which shows that some attention was devoted in the past to the relationship between economic and technical aspects of shipping. However, the ‘economics’ usually turned out to be simple cost calculations, instead of clear insight in costs and benefits of certain design decisions. The main variable for the shipowner to buy a ship, or to operate a ship on a certain route is earnings potential. The relation between technical specifications and earnings potential is fairly direct: desired earnings potential influences the design specifications, and the specification of the finished ship determine the earnings potential. The analysis in this paper shows that shipowners also consider cargo carrying capacity, speed and versatility, but no other, more detailed, design factors. Subsequently, we present the design for service framework for the shipping industry. This framework points the attention to a thorough service requirements analysis that drives the design stage. Finally, some preliminary work is presented on empirical studies that are currently developed in the Netherlands.

Date: 2006
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DOI: 10.1080/03088830600612880

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