DAMEN Magazine #5

Message from the Board

Published in category: People

As Damen celebrates 90 years of shipbuilding, it faces a challenging time in a number of markets and the rapid evolution of technological advancement. Here, the company’s Executive Board, Chief Executive Officer René Berkvens, Chief Commercial Officer Arnout Damen, Chief Financial Officer Frank Eggink and Chief Products Officer Jan-Wim Dekker, voice their thoughts on Damen’s recent performances and directions for the future.

Q. In this year’s Damen magazine, we are looking back at the history of the group. As we do this, the growth of Damen over the decades from a small Dutch yard into a global maritime enterprise is striking. Throughout this international expansion, what has been the key to ensuring sustained development and success?

Frank Eggink, Chief Financial Officer Frank Eggink:
There are a considerable number of factors behind this. At the root of Damen’s success is the standardised vessel concept introduced by Kommer Damen in 1969. This unique approach offers Damen clients a range of advantages, including the fastest possible delivery of proven, reliable vessels. Added to this is our relentless customer focus, the continual process of listening to clients and incorporating their feedback into the evolution of our products. Furthermore, within Damen there is an unwavering commitment to the spirit of entrepreneurialism. Because of this, we are willing to take the necessary risks in pursuit of satisfying the requirements of our clients.
Rene Berkvens, Chief Executive Officer René Berkvens:
It’s also about presenting people with the same mission and vision values. When people join Damen as an employee, they receive the same introduction to the company – all over the world. Our intranet is being rolled out group-wide, as is our Code of Conduct. We are creating our own culture and ensuring that all our people are aligned.
Arnout Damen, Chief Commercial Officer Arnout Damen:
The One Damen label is important. We have the same rules of engagement, including safe working conditions, supplier coordination, compliance processes and communications policies, everywhere in the group.
Jan-Wim Dekker, Chief Products Officer Jan-Wim Dekker:
Our core values see to this – we want to see our people enthusiastic about what they do and comfortable too. One of the key things is that we allow people to speak and to share their ideas. And, very importantly, we have a common culture across the organisation – client focus. Customer is key.

Ultimately, it’s about the people – you can make all the processes you want, but at the end of the day, it’s about the people.

Jan-Wim Dekker

Q. What do you think about Damen’s performance in 2016 – given the economic circumstances would you consider it to be reasonable?

Rene Berkvens, Chief Executive Officer René Berkvens:
We are living in the toughest of times. The Shipbuilding market is difficult on a worldwide scale, particularly in the Far East. Low oil and gas prices and low commodity prices are reducing demand for large ships. This has the knock-on effect of reducing the requirement for smaller vessels and port development. It’s the perfect storm and we are affected by it. On the other hand, because we are a niche player it’s not all bad news. Some markets are still performing well – fishing, yachts, defence, cruise, ferries and offshore wind are examples.
Frank Eggink, Chief Financial Officer Frank Eggink:
Although the year still came in at a profit, we cannot afford to be complacent and should shift gears to further reduce costs, improve quality and improve project execution and risk management. A number of markets we serve are being faced with rather sustained oversupply and it is going to take a few more years before new equilibriums between supply and demand will be found.
Market trends such as the oil price decline have triggered the need for a step change in industry cost structures. I am convinced this will happen and a gradual increase in activity levels will occur. Now is the time to for Damen to get into shape for when markets recover.
Jan-Wim Dekker, Chief Products Officer Jan-Wim Dekker:
The way I look at it is; if you are active in so many markets, there are always going to be some that are performing well and some that are not doing so well. What our multi-market penetration does is ensure that the peaks and troughs are more controlled.
Arnout Damen, Chief Commercial Officer Arnout Damen:
Considering the global situation, we are doing OK. These are very difficult times, but we are still doing business. This is because we offer a combination of good services, a range of financing options, good quality and good pricing.

The Maritime industry… is in the first throes of a transformation. Against such a backdrop we should take the best from our past and prepare for – and if possible help shape – the future.

Frank Eggink

Q. Last year, there was some realignment within Damen with the re-positioning of some key roles and personnel within the organisation – could you explain a little about the reasoning behind this and has it been a success?

Frank Eggink, Chief Financial Officer Frank Eggink:
The Maritime industry, and Damen as a part of that, is in the first throes of a transformation. Against such a backdrop we should take the best from our past and prepare for – and if possible help shape – the future. We should strengthen the core of our company and prepare for sustained relevance in the future; the right suite of products & services with the right specification and quality, built and offered economically and at acceptably fast delivery times. To do that, we should always have customer expectations top of mind.
Jan-Wim Dekker, Chief Products Officer Jan-Wim Dekker:
To those ends, we have improved logistics, quality control and accountability throughout the organisation – now there is quicker decision making and clearer accountability for production and quality roles. By standardising procedures more and more we are able to pass on to all parts of the group the design and construction experience, streamlining the process and the supply chain, improving delivery time and lowering costs. At the same time, we position ourselves better to deliver customised options for our clients. The shorter lead times will ensure that, with the same capacity, we can deliver more vessels. We will also better be able to manage our stock levels and achieve better purchase agreements.
Arnout Damen, Chief Commercial Officer Arnout Damen:
We are working on giving clients a better price quality ratio, developing new solutions and looking to reduce the total cost of ownership. We want to support our customers in becoming more profitable by improving our processes, being more flexible in customisation, being faster and offering more solutions for monitoring and maintenance.

Q. Clearly it’s going to be some time yet before we see major improvements in the offshore industry – which markets do you expect will perform well in the coming months?

