CASE STUDY SCENARIO

Logical Ship Management (LSM) is one of the oldest and one of the largest ship management companies in the world. It has eight offices in various shipping hubs around the world, namely Shanghai, Singapore, Dubai, Hamburg, Rotterdam, Southampton, Miami, and Houston.

The company manages vessels for a variety of local small and large ship owners from its mentioned offices, which include tankers of various types and sizes, cape size and Panamax bulk carriers, and container vessels ranging from 2,900 TEU to 10,000 TEU. The Miami office manages the cruise vessels. Very few of the vessels are “sister” vessels and most of them have been built in different shipyards in Asia and Europe.

The company is now trying to venture into a new market and negotiating contracts with a large local offshore company in Brazil for managing their fleet of offshore vessels and hopes to open an office there soon. Most of these offshore vessels are either DP2 or DP3 rated by a large classification society.

In each of its existing offices, the company manages an average of about 40 ships which are registered either in the port where the offices exist or one of the larger flags of convenience (FOC) like Panama and Liberia. The ratio between the local flag and FOC vessels is 1:3. The sailing staff and the office staff are all of mixed nationality, except where the local rules require having local crew and officers on board.

The company has had a longstanding policy that in normal conditions none of the technical superintendents employed should manage more than four ships at a time and the fleet manager more than 20 vessels, thus for ease of understanding it can be assumed that there are two groups in each office.
When one of the superintendents is on leave or attending dry-dock, the remaining vessels for that period are distributed among the superintendents in the office from the same group evenly for backup. The backup for the Fleet Managers is the Technical Director.

The company’s manning agents, along with their local training facilities, exist in various parts of the world based on from where the majority of the crew and officers are employed. Their largest manning agent is from Manila.
The rest of the functions like purchasing, HSEQ (Health, Safety, Environment and Quality) etc. are in house and occupy the same offices as the technical team.