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Breakbulk April 2019

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4 The Journal of Commerce | April 2019 Editorial April 2019 Janet Nodar Breakbulk and Project Cargo Executive Editor, The Journal of Commerce and JOC Events: Chris Brooks 609 649 2181, Executive Editor, The Journal of Commerce and Mark Szakonyi 202 872 1234, Managing Editor: Benjamin Meyer 916 716 6272 Managing Editor: Barbara Wyker 908 507 4802, Senior Editors: William B. Cassidy Trucking and Domestic Transportation 202 872 1228, Bill Mongelluzzo West Coast 562 428 5999, Hugh Morley Northeast, Mexico 646 679 3475, Eric Johnson Technology 213 444 9326, Janet Nodar Breakbulk and Heavy Li 251 473 2742, Greg Knowler Europe +44 7976798770, Turloch Mooney Global Ports +852 9011 9109, Associate Editor: Ari Ashe Southeast Ports, Intermodal Rail 202 548 7895, Data Analyst: Marcin Lejk +44 58 741 62 70, Shipper Engagement Manager: Dustin Braden 646 679 3450, Senior Content Editor: Alessandra Gregory Barrett, 860 248 5238 Senior Designer: Sue Abt, 862 371 3534, Designer: Bryan Boyd, 908 910 7849, Publisher: Tony Stein, 770 295 8809, Sales: Cindy Cronin, Strategic Account Manager Southeast, Gulf, Canada sales, 954 260 6061 Jean Gibbons, Senior Sales Executive West Coast, Midwest sales, 706 469 7160 John Knowles, Senior Sales Executive Europe sales, +44 7779 974677 Allyson Marek, Senior Sales Executive Northeast sales, 862 754 8012 Alex Remstein, Associate Sales Specialist Reprints/Classifieds/Copyrights, 646 679 3418 For Magazine Subscription Customer Service: 450 West 33rd St., 5th Floor, New York, N.Y. 10001 800 952 3839 Executive Director, Editorial Content, Maritime & Trade, IHS Markit, Peter Tirschwell Executive Director, Media & Events, Maritime & Trade, IHS Markit, Amy Middlebrook Manager, Production, Carmen Verenna Product Manager, JOC, Jesse Case ©2019 The Journal of Commerce — All Rights Reserved For more information, visit our website, loads of container shipments is way di erent from organizing 20 heavy hauls across state lines. "Systems (that work for tra- ditional forwarding) often don't integrate well," the project owner said. "From my experience, it takes a long time to integrate them." The largest freight forwarders devote most of their time and talent to containers and air transport, rather than project logistics. On top of that, many shed project expertise during the post-2008 and oil crash-related project downturn. It's common for inexperienced service providers to underestimate the personnel needed for proper project execution. Sta shortages and a lack of competency are also a ecting capital projects further upstream, according to Phyllis Kulkarni, regional director, North Americas, for project consul- tancy Independent Project Analysis. Tell-tale signs include project and mega-project budget overruns and schedule slippage. The engineering, procurement, and construction (EPC) industry will have to face these challenges, she says (Story, page 18) or put its ability to develop and exe- cute major projects at risk. Solutions include making sure logistics people are at the planning table early in the capital project process, a point also emphasized by Mottola. The elements that make project logistics challenging also make it ap- pealing, however. The largest indus- trial projects are now mega-projects, i.e., with budgets of a billion dollars or more, and these can have multi- million or even billion-dollar freight budgets. These are big responsibili- ties — and they are also exciting and meaningful. Modern project logistics requires a whole new level of professional expertise. Getting that message across to a new generation is key. Seasoned logisticians need a chance to share their institutional knowl- edge, and the industry needs an infusion of eager, well-trained new talent. Without that, risks and costs will rise — a lot. PROJECT LOGISTICS KNOWHOW, never widespread, appears to be becoming an even rarer commodity in 2019. However, Dennis Mottola, who has retired after 45 years in the logistics industry — 21 of those years at Bechtel — says it's evident to him that Houston-area students increas- ingly understand what project logis- tics are, thanks to e orts to spread the word, and they are interested in applying for project logistics jobs (Story, page 12). This is heartening, as throughout the project logistics world — not to be too melodramatic — it appears that a thinning band of mature pro- fessionals is wrestling with a growing gap in expertise. This gap underpins several of the discussions (con- tracting, outsourcing, technology, industry challenges, portside issues) that will take place during the JOC's Breakbulk and Project Cargo Confer- ence in New Orleans April 29-May 1. A logistics executive with a major project owner whom I spoke with recently said that in his opinion, it's not even an expertise "gap" — "it's a hole," and the hole stretches across EPCs, manufactur- ers, forwarders, and other service providers in project logistics. He simply does not see enough younger people ready to step into position when the older genera- tion leaves. A lack of competency is putting the industry's future at risk, in his opinion. While he sees no lack of commercial types eager to share slick presentations, when the question becomes who will do the actual work — who will book the shipments, handle the packing lists, work with the ocean carriers, open the fi les, call the trucking lines, coordinate the moves — "it gets quiet," he said. Unsurprisingly, com- petition for good project logistics people is heating up. Project logistics is challenging, no question. Many aspects will nev- er be commodifi able. Processes and skill sets are not neatly transferable from other types of logistics, already under-digitized. Booking 20 truck- Wanted: Talent scouts

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