Sailing through rough waters

SAILING THROUGH ROUGH WATERS - NAVIGATED BY KNOWLEDGE

The Master Thesis of Nicolai A. Kirkeng & Herman Ness 2010

1

Nicolai Kirkeng & Herman Ness 2

Agenda

• Background• Our study– Research question

• Propositions• Findings• Recommendations• Future research

Agenda


Background

• The global competitive advantage of the Norwegian maritime industry– Norway has strong maritime cluster– Is it as strong in the challenge to develop into a

Global Maritime Knowledge Hub?• Norway has two ship owner centers: – Oslo and Bergen

Background


Limitation of our scope

• Cluster limitations– Focusing on the knowledge intensive elements of the

cluster. Primarily with regards to the headquarter functions of the shipping companies.

• Global Knowledge Hub Index limitations– Focus on

• Cluster attractiveness• Talent attractiveness• Ownership attractiveness

– The linkages between the dimensions: • Cluster dynamics

Limitations


Research question

“What are the characteristics of the Norwegian deep sea shipping clusters that can enable the creation of global maritime knowledge hubs – A comparative study of the Oslo and Bergen shipping clusters.”

Research Question


Deep sea shipping

Oslo

Deep sea shipping Bergen

Primary case study

Comparative case study

Case study

Company Person

Wilh. Wilhelmsen Thomas Wilhelmsen

Tschudi Shipping Felix Tschudi

BW Group Sverre Prytz

IM Skaugen SE Morits Skaugen

Company Person

DnBNor Harald Serck-Hansen

Nordea Carl Erik Steen

Fearnley’s Jon-Aksel Torgersen

Vogt&Viig Ingar Fuglevåg

Wikborg Rein Gaute Gjelsten

Skuld Douglas Jacobsohn

Company Person

Grieg Group Eli Vassenden

Utkilen Bjørn Sjaastad

Odfjell SE Jan Hammer

Norske Skipsverft Birger Skaar

Financial & Legal services

Oslo

Case study


Propositions

Cluster attractiveness

Talent Attractiveness

Ownership Attractiveness

P1

P2

P3

P4

Linkages

Performance

P5 a b c

Propositions


More specialized service firms = higher performance

• Proposition 1: Ceteris paribus, the higher the degree of dedicated professional service firms, e.g. financial, legal and brokerage services, the higher the performance of the cluster.

Propositions


Maritime financial and legal firms

2001 2002 2003 2004 2005 2006 2007 20080

100

200

300

400

500

600

700

800

900

Employees

Oslo

Bergen

Oslo Bergen kr -

kr 500

kr 1 000

kr 1 500

kr 2 000

kr 2 500

kr 3 000

Income

In m

illio

ns

Oslo*; 47 %

Bergen; 17 %

Rogaland; 8 %

Share of Norwegian maritime legal and financial services firms

Propositions


• P2a: Ceteris paribus, the higher the availability of cluster specific labor pool, the higher the performance of the cluster

• P2b: Ceteris paribus, the higher the degree of labor mobility, the higher the performance of the cluster

Competent labor and labor mobility = higher performance

Propositions


Secondary school

High school

Bachelor

Master

PhDSecondary school

High school

Bachelor

Master PhD

Secondary school

High school

Bachelor

Master

PhD Secondary school

High schoolBachelor

Master

Oslo BergenD

eep

Sea

Ship

ping

Lega

l and

fina

ncia

l ser

vice

sEducation

Propositions


Diverse ownership types and FDI = higher performance

• P3a: Ceteris paribus, a more diverse set of ownership types will increase the performance of the cluster

• P3b: Ceteris paribus, the higher Foregin Direct Investment and the higher Foreign Facilitation Investment Globally by cluster members, the higher the performance of the cluster

Propositions


More valuable linkages = higher performance

• P4: Ceteris paribus, the higher the degree of internal closure within the cluster and external brokerage outside the cluster, the higher the performance of the cluster.

HighDiverse group with diverse

external contactCohesive group with diverse external

contact (Maximum performance)

LowDiverse group with

homogenous external contactCohesive group with homogeneous

external contact

Low High

(Burt 2005:139)Closure within groupB

roke

rage

be

yon

d

gro

up

Propositions


Cluster network in Bergen Cluster network in Oslo

The shipowners are the main link in and out ofthe cluster

All the industries have independent links out ofthe cluster.

Suggested network characteristicsPropositions

“Shipping is a information game that is why John Fredriksen still does business in Oslo, and that’s probably how Blystad could start playing the rig-market almost a year before the rest of the world” – Oslo representative

”It seems that the services firms are satisfied by serving the local ship owners” – Bergen representative


Linkages moderate the effect of the different dimensions on performance

• P5a: Linkages moderate the relationship between dedicated professional service firms and the performance of the cluster. Dedicated professional service firms are more beneficial for performance for clusters characterized by high degrees of linkages.

• P5b: Linkages moderate the relationship between cluster specific competent labor pool and the performance of the cluster. Cluster specific competent labor pool is more beneficial for performance for clusters characterized by high degrees of linkages.

• P5c: Linkages moderate the relationship between diverse ownership and the performance of the cluster. Diverse ownership is more beneficial for performance for clusters characterized by high degrees of linkages.

Propositions


Oslo distinguish itself with the highest potencial of becomming a GKH

• Mainly due to a more beneficial network structure and the mass of industries outside the cluster that strengthen the legal and financial services

• We have also seen– A wider set of specialized services– More educated worker pool– Higher degree of FDI, especially Foreign Facilitation

Investment Globally– More external brokerage, though less internal closure

Findings


Findings

• The legal and financial services are an important part of the maritime cluster, and has a strong impact on the clusters performance

• Unstable policies on the national level is one of the strongest barriers to develop a GKH

Findings


Potentials

Oslo – Maritime Services GKH• World class maritime

serices sector

Bergen – Niche center• High world-wide market

penetraction in selected segments

Findings


Recommendations

• Shipping companies should outsource more of their activities to benefit from a stronger and healthier specialized service sector.

• The actors in the cluster should facilitate for more labor mobility

Recommendations

Nicolai Kirkeng & Herman Ness

Potential future research

• Whom is dependent of whom?– How does it effect the maritime services industry

that the Oslo ship owner community is declining?• Can they make it on their own?• Would there have been a different story 10-20 years

ago?

• Test our propositions

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Future research

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Thank you for your attention!

Q&A

Sailing through rough waters

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