{"id":25458,"date":"2017-11-15T20:49:53","date_gmt":"2017-11-16T01:49:53","guid":{"rendered":"https:\/\/digital.hbs.edu\/platform-rctom\/submission\/digitization-in-tank-container-transportation-maintaining-stolt-tank-containers-competitive-advantage\/"},"modified":"2017-11-15T20:57:42","modified_gmt":"2017-11-16T01:57:42","slug":"maintaining-stolt-tank-containers-competitive-advantage-in-the-digital-age","status":"publish","type":"hck-submission","link":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/maintaining-stolt-tank-containers-competitive-advantage-in-the-digital-age\/","title":{"rendered":"Maintaining Stolt Tank Container\u2019s Competitive Advantage In The Digital Age"},"content":{"rendered":"<p>Over the past 5 years, the global tank container fleet has been challenged by a compound annual growth rate of 8.5% of the delivery of new tanks resulting in a sharp reduction in rates.<a href=\"#_edn1\" name=\"_ednref1\">[i]<\/a> Within this fleet development however, there is a growing trend in favor of the operators as shippers are outsourcing logistics requirements. Stolt Tank Containers stands as the world\u2019s largest operators with 35,000 stainless steel tank containers in their fleet, representing 10% of global supply.<a href=\"#_edn2\" name=\"_ednref2\">[ii]<\/a><a href=\"#_edn3\" name=\"_ednref3\">[iii]<\/a> By specializing in food grade products and specialty chemicals, STC excels through superior handling and safe, reliable and quality transportation. As the market faces further pricing pressure, incumbent operators stand poised to benefit from this competition as customers will prioritize quality of services. In order to take the lead in this trend, STC must focus on providing superior door-to-door information technology and leasing management systems.<\/p>\n<p style=\"text-align: center\"><iframe loading=\"lazy\" title=\"Stolt Tank Containers - The Journey of a Tank Container\" width=\"640\" height=\"360\" src=\"https:\/\/www.youtube.com\/embed\/BQfeRP_NTmc?start=3&#038;feature=oembed\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share\" referrerpolicy=\"strict-origin-when-cross-origin\" allowfullscreen><\/iframe><\/p>\n<p>STC\u2019s proactive approach to these needs are reflected in their investments into mySTCtanks.com and their Quality Leasing Management system. In a recent McKinsey Report on the container shipping industry, they survey the growth in digital startups in transport and logistics due to influx of venture capital funding.<a href=\"#_edn4\" name=\"_ednref4\">[iv]<\/a> For instance, Xeneta, an Oslo based startup, offers customers simplified access to over 35 million spot and long-term contracts.<a href=\"#_edn5\" name=\"_ednref5\">[v]<\/a> That being said, these solutions are marketed towards the container market. Further given the complex nature of specialty chemical and food grade products, digital innovation must be handled by the incumbents. This is where STC has taken meaningful steps by developing mySTCtanks.com, their independent shipment management system.<\/p>\n<p>The standout value add from the website is the quoting &amp; booking system. Within the tank container industry, the customers vary by long term contracts or spot market orders. Depending on the nature of the supply, the company might interface directly with a manufacturer or through a dedicated broker. In either instance, the customer is afforded immediate quotes enabling access to quick pricing in an industry that was once dominated by a paper trail of communications between the customer, broker, and logistics provider.<a href=\"#_edn6\" name=\"_ednref6\">[vi]<\/a>\u00a0 As the market experiences more competition, quick access to such information provides STC with a significant competitive advantage.<a href=\"#_edn7\" name=\"_ednref7\">[vii]<\/a><\/p>\n<p style=\"text-align: center\"><a href=\"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2017\/11\/mystctanks.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone wp-image-25582 size-large\" src=\"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2017\/11\/mystctanks-1024x631.jpg\" alt=\"\" width=\"640\" height=\"394\" srcset=\"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2017\/11\/mystctanks-1024x631.jpg 1024w, https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2017\/11\/mystctanks-300x185.jpg 300w, https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2017\/11\/mystctanks-768x473.jpg 768w, https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2017\/11\/mystctanks-600x370.jpg 600w\" sizes=\"auto, (max-width: 640px) 100vw, 640px\" \/><\/a><\/p>\n<p>Remaining conscious of the nature of the products which STC ships, asset-intensive industries such as chemicals or food product supplies have increasingly been digitizing their supply chains.<a href=\"#_edn8\" name=\"_ednref8\">[viii]<\/a> Subsequently, the need for their logistics partners to provide equally informative data has compounded and therefore addressed in STC\u2019s track &amp; trace systems. The ability for a customer to analyze the time spent at each of the points of distribution through the journey allows for constant cost efficiency solutions that both the customer and STC can work on together.<\/p>\n<p>The long-term opportunity that STC must continue to develop and explore is their Quality Leasing Management interface. Given the growing trend towards operators, it is unclear how STC has made this unique platform readily available through digital means. It might be easy to assume that much of this work is human capital intensive however by potentially integrating mySTCtanks.com with a QLM interface, STC might be able to provide quick and reliable quotes to shippers who are looking to outsource logistics.