What is a Voyage Management System
By ClearVoyage | 25th March 2022
What is it?
A Voyage Management System, or VMS, is an application that can help you handle both the chartering, operations and financial side of your business. Different Voyage Management System software provide different things. Most systems (including ClearVoyage VMS) include:
- Fleet list to keep track of every vessel in your fleet
- Commercial center for handling contracts, cargos and estimates
- Voyage center for handling planning, operations and voyage accounting
- Contact book to keep track of every charterer, broker and supplier you do business with
- Dashboard to give an immediate overview of the key stats important to you
ClearVoyage VMS also comes with reporting and analytics built-in:
- Voyage performance dashboards for an instant overview of key performance indicators
- Customer relationship dashboards to help you track and quantify your relationships with counterparties
- CO2 dashboards to monitor and document your environmental performance
Complexity of modern voyage management
Managing voyages is done across multiple teams, onboard vessels and on shore, in different time zones. Team members need to work seamlessly with each other to negotiate and execute contracts successfully.
It is a complex set of processes. Teams track high volumes of information which is constantly changing. It is also a tightly coupled system: as decisions and events often affect multiple teams. Decisions need to be shared quickly and easily with colleagues.
New regulatory hurdles and the push for decarbonisation of shipping are putting greater pressure on ship owners who face increasing competition to stand out to blue-chip charterers and secure financing from banks.
For a ship owner, being an excellent operator may not be enough going forwards. They need to showcase their operational and environmental excellence in a transparent manner.
Disconnected systems cost you money
It is possible to operate a fleet in spreadsheets, emails and messenger apps. Many do. So why change?
Yes, keeping critical information in spreadsheets and emails works, to an extent. However, this means your team send each other countless email requests. How often have you experienced long waiting times for data and reports?
The barriers to smooth communication from working in siloed systems mean that your team may not have up-to-date and accurate information. This makes it harder for them to make the best decisions possible and you run the risk of missing key opportunities.
Shipping is a high stakes game. Chartering and operations require many daily decisions to be made, which can all have a huge financial impact on the ship owner. Just a few sub-optimal decisions a year could result in significant loss of revenue.
Working in a shared system allows data to be shared across teams instantly. Seeing data live eliminates the operational risk of keeping data on disconnected systems. A good VMS should put your team in control of decision-making closely matching their work processes and bringing them the insights they need when they need them.
A good VMS should be a platform for you to scale your business, bringing good governance and communication which would otherwise be impossible when trying to scale with spreadsheets and internal emails.
Some examples of the benefits
Concrete, real-world examples can illustrate just how much a Voyage Management System can assist real-world processes and bring new efficiencies to a ship owner or operator
1. Collaborative teamwork that optimises commercial decision making
Sharing data instantly and automatically in a system ensures that team members have the information they need when they need it – without wasting time in email.
Commercial decision-making, that is informed by all the facts, has a greater chance of identifying opportunities and maximising revenue.
2. Streamlined tracking of the voyage P&L
A lengthy period charter can generate dozens of hire invoices, with a multitude of hire periods, expenses, claims for reimbursement and even disputed items.
Tracking all these variables in spreadsheets is manually intensive, prone to human error and becomes very repetitive when you want to generate cumulative statements.
You can streamline the entire process, tracking each item through the process of creation, invoicing and payment with a VMS that is integrated with your accounting systems. This can bring huge time savings, along with the reduced risk of human error leading to lost revenue.
3. Early alerts to minimise operational risk
Missing the laycan or delivery date of a charter party is extremely costly.
Using AIS data to identify vessel locations and satellite weather forecast data, can deliver accurate and frequently updated arrival times. This operational risk can be minimized with a simple alerts system to inform operators when a vessel is at risk of arriving late for its next port call.
What should I look for?
We believe that there are 7 key characteristics which you should seek from a prospective Voyage Management System. If the VMS has these, you can expect to see significant ROI
The system should support your way of working. If that means having a strict approval process or you simply want a different homepage to your colleagues – the system should flex to meet your needs. Not the other way around.
2. Intuitive design
The application must be easy to use. If it isn’t, then your team will not get the full value of the investment. If the system is too difficult, team members may revert to using spreadsheets.
3. Fair pricing
Any VMS should have a transparent and fair pricing structure. Beware of models based on charging significant implementation, training and consulting fees. Does this structure really work in your interest? Or is this another revenue stream for the software company?
4. Transparency built in
Robust audit trails are a must. But more than that, users should be able to quickly identify key facts and events relevant to them. Ask yourself: “if I login to this system at 8am on Monday morning, how do I find out what has changed since I last logged out?
Does the VMS have APIs? What third party software does it already connect to? If the VMS is going to fit into your business, connectivity is essential.
6. Easy adoption
What do implementation and onboarding look like? They should be simple, straightforward and if possible, at no or low cost.
A VMS will hold all your commercial and operational information, as well as much of your financial data. It is imperative that the application uses industry-leading encryption and security measures such as two-factor authentication.
Interested In Learning More?
We will talk about your Voyage Management Needs and show you exactly how ClearVoyage can meet them
Here’s what we will cover in your free personalised demo:
- Go over your key procceses and desired out comes
- Show you only the features of ClearVoyage you care about
- Address all the questions you’d have
- Create a custom quote (if you’re interested)