Content area
Full Text
INTRODUCTION
Outsourcing is well established in many industries. It allows companies to concentrate on their core business - doing best what matters most - and establishes strategic partnerships between companies that often yield benefits beyond what, individually, each can achieve. In the maritime world, outsourcing operational and management functions has become increasingly common. The structural changes that gained pace in the final quarter of the 20th century brought inexperienced owners and flag states into the shipping industry, and thereby provided new opportunities for established companies with expertise to sell. So, third-party ship management grew into a major maritime sector in its own right, with many hundreds of companies providing services ranging from the technical superintendence of vessels to proxy ownership. However, the extent to which outsourcing has been adopted in the maritime world remains patchy. In Greece, for example, it is still fairly unusual. Why is this so? In this paper, the authors suggest that decisions to outsource ship management functions are influenced by company life-cycle effects, which go some way towards explaining the stance of Greek owners, in particular.
Third-party ship management today includes a range of services that can be technical, operational, financial or even social. Often, such services are provided under standard forms of contract as is common in other areas of maritime practice. BIMCO Shipman, for example, the first such standard contract, was introduced in 1988 and covers several levels of service including crewing, technical services, insurance, accounting, chartering, sale and purchase, stores and bunkering, as well as day-to-day operations. Hundreds of management service providers exist. However, their business arrangements and client relationships are often, necessarily, confidential so it is difficult to gauge the size of the market precisely. Moreover, some companies describing themselves as ship managers provide services only to their own, wholly owned subsidiaries. Despite these caveats, there is no doubt that third-party ship management is now a well-established feature of the maritime scene.
SEPARATION OF OWNERSHIP AND MANAGEMENT: LIFE-CYCLE EFFECTS
Many factors, both internal and external, influence a firm's evolution and growth. Size, culture, technological competence, market sector are all obviously important. So also are the political and economic environment in which the business develops. Age, both of the firm and its principals, is also of...