Studying the drivers – Henrique Pestana profile
“Someone once said that God must have been a ship owner, because wherever you are, the resources are somehow always a long way away across a lot of water,” says Henrique Pestana, head of ship design for ABB.
“It’s simple, but true – what you need is never where you need it: if you want insight into the shipping industry I’d say first you have to stand back and look at the macroeconomics: even the political situation is usually a result, not a cause, of this picture.”
Mr Pestana has certainly got himself a good view: his career has taken him from working as a naval architect in Lisbon to managing fleet operations.
“The early days of design were fun. I spent a lot of time seeing things through from first sketches to sea trials so it was almost like being ‘dad’, but when I decided to change path, I realised what I had been suspecting all along was right – the biggest driver in ship management is the money, your first thought is about the budget.” He adds: “Above all you are concerned that the vessel doesn’t stop and the sophistication of the ship’s design elements doesn’t account for much when you are up against a problem. So although I’d been involved with a number of very subtle designs, the fact is a lot of this simply passes you by when you are actually running the ship...”
In 2008 he moved on again to Gearbulk in London and the first lesson was the breadth of input: “Although I was responsible for the newbuilding process, I was exposed to the finance element, the shareholders, the board and the yards.”
The second lesson was in its way harder, although again it really brought home how interwoven the industry’s economics are with everyday life: “I was knocked by restructuring from the downturn. It is one thing having an intellectual understanding of the interdependent nature of the industry, but it’s still quite another watching these huge economic issues cascade down to hit you.”
Looking back, he admits that although ‘interesting’ in retrospect, “at the time the uncertainty was the worst part of it all”. “People had finance and even letters of credit to move goods around withdrawn, owners and suppliers went bankrupt leaving everyone hanging, wondering what next.” He points out there were some tough judgements calls: “Although people generally cooperated, the fact remains if you did this, you were always worried that you weren’t protecting yourself or your company enough.”
He adds, “It wasn’t disclosed at the time, but I saw how near we got to a real meltdown, not just a recession. So although it’s tempting to judge those people in leadership positions harshly – and maybe certain things could have been done better – at least those decisions were good enough to stop the worst that could have happened. And the worst could have been very, very bad indeed.”
The next step for Mr Pestana was to a fleet management position with Meridian Marine in Liverpool in 2009. “It was an opportunity to see other dimensions of the issue: this time it was more centred on people, how best to can lead a team. I had to learn to be far more subtle in my outlook: it’s all very well knowing what your objective is, but you simply can’t treat people like machines. So, you have to accept that people need to empower themselves, and that they might not do something exactly in the way you’d like. The big skill is to let people lead themselves: stand back a little while at the same time be ready to step in if the focus gets lost.”
His current position as head of ship design for ABB has meant he is putting all this insight together: “One of the most interesting areas of this particular role is seeing how the macroeconomics decide the ship designs: the idea is to be able to make some guesses, forecast the future. For example, owners now don’t just want a vessel to run at one speed, they want flexibility as slow steaming could be dropped very quickly with a surge in demand – and the owners want to be ready.”
In all this there are, he says, some elements that prove more consistent than others. “Although the routes often stay fairly static bar one or two port calls, the flows themselves can change quite dramatically. Despite this, given a little information, you might be able to see it coming: you could ask yourself what would it mean for trade and environment if, for example, India’s paper consumption were to reach even 5% of Europe’s per capita level?”
All these questions are elements in a global puzzle; as Mr Pestana points out, at least some of the answers are going to be ship shaped.
By Stevie Knight
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