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fie —_— ey is WW Modern doring ‘and Dock M ractioal Ways to Cut ! flCosts in’ Cargo hana, ore <7 ail 4 saan 0 fT=--Z Z Wy \ iN a * . = Conducted by H.E.STOCKER eoartments Must Co-operate or Increased Business and Profits the operating and traffic de- partments is necessary for best overall results, yet it is characteris- tic of most organizations that the co- operation between the two depart- ments is far from effective and is often almost entirely lacking. In rehabilitating shipping com- pany organizations so that they may weather the depression, this matter of co-operation within the company should be given attention. The re- sult will be that costs are cut and traffic inereased. This conclusion is based on many years of experi- ence in traffic and operating work, and in handling claims, supplement- ed by additional contact with the financial accounting divisions of the shipping business. F ise: overs co-operation between Giving Something Away A shipping company’s problems must be viewed from every aspect, and the results of actions taken and methods used, in their effect on suc- cessful operation must be considered as a whole rather than for any one department. Guided by this point of view the destructiveness of lack of effective eo-operation between the traffic and operating departments has been brought out forcibly. Operating costs are increased and schedules disrupted by unwise book- ing of cargo by the traffic department. If a lot of long steel is expected to arrive shortly before sailing, it may be necessary to hold open cargo space, with the result that overtime 32 By H. E. Stocker must be worked, the ship sails late, extra fuel is expended to make up time and so on, to the point where most, if not all, the profit on the steel is lost. In the drive to ‘‘get business’’ the traffic department will agree to shift a steamer for a small lot of cargo, so that considering all the costs incident to the shift the company fails to make a profit. The traffic department may claim that the shift should have been made even at a loss, to retain the good will of the shipper. However, a sound business man, considering the business as a unit, does not con- sider it good business to sell any- thing at a loss, whether it be trans- portation or automobiles. On the other hand, the operating department will often object to han- dling certain cargo. Take soda ash for an example. The operating de- partment objected vigorously to han- dling of this commodity because of damage to other cargo, and the higher wage rate which they claimed it was necessary to pay the long- shoreman. Over a period of years the traffic department continued to accept soda ash and the operating department continued to object. This constant friction consumed energy which should have been used to more profitable ends. When com- petition is as severe as it has been in shipping for the past twelve years, traffic men should not be fighting their operating department but work- ing with them to get business to cut costs. MARINE REVIEW—May, 1933 In another ¢ase, several thousand dollars revenue was lost because the operating department refused to ac- cept a certain class of cargo because of heavy claims that resulted. The business-like manner of solving this problem would have been not to re- fuse the cargo, but find a way to han- dle it without heavy claims. This was done, but some ten months later and after thousands of dollars of profit were lost to a competitor. The pro- tests of the traffic department in the meantime were of no avail. Aiding the Traffic Man Point of view is the most impor- tant factor. This is largely the re- sult of the basis on which a man’s work is judged. Traffic men are judged by the business obtained at profitable rates. The operating de- partment by claims, operating costs, maintenance of schedule and insur- ance claims, ete. Traffic men are constantly in con- tact with all varieties of people from whom they are trying to get busi- ness or to keep happy so they will continue to get business. They have no dictatorial powers over these people, and therefore must accom- plish their ends by the methods of the politician rather than the meth- ods of a captain or an engineer. The wear and tear on a man’s nervous system is great. If this is combined with a worrying kind of supervision from the office or a lack of support from the office and from the operating department, the re-