At your service

Customer service is more important than ever for Maersk Line.
Nielsen: The Middle East and Gulf region is very important for Maersk Line.
Nielsen: The Middle East and Gulf region is very important for Maersk Line.

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Despite being one of the biggest industry players, customer service is more important than ever for Maersk Line. Michael Starling reports

It does not matter if you are a sole trader or a family-run firm – any small- to medium-size business that aims to grow or maintain its offering must be innovative and always strive to make improvements.

You may think this is vital advice only for the smaller businesses, but you could not be further from the truth. Even the biggest industry powerhouses have to take a step back to focus on the fine detail.

Waiting in the reception area at the Maersk Line offices on Sheikh Zayed Road in Dubai it was obvious from the hustle and bustle in the lifts to the queues at the counters that the company is much more than just one of the biggest players in the shipping industry.

It provides a vital resource for thousands of traders and manufacturers and is very much a day-to-day part of people’s lives.

When you read about the Maersk Line, part of the A.P. Moller-Maersk Group, it is very easy to just digest the information about the size of the organisation and to forget about the people on the ground that the company serves – its customers.

It is this precise reason why the company made a dynamic shift and took three years to create its customer charter – a program to get the basics right, improve service and deliver higher standards each and every single time it does business with a customer.

According to Maersk Line’s UAE, Oman and Qatar managing director Lars Oestergaard Nielsen, service is an area where it has to improve and what the company will be focusing on globally throughout its 325 offices worldwide.

“From a product perspective there probably isn’t a lot more to be done,” said Nielsen in an interview with Maritime & Ports Middle East.

“Where I think the big improvements are going to come, and where they are coming, is more the service aspect of the business. One of the things we have launched is the customer charter.

We have defined eight different criteria that we are now publishing in terms of how good we are at the service aspects of our business. This is about how quick we can turn around loading; how quick we can answer the telephone; and if there is a problem how quick can we provide resolution. That’s really where the focus is going to be, it’s more about the service rather than the products.

“The product is harder and harder to differentiate. We are by some measure the most reliable shipping line today according to Drewry, the independent consultants. It is very clear from their reporting that Maersk is the most reliable shipping line. But it does not mean the others are necessarily bad. Perhaps they are a little less reliable, but it is nothing major today.

“If you are going to run a ship from A to B, most shipping lines can do that in a reasonable way, but it is the service and all the things that go around it for where our focus is on now. This is a global strategy for Maersk Line.”

In its 2013 first quarter results Maersk Line recorded strong growth compared to the same quarter in 2012. And with the introduction of the Triple-E vessel and the P3 Network partnership with MSC Mediterranean Shipping Company S.A. and CMA CGM, it does seem that the company has plans to maintain its business in what has been, and will continue to be, a tough period for the industry.

“The first quarter was a lot better this year,” said Nielsen. “We turned it around by some US$800 million-plus, that was the improvement of the result quarter-on-quarter. That came from things we had started last year. It was more of an issue carrying into this year what we had started last than necessarily a lot of new initiatives.

“Just to be clear, as an industry – not just Maersk Line – the average profit return on invested capital for the last seven years has been 1-2%. It’s not been a particularly healthy industry, that’s why we are saying something has to change. We need to get back to a reasonable level of profit margin over time, and we have not had that.

“Things are not looking particularly good from a supply and demand perspective and if you are a shipping line you are heavily dependent on world economic developments because that’s what really drives global trade.

What you are seeing is a lot of new ships coming on screen this year that were ordered two, three or four years ago when times were better. So it is likely going to be a difficult trading environment for a shipping line in the next year or two.”

One of those ships being introduced is the Triple-E, the world’s largest with a capacity of 18,000 twenty-foot equivalent unit (TEU). Maersk Line has 20 on order, but according to Nielsen there are no plans to bring them to the Gulf.

While we may not see the Triple-E grace our waters in the foreseeable future, the region is vital for Maersk Line thanks to the consistent business nature and strong geographical location.

“The Middle East and Gulf region is very important for the company,” said Nielsen. “One of the company’s core focus areas is Africa. We have a very long history and a very good position in Africa and the region here is extremely important for the trade to and from Africa.

From that aspect the Gulf is very important. On top of that we are seeing the Middle East trade in general as somewhat more stable. We don’t see the same peaks: times are not as good here as, for example, in China when times are very good, but on the positive flip side times are not as bad when they are bad elsewhere. It’s a more stable business here and that is important for a company like ours because we have a very high-fixed cost for running our business.”

The industry may be facing choppy waters, but Maersk Line’s emphasis on improving service can only bring more positive results. Perhaps this change in culture really does mean the customer is always right.

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