<\/p>\n<p>As digital disruptors are aggregating pricing information across logistics providers, STC should be the first movers in the industry to increase transparency of rates across suppliers. <span style=\"font-size: 13.0pt;font-family: 'Trade Gothic W01',serif;color: #181818\">This can be done by working with selected freight forwarding IT companies to create such a platform. <\/span>By doing so, given STC\u2019s notably superior quality in logistics and pricing power from scale, there will be increased mobility in the industry that inevitably STC will benefit from.<\/p>\n<p>Broader to this conversation, it is unclear how increased competition in the industry, in terms of the number of operators, are reacting themselves? The nearest competitor to STC stands asthe Hoyos Group with roughly the same number of tank containers in the market. The breadth of chemical storage solutions they offer make it potentially more difficult to offer one single digital solution. Will being horizontally integrated and differentiated act as a barrier to digitization or offer more potential solutions?<\/p>\n<p>Further, as world trade increases and container shipping reaches its most consolidated stage, how will digital solutions in this broader industry adapt to more specialized forms of shipping?<\/p>\n<p>Words: 708<\/p>\n<p><a href=\"#_ednref1\" name=\"_edn1\">[i]<\/a> International Tank Container Organisation, <em>Global Tank Container Fleet Survey: 2017<\/em>, viewed November 10, 2017, <a href=\"https:\/\/www.international-tank-container.org\/library\/#newsletters\">https:\/\/www.international-tank-container.org\/library\/#newsletters<\/a>.<\/p>\n<p><a href=\"#_ednref2\" name=\"_edn2\">[ii]<\/a> \u201cState of the Tank Container Markets\u201d, Tank Container Finder, June, 2017, <a href=\"https:\/\/tankcontainerfinder.com\/blog\/view\/state-of-the-tank-container-market-2017-14\">https:\/\/tankcontainerfinder.com\/blog\/view\/state-of-the-tank-container-market-2017-14<\/a>.<\/p>\n<p><a href=\"#_ednref3\" name=\"_edn3\">[iii]<\/a> Stolt-Nielsen 2016 Annual Report, Accessed, November 10, 2017, <a href=\"https:\/\/www.stolt-nielsen.com\/en\/investors\/\">https:\/\/www.stolt-nielsen.com\/en\/investors\/<\/a>.<\/p>\n<p><a href=\"#_ednref4\" name=\"_edn4\">[iv]<\/a> McKinsey &amp; Company, <em>Container Shipping: The Next 50 Years,<\/em> viewed November 4, 2017, <a href=\"https:\/\/www.mckinsey.com\/industries\/travel-transport-and-logistics\/our-insights\/how-container-shipping-could-reinvent-itself-for-the-digital-age\">https:\/\/www.mckinsey.com\/industries\/travel-transport-and-logistics\/our-insights\/how-container-shipping-could-reinvent-itself-for-the-digital-age<\/a>.<\/p>\n<p><a href=\"#_ednref5\" name=\"_edn5\">[v]<\/a> Xeneta, viewed November 10, 2017, <a href=\"https:\/\/www.xeneta.com\/freight-forwarders\">https:\/\/www.xeneta.com\/freight-forwarders<\/a>.<\/p>\n<p><a href=\"#_ednref6\" name=\"_edn6\">[vi]<\/a> McKinsey &amp; Company, <em>Container Shipping: The Next 50 Years,<\/em> viewed November 4, 2017, <a href=\"https:\/\/www.mckinsey.com\/industries\/travel-transport-and-logistics\/our-insights\/how-container-shipping-could-reinvent-itself-for-the-digital-age\">https:\/\/www.mckinsey.com\/industries\/travel-transport-and-logistics\/our-insights\/how-container-shipping-could-reinvent-itself-for-the-digital-age<\/a>.<\/p>\n<p><a href=\"#_ednref7\" name=\"_edn7\">[vii]<\/a> Stolt-Nielsen Limited, \u201cmySTCtanks.com\u201d, viewed November 10, 2017, <a href=\"https:\/\/www.stolt-nielsen.com\/en\/our-businesses\/stolt-tank-containers\/mystctanks\/\">https:\/\/www.stolt-nielsen.com\/en\/our-businesses\/stolt-tank-containers\/mystctanks\/<\/a>.<\/p>\n<p><a href=\"#_ednref8\" name=\"_edn8\">[viii]<\/a> Schrauf, S. and P. Berttram, Industry 4.0: How Digitization Makes the Supply Chain More Efficient, Agile, and Customer Focused, PWC Strategy&amp; (2016).<\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The tank container industry has struggled with sluggish demand and increased competition. How can Stolt Tank Containers position its digital ecosystem at the center of service for their customers?<\/p>\n","protected":false},"author":10140,"featured_media":25759,"comment_status":"open","ping_status":"closed","template":"","categories":[3974,1505,3971,788,1926,1062,3973,3972],"class_list":["post-25458","hck-submission","type-hck-submission","status-publish","has-post-thumbnail","hentry","category-bulk-liquids","category-cargo-shipping","category-container-shipping","category-digital","category-food-supply","category-shipping","category-specialty-chemicals","category-world-trade","hck-taxonomy-organization-stolt-nielsen-limited","hck-taxonomy-industry-shipping","hck-taxonomy-country-norway"],"connected_submission_link":"https:\/\/d3.harvard.edu\/platform-rctom\/assignment\/rc-tom-challenge-2017\/","yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Maintaining Stolt Tank Container\u2019s Competitive Advantage In The Digital Age - Technology and Operations Management<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/maintaining-stolt-tank-containers-competitive-advantage-in-the-digital-age\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Maintaining Stolt Tank Container\u2019s Competitive Advantage In The Digital Age - Technology and Operations Management\" \/>\n<meta property=\"og:description\" content=\"The tank container industry has struggled with sluggish demand and increased competition. 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