Arnout Damen, Chief Commercial Officer Arnout Damen:
A number of markets look good for this year – yachting is doing well. Amels had an excellent year in 2016 with a large number of orders for newbuild and maintenance. Offshore wind is likely to improve; aquaculture and fishing are performing well.
Frank Eggink, Chief Financial Officer Frank Eggink:
Order intake in 2016 increased slightly compared to 2015 and the deal funnel contains an interesting set of opportunities. Significant resources are invested in the preparatory work for some large multi-vessel projects and the development of improved and new vessel types for a number of current and new markets. Outstanding customer service increasingly helps differentiate Damen from the competition; with an increasing number of Service Hubs close to our customers and Damen maintenance programmes, we can really add value for our clients as we help increase the operability of their vessels and reduce their costs of operation. Going forward we will look at how to use the data gathered from our vessels. Unlocking this information will help us to develop preventive and condition-based maintenance programmes.

These are very difficult times, but we are still doing business. This is because we offer a combination of good services, good quality and good pricing.

Arnout Damen

Q. What do you consider to have been the highlights of 2016?

Arnout Damen, Chief Commercial Officer Arnout Damen:
A number of things stand out from last year. Amels delivered its largest yacht to date. The second Damen Offshore Carrier, the award winning Maersk Connector, was delivered and we signed one of our largest ever contracts, for an Antarctic Supply Research Vessel for Australia. And, despite difficult market conditions, we still delivered over 150 vessels.
Jan-Wim Dekker, Chief Products Officer Jan-Wim Dekker:
The improvements we made in operational excellence and innovation stand out from last year. We made real steps towards the future with lots of new developments, including new products. The Excellerate programme saw us implement a standardised, industrial shipbuilding approach in Singapore, Vietnam and China, improving quality and control, with shorter lead times and lower costs of ownership.
Frank Eggink, Chief Financial Officer Frank Eggink:
During the year, we have enriched our arsenal of financing and insurance solutions. Increasingly we are able to find a solution for all client challenges in this regard, supported by an increasing number of financial service providers. Building on the efforts from 2014 onwards, in 2016 the Group compliance programme was further advanced into the ‘muscle memory’ of the organisation and stakeholders that supply and represent the group. Also, in the area of IT, substantial progress has been made facilitating a professional platform to rely and build on. To name an example, the start of the CAD PDM programme; this will add a lot of value, generating increasingly efficient engineering.

 

Q. What steps are you taking to ensure that Damen is ready to respond quickly when the upturn comes?

Rene Berkvens, Chief Executive Officer René Berkvens:
One of the effects of the current market climate is going to be an increase in competition. This can be a good thing; as such an environment can provide real drive for innovation. What we need to do is invest in the future, developing new ideas, new products. We need to experiment and innovate. And we must always remember, our people are our best assets. We need to ensure they receive the best training and development. The better our people develop, the better we perform.
Arnout Damen, Chief Commercial Officer Arnout Damen:
We have to focus on being tight, sharp, flexible and fast, ready for when the good times come. A lot is about presentation and customer interface. There is a market out there – even now – we just have to demonstrate to clients that we can offer them viable solutions. We also need to maintain our focus on R&D so that we can continue to innovate and be of sustained relevance for the future.

 

Q. Can you tell us anything about any new products or solutions that are planned for the near future?

Jan-Wim Dekker, Chief Products Officer Jan-Wim Dekker:
There are a number of products in the pipeline. Amongst them the Reverse Stern Drive Tug, the Damen Decommissioning Series, versatile Utility Vessels and the Marine Aggregate Dredger.
Rene Berkvens, Chief Executive Officer René Berkvens:
Marine access solutions will be an important part of product development this year. We are looking at a range of options that will make crew transfer safer, faster and more efficient.
Frank Eggink, Chief Financial Officer Frank Eggink:
Sustainability will grow in importance. We’ve already made a lot of progress in this area, with improved fuel efficiency and reduced emissions of our products, new solutions such as the certified InvaSave ballast water treatment unit, measures to increase energy efficiency and recycling in our operations, but we will be doing more. Technical developments, such as further increased fuel efficiency, more uptime, more consistency and remote monitoring will be strong features. Also, more concepts, like the Leaseco Programme, making it easier for clients not only to purchase vessels, but to lease them. We’re looking at ways to better align the CAPEX with the cashflow generation of the contracted work performed with our vessels through financing solutions.

Our people are our best assets. We need to ensure they receive the best training and development. The better our people develop, the better we perform.

René Berkvens

Q. What will be your personal focus for 2017?

Frank Eggink, Chief Financial Officer Frank Eggink:
There is a challenging year ahead. I will be aiming to ensure continued sound financials for the group and at investing in the developments from which we will benefit when the markets improve. Additionally, I will be looking at attractive growth opportunities that present themselves at the bottom of the economic cycle.
Rene Berkvens, Chief Executive Officer René Berkvens:
To continue to bring the group closer together – further developing the concept of One Damen. And to do what we are here to do – satisfy our customers and make them more competitive.
Jan-Wim Dekker, Chief Products Officer Jan-Wim Dekker:
To improve our KPIs and stock levels and to keep the team smiling, enthusiastic, and working together. Ultimately, it’s about the people – you can make all the processes you want, but at the end of the day, it’s about the people.
Arnout Damen, Chief Commercial Officer Arnout Damen:
To show our customers that building with Damen is a headache-free way to quality products with low maintenance and low total cost of ownership.
back to top