President & CEO's statement
Leading towards a digital and efficient future
2016 has been the toughest year for our company in 30 years because of the continued downturn in the maritime and upstream oil & gas markets. Despite the challenging conditions in many of our markets, our position as a company remains strong. I believe we are investing wisely and taking positions now that will allow us to make the best of the world when it is trending positive again.
I expect the challenging market situation for shipping and offshore oil & gas to continue during the period ahead, even allowing for a more optimistic outlook in selected sectors such as cruise. At the same time, I believe the renewable energy sector will grow significantly due to the drop in the cost of both renewable energy and energy storage, making this combination increasingly competitive.
Common for all the sectors we work in is an accelerated call for digital transformation. The potential for smarter use of data is enormous. The key to unlocking this potential is trust and the ability to operate across silos. This is where we in DNV GL see ourselves playing a critical role in the era of the internet of things. I see this as a natural extension of our role as a widely trusted, independent party with deep domain expertise and strong analytics capabilities.
To facilitate frictionless connections between different industry players, domain experts and data scientists, DNV GL is working with Microsoft Azure to launch a secure industry data analytics and data management platform. We call this platform Veracity and it is designed to help companies leverage the ever-increasing amount of data amassing from their assets. We are not looking to own data, but to unlock, qualify, combine and prepare data for analytics and benchmarking. DNV GL’s Veracity data platform will bring industries together in digital eco-systems enabling them to enhance the exchange of data, build new services, create new insights and make better decisions.
Working to create our own industry data platform was not the only way in which we made progress towards our strategic goals in 2016. Another important step was the launch, through our Software house, of our first software-as-a-service solution. A really tangible feature for the digital era.
We are also delivering services more efficiently through digitalization. DNV GL is the first classification society to offer drone-based tank surveys, with numerous such surveys already completed. This saves cost, avoids coating damage typically caused by staging work, and reduces the health and safety exposure for the people involved. We have also successfully piloted digital certificates and are the first classification society ready to roll on that front.
Another example is related to our safety risk management services. By using MyQRA, we can deliver QRA studies much more efficiently, in addition to improving the impact of our deliverables.
We have also been hired to do a ground-breaking Real Time Networks project for one of the UK’s key gas distribution operators. Here, we are combining our expertise in pipelines, sensors, software, data analytics and digital solutions to enhance system performance.
In the Life Science area, we have secured the BIGMED project, where we are cooperating with leading universities and hospitals to establish DNV GL as an internationally recognized data custodian and enabler of precision medicine.
Collaborative innovation continues to be a cornerstone for our company. One out of many joint industry projects we launched in 2016 is on standard-setting for floating wind turbines. The project is run together with 14 companies from the wind, oil & gas and maritime sectors.
To further strengthen our energy services, we acquired power systems expert Gothia Power in Sweden and Green Power Monitor in Spain. This strengthened not only our energy position, but also our ‘digital power’ position. Green Power Monitor is a leading harvester of data from solar plants and uses this to provide insight and give advice to operators.
The excellent customer feedback we received throughout the year warms my heart. This referred not least to our round-the-clock technical centres for ship owners and managers that we have named DATE – Direct Access to Technical Experts. The service was used more than 20,000 times in 2016, and 97% of the requests were handled within the agreed time frame.
We have also taken some key decisions to improve our cost position and internal efficiency. Most effects will be seen during 2017 and I expect to see the full effect in 2018. Sadly, we have had to take additional steps to adapt to the decline in the activity level in our core industries, including headcount reductions. We are now almost 2,500 fewer colleagues than we were just two years ago.
With this backdrop, I am however very pleased to see that our health and safety performance is stable and on benchmark with our industry peers, and that the enablement, empowerment, organization and collaboration of our staff continue to exceed the global norm. I have high expectations for our performance in this area and will ensure our continued focus on this topic going forward.
DNV GL’s business model is based on trust at all levels and in all business environments. We strive to reflect the DNV GL values in everything we do, demonstrate ethical leadership and uphold our reputation for integrity.
During 2016, we took an important step towards our ambition of becoming carbon neutral in relation to our travel and office buildings by 2020. A pilot project was run in Norway and through various measures and offsets we managed to achieve carbon neutral operations. Our results have been verified by an independent third party.
We continue our support for the UN Global Compact principles and are working to deliver on the UN’s 17 Sustainable Development Goals together with customers and partners. Our purpose of safeguarding life, property and environment is more valid than ever before, and I’m confident that DNV GL is well positioned to be at the forefront in all our industries.
In this world of flux and change, our customers are increasingly turning to us for advice about the long term. Our two foresight studies issued in 2016, Technology Outlook 2025 and Future of Spaceship Earth, have been very well received in all markets across the world. It is a source of great pride to me that DNV GL is so well qualified to help manage the risks that truly matter and to turn risks into opportunities.