Don’t Squeeze Training Margins

by Paul Scott Abbott | Breakbulk Magazine | Issue 4 2019

Education Still Comes First and Last

Despite diminishing profit margins, now is not the time for project forwarders and related logistics entities to cut back on education and training.

As several industry leaders told Breakbulk, reducing focus on maintaining a knowledgeable workforce would be a big mistake in these challenging times.

“We can’t afford to let market fluctuations and business model changes dictate whether or not we are continuing with training and education,” said John Hark, chartering director for North America for global project cargo forwarder Bertling Logistics.

Mirko Knezevic, chief operating officer for global projects at UTC Overseas, put it even more directly: “It would be a grave mistake to com-promise or cut back on education and hands-on training for our staff. Project freight forwarding is a knowledge-based business, and our people, their professionalism and specialization are our biggest asset.”

Others, including executives of C.H. Robinson and Crowley Maritime, concur that investments in talent must continue for movers of project cargo, while broader initiatives are advancing to ensure availability of sufficiently trained labor throughout maritime and supply chain logistics industries.

TIME TO ‘SOLDIER ON’

Bertling’s Hark said all global project forwarders need to maintain a certain critical mass in such areas as technical heavy-lift capabilities and information technology services and, “most importantly, our people and their experience.”

“Education and training in general go hand-in-hand with maintaining this critical mass that allows us to be ready to successfully execute projects,” Hark said. “We take a more pragmatic approach to the changes and challenges and soldier on.

“You can either evolve and roll with it or be left behind,” he continued. “Our training and education of employees has therefore not suffered.”

The majority of Bertling’s education and training is done in-house, through various modules covering numerous pertinent topics.

“The modules have been rolled out globally,” said Hark, who is based out of Bertling’s North American head office in the Houston suburb of Humble, Texas. “Our clients therefore continue to experience the same professional service no matter which global Bertling office they are liaising with.”

At the same time, according to Hark, it is important for project forwarders to flexibly adapt to change, including through supportive training.

“We will continue to adjust to inevitable market fluctuations and business model changes,” Hark said. “As the future role and scope of the capital project forwarder changes, we will adjust our service offerings accordingly. These changes will continue to be supported by our purpose-matched global education initiatives and programs.”

EDUCATION ESSENTIAL

UTC’s Knezevic said success in the project sector requires solid education in the logistics field, including specialization with hands-on experience in all modalities.

“Thin margins cannot be a reason to neglect or reduce time and resources spent on education,” said Knezevic, who is based in UTC’s New Jersey office. “This includes quality time spent passing on one-on-one experience from senior project managers to junior project team members as they work side-by-side dealing with real-life project challenges.”

Echoing her colleague’s views, Diana Davila, UTC’s project director, commented: “UTC understands the relevancy of improving our staff’s performance in this ever-changing environment and in light of tight margins.

“To continuously improve the performance of our staff, it is essential for our organization to ensure that our team has the required experience and training to achieve our objectives,” said Davila, who works out of the company’s corporate office in Houston. “This is also critical for the success and future growth of our company.

Training is not an area that the industry can afford to reduce or eliminate, she added and stressed that this needs to be pushed forward to ensure the industry attracts new candidates: “Our industry is aging, and an important mechanism to attract new talent is through training and education.”

UTC states that it is a strong believer in maintaining core competencies and knowledge in-house and advises against ceding this to third-party entities. Otherwise companies risk becoming a limited process forwarder rather than a single one-stop, full-service provider.

INVESTMENTS CONTINUE

Frank Guzman, director of project logistics for third-party logistics provider C.H. Robinson, agreed that ongoing education and training are critical to its ability to offer the full spectrum of services to project shippers.

“Customers appreciate the ability to work with one company to service all their transportation needs – including ocean, air, customs brokerage, vendor management and surface transportation – the full project logistics package,” Guzman said. “Having a global scale and account base to efficiently secure the rates and capacity needed is vital to a healthy project logistics organization. To best serve our customers, we will always prioritize the investment of education and training for our global talent in those areas.”

Guzman noted that many project owners, including a host of engineering, procurement and construction companies and original equipment manufacturers, have reduced the role of project logistics 3PLs in certain industry sectors. However, he said, opportunity remains in other industries and niche global regions.

Pointing out that C.H. Robinson is a non-asset-based company, Guzman said: “Instead of investing in planes, ships or trucks, we invest in our people, processes and technology. One of C.H. Robinson’s largest investments is our experts around the globe, training them in our processes and proprietary technology platform, Navisphere, to achieve smart solutions and better outcomes. Speaking specifically about C.H. Robinson’s project logistics service line, we continue to invest in educating and training new talent.”

UPHOLDING IDEALS

Holding to core corporate values by means of workforce training is seen as imperative by Crowley Maritime, which counts third-party logistics among its offerings.

“Despite any external industry pressures, Crowley has remained true to our values of safety, integrity and high performance through our continued commitment to training our workforce, especially on the marine side,” said Vicky Ellis, Crowley’s director of marine development and learning.

“If any impact has been felt from industry factors,” she said, “it has been to drive the continual improvement of the training programs we offer and how we deliver them. Crowley has turned toward new and creative means of developing and delivering training to our employees, such as through customized and scalable online learning courses that can be delivered globally and economically without sacrificing quality.” Crowley has also begun to develop micro-learning courses, which deliver content to employees in smaller, easier-to-absorb pieces which results in learning with a lesser impact on operations.

Ellis said Crowley not only continues to meet all regulatory requirements to train employees on critical safety and job-specific topics, but the organization goes above and beyond to maintain and improve the skills of marine employees through training initiatives, including the company’s simulation-centered navigation and engineering assessment program, as well as regular officer seminars on a wide range of leadership and supervisory skills.

Crowley also maintains strong working relationships with union-affiliated training schools such as the Seafarers Harry Lundeberg School of Seamanship in Piney Point, Maryland, and the AMO STAR Center in Florida.

Peter Sutton, managing director for safety at Crowley Petroleum Services, added that mariners benefit from regular shoreside training conferences, an online training portal and the efforts of several fleet traveling officers who sail with vessels to conduct onboard equipment-specific training, all with an emphasis on safety.

BROADER CONCERN

And in tandem with improving training efforts, industry is stepping up to address broad concerns related to the sufficiency of trained workforce.

The American Association of Port Authorities, with membership throughout the western hemisphere, scheduled its first Workforce Development Summit as a three-day affair in June in Long Beach, California, in conjunction with the Port of Long Beach, Long Beach City College and TransPORTS, the official national industry intermediary chosen by the U.S. Department of Labor to expand registered apprenticeships in ports and the multimodal transportation, distribution and logistics industry nationwide.

“Our industry faces increasing challenges in filling port-related jobs that require highly skilled or specialized technical training,” said Mary Beth Long, vice president of external affairs for AAPA. “The pool of viable candidates to fill these jobs is diminishing as other industry sectors, such as technology and manufacturing, are competing for applicants from the same job pool.

“Finding creative ways to develop the workforce is requiring ports to ramp up their efforts,” Long said.

From development of elementary education initiatives and internships, to apprenticeship programs and college-level curriculum, project cargo ports and logistics providers are playing an ever-increasing role in preparing job candidates for new opportunities in this sector.


APPRECIATION OF APPRENTICESHIPS

Both Bertling’s John Hark and UTC’s Mirko Knezevic said the European practice of offering apprenticeships in freight forwarding is a model that could be increasingly beneficial in North America as well.

Hark said Bertling continues to work with the apprenticeship education model in Europe and this will not change. The apprenticeships will also stay in line with any business model changes.

“We are confident that young professionals coming up through that traditional system will continue to get an appropriate education that matches industry needs,” he said.

Specific to the U.S., Bertling works closely with Houston area universities, colleges and high schools to guide curriculums around current and future business trends, with an eye toward advancing a sufficient industry labor force amid a rapidly aging U.S. populace.

“This collaborative effort has continued to gain momentum and has become an effective partnership that we are proud of,” said Hark, who, in addition to his work at Bertling, also serves as an adjunct professor in the Department of Maritime Business Administration at Texas A&M University, his alma mater.

“The talent gap is growing,” he said, “and we all have a responsibility to work towards filling it with the most capable professionals as possible, regardless of market cycles or business model changes. This will always be a top-down driven priority at Bertling on a global basis.”

Knezevic said maintaining a high level of competence and building up young people represents a particular challenge for U.S.-based project forwarders.

The European model for freight forwarding apprenticeships includes attending a trade school and a three-year training program with a company, Knezevic said, commenting: “The result is a formal freight forwarding certificate and a solid education that prepares a new generation of professionals for a career in our field. The fact that these apprenticeships feature part theoretical education and part hands-on work with an actual freight forwarding company is priceless.

“The hands-on European-style freight forwarding classes would be a valuable addition to the curriculum at community colleges and trade schools in the U.S.,” he said. “I believe this would attract more young people to the profession and provide a much-needed talent pool for our industry.”